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Speaker’s Statement
Mr Speaker
I am sure the House will wish to join me in mourning the passing, since the House last sat, of two distinguished former Members of this place: Lord Healey of Riddlesden in the County of West Yorkshire, and Lord Howe of Aberavon. By any yardstick, and without any doubt, both those individuals were outstanding parliamentarians, and people who served their constituents, their parties and their country with unwavering loyalty and distinction. Intellectually and politically formidable, they will be greatly missed. They both had impressive hinterlands, and the House will wish to join me in extending condolences to their families and friends.
Today at Home Office questions we must manage without the Minister for Security, who graciously informed me in advance that he is absent on important parliamentary and Government business in Japan. We shall endeavour to bear up under the burden of his absence.
Oral Answers to Questions
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Nick Smith (Blaenau Gwent) (Lab)
1. What modelling has been conducted by her Department on the potential effect on individual police forces of proposed changes to the police funding formula.
The Secretary of State for the Home Department (Mrs Theresa May)
How funding should be allocated to the police in future is a complex and important matter, and we conducted a detailed analytical review before launching a public consultation on reform of the current funding arrangements. We have considered carefully the responses received from that consultation, and my right hon. Friend the Policing Minister has written to all police and crime commissioners and chief constables with refinements to the proposed model in the light of the feedback received.
Nick Smith
In 2013-14, just 22% of the 7.3 million emergency and priority incidents that the police responded to were crime-related. The police are being asked to shoulder the workload caused by cuts in other Departments, and the Public Accounts Committee has stated that the Home Office has no data about that added burden. How will the Home Office work with other Departments to ensure that the impact of spending decisions is not borne wholly by the police service?
Mrs May
The Home Office is already working with other Departments to ensure that, if matters are better the responsibility of other Departments, those other Departments take them on board. A good example is what we have been doing for people with mental health needs. We have worked with the Department of Health, and it has provided funding to ensure more places of safety that are not police cells. We have significantly reduced the use of police cells for those in mental health crisis or with mental health problems. As a result resources have been released for the police and, crucially, there are much better outcomes for people with mental health problems and issues.
Damian Green (Ashford) (Con)
Does my right hon. Friend agree that it is important for police forces to spend their money effectively, and that the police innovation fund helps them to do that? Does she share my delight that Kent police have decided to issue every front-line officer with a body-worn camera that increases the effectiveness of police patrolling, as well as helping to keep officers safe?
Mrs May
My right hon. Friend makes a good point, and I commend him for the work on the innovation fund that he did when he was Policing Minister. This is an important development and he is right to welcome and commend Kent police for what they are doing with body-worn video cameras. That is an important step forward. We are also looking at the Police and Criminal Evidence Act 1984 to ensure that every part of the system can support the use of evidence from body-worn video cameras. I am sure the whole House recognises that that important step forward is of benefit to the police but also to victims.
Keith Vaz (Leicester East) (Lab)
Chief Constable Steve Finnigan of Lancashire police recently described the cuts to policing as “nothing short of madness”. Although I welcome the Government’s decision to consult on the funding formula, and the Policing Minister’s ability to engage with local forces, under the proposed model a constabulary such as Leicestershire could lose up to £700,000 a year, while others would gain. Does the Home Secretary agree that it is time to make the case to the Chancellor that the Home Office should be a protected Department because it deals with the security and safety of the British public?
Mrs May
I am interested in the right hon. Gentleman’s question. In his capacity as Chair of the Home Affairs Committee he has previously questioned the funding formula for policing, and indicated that an alternative formula might be a better way forward. That is what we are doing; we are trying to find a formula that will work across police forces, and that is why we held and responded to a public consultation. As I said earlier, my right hon. Friend the Policing Minister has written to police and crime commissioners and chief constables with a revision of that formula, and he will discuss the matter with them.
Mr Philip Hollobone (Kettering) (Con)
Northamptonshire police have been particularly innovative in finding joint operational and cost-saving initiatives with the local fire service, but it faces a particular challenge involving violent crime. How might those two important factors be factored into the new police funding formula?
Mrs May
I welcome my hon. Friend’s comments on Northamptonshire police, who have indeed been very innovative. They have been at the forefront of work to join together the police force and the fire authority to ensure savings and a better service for the people of the county of Northamptonshire. We are trying to adopt a funding formula that is simpler than the previous one, that is fair across the board and that people can look at and understand; a funding formula where people can appreciate why the elements are in there. That cannot be said of the current funding formula.
Daniel Kawczynski (Shrewsbury and Atcham) (Con)
2. What assessment she has made of the effectiveness of police and crime commissioners.
Sir Simon Burns (Chelmsford) (Con)
5. What assessment she has made of the effectiveness of police and crime commissioners.
Huw Merriman (Bexhill and Battle) (Con)
11. What assessment she has made of the effectiveness of police and crime commissioners.
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
Elected police and crime commissioners provide accountable and visible leadership, which I hear the whole House now supports. PCCs are an excellent body taking the lead role, as we have just heard, in driving collaboration between forces and other emergency services to deliver more effective services and better value for money.
Daniel Kawczynski
I thank my right hon. Friend for that answer. In West Mercia, the main advantages of having commissioners are accountability and transparency, which local people very much appreciate. We have just selected our new Conservative candidate, Mr Campion, who, if elected, will do an excellent job. Will my right hon. Friend assure me that he will continue to look at ways to devolve power and responsibility to police and crime commissioners, as this experiment is working?
Mike Penning
My hon. Friend raises a very important point and I wish Mr Campion well in his bid to represent his community as a PCC. We will soon be introducing legislation that will allow more collaboration and more help to be brought to the police, fire and ambulance services—that is the sort of thing we would expect.
Sir Simon Burns
Will my right hon. Friend enable PCCs to follow up complaints about policing made by the people they serve?
Mike Penning
That is exactly what we would like them to be doing. All too often, complaints go all the way through the system when they could actually be dealt with locally.
Huw Merriman
Rother District Council is one of only 17 remaining local authorities that have not decriminalised on-street parking offences, meaning that the Sussex police and crime commissioner is required to provide police resources to ticket cars that stay longer than two hours in a bay. Will the Minister consider freeing up police resources by requiring those remaining local authorities that enforce in their own car parks to additionally enforce on-street parking?
Mike Penning
Although this is a matter for the local government department, I want as much capability as possible on the streets in every constituency. I do not think issuing parking tickets is a role for a police officer.
Margaret Greenwood (Wirral West) (Lab)
It is anticipated that Government cuts to Merseyside police could reach £27 million next year. This has been brought to my notice by the police and crime commissioner for Merseyside. Police community support officers and the mounted police section are under threat of disappearing altogether. Teams tackling sex offences, hate crimes and serious and organised crime are also likely to be seriously affected. Does the Minister share my concern about the impact the cuts could have on crime rates?
Mike Penning
Can I first say to the hon. Lady that my thoughts and prayers are with the family of the police officer lost on Merseyside? I had the honour and privilege of going to Merseyside to pay my own respects, as well as meeting with officers.
I fully understand different PCCs trying to negotiate a position, but scaremongering is not the best way forward. I will come back with further ideas—that is what the consultation is all about, and that is what I promised I would do when I started it.
Mr David Hanson (Delyn) (Lab)
The turnout in north Wales for the police and crime commissioner elections last time was 14.83%, which under the Trade Union Bill would make them null and void. Will the Minister look at how he can improve turnout, perhaps by considering again what he refused to do last time—a freepost in all PCC elections?
Mike Penning
I have a great deal of respect for the right hon. Gentleman and his work in his role as a Minister, but we did that during the west midlands by-election and it made absolutely no difference to the turnout. What will make a difference to the turnout, without any shadow of a doubt, is having that coincide with other elections, which is what is going to happen this time. I am really pleased that the Labour Opposition now realise the work that PCCs do and are now supporting them, rather than trying to abolish them.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
I echo what the Minister said about the tragedy in Merseyside last week, but I disagree profoundly with his description of Jane Kennedy’s comments as “scaremongering”. The impact on Merseyside of the proposed changes to the police grant will be very damaging. Will he meet her and Merseyside Members to discuss the matter?
Mike Penning
I will meet again with Jane Kennedy. She knows my door and has my personal phone number and personal email, as do all the PCCs—I made sure of that from day one. I am saying that no one knows exactly what we will end up with in the formula. We have consulted and said it would change. We have come back with other ideas. I expect other ideas to come back. No one knows the numbers. No one knows the size of the cuts, so let us wait and see. As I said, the consultation continues.
Amanda Milling (Cannock Chase) (Con)
25. I recently joined Staffordshire’s police and crime commissioner and other local MPs to call for greater integration of the back-office functions of our police and fire services. That option was presented to avoid front-line fire services being cut, but we have now seen fire engines removed from both Cannock and Rugeley stations. What are the Government doing to encourage police and fire authorities to share back-office services?
Mike Penning
We are already seeing around the country the sort of innovations my hon. Friend talks about, and I have no idea why they are not doing it in that part of the world. It is common sense to break down silos and get the emergency services working together to secure more money for the front line. It is what we would all expect.
Patrick Grady (Glasgow North) (SNP)
3. What assessment she has made of the effectiveness of the visa application process for visitors from sub-Saharan Africa.
The Minister for Immigration (James Brokenshire)
The Government regularly monitor the effectiveness of the visa application process in sub-Saharan Africa as part of their monitoring of the global visa service. We are committed to the UK benefiting from a safe and secure visa service while providing a first-class operation to genuine visitors.
Patrick Grady
Next month marks 10 years of formal co-operation between the Governments of Scotland and Malawi, but I have heard from the Scotland Malawi Partnership that Malawian nationals are finding it increasingly difficult to apply for visas, making strengthening community links more difficult. Given that the partnership has told me that every part of the system seems to be becoming about charging more and delivering less, will the Minister meet me and representatives from the partnership to discuss those concerns in more detail?
James Brokenshire
I am always pleased to meet hon. Members to discuss the work of the Scotland Malawi Partnership, and I fully recognise the close bonds and ties that have existed for many years. Our focus is on delivering a high-quality service, and I am pleased to note that about 86% of applications from Malawi are successful. We are considering closely how we can improve the service further, however, and I am certainly happy to meet the hon. Gentleman to discuss the issues on his and the partnership’s mind.
Sir Edward Leigh (Gainsborough) (Con)
The Mayor of Calais has a point, does he not, about there being a unique pull factor—[Hon. Members: “She!”] I do apologise. I am sure she is a most impressive lady and a friend of our nation. Anyway, she has a point about there being a unique pull factor in the benefits we pay, how we deal with discretionary leave to remain and the fact that people can vanish into the black economy. Rather than just concentrating on visa applications, therefore, will the Minister undertake to remove all these pull factors into this country?
James Brokenshire
I think my hon. Friend, in his own distinct way, has highlighted the important distinction between legal and illegal migration and the challenges we have faced in terms of migratory flows and those putting their lives at risk on the Mediterranean sea and in the hands of people traffickers. We are examining all options, as part of the Government’s comprehensive stance, and focusing in particular on those people traffickers and smugglers selling people false hope and putting their lives at risk.
Mr Nigel Evans (Ribble Valley) (Con)
4. What guidance she has issued to police forces on high-profile policing.
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
Naturally, the Government do not issue specific guidelines for police forces on high-profile policing. The College of Policing sets the standards for professional practice to support police forces and other organisations so that the public are protected.
Mr Evans
I have been going to Conservative party conferences for more than 30 years. [Hon. Members: “No!] They’re only jealous. The policing at these conferences has always been high profile, but this was the first one where I have witnessed those working in hotels and the conference centre, as well as delegates, having to run a gauntlet of demonstrators shouting vile abuse at people—tantamount to hate crimes—spitting and throwing eggs. The police response was totally inadequate. What conversations will the Minister have with the police chief for Manchester, and what action can be taken in future to ensure that those attending conferences can do so safely?
Mike Penning
I think we would all agree that people attending any party political conference or people working there should not need to go through the type of abuse that took place there. This is a matter for the Metropolitan—I mean the Greater Manchester police; it is usually a matter for the Metropolitan police— and, to be fair, I have already had conversations about this issue. A review is going to take place, and I believe that the Conservative party will be having consultations, too.
Toby Perkins (Chesterfield) (Lab)
May I say that Labour Members share the disgust of the hon. Member for Ribble Valley (Mr Evans) for what was seen to happen there, which does not have any place in legitimate protest? Those involved in no way spoke for anyone on the Opposition Benches.
High-profile policing is incredibly important in Chesterfield, and the Minister will be as alarmed as I was to learn that there has recently been a significant increase in the number of burglaries in Chesterfield and Derbyshire. Will he listen to representations from the police and crime commissioner about the real pressure on our police force and will he help the police and the police and crime commissioner to cut burglaries in Chesterfield?
Mike Penning
Of course I will work closely with the police and crime commissioner and chief constables in the 43 authorities for which I have responsibility. As for the conference itself, the vast majority of police officers did a fantastic job. It was often decisions made above them that told them what they had to do. I am naturally concerned if there has been an increase, which is against the national trend: crime has continued to fall under this Government.
Jake Berry (Rossendale and Darwen) (Con)
If the Conservative party conference is to return to Blackpool one day, it is absolutely key to get the Lancashire police funding formula right. Increasing concern has been expressed this weekend among Lancashire MPs of all parties, so I would be grateful if the Minister would meet me and other Lancashire Members to discuss the police funding settlement.
Mike Penning
I thought it was you, Mr Speaker, in your days on the Back Benches, who could manage to get such a question in. It was very cleverly done by my hon. Friend, and I will naturally meet any delegation from any party to talk about police funding.
Mr Dennis Skinner (Bolsover) (Lab)
What a difference 30 years makes. Thirty years ago, we were talking about the police being harnessed by a previous Tory Government to close down the pits, sack the miners and carry out ethnic cleansing of the pit villages. Now we are told by the hon. Member for Ribble Valley (Mr Evans) that they are starting to get worked up about the cuts in pay and cuts in police forces. You want to be careful what you wish for.
Danny Kinahan (South Antrim) (UUP)
I know that policing is devolved and that we have an extremely professional and able police force in Northern Ireland, but when considering high-profile policing and looking at the other end where cuts are coming through in Northern Ireland and there are fewer police on the ground, is the Minister aware that that means that the paramilitaries and those working in crime will see their opportunities? Will he discuss how to tackle that problem better?
Mike Penning
With all due respect to the hon. Gentleman, this is a devolved matter, and as the former Minister of State with responsibility for Northern Ireland, I know just how devolved it really is, which is right and proper. The National Crime Agency currently operates in Northern Ireland, but this is a devolved matter, so it is something the hon. Gentleman needs to take up with David Ford.
Mark Spencer (Sherwood) (Con)
6. What changes she plans to make to the investigatory powers of the police and security services.
Alex Chalk (Cheltenham) (Con)
18. What changes she plans to make to the investigatory powers of the police and security services.
The Secretary of State for the Home Department (Mrs Theresa May)
The Government have been clear about the need to provide law enforcement and security and intelligence agencies with the powers they need to protect the public. A draft investigatory powers Bill will be published this autumn for pre-legislative scrutiny by a Joint Committee of both Houses of Parliament.
Mark Spencer
I thank the Home Secretary for that answer. I wonder whether she recognises the growth in internet-based communication systems, such as WhatsApp, Snapchat and many others, of which terrorists might be making use. Will she consider taking powers to support the security services in tracking relevant individuals who might want to do us harm?
Mrs May
My hon. Friend is absolutely right. New services are obviously being developed. The law makes it very clear that any communications service provider offering a service in the United Kingdom should be in a position to respond to a warrant when it has been decided that there should be access to intercept material on the basis that it is necessary and proportionate. That was made clear by the Regulation of Investigatory Powers Act 2000, and we put it beyond doubt in the Data Retention and Investigatory Powers Act 2014.
Alex Chalk
Does the Home Secretary agree that it is incumbent on organisations such as WhatsApp and Snapchat, which routinely encrypt messages, to co-operate with the authorities to ensure that those who may do us harm are prevented from doing so?
Mrs May
I assure my hon. Friend, and my hon. Friend the Member for Sherwood (Mark Spencer), that we want to ensure that our law enforcement and security and intelligence agencies have the powers that are necessary to keep us safe. They do an excellent job, but it is our role, here in Parliament, to ensure that they have the legislative backing to enable them to do it. I believe, and the Government believe, that there should be no safe space for terrorists, criminals or paedophiles on the internet.
Greg Mulholland (Leeds North West) (LD)
In the light of the High Court ruling in July, may I ask the Home Secretary whether she will now do what should have been done in the first place, and ensure that access to our private data is authorised by a genuinely independent body or a court?
Mrs May
The hon. Gentleman will be well aware that each of the three reviews of the powers and legislation relating to interception of communications and access to communications data came up with a different answer in respect of the authorisation process for access to intercept material. David Anderson suggested that there should be a judicial authorisation, the Royal United Services Institute suggested that there could be a hybrid, and the Intelligence and Security Committee of Parliament suggested that the authorisation should remain with the Secretary of State. We have been considering the matter very carefully, and, as I have said, a draft Bill will be published in due course.
Ms Margaret Ritchie (South Down) (SDLP)
Will the Home Secretary tell us which is more important to the Government, national security or accountability, truth and justice for victims?
Fiona Bruce (Congleton) (Con)
7. What steps the Government are taking to tackle hate speech.
Kwasi Kwarteng (Spelthorne) (Con)
17. What steps the Government are taking to tackle hate speech.
The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)
No one in this country should live in fear because of who they are. We have made progress in tackling hate crime, but we are determined to do more, including challenging those who spread extremist messages and seek to divide our society. We will therefore develop a new hate crime action plan, working in partnership with communities and across Government to ensure that we have strong measures to stop these deplorable crimes.
Fiona Bruce
Can my right hon. Friend reassure me that in tackling hate speech, the Government will continue to protect and cherish freedom of speech in this country, and, in particular, that Christian Ministers need have nothing to fear when preaching biblical principles in their own pulpits, as their predecessors have done for more than 1,000 years?
Karen Bradley
I assure my hon. Friend, who campaigns so much for the protection of religious freedoms, that we value the role of faith in society, and will protect everyone’s right to practise their faith. Freedom of speech is a fundamental value that binds our society together, and we will always protect that right. Nothing that we are doing, or planning to do, to tackle hate crime and extremism will stop the United Kingdom’s long tradition of preaching.
Kwasi Kwarteng
I am very grateful for the Minister’s answer. Will she assure the House that nothing in legislation will undermine not just Christianity, but people who preach other faiths?
Karen Bradley
I assure my hon. Friend that we are doing nothing in legislation that will prevent the right to believe, and the right to practise and preach. What we are doing is focusing on people who seek to use religious texts as an excuse to promote hatred and extremism. That is what we want to stop.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
Does the Minister agree that the Secretary of State’s speech to the Conservative party conference could itself be defined as hate speech, and that it did nothing for her bid for the leadership of the Conservative party and everything for a potential bid for the leadership of UKIP?
Gavin Robinson (Belfast East) (DUP)
Is the Minister aware of the current case of Pastor James McConnell in Belfast, who is being prosecuted for a sermon he delivered in his church to his congregation, and does the Minister accept that, with all the best will in the world, it is ordinary, decent citizens who are fearful of stepping over a line who will be prosecuted and persecuted under the crime of hate speech, and not those paramilitaries and terrorists we need to focus on?
Mr Speaker
Order. I listened intently to what the hon. Gentleman said and from the phraseology he used it seems that a prosecution is currently under way. If that is so, the sub judice rule applies and therefore a degree of caution in the ministerial response would be prudent.
Karen Bradley
Thank you, Mr Speaker; you took the words out of my mouth. I clearly cannot comment on that matter, but I do want to assure the hon. Gentleman that using religious texts as an excuse for hatred and as a reason to incite hatred is not acceptable and we will not stand for it.
Mrs Maria Miller (Basingstoke) (Con)
Last week the Women and Equalities Committee visited Oldham, Manchester and Birmingham and heard from a number of local organisations about their continuing concern about hate crime, and particularly hate speech. I know the Government take this issue very seriously. Can the Minister update the House on the progress they are making in terms of the reporting of hate crime, which is clearly still a considerable concern in many communities?
Karen Bradley
I thank my right hon. Friend for that question. We met last week and discussed some aspects of this. We are looking at the feasibility of the reporting of hate crime and will be making a decision shortly.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
Balancing freedom of speech with the need to ensure we have a strong, diverse and cohesive society is a challenge for any Government, but what practical funding does the Home Office offer to support communities like mine that want to run initiatives to bring diverse communities together and promote that more cohesive society?
Karen Bradley
As I just said, we are looking to introduce a new hate crime action plan and we are looking at all the ways we can support those local communities who want to work actively to promote community cohesion and our shared values.
Lyn Brown (West Ham) (Lab)
The Government want universities to ban speakers who say things that do not break the law but which do promote hatred or violence. Can the Minister give one clear example of a statement made in a UK university which should now be banned?
Karen Bradley
I welcome the shadow Minister to her place and look forward to working with her. I think she will agree that this is about how we protect our shared values and how we make sure we work together and keep our citizens safe. I hope she will work with the Government to make sure we do that.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
8. What steps she is taking to tackle domestic violence. [R]
The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)
Tackling domestic violence is a key priority for this Government. We have created a new offence of domestic abuse, we are making improvements to the police response and this year provided over £20 million to fund specialist domestic and sexual violence services, national helplines and refuges.
Dr Cameron
What steps will the Minister take to improve the witness testimony experience of survivors of domestic abuse through special measures, which may increase reporting and conviction rates?
Karen Bradley
We are looking through the refreshing work we are doing in our whole violence against women and girls strategy and we are considering how we can make sure the victim experience is such that victims are treated with the dignity and respect they need. We are working with the Ministry of Justice to make sure that happens.
David T. C. Davies (Monmouth) (Con)
Does my hon. Friend agree that forced marriage is a particularly iniquitous and hidden form of domestic violence that is going on in this country at the moment, and will she look at funding for the forced marriage unit, which is doing excellent work in the Foreign Office to try and protect young British girls from being married off against their wishes?
Karen Bradley
I have visited the FMU, which is a joint Home Office and Foreign Office unit. It does excellent work and I know that its outreach programme is getting to those girls who may be victims of forced marriage and making sure this does not happen.
Deidre Brock (Edinburgh North and Leith) (SNP)
23. Does the Minister support the HeForShe campaign which many world leaders have signed up to as impact champions, and will she encourage her own party colleagues, including the Prime Minister, to sign up to help end discrimination and violence towards women?
Karen Bradley
I thank the hon. Lady for her question. Could she perhaps provide more information about that campaign? We support many campaigns and I would like to find out more about that one.
Andrew Stephenson (Pendle) (Con)
Will the Minister join me in supporting the work of citizens advice centres across the UK and their Talk about Abuse campaign, a national campaign to help friends and family members to support the victims of domestic abuse?
Karen Bradley
I attended the launch event of that excellent Citizens Advice campaign, which has already helped me with a case in my own constituency, in which I was able to refer someone to the citizens advice bureau to get the specialist and expert support that they needed.
Sarah Champion (Rotherham) (Lab)
Reports of domestic and sexual violence are increasing across the country. However, in an attempt to deal with the relentless Government cuts, local authorities and the police are stopping specialist abuse support to victims and instead providing generic services or no services at all. Will the Minister commit to ensuring that everyone, regardless of gender, sexuality or ethnicity, feels safe and supported in their home?
Karen Bradley
I welcome the hon. Lady to her place on the Front Bench and I look forward to working with her. We have worked together on a number of previous campaigns and I know that she will be excellent in her new role. As I have said, the Home Office is refreshing its violence against women and girls strategy, and part of that involves looking at commissioning and local commissioning to ensure that those specialist services, which she rightly says victims need to get the support that they require, get the funding that they need.
Paul Blomfield (Sheffield Central) (Lab)
9. What progress the Government have made on their response to the refugee crisis.
The Parliamentary Under-Secretary of State for Refugees (Richard Harrington)
As my right hon. Friend the Prime Minister announced on 7 September, the Government will expand existing resettlement schemes to resettle up to 20,000 Syrians in need of protection. In the past few weeks, we have established a cross-departmental operations centre for Syrian refugees, based in the Home Office, and we look forward to welcoming refugees in a well-organised way in the months and years to come.
Paul Blomfield
I thank the Minister for that reply, but one further practical step that the Government could take would be to expand the family reunion criteria, which, as he will know, are currently restricted to spouses and dependent children. Will the Government help to keep already traumatised families together by allowing elderly parents and other family members to find temporary protection in the UK, as the Refugee Council and the Red Cross have requested?
Richard Harrington
The family reunion scheme has been used successfully in the past, and it is still being used. In addition, we have the vulnerability criteria of the United Nations High Commissioner for Refugees, which include vulnerable families.
Helen Whately (Faversham and Mid Kent) (Con)
Last week, I visited the jungle camp in Calais. It was clear that the fence and other security measures were making it very difficult for people to get to the UK, but conditions at the camp are desperate and getting worse. Will the Minister tell us what further actions the Government are planning to take in response to this situation?
Richard Harrington
The Government are working closely with the authorities in Calais to make sure that this does not happen.
Debbie Abrahams (Oldham East and Saddleworth) (Lab)
16. Oldham and many other areas are under incredible financial pressure at the moment, but we want to do our bit to support refugees. What practical and financial support will be provided by the Government beyond the single-year funding that is currently provided, and will any such support reflect the good practice set out in the UNHCR’s gateway programme, which has shown the long-term benefits of financial front-loading?
Richard Harrington
As the hon. Lady will be aware, the year one costs are taken care of, to cover the cost of refugees coming to this country. The Government have looked carefully at covering years two to five, because we are conscious of the fact that local authorities will be incurring extra costs. In the letter that I wrote on 1 October to the chief executives of local councils, it was made clear that the Government would be assisting them with the extra costs incurred.
Andrew Bridgen (North West Leicestershire) (Con)
Does the Minister agree that it ought to be a high priority for the Government to crack down on human traffickers and people smugglers, who profit from the misery of others? What steps are the Government taking to crack down on this evil trade?
Richard Harrington
The Government are well aware of the point that my hon. Friend has made. I am pleased to report that I went to Portsmouth last Friday to visit the naval base to which the cutters run by Border Force returned from the Mediterranean. During their time in the Mediterranean they apprehended many people smugglers. It is the Government’s policy to ensure, through the taskforce, that that will increase, because this is a serious problem.
Joanna Cherry (Edinburgh South West) (SNP)
Today, The Times and The Guardian have published a statement signed by more than 300 leading lawyers, including 12 retired judges, a former President of the Supreme Court, former Law Lords, 103 Queen’s counsel and prominent academics, calling on the United Kingdom Government to take a
“fair and proportionate share of refugees, both those already within the EU and those still outside it.”
They say that the UK’s “present offer” to take 20,000 is “deeply inadequate”. Does the Minister and his Home Secretary think they are wrong?
Richard Harrington
I listened to that interview carefully; the person concerned was asked what they did think was adequate and was not able to answer. I hope that listeners to the programme and people who have read this correspondence will be aware that this Government are doing a lot in the countries around Syria and our expenditure has so far been more than £1 billion to help people in the areas around Syria. In addition, we have our programme to help 20,000 of the most vulnerable refugees, which I am very proud of and want to see delivered very efficiently.
Joanna Cherry
If the Minister wishes to see the advert—I have a copy here—he will see that it was signed not by a person, but by 342 lawyers. Let me follow up with a second question. The Home Secretary suggested in her conference speech that she wanted to work with other countries
“to review the international legal definitions of asylum and refugee status.”
Is she really wanting to dilute the international protection offered to those at real risk of serious harm or persecution?
Richard Harrington
My right hon. Friend made it clear in that speech that it was our intention to be able to deal with a lot of fraudulent applications for asylum, so that we can concentrate on those people who really need it. The hon. and learned Lady should be very proud of this Government taking 20,000 of the most vulnerable refugees over the course of this Parliament.
Mr Alistair Carmichael (Orkney and Shetland) (LD)
I join the Minister in commending the work of the cutters, HMC Protector and HMC Seeker, which this year have rescued 1,650 people and played a part in the apprehension of no fewer than 26 people traffickers. Can he explain to the House why these cutters are being withdrawn from service at this time, given that we are clearly not seeing the drop off in the number of people coming across the Mediterranean that we have seen in previous years around about this time?
Richard Harrington
I am sure the right hon. Gentleman will be aware that the cutters’ return to Portsmouth was part of their planned period in operation, which was agreed with the other countries. Other ships have taken over, and I know that we play a very significant part in the apprehension of people traffickers.
Lucy Allan (Telford) (Con)
10. What steps local police forces are taking to lead innovation in policing.
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
The 43 forces around the country are empowered to bring forward innovation and different ideas. The integrated public contract command and control system that West Mercia and Warwickshire police have developed with the Hereford and Worcester fire and rescue services is an example of that, and it was partly paid for by the police innovation fund.
Lucy Allan
I thank the Minister for his reply. My constituency is home to a business called SmartWater, which has pioneered forensic marking technology. This innovative technology helps the police to prevent and detect crime. Does he agree that a collaborative approach between the public and the police to encourage the marking of property could revolutionise policing in the UK?
Mike Penning
I am very aware that the Home Secretary visited my hon. Friend’s constituency and this excellent company with her in 2013. In my constituency, SmartWater is particularly being used in rural areas to protect very valuable agricultural plant—this is about not only prevention, but tracking it after it has been stolen.
Bridget Phillipson (Houghton and Sunderland South) (Lab)
Innovation is, of course, to be welcomed, but many forces are finding it increasingly difficult to deliver even on core policing functions. According to the National Audit Office, Northumbria police force has already suffered the highest level of funding cuts in the country. On that basis, can local people really have any confidence that we will get a fair deal from Ministers this time around?
Mike Penning
In 2010, it was said that the cuts would be devastating, policing would suffer and crime would go up—it went down. We will look very carefully at the consultation. I stood at this Dispatch Box and promised that I would come back with different figures and so on, based on the consultation. That was a promise I gave the House and it is exactly what I have done, and I will continue to listen.
Robert Jenrick (Newark) (Con)
12. What recent assessment she has made of trends in crime rates in England and Wales.
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
It will not be a surprise to hear that police reform is working. The independent Crime Survey shows that crime has dropped by nearly a quarter since 2010 with 150,000 fewer burglaries and almost 400,000 fewer violent crimes.
Robert Jenrick
This autumn, Nottinghamshire police, like many other forces, is rolling out body-worn cameras, which have a huge potential to reduce crime and to increase convictions. Will the Minister encourage the police and the Crown Prosecution Service to embrace that technology and the evidence it produces, particularly in difficult crimes against women such as domestic violence where powerful evidence from the scene of a crime or the aftermath could play a big role in increasing the currently quite poor rates of conviction?
Mike Penning
Domestic violence is one of the more difficult crimes to prosecute, not least because the victim very often changes their mind or does not want a prosecution to take place, but when they see the video evidence of what they look like when the police officers arrive, their confidence often grows, which means that we see more convictions going forward, so I completely agree with my hon. Friend.
Jack Dromey (Birmingham, Erdington) (Lab)
For the past five years, the Government have claimed that they have cut the police and cut crime. Now we know the truth: once fraud and online crime are included in the crime statistics next year, crime will have risen by up to 40%. Will the Home Secretary finally admit therefore that crime is not falling but changing, and that with the threat of terrorism, the demands of protecting our children and of growing violent and sexual crime, this is the worst possible time to cut another 23,000 police officers?
Mike Penning
This Government are not cutting 23,000 police officers, as the shadow Minister knows full well. Yet again I have to say that he is much better than his comments. We would be really happy—I would be really happy—if more people had the confidence to come forward and report domestic violence and those figures went up. I am sure that that would be welcome across the House. It is also right and proper that this Government, unlike the previous one, include fraud in the figures.
Melanie Onn (Great Grimsby) (Lab)
13. What discussions she has had with local authorities on funding and other practical arrangements for the settling of refugees.
Karl Turner (Kingston upon Hull East) (Lab)
14. What discussions she has had with local authorities on funding and other practical arrangements for the settling of refugees.
The Parliamentary Under-Secretary of State for Refugees (Richard Harrington)
The UK has established networks to accommodate and support resettled people. We know that an increase in numbers will require an expansion of current networks, so we are currently working with a wide range of partners including local authorities to ensure that people are integrated with sensitivity in local communities. In particular, we are working with local government operations to see how the funding for that will operate.
Melanie Onn
I thank the Minister for his response. The refugees who will be granted residence in Britain under the new scheme will be vulnerable victims of torture and sexual abuse and those with acute physical and mental medical needs. Contrary to what the Minister said in response to my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams), my local authority in north-east Lincolnshire is unclear about the extent of the extra support that will be provided to help adequately meet the needs of the most complex cases. Will the Minister confirm that, in addition to the funding of basic needs such as clothing and housing, consideration has been given to the funding of other services such as counselling, translation services and training?
Richard Harrington
I can happily confirm that that is the case. I pay tribute to Councillor Dave Green, the leader of Bradford council, for being one of the leaders in this area. I saw for myself how the things that the hon. Lady mentioned take place in Bradford, and those things will be greatly expanded.
Karl Turner
What is the Minister doing to extend the funding that local authorities are given to support refugees from one year to three years? The Minister will be aware that Hull city council has offered to support Syrian refugees and it was very keen to do so, but what are the Government doing to help us fund that work?
Richard Harrington
The hon. Gentleman will know that I have answered that question before. I have written to the chief executives of all the local councils explaining that we will help with funding for years two to five.
Keir Starmer (Holborn and St Pancras) (Lab)
May I touch on a different aspect of housing and migration? When sanctions were introduced for landlords renting to those disqualified by immigration status, it was agreed that there would be a pilot in the west midlands and that that pilot would be evaluated before its roll-out. An evaluation by the Joint Council for the Welfare of Immigrants has shown widespread discrimination—up to 42%—against lawful migrants, those without British passports and those who appear to be foreign. In the light of those results, will the Secretary of State assure the House that the results of the Home Office evaluation will be published before the Second Reading tomorrow and that if similar patterns of discrimination are shown the roll-out will be abandoned?
Richard Harrington
I welcome the hon. and learned Gentleman to his role and look forward to our discussions in the future. I can confirm that the Government will publish the results of the consultation before the Committee stage of the Bill.
James Cleverly (Braintree) (Con)
T1. If she will make a statement on her departmental responsibilities.
The Secretary of State for the Home Department (Mrs Theresa May)
I am sure that the thoughts of the whole House will be with the people of Turkey after the terrible attack that took place in Ankara at the weekend.
A week ago, in the small hours of the morning, Police Constable David Phillips was killed in the line of duty. PC Phillips’ death serves as a terrible reminder of the real dangers that police officers face day in and day out as they put themselves in harm’s way to deal with violent criminals and dangerous situations. The murder investigation is ongoing, Merseyside police have made arrests and I am sure that the whole House will agree on the importance of bringing his killers to justice.
Police officers put themselves in danger doing a vital job and it is important that we ensure that their families are looked after if the worst happens. As the law stands, widows, widowers and surviving civil partners of police officers who are members of the 1987 police pension scheme stand to lose their partner’s pension if they remarry, form a civil partnership or cohabit. In recognition of the level of risk that police officers face in the execution of their duty, the Government have pledged to reform the 1987 police pension scheme—
Mrs May
We will reform the scheme to ensure that the widows, widowers and civil partners of police officers who have died on duty do not have to choose between solitude and financial security. The Government will lay these regulations in the coming weeks and the change will be backdated until 1 April 2015.
Mr Speaker
Order. The Home Secretary has clearly brought great happiness to the right hon. Member for Slough (Fiona Mactaggart), and that will be recorded in the Official Report. We are extremely grateful.
James Cleverly
I welcome the statement made by the Home Secretary, and I also welcomed the restatement in the Prime Minister’s conference speech of his commitment to end the brutal practice of female genital mutilation among British citizens and those living in Britain. What steps are being made by the Home Department to ensure that those commitments become reality?
Mrs May
I thank my hon. Friend for his question. If you will indulge me, Mr Speaker, I suspect that this might be the first time I have stood at this Dispatch Box and said something that brings happiness to the right hon. Member for Slough (Fiona Mactaggart), so the moment is historic and not just something to be recorded.
The Prime Minister has taken a particular interest in FGM and last year he co-chaired with UNICEF the girl summit, the first of its kind. At the time, we announced a number of steps that we would take on FGM. The Home Office has set up an FGM unit, focusing Government efforts in this area, and we have, for example, introduced the new protection orders, which we fast-tracked so that they were available in July and could be used to protect girls who might have been taken abroad during summer school holidays for the practice of FGM.
Andy Burnham (Leigh) (Lab)
On behalf of everybody on the Opposition Benches, may I echo the Home Secretary’s tribute to Police Constable David Phillips, who died working to keep the people of Merseyside safe? I am sure that the whole House will want to join me in sending a message of condolence to his family and of gratitude for his service to the public.
Today, the former head of the Supreme Court, three Law Lords, a former Director of Public Prosecutions, five retired Court of Appeal judges, a president of the European Court of Human Rights and 100 QCs who represent the Government have described the Home Secretary’s response to the refugee crisis as “deeply inadequate”. Why does the Home Secretary think that she is right and all of them are wrong?
Mrs May
I have to say to the right hon. Gentleman that asking as his first question one that has already been asked by the Scottish National party spokesman might not be a route he wishes to go down in future. My hon. Friend the Under-Secretary of State for Refugees has answered the question, but I will respond to the right hon. Gentleman.
This country and this Government can be proud of the efforts we are making to support refugees from the Syrian crisis. We have put £1.1 billion in for those in the refugee camps and in communities in Lebanon, Jordan and Turkey. We are the second biggest bilateral donor to the region and to those refugees after the United States of America. In addition, we have been operating our Syrian vulnerable persons resettlement scheme, which we are expanding so that the 20,000 Syrian refugees who are most vulnerable will be brought to the United Kingdom over the course of this Parliament.
Andy Burnham
Let me tell the Home Secretary why I repeated the question. Could not the public have legitimately expected the Home Secretary to answer a question about the biggest humanitarian crisis since the second world war? Her response reveals her fixed mind on this issue, which is simply not good enough because she is not responding to the unfolding nature of the crisis. Her position is flawed for one reason: she is trying, out of convenience, to draw a false distinction between refugees still in the region and those who have arrived in Europe, whom she describes as the wealthiest, fittest and strongest. I say to her: look at the TV pictures today; these people are not wealthy, fit or strong. They are desperate and they need our help. Is it not time to stop digging in, show some humanity and reach out a helping hand?
Mrs May
The question was rightly answered by my hon. Friend the Under-Secretary of State for Refugees—an appointment, I remind the House, that the Prime Minister made recently to ensure that there is a very clear focus on the job of making sure that the 20,000 Syrian refugees whom we bring to the United Kingdom are given accommodation and other types of support when they arrive here. As I said, the UK can be justifiably proud of the work that it is doing, and of the people whose lives it is keeping going through the provision of medical supplies, food and water in the refugee camps. Through our scheme we are taking the most vulnerable—not those who have been able to reach the shores of Europe, but those who are not making that journey. I hope the right hon. Gentleman will send a very clear message that it is better for people not to try to make the dangerous journey across the Mediterranean and through other routes into Europe because sadly people are still dying doing so.
Simon Hoare (North Dorset) (Con)
T3. My right hon. Friend will be aware that most goods vehicles coming into the United Kingdom are operated by overseas companies. How can Her Majesty’s Government encourage those firms to operate appropriate levels of security to prevent people using those vehicles to gain illegal entry to our country?
The Minister for Immigration (James Brokenshire)
We have strengthened our partnership with the haulage sector and food industry to reduce the challenge of clandestine stowing away. My hon. Friend highlights an important point about the international aspect. We hosted a conference in Brussels setting out and sharing good practice because we need to ensure that there are high standards not only among UK hauliers but among EU hauliers.
Patrick Grady (Glasgow North) (SNP)
T2. Does the recently updated Home Office country information and guidance on Eritrea take into account the recent findings of the UN commission of inquiry into human rights in Eritrea?
James Brokenshire
We keep our country guidance up to date. The hon. Gentleman highlights a particular piece of evidence. Our guidance is constantly reviewed and we look at all forms of evidence in setting out the approaches that our entry clearance officers should take.
Jeremy Lefroy (Stafford) (Con)
T5. The Modern Slavery Act 2015 was a great achievement for my right hon. Friend the Home Secretary and her colleagues. What progress is she making in working with other European countries to tackle modern slavery, especially in the light of the report from the Centre for Social Justice on organised crime groups that move men, women and children across EU borders into slavery?
The Parliamentary Under-Secretary of State for the Home Department (Karen Bradley)
I thank my hon. Friend for his compliments about the Modern Slavery Act. A number of measures from the Act, including the new offences, are now live. We shall shortly implement the section on transparency in supply chains, which has the potential to change international opinion on slavery. We have also been successful in having modern slavery included in the sustainable development goals at the UN, which should mean that there is increased focus on the issue. We are also working with other European Governments to ensure that slavery is at the top of their agenda too.
Anne McLaughlin (Glasgow North East) (SNP)
T4. A month ago a very impressive young woman came to my surgery asking for my help. She is in her mid-20s and is a high-flying accountant—or she would have been had her wings not been clipped by the shock news that she has no status in this country through no fault of her own, but because her parents have overstayed their welcome. She is now estranged from them. Does the Home Secretary have any sympathy with children in those circumstances who have done nothing wrong? Could I write to her and ask her to use some discretion in looking at this case?
James Brokenshire
It is very difficult to comment on an individual case without knowing all the facts and circumstances, but if the hon. Lady would like to write to me with that information, I will consider it carefully.
James Berry (Kingston and Surbiton) (Con)
T8. I am proud that in Kingston offers have come in thick and fast to host Syrian refugees since we offered to do so not after the terrible image of Alan, but more than 12 months ago. This has not always been easy because some of the refugees come from incredibly traumatised backgrounds. Is the Home Secretary assessing which Syrian refugees have been victims of torture and ensuring that they are housed close to areas where they can access rehabilitative services?
The Parliamentary Under-Secretary of State for Refugees (Richard Harrington)
I can assure my hon. Friend that we are looking in great detail precisely at placing vulnerable refugees in areas where there are the facilities to deal with them.
Caroline Lucas (Brighton, Pavilion) (Green)
T6. As Ministers will know, crisis funding for domestic violence refuges ends on 31 March 2016, so where should the many thousands of women and children fleeing violence now turn for lifesaving support after that date? In particular, will the Minister commit to the provision of sufficient permanent funding for women’s refuge in future?
Karen Bradley
In response to earlier questions, I talked about the refreshing of our violence against women and girls strategy, which includes looking at how we commission services, but it also looks at prevention. We need to make sure that women are not in the position where they need to go to refuges, so we are looking at how we make sure that the right provision is available and at how we do all we can to prevent this crime happening in the first place.
David Morris (Morecambe and Lunesdale) (Con)
T9. In my constituency the CCTV equipment is coming to the end of its functional life. What funding is in place to replace this scheme?
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
In most cases CCTV is funded by the local authority, working closely with the police in that local area. I have visited many areas where new CCTV cameras have been installed. That is something we will work on together, and I would be happy to meet my hon. Friend.
Mike Kane (Wythenshawe and Sale East) (Lab)
T7. I am sure the Minister will welcome the appointment of Ian Hopkins as the new chief constable of Greater Manchester, but the Manchester Evening News is reporting that he could face £157 million of cuts because of the funding formula. Regardless of those negotiations, will the Minister guarantee that any negotiated settlement will not be undermined by the comprehensive spending review?
Mike Penning
The funding formula changes were introduced because nearly every force in the country wanted them. I appreciate that there are concerns out there, but people do not know exactly what is happening, and the changes are separate from the spending review.
Mr David Davis (Haltemprice and Howden) (Con)
In about two weeks’ time we are expecting the return of the last British resident, Shaker Aamer, from Guantanamo Bay, and I thank the Government for their actions in support of that measure. However, the last 16 residents of Guantanamo Bay who returned to Britain had been subject to torture and were paid compensation by the Government. Can the Home Secretary tell us how many of those 16 were subject to gagging orders as a result of the settlement?
Yvette Cooper (Normanton, Pontefract and Castleford) (Lab)
The Home Secretary has just said that she does not want people to make dangerous journeys, but the family reunification rules are making them do exactly that. A 17-year-old Syrian boy whose parents have been killed and whose brother lives here was told that the only way he could apply was to travel in person to apply to the nearest embassy or consulate. On the way to Turkey to do so, he was kidnapped and tortured for four days. That was a very dangerous journey, required by the family reunification rules. Will the Home Secretary personally review this case and agree to look at the family reunification rules so that we can support more desperate and vulnerable families? I urge her personally to do this.
Mrs May
My hon. Friend the Under-Secretary of State for Refugees referred earlier to the work that we are doing. Obviously, there are the existing family reunification rules, but we are also expanding the vulnerability criteria whereby we identify with the UNHCR those refugees who will be resettled here in the United Kingdom. That includes a category of vulnerable families.
Mr Peter Bone (Wellingborough) (Con)
Will the Home Secretary confirm that she has not personally authorised any intercepts of MPs’ communications? Perhaps after last week, will she confirm that any future Government that she may head will not intercept MPs’ communications?
Mrs May
My hon. Friend will be aware that we do not comment on individual applications for intercept. Indeed, under the Regulation of Investigatory Powers Act 2000 it is an offence for anyone to identify an individual warrant or an individual interception that takes place. The Wilson doctrine applies, but of course it is subject to proceedings that are taking place at the moment.
Alison McGovern (Wirral South) (Lab)
PC David Phillips was the very best of all of us in Wirral. His death has shaken people everywhere, but especially his family and friends in my constituency. An amazing £145,000 has already been raised in his memory. Will the Home Secretary confirm that the Government stand absolutely ready to assist Merseyside police in their efforts to bring the guilty to justice, to help PC David Phillips’s family and to properly mourn and praise this dedicated and courageous officer?
Mike Penning
I do not think I could have put that any better as the Policing Minister. I made my offer to the chief constable to visit if he wanted me to—if they had not wanted me to go, I would not have gone—and he asked me to do so. I had the honour and privilege of talking to police officers who were on the shift that David Phillips was part of, and to the other officers who were there. It was probably one of the most moving experiences I have ever known. I also had the privilege of laying flowers just after his family had left. We will give all the support we possibly can to the chief constable and the investigating officers, but we now need to let them get on with the job.
Several hon. Members rose—
Mr Speaker
Order. As I intimated was likely at the start of Home Office questions, we have been notably deprived by the absence of that intellectual iconoclast, the Minister for Security, the right hon. Member for South Holland and The Deepings (Mr Hayes), but we have pressed on as best we can, regardless of that deprivation.
Mr Speaker
Points of order come after urgent questions, so the right hon. Gentleman has time for tea.
NHS: Financial Performance
(8 years, 6 months ago)
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Heidi Alexander (Lewisham East) (Lab)
(Urgent Question): To ask the Secretary of State for Health if he will make a statement on the financial performance of the NHS.
The Parliamentary Under-Secretary of State for Health (Ben Gummer)
I thank the hon. Lady for giving me this opportunity to come to the House and make a statement on the financial performance of the NHS.
On 9 October, Monitor, the regulator of NHS foundation trusts, reported that foundation trusts ended the first three months of the financial year with an estimated net deficit of £445 million. Monitor’s publication noted that performance in the first quarter of the financial year is usually worse than it is over the rest of the year. The NHS Trust Development Authority also published that day the financial position of NHS trusts for the first quarter of 2015-16, which showed that the NHS trusts sector ended the first quarter of the year £485 million in deficit.
The financial position of the NHS is undoubtedly challenging. It is important to recognise that, despite the difficult decisions we have had to make as a result of the calamitous deficit we inherited, it is the Conservative party that has chosen to prioritise funding for the NHS. That is why we are committing an additional £10 billion over the lifetime of this Parliament, starting with £2 billion this year.
However, additional Government spending is not the only answer to the challenges faced by the NHS. The Government have taken action with our arm’s length bodies to support local organisations to make efficiency savings and reduce their deficits. In the first three months of this year NHS trusts spent £380 million on agency staff, while foundation trusts spent £515 million. That is nearly £10 million a day across the NHS. We need to reduce that spending and challenge the agencies that are charging, frankly, outrageous amounts for their staff. To that end, a package of measures, including a ceiling on the amount each trust can spend on agency nurses and mandatory central framework agreements, was announced by my right hon. Friend the Secretary of State in June.
The Government and NHS leaders have taken national action to support local leaders in managing down those deficits. I very much welcome a constructive discussion with the Opposition on where we might be able to go further in driving the efficiency savings that the NHS must find if it is to provide the exceptional standard of patient care that we all, on both sides of the House, wish to see.
Heidi Alexander
I thank the Minister for that response. Where possible, I hope that we can have a mature and constructive relationship. However, he should make no mistake that when responses are as poor and lacking in detail as the one we have just heard, I will provide strong and robust opposition.
Ministers are accountable to patients, and their silence on the growing black hole in NHS finances has been deeply disappointing, as is the absence of the Health Secretary today. Not a single Minister was available to be interviewed about the NHS on Friday: it is not good enough. The deficit for the first three months of this financial year was larger than the deficit for the whole of 2014-15.
So, first things first: what advice has the Minister issued to hospital chief executives and finance directors about managing these pressures? Does he honestly think it is still possible for hospitals to balance the books, maintain current services, and deliver safe patient care? Given that the figures relate to quarter 1 and we are now in quarter 3, will he provide his latest assessment of the NHS financial outlook?
There is clearly not enough money in the current budget to cover existing costs. How on earth does the Minister plan to fund more services spread over seven days? The Conservatives’ election promises of more money have yet to materialise, and now their commitment to transparency in the NHS is looking decidedly shaky. For someone who prides himself on being open, the Health Secretary has been suspiciously silent about the delayed publication of these reports. Let me quote what a senior official in Monitor said just over a week ago:
“We are being leaned on to delay them and I have a suspicion that the sensitivity would be less after the Tory party conference”.
Will the Minister say whether these allegations have been investigated? The figures were presented to the board of Monitor on 30 September, so when was he told? Was it before the Tory party conference?
It may be an inconvenient truth for the Health Secretary and his Ministers, but the public have the right to know what is going on and what the Government plan to do. People across the country depend on NHS services, and Labour Members will stand up for them.
Ben Gummer
First, I welcome the hon. Lady to her place. Although he is not in the Chamber, I pay tribute to her predecessor, the right hon. Member for Leigh (Andy Burnham), who occupied her position, both as shadow Secretary of State and as Secretary of State, for a considerable period. I hope we can develop our relationship as constructively as possible in the months and years ahead.
The hon. Lady rightly said that Ministers are accountable to patients. That is precisely why we will not make the same mistakes as her predecessors in trying to trade off patient care and patient safety with the finances of the NHS. That is why we have been entirely open not only about the size of the deficit but, in a manner that the previous Administration were not, the failings of care in the NHS when they occur.
The hon. Lady said that the deficit is larger than it was in the whole of last year. That is not accurate. The deficit is traditionally larger in the first quarter of any one year. [Interruption.] She questions that, but it is a statement of fact.
We took action as soon as we came into office to give providers the opportunity and ability to bear down on deficits: it was one of my right hon. Friend’s first actions in coming into government. In three specific areas—agency staff required because of our need to take urgent action following the calamitous and scandalous events at Mid Staffs, the high and excessive pay of NHS managers and consultancy spend, and NHS property—we have given trusts the ability to bear down on deficits. We expect to see the use of those new tools in the past few months bear fruit in the months to come.
The hon. Lady asked if it is possible to balance books and deliver safe patient care. I point her in the direction of the trusts that are, and have been, successfully balancing their books and providing exceptional patient care. Indeed, it has been observed not only by me and other Ministers, but by those outside the Department of Health, that the trusts that best manage their finances and the efficiency of their hospitals also tend to provide the best patient care.
The hon. Lady made an interesting statement about there clearly not being enough money, but she will be aware that the NHS itself asked for £1.7 billion in this financial year and that we responded not with £1.7 billion, but with £2 billion. We have met the NHS’s own funding requests with more than it has anticipated. For the remainder of this Parliament the NHS itself has requested £8 billion of funding, and we have pledged to give it every single billion—a pledge that was not matched by the Opposition and that they tried to undermine at the last election. They pledged to give only £2.5 billion, as opposed to the £8 billion we promised the electorate. The hon. Lady says that promises have yet to materialise, but the money that we promised, not at the last election but in the previous autumn statement, is already flowing through the system.
The hon. Lady asked specifically about the relationship and the nature of the release of the figures. I completely refute her suggestion and I am certainly looking at investigating why such comments were made. I speak for the ministerial team when I say that we did not put on pressure as she might have suggested.
Finally, the hon. Lady says that the public have a right to know what is going on. We have been completely straight, and I have been direct, about the financial challenges facing the service. The reason for those financial challenges is the extraordinarily challenging situation resulting from the demographic changes in our country. On the Government’s part, that requires making very big decisions about the transformation of the service. We best do that not by making the NHS a political plaything, but by working together to deliver precisely the plan that the NHS has delivered for this Government and that we intend to deliver for the patients and people of this country.
Dr Sarah Wollaston (Totnes) (Con)
I welcome the Minister’s statement, particularly the confirmation that the £8 billion will be forthcoming. He says that the money is already in the system, but what the NHS really needs is to be reassured about how much of that £8 billion will be front-loaded in the spending review. Will he reassure the House that he will set out in the clearest possible terms that it needs to be delivered as early as possible?
Ben Gummer
When my right hon. Friend the Chancellor made his commitment in the autumn statement on this year’s spending, he said it was a down payment on the five-year forward view and expressed his determination to ensure that the NHS is protected and promoted in all areas of Government.
Dr Philippa Whitford (Central Ayrshire) (SNP)
The Minister mentioned successful trusts, but fewer than one in five predict reaching the end of this financial year in balance. That does not leave an awful lot of successful trusts. I echo the call for the funding to be front-loaded. Where are trusts meant to find staff if they are not allowed to use agency staff or nurses from overseas? Given that the deficit started to appear only in 2013—after the Health and Social Care Act 2012—does the Minister not feel that the Conservative party should review the direction of travel? The NHS was in balance from 2009 to 2013 and it has been on a downward slope ever since.
Ben Gummer
I will address the hon. Lady’s final point first, if I may. The previous coalition Government’s 2012 Act has saved considerable numbers—billions of pounds—which we would now have to make up if we had not made difficult decisions.
That allows me to address the hon. Lady’s first point. We have a choice: we can take the traditional view of politicians, which is to try to paper over the cracks and pour money into an unreformed system, or we can take the difficult decisions that will mean that we deliver patient care in the long term. That is what the Conservative party is willing to do: we are not only providing the commitment to funding, but taking the necessary, difficult decisions.
On the specific issue of agency nurses—one such example of difficult decisions—it is not so much the number of nurses available as the scandalous rates at which they were hired out to NHS trusts. We have taken action on that to ensure that NHS providers can procure agency staff when and how they need them at a reasonable rate.
Mr Kenneth Clarke (Rushcliffe) (Con)
Will my hon. Friend confirm that there have been no cuts in expenditure on the health service and that there have been no cuts in the total level of service? The problems at the moment are caused by the extraordinary pressures of an ageing population, clinical advances and rising public expectations. Will he continue to get the right balance between the needs of greater efficiency and responsible public financing, putting patient interests first and resisting short-term lobbying from trouble spots, which is a permanent feature of the politics of the NHS? In particular, will he resist any attempts by organisations such as the British Medical Association to turn controversy into yet another pay claim?
Ben Gummer
I thank my right hon. and learned Friend for his assurances on what needs to be done: he, more than anyone in the House, knows how to do it. Had the Government taken the Opposition’s advice and cut the money going into the NHS, we would not have achieved record numbers of doctors and nurses; we would not have halved MRSA and clostridium difficile rates; we would not have eliminated mixed-sex wards; and we would not have achieved record high cancer survival rates. All that has been made possible because of the funding commitments that the Government have made, to which the Opposition failed to commit at the election.
Norman Lamb (North Norfolk) (LD)
The Minister will be aware that failure to finance social care adequately has a significant knock-on effect on NHS finances. He will also be aware that the finances of NHS organisations are deteriorating rapidly, and that senior people across the system do not believe that the system can achieve the £20 billion of efficiency savings that are required. Before the election, I proposed a non-partisan commission engaging with the public, burying our political differences and working together to safeguard the NHS. I welcome the fact that he has indicated the need for that sort of approach, but will he now commit to it? The Secretary of State agreed to it in the election campaign, so will the Minister commit to work with all parties to come up with a new settlement making the necessary changes but also coming up with the necessary finances?
Ben Gummer
I thank the right hon. Gentleman, who was an exceptional care Minister in the coalition Government, but I am a little confused by his question. He was in post when the five-year forward view was delivered by the chief executive. Within that five-year forward view is a commitment to £22 billion of efficiency savings, and he did not raise his concerns at that stage. It is precisely those efficiency savings, presented by the NHS itself and on which we have embarked, that will allow the transformation to better care that we know is possible within the service.
Richard Drax (South Dorset) (Con)
We all have huge admiration for all the staff who work in the national health service. Visiting two community hospitals in my constituency in the past week, I saw that work at first hand. However, we are baffled by the bureaucracy that still exists in the NHS. Does my hon. Friend agree that we can go much further and be far more radical in cutting bureaucracy, not least, for example, by cutting the number of trusts? Is that going to be looked at as a whole to see if we can provide more money for front-line services?
Ben Gummer
My hon. Friend is entirely right. Every penny that we can save in bureaucracy and administration is a penny that we can spend on patient care, which is why the Secretary of State commissioned Lord Carter to look at the administration and bureaucracy that surrounds hospitals especially. Lord Carter has identified many billions of savings that can be made, and I anticipate that there will be more to come.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
The university hospitals trust in Birmingham, Edgbaston is balancing its books, but the neighbouring hospital, Heartlands, ran up a deficit of £5.6 million last year. In the first five months of this year, the deficit has reached £29.4 million. GPs in Worcestershire recommend that their patients are not referred to Worcestershire hospitals but to University Hospitals Birmingham NHS Foundation Trust. What action has the Minister taken to prevent those few hospitals that are balancing their books from being pushed over the edge?
Ben Gummer
The right hon. Lady makes the important point that exceptional hospitals such as her own not only balance their books, but have a management culture that allows them to deliver some of the best care in the country. She is right that there is a continuing challenge for all trusts, whether they are well managed or poorly managed. The measures that we have brought in, especially those on agency nurses, are designed to enable the chief executive of her trust to continue with that exceptional management in the years to come.
Henry Smith (Crawley) (Con)
I note with interest that the new Leader of the Opposition has said that the Welsh model for the NHS should be expanded to encompass the whole of Great Britain. I am interested to hear my hon. Friend’s views on that, seeing as Labour has significantly cut funding to the NHS in Wales.
Ben Gummer
My hon. Friend is entirely right that the new Leader of Her Majesty’s Opposition made that point. It is surprising because, as a representative, I would not like our A&E targets to be missed for seven years in a row, as has happened in Wales. If we replicate what has happened in Wales here in England, we will see worse care for patients. I am sure that Members from all parts of the House would not wish to see that happen.
Kelvin Hopkins (Luton North) (Lab)
Comparable developed countries spend a substantially higher proportion of GDP on health than we do. In my view, that means that our health service is substantially underfunded. Will the Minister report back to the House on those comparisons and explain why we spend so much less than those countries on health?
Ben Gummer
The hon. Gentleman is right that, in the past, the NHS has not had the funding that it requires. That is exactly why the Government have committed £10 billion to the NHS at a time when efficiency savings are being made across all other Departments. That is the mark of a party that believes in the NHS and the reason why only this party can fairly claim to be the party of the NHS.
David Tredinnick (Bosworth) (Con)
I suggest to my hon. Friend that one way to reduce the pressures on the service would be to make greater use of health professionals who are regulated by the Professional Standards Authority, which covers 13 mental health and wellbeing professions. What is the point of people getting statutory oversight, regulation and registration if the health service does not employ them to reduce the demand for its services?
Ben Gummer
My hon. Friend is right to point to this area of health policy as one that is of interest. That is why the Law Commission reported on professional regulation before the last election. It is being kept under close review within the Department.
Mr Speaker
We are straying a tad from the relatively narrow terms of the urgent question, to which I know colleagues will be eager to return, and none more so than the hon. Member for Strangford (Jim Shannon).
Jim Shannon (Strangford) (DUP)
I thank the Minister for his statement. This is a question for Members across the whole of the United Kingdom of Great Britain and Northern Ireland, where there are pressures on the NHS, because while we all have passion and love for the NHS, we must ensure that there is enough money for it. Will the Minister confirm the amount of money that will be there for accident and emergency departments and say what will be done on waiting lists?
Ben Gummer
The hon. Gentleman will know that funding for the NHS in Northern Ireland is not within my bailiwick. I therefore point him in the direction of the Northern Ireland Office and his Assembly. As far as England is concerned, I confirm that we will deliver not the £8 billion that the NHS has asked for, but £10 billion over the course of this Parliament.
Tom Pursglove (Corby) (Con)
The policy of advancing a new urgent care hub at Kettering general hospital has united politicians of all parties in north Northamptonshire, as well as the public. Does the Minister agree that we need more of that in our country—rather than petty bickering, people getting together to find solutions to these problems?
Ben Gummer
Conservative Members disagreed with my hon. Friend’s predecessor on many points, but he did great cross-party work with Members who were not of his political persuasion to find a good solution for urgent care in his area. I hope that we will follow that model on a larger scale across the country. If we can do that, there will be a much better resolution to the challenges facing the NHS. Patients and people want us to address those challenges without turning the whole thing into a political circus.
Marie Rimmer (St Helens South and Whiston) (Lab)
I agree that the use of agency staff places a great cost on the national health service, and I am sure the Minister will accept that cutting the number of training places for nurses and doctors at the beginning of the previous Government will have had an impact on that. St Helens and Knowsley teaching hospital is currently recruiting in Spain because it cannot recruit here. Recruitment and retention are crucial, and more than 50% of doctors now apply to practise abroad. Does the Minister think it sensible to further punish trusts that are in financial deficit—there are many across the country—by reducing their quality pay if they do not balance the books this year?
Ben Gummer
The hon. Lady asks about nurse training places, and this year the number of places is consistent with the number in 2010. The key point is not just the number of nurses in training, which is determined by NHS providers, but the number of nurses in hospitals serving patients and the public. The number of nurses is currently at a record high thanks to this Government’s actions.
Simon Hoare (North Dorset) (Con)
My hon. Friend may have missed the speech to the Labour party conference by the hon. Member for Lewisham East (Heidi Alexander). He may therefore be interested to know that she said that the Labour party would not be enforcing any efficiency savings in the NHS, including the £22 billion that the NHS itself has identified. Will he confirm that efficiency savings must be a concomitant part of NHS funding?
Ben Gummer
I saw the comments by the hon. Member for Lewisham East (Heidi Alexander), and the thing that confused me most is that she imagines that efficiency savings are a creation of this Government. They are not; they are the product of the “Five Year Forward View” that identifies the need to create £22 billion of efficiency savings over the next five years. Had she read the “Five Year Forward View” she would be aware that those efficiency savings are essential if we are to get the patient care and quality that Simon Stevens identified as a necessity for the service.
Wes Streeting (Ilford North) (Lab)
The House of Commons Library estimates the cost to the NHS from falls this year at around £2.45 billion. At a round table that I chaired last week with our local NHS trust it was clear that although the will is there to tackle the cost of falls, the resources are not. Is that a good example of how the under-resourcing of the NHS is harming patient outcomes and undermining the efficiencies that the Minister hopes to achieve? How will he address that and wider inefficiency in the NHS?
Ben Gummer
I point the hon. Gentleman to parts of the country such as Torbay, Greenwich and the soon-to-be-devolved Greater Manchester authority where the relationship and integration between social care and hospitals is producing exactly the kind of linked up action that he identifies for falls. If we can achieve that at local level we will have a truly integrated health and social care system that is not imposed from above but created by those who deliver care on the front line.
Rehman Chishti (Gillingham and Rainham) (Con)
I welcome the Minister’s statement. A comprehensive economic evaluation conducted last year by the London School of Economics and the Centre for Mental Health calculated that the annual cost of perinatal mental illness to the NHS is £1.2 billion, and the total cost to society is £8.1 billion. The Minister will know that on Wednesday I will introduce a private Member’s Bill that is supported by the Royal College of Psychiatrists and will save lives and costs. Will the Minister ensure that that is fully considered?
Ben Gummer
My hon. Friend raises an important matter that has also been raised by my hon. Friend the Member for South Northamptonshire (Andrea Leadsom). Given my responsibility for maternity services, I am particularly focused on the need to do better in perinatal mental health and maternity care, and I hope to say something about that in the not-too-distant future.
Teresa Pearce (Erith and Thamesmead) (Lab)
As far as I am aware, the Minister has not answered the question about the delay in issuing the report. If he cannot answer now, will he put a note in the Library and explain the reason for that delay?
Ben Gummer
I answered that point entirely accurately and categorically, and on behalf of the ministerial team I refute the allegation.
Robert Jenrick (Newark) (Con)
My local trust in Nottinghamshire, Sherwood Forest, is in a very bad financial position—one of the worst in the country. The primary reason is the appalling private finance initiative deal we inherited from the previous Labour Government, which consumes 17% of the trust’s annual budget. Would a new Parliament be an opportunity for the Government to look again at those appalling PFI contracts, particularly those that affect trusts such as mine that are in special measures?
Ben Gummer
Across the country, trusts are struggling under the load of poorly negotiated PFI contracts. It is worth remembering that when the Labour party speaks about all the money it put into the NHS, a large part of it was borrowed via PFI—that part which was not borrowed as part of Government debt. The important point about PFI is to try to address each contract in turn. The Department is looking at this on an ongoing basis, not only as it concerns old contracts but in the letting of new ones.
John Glen (Salisbury) (Con)
Salisbury hospital enjoys an excellent reputation across the constituency. On a recent visit, having completed a number of easily found cost reduction programmes, the management expressed their determination to continue with patient-level costing service by service and to pursue electronic patient records reform. They asked me to raise their concern about obtaining visas for specialist scientists at the hospital and the need to have a better joined-up service between primary, secondary and tertiary elements of the NHS.
Ben Gummer
I thank my hon. Friend for bringing the attention of the House to innovation at a local level. This kind of innovation, which will allow us to transform the service into an even better NHS in the years to come, is being repeated in many trusts across the country. If I may, I will reply to him by letter on the specific issue of scientists after I have investigated the points he has made.
Helen Whately (Faversham and Mid Kent) (Con)
In addition to needing extra funding, which the Government have rightly committed to provide, the NHS could and should make better use of its resources through better procurement, the use of technology and the employment of permanent rather than temporary staff. The challenge is how to do this at the necessary pace and scale. Will my hon. Friend advise what steps the Government are taking to drive the pace and scale of the changes that are important not only to improve productivity but for better outcomes and patient experience?
Ben Gummer
My hon. Friend identifies precisely the action we in the Department need to take. It would be a dereliction of duty to pour money into an unreformed system, as it would mean money being spent on administration, bureaucracy and waste, and not on the changes we need to improve patient care. We need to move at pace to bring in the changes necessary to transform the system if we are to get the NHS we all want to see.
Mr Peter Bone (Wellingborough) (Con)
I congratulate the shadow Secretary of State on an excellent urgent question and the Minister on how he has responded. It is interesting that there are more Government Members who want to ask questions. With regard to deficits, we have very expensive and highly paid management and accountants. They set their budgets and then a deficit develops. What action can be taken against these highly paid individuals for not keeping to their budgets?
Ben Gummer
My hon. Friend raises an important point. There are trusts that are being managed exceptionally well which hit the budgets they set at the beginning of the year. That is the normal course of business for other organisations. This is why my right hon. Friend the Secretary of State introduced the clawback on new chief executive contracts, which mean that if they do not perform according to plan then a proportion of their salary will be docked at the end of the year. That is an important reform, one not introduced by the previous Administration but by us, the party of the NHS.
Andrew Stephenson (Pendle) (Con)
May I echo the comments made by my hon. Friend the Member for Newark (Robert Jenrick)? Parts of the Royal Blackburn hospital and Burnley general hospital were rebuilt by private companies in 2006, under the previous Labour Government, at a combined cost of about £140 million. East Lancashire Hospitals NHS Trust will have to pay back almost £1 billion by 2041 because of the PFI contracts signed at that time. Does the Minister agree that the toxic PFI legacy is one of the biggest challenges facing most of our NHS trusts?
Ben Gummer
A considerable number of PFI contracts were poorly negotiated under the previous Labour Administration. They need to be looked at one by one, and the Department is committed to doing that again to see whether we can reduce the burden on trusts. My right hon. Friend the Secretary of State will have more to say about that in the course of the transformational changes that we are helping the NHS to make.
Right to Buy
Urgent Questions are proposed each morning by backbench MPs, and up to two may be selected each day by the Speaker. Chosen Urgent Questions are announced 30 minutes before Parliament sits each day.
Each Urgent Question requires a Government Minister to give a response on the debate topic.
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John Healey (Wentworth and Dearne) (Lab)
(Urgent Question): Will the Minister explain to the House the details of the voluntary agreement on the right to buy negotiated with the National Housing Federation and how it differs from his original statutory approach?
The Minister for Housing and Planning (Brandon Lewis)
As stated in our manifesto, the Government want to give housing association tenants the same homeownership opportunities as council tenants. Since the introduction of right to buy, nearly 2 million households have been helped to realise their aspiration of owning their own home. There have been 46,000 sales since April 2010, including more than 40,000 under the reinvigorated scheme introduced in 2012 by the last Government.
The Government want to help families achieve their dream of homeownership, but at the moment about 1.3 million housing association tenants cannot benefit from the discounts that the last Government introduced. We want to give housing association tenants the same homeownership opportunities as council tenants. At present, some housing association tenants have the preserved right to buy at full discount levels or the right to acquire at a much lower discount level, while others have simply no rights at all. This cannot be right. The Government want to end this inequity for tenants and extend the higher discounts to housing associations.
On 7 October, the Prime Minister announced that a deal had been agreed with the National Housing Federation and its members giving housing association tenants the opportunity to buy their home at an equivalent discount to the right to buy. This delivers our manifesto commitment to extend the benefits of right to buy to 1.3 million tenants. In summary, the deal will enable 1.3 million families to purchase a home at right to buy-level discounts, subject to the overall availability of funding for the scheme and the eligibility requirements.
The presumption is that the housing association will sell the tenant the property in which they live, the Government will compensate it for the discount offered to the tenant and the association will retain the sales receipts to enable it to reinvest in the delivery of new extra homes. Housing associations will use the sales proceeds to deliver new supply and have the flexibility, but not the obligation, to replace rented homes with other tenures, such as shared ownership. The Government will continue to work with the National Housing Federation and its members to develop new and innovative products so that every tenant can have the opportunity to buy or have a stake in their own home.
As part of the agreement, the Government will also implement deregulatory measures to support housing associations in their objectives to help support tenants into homeownership and deliver an additional supply of new homes. Boosting the number of sales to tenants will generate an increase in receipts for housing associations, enabling them to reinvest in the delivery of new homes. Housing associations will be able to use sales proceeds to deliver that new extra supply and will have the flexibility to replace homes with tenures such as shared ownership. Housing associations have a strong record in delivering new homes, as evidenced by the way we have exceeded our affordable homes target, delivering nearly 186,000 of them—16,000 more than originally planned for the period to 2015.
We want more people to be able to buy a home of their own, and extending the right to buy is a key part of that. It will give tenants who have that aspiration something to strive for that is achievable and give housing association tenants the opportunity for the first time to purchase their home at the same discount levels currently enjoyed by council tenants. We will now work closely with the sector on the implementation of the deal, and of course I will update hon. Members as we move through the stages of implementation.
John Healey
I am sorry that I have had to drag the Minister before the House this afternoon. I am disappointed that the Secretary of State made a written statement this morning, but is not prepared to account for himself to the public this afternoon on one of the Prime Minister’s central election pledges. The extension of the so-called right to buy to housing associations, funded by the forced sale of council homes, will mean fewer genuinely affordable homes when the need has never been greater. We will oppose it. This is a back-room deal to sidestep legislation and proper public scrutiny in Parliament.
We have said from the start that this is unworkable and wrong—and so it is proving. The Minister’s and the Secretary of State’s statements today are riddled with holes. They are promising 1.3 million housing association tenants the right to buy their own home. How many tenants will not, in fact, have this right next year? What about those in at least 37 housing associations who have said no to the deal, and those many more who have not been consulted and have not replied? What about those in the nine separate categories of the deal
“where housing associations may exercise discretion over sales”?
What about those caught by the Secretary of State’s weasel words this morning in the written statement, whereby all this will be subject to
“the overall availability of the funding of the scheme”?
What do tenants do when the landlord says no? How can this be a “right” to buy, with no legislation behind it? In truth, this is not a right-to-buy, but a beg-to-buy policy, and many housing association tenants will find next year that they have been badly let down by the Prime Minister’s promises.
I strongly back the desire of most of us to own our own home. That is why I commissioned the chief executive of Taylor Wimpey to do a report for me on the decline of homeownership, which has gone down each and every year in the last five years. This right-to-buy policy, however, is bad housing policy. Shelter warned that 113,000 council homes could be sold off to pay for it, with no-go areas for many lower income families to live in in many of our major cities and towns. What assessment has the Minister made of the number of council homes that will be lost, and when will he publish the full impact assessment of these plans, as he promised the House he would on 29 June, and when will Members be able to vote on these plans, as the Prime Minister promised on 27 May when he opened the Queen’s Speech debate?
The Minister has talked about one-for-one replacement of all homes sold—well, we have heard that before. In 2010, the same promises were made for council homes, and it has been five years of failure—not with “one for one”, but with one home built for every nine sold. So what is the Minister’s guarantee for a one-to-one, like-for-like replacement for both council and housing association homes sold under this scheme, and how many of these genuinely affordable homes sold by housing associations will be replaced by homes that are not?
Finally, this is a challenge for the Chancellor as well as the Minister. This policy fails the test of good social policy and the test of sound economics. It squanders a long-term asset by selling it on the cheap. Will the Minister commit to publishing a full value for public money assessment because taxpayers will bear the cost three times over—first, for the public investment to build the homes; secondly, for the discount to sell them; and thirdly, for the higher housing benefit bill that will come when these homes are bought to let again to tenants at full market rents. If the Minister and his party really want to occupy the centre ground, they should drop this extreme policy. It is a bad deal for tenants and a bad deal for the taxpayer.
Brandon Lewis
I have to say that the right hon. Gentleman’s opening remarks, when linked to his closing remarks, sum up where we are. I am disappointed that he seems to want to stop people having the right to own their own home. We will absolutely support people in that right. He talks about the written ministerial statement, but this happened because we have been very busy getting on with the business of delivering homes for people and the right to buy, rather than spending time talking about reports and process.
A few weeks ago, my right hon. Friend the Secretary of State and I spent a couple of days at the National Housing Federation conference talking to housing association members and their representatives. I am not sure whether the right hon. Gentleman was there—we did not see him—but we spent our time talking to the sector, and this is a deal from the sector. The housing associations now want to help their tenants into homeownership, and I applaud them for that. I think that they have done an excellent job in working to deliver a new model that presents a new opportunity to people throughout our country. Opposition Members seem determined to end that opportunity, and, indeed, the Labour party in Wales has stopped people having that aspiration.
This is a deal for the entire sector, as the sector itself has made clear. I am disappointed that the right hon. Gentleman has presupposed its stance by saying that it will oppose the deal. That puts him in an almost unique position. The tenants want the chance to buy, and the housing associations proposed the deal. It is disappointing that the right hon. Gentleman has set himself against them by opposing their deal, which we have accepted after the work that they have put in.
I am sure that, if the right hon. Gentleman looks at the way in which we are providing homes and the way in which the deal will work for people throughout the country, he will recognise that the new portability arrangements will, for the first time ever, give those living in sheltered or extremely rural accommodation who—even under the current scheme—have no right to buy their own homes a chance to do so. I am proud that we are able to deliver on the aspiration and that manifesto promise.
I noted the right hon. Gentleman’s points about the number of homes being built, which Labour Members have raised many times. Eventually, they will come to acknowledge that, in 13 years of Labour government, 170 homes were sold for every one that was built. We have announced that, under the reinvigorated scheme, it will be “one for one”: for every home that is sold, an extra home will be built.
Let me make the facts clear. In year one of the scheme, 3,054 homes were built. In the equivalent year, three years on—councils have three years in which to build—3,644 homes have been built. That is more than one extra home for every one that is sold. If councils do not build a home in time, we in the Government will take the money from them, and we will make sure that those homes are built as outlined in the scheme. The building of that one extra home will drive up housing supply.
I am disappointed that the right hon. Gentleman has not been joined by the shadow Secretary of State, the hon. Member for Hemsworth (Jon Trickett), but I am delighted that my right hon. Friend the Secretary of State is able to join me to state very clearly to the House that we will support people’s desire and aspiration to own their homes. We will deliver the right to buy to those 1.3 million tenants. I thank the housing associations for the work that they have done, and for their willingness to stand up and deliver for their tenants and the tenants of the future. This is the most powerful form of social mobility that we can deliver, and I am proud to be able to be a small part of that.
Mr Robin Walker (Worcester) (Con)
Perhaps I should declare a family interest, as my late father was one of the authors of the original right to buy policy.
Mr Walker
You are very kind, Mr Speaker.
I congratulate the Minister on his statement. Having raised the concerns of my constituents in housing association properties, I am delighted that this voluntary deal has been reached.
The Minister may be interested to know that Sanctuary Housing, which is the largest registered social landlord in the country and whose headquarters are in my constituency, has said not only that it thinks that the deal can be delivered with one-for-one replacement, but that it believes it can increase the supply of affordable housing over the next five years at almost twice the rate that it has been able to deliver over the last five years.
Brandon Lewis
My hon. Friend has made some very good points, particularly the point about his father. That scheme enabled so many millions of families to own their own homes, and I think everyone who has been involved in it should be very proud of that.
Over the last few months and especially over the last few weeks, at the National Housing Federation conference and since, we have been talking to housing associations which clearly want to use this deal to make their assets work and to build more homes. We must remember that it will drive up housing supply.
Alison Thewliss (Glasgow Central) (SNP)
The Scottish Government have taken action to abolish the right to buy for housing association and local authority tenants. We arrived at that position after observing the frustration of local tenants who could not gain access to stock because it was being sold up year after year. The pool of stock available to housing associations—particularly in cities, where land was not in great supply—was shrinking year after year.
I consider public housing—social rented housing—to be a public asset, and an important part of the infrastructure of our country. Why would a housing association providing housing for people with particular needs, such as disabled people, choose to invest in more expensive housing if that asset would be lost further down the line? Why would anyone invest in houses if they were not going to see that return and why would we continue to have that policy in particular areas where there is not enough land to replace them? We would just lose the investment that is there.
Has the Minister given any consideration to how this policy in England will affect housing associations that operate on a cross-boundary basis? Sanctuary Housing was mentioned earlier; it is a housing provider that operates both in England and Scotland. Scotland has protected the right to buy; England has not. Has any assessment been made of how this will impact on Scotland?
Brandon Lewis
On the properties the hon. Lady outlined, in the deal itself and the right to buy there are exemptions, but I do sympathise with her point. I understand how the Scottish Government came to the point that they did in terms of the frustration with housing supply because, as I have just outlined, Labour simply did not build the houses over their 13 years in government. The answer is that we need to make sure we are building the houses. I would encourage the Scottish Government that the solution is not to stop people having the right to buy their own home. I would encourage that and use the money from that to build the extra houses we need; if Labour had done that for 13 years, we would not have lost the 420,000 affordable homes that were lost in those years. We have increased those numbers in the last Parliament. We will do so again in this Parliament and, through the money coming in from right to buy, there will be that full replacement income for housing associations to build an extra home; that is the key to this.
Kit Malthouse (North West Hampshire) (Con)
I congratulate the Secretary of State and Minister on this most civilised of solutions. However, may I raise a point I have had discussions with them on on a number of occasions: exemptions for small rural communities where housing association properties are extremely valuable but also extremely hard to replace? Have we had discussions with housing associations about the same exemptions for those small communities as are currently embodied in council house right to buy?
Brandon Lewis
I thank my hon. Friend. He makes a good point. The housing associations have played a hugely important part through the way they have come forward with this deal and have recognised the mandate the Government got in the general election to deliver this. They have done an excellent job in this regard. This is about extending the right to buy and therefore the rural exemptions extend as well. Indeed my hon. Friend can see the deal on the National Housing Federation website and there are some examples there of the very point he has outlined.
Sadiq Khan (Tooting) (Lab)
As the Minister will be aware, there is a housing crisis in London. The cost of rent goes up each year and there are fewer and fewer homeowners in London. London does badly out of this scheme, which will be funded, as he is aware, by selling off family-sized social homes in London. In those circumstances, can he guarantee that the money raised from the right to buy sell-off in London will be ring-fenced to build genuinely affordable homes in London?
Brandon Lewis
The “extra home built for every home sold” applies to London. London will see more homes built as a result of this and, even under the reinvigorated scheme from 2012 onwards, in the first year some 536 homes were sold in London and 1,139 were built in the period, much more than one extra built for every one sold.
John Howell (Henley) (Con)
From listening to those on the Opposition Benches, we might get the impression that this is a stand-alone measure, but is it not a part of our broader programme to encourage homeownership among the widest collection of people in the country, and is this not a good illustration of how we are committed to doing that?
Brandon Lewis
My hon. Friend makes a good point. Yes, it absolutely is part of a wider package of work we have been doing and will continue to do to drive up home building as well as homeownership throughout different parts of the sector and with different types of tenure, while always remembering that 86% of our population want to own their own home and doing everything we can to support them in that aim.
Emily Thornberry (Islington South and Finsbury) (Lab)
May I pick up the point that has just been raised? I was very concerned that money raised from the right to buy in areas such as mine will leave the borough and possibly leave London altogether. The Minister has not really answered this point. It is vital that any money raised through right to buy is reinvested in the nearby area. We should therefore look at all schemes to include as much genuinely affordable housing as possible. For example, 900 homes are being built at 250 City Road in my constituency. The cheapest one-bed flat there is £865,000 so starter homes are simply not affordable there. Does the Minister agree that the only genuinely affordable homes at the 250 City Road scheme are likely to be those for social rent?
Brandon Lewis
This is a pretty simple question of supply and demand. To get more affordable prices, we need to build more homes, and I hope that the hon. Lady will support this process, which is about getting more homes built in London and in the rest of the country.
David Rutley (Macclesfield) (Con)
I am pleased to hear from the Minister’s answer that the principle of reinvesting the proceeds of sales is at the heart of the proposals. Does not this underline the fact that our party is here not just for homeowners but for home building as well?
Brandon Lewis
Absolutely; my hon. Friend makes an important point. We are hugely determined to drive up house building, having inherited from Labour in 2010—when the right hon. Member for Wentworth and Dearne (John Healey) was the Minister—the lowest level of house building that the country had seen since 1923. We have seen the figures rise, and they need to continue to do so. All the work going on at the moment is about getting more homes built in this country.
Andrew Gwynne (Denton and Reddish) (Lab)
New Charter Homes, a registered social landlord in the Tameside part of my constituency, has just announced 150 job losses. It says that this is a direct consequence of this Government’s right to buy and rent policies. What assessment have the Government made of the impact of those two announcements on registered social landlords’ business plans, and what support will the Minister give to housing associations such as New Charter to ensure that their financial stability is put on a firm footing for the future?
Brandon Lewis
I am almost at a loss for words. The right to buy for housing associations has not yet come into force, so how a housing association can be taking that view now is beyond me, particularly when we bear in mind that our policy will create more work for them. We want them to use the income from right to buy to build more homes, which will mean more work for the housing associations.
Dr Sarah Wollaston (Totnes) (Con)
I welcome the Minister’s confirmation that housing associations in rural areas will continue to have an exemption. However, can he reassure those small communities in rural areas with very high housing costs, such as those in my constituency, that if the housing associations choose not to avail themselves of the exemption, any like-for-like replacement will be provided in the same area? If such replacement were provided in a distant town, our rural communities would be depleted.
Brandon Lewis
My hon. Friend makes a good point, and I thank her and her colleagues for the time that they put in over the summer to talk to their local housing associations about the deal that the associations were working towards putting to us. It is important that people recognise that the rural exemptions will continue. We are extending right to buy and the rural exemptions are in right to buy. She will also be able to look at the portable option that the housing associations are putting forward.
Greg Mulholland (Leeds North West) (LD)
The Conservatives cannot seriously believe that the way to deal with the housing crisis is to give developers carte blanche to build unaffordable housing, including on green-belt sites, while attacking social housing. This is not a policy of aspiration for the millions on social housing waiting lists, for those living in overcrowded accommodation or for those with no home at all. Will the Minister tell us why there is this discrimination between those who are in social housing and those in the private rented sector? Many in the latter category are desperate to get into affordable social housing. What will he do to prevent the homes that are sold from being put into the private rented sector, as has happened to 40% of previous right-to-buy homes?
Brandon Lewis
First, 86% of the people in our country want the chance to own their home, and we make no apology for supporting them. On right to buy, we are talking about the housing associations building more homes. As we have already heard, a number of them—including some of the largest, such as Sanctuary, Orbit and L&Q—see this as a way of ensuring that their asset base can be used to deliver the extra homes that we need, to ensure that housing supply goes up. For those people in the private rented sector, I absolutely want to continue to do everything possible to support their aspiration to own. That is what Help to Buy is about, and it is what the 200,000 starter homes announced by the Prime Minister and the Chancellor of the Exchequer last week are about. I hope that the hon. Gentleman will support us in our programme of work.
Andrew Stephenson (Pendle) (Con)
I am pleased that my constituency’s largest housing association, Housing Pendle, is delivering 122 new affordable homes this year. Will the Minister confirm that extending the right to buy to housing association properties will mean more money overall, with money being released to build new affordable homes, thus helping more families to access the good quality, affordable homes they so desperately need?
Brandon Lewis
My hon. Friend makes an excellent point. He has a good example in his local authority area of a housing association that is keen to build, and this scheme will allow it to access its assets to build more and to use that income to make sure it is building more homes to increase supply across our country.
Ms Karen Buck (Westminster North) (Lab)
Listening to the Minister, one would almost think he had not presided over a collapse in homeownership in this country during the past few years. In inner-London areas we face the prospect of losing up to three quarters of our social homes, which has led even the leader of Conservative Westminster Council to say that this is going to lead to the loss of a swathe of social housing. It is all very well for the Minister to say that he is going to replace in London, but people do not just live in a city—they live in communities, they live near their work and they live near their children’s schools. Will all replacement homes be built within the same local authority, where council housing and housing association properties have been sold off?
Brandon Lewis
First, I say to the hon. Lady that the drop in house building that led to the drop in homeownership started under the Labour Government. In fact, the right hon. Member for Wentworth and Dearne (John Healey), who is on the Labour Front Bench, said that he had no problem with a fall in homeownership, but I have a different view. This Government want to make sure that we drive up not only home building but homeownership. We will do anything we can to support that, and this deal that the housing associations have put forward will help to increase the supply of affordable homes right across our country, including in London.
Mr Peter Bone (Wellingborough) (Con)
This is one of the best policies the Government have introduced. We are hearing the 1980s arguments all over again from Opposition Members. The truth of the matter is that when a property is sold, that person still lives in that property; I spoke to my local housing association over the weekend and it is really keen on this idea, because it will be able to invest in one and a half homes with this money—that is one and a half extra families with a house to live in. How can anyone possibly be against that?
Brandon Lewis
As ever, my hon. Friend makes a hugely important point. I, too, am baffled as to why any Opposition Member would want to disagree with the housing associations, with their tenants, with the people of this country, who gave us a mandate to deliver this policy, and with the 86% of people who want the opportunity to own their own home. This approach will send housing supply up—he is absolutely right about that. A key point is that for every home sold this will mean at least one extra home being built. That increases housing supply. It is simple mathematics.
Ruth Cadbury (Brentford and Isleworth) (Lab)
The hon. Member for Wellingborough (Mr Bone) said that the people who will buy their home will live in their home, but the evidence from the council housing right to buy shows that not to be the case, certainly not in London. What assessment has he made of how many of the homes to be sold under this policy are likely to become private rental properties—often at high rent and let to people in housing need who have no hope of owning their own home?
Brandon Lewis
When a home is sold under the current right-to-buy scheme, there are restrictions on what people can do for a period of time, and that will continue in the extended scheme. Ultimately, many years down the line, I absolutely defend the right of any homeowner to do with their home what any other homeowner can do, be it selling it or living in it, but there are protections for the first few years after purchase.
Tom Pursglove (Corby) (Con)
I strongly support the right-to-buy approach and welcome what the Minister has had to say today. There are, however, concerns in Barnwell in my constituency relating to the replenishment of homes sold in rural areas, particularly given that a highly desirable new housing association development has just come on stream. What assurance can he give my constituents in Barnwell?
Brandon Lewis
I have two points to make to my hon. Friend. First, for every home sold an extra home will be built in that area. Secondly, depending on the particular details of the area, the rural exemptions may apply, too. At the very least there will be an extra home built for every home sold.
Ms Margaret Ritchie (South Down) (SDLP)
Other than the right-to-buy scheme, what funding options has the Minister explored to provide social housing? Where I come from, the right-to-buy scheme—within the Housing Executive but not within a housing association—simply removes social houses from those who cannot afford to provide a home for themselves.
Brandon Lewis
As I said earlier, I cannot speak for the Scottish Government, although I do encourage them to build more houses. [Hon. Members: “Northern Ireland!”] The whole point of this scheme is that, for every house that is sold, an extra home will be built. I say to the hon. Lady that the affordable house building scheme has delivered ahead of its targets, and we are now delivering at the fastest rate for more than two decades. I say to all Opposition Members that the Conservative-led coalition Government delivered more social council housing in five years than Labour did in 13 years.
Jim Fitzpatrick (Poplar and Limehouse) (Lab)
I share the worries of many of my colleagues about replacement local provision. I assume that these sales will be under leasehold provision. The Minister knows that a number of us in the House have concerns about the weakness of the regulations covering people who own leasehold properties. Will he assure us that he will continue to look at leasehold reform as part of these proposals as well as separately?
Brandon Lewis
Yes, I am happy to reassure the hon. Gentleman that we will continue to look at leasehold reform and to ensure that protections are there for leaseholders in the future.
Mr Kevan Jones (North Durham) (Lab)
In my constituency, Cestria Community Housing and Derwentside Homes have been building new homes both for rent and for sale. The things that have skewed their business plans have been the cap on rents and this right-to-buy proposal. Would it not be easier if the Government were to underwrite some of the borrowings of those housing associations that want to build, such as the two that I have just mentioned?
Brandon Lewis
Obviously, rent changes are going through the House at the moment, but this right-to-buy scheme helps housing associations build more homes. It gives them access to more finance and a greater realisation of their assets, and I support that. With regard to the rent changes, bearing in mind the savings that are going on right across the public sector, looking for efficiencies of 1% a year from housing associations is not unreasonable. Many housing associations are embracing that idea.
Angela Rayner (Ashton-under-Lyne) (Lab)
The New Charter Group is a major social housing provider is my constituency. How can its housing associations support right to buy with no staff? As my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) said, a loss of 150 jobs has been announced today. Inevitably, that will mean poorer services for tenants and fewer homes built for local people. Will the Minister meet New Charter’s management and the union Unison, which represents the workers? What action will he take to protect our social housing for the sake of current and future tenants?
Brandon Lewis
What I say to housing associations and generally is that we do need to ensure that we are efficient in our use of public funds and of tenants’ income. Housing associations should be looking at that and at whether they have the right mechanisms and structures in place. I cannot comment on particular housing associations, but right to buy will mean that there is more work for them to do in terms of building those extra homes that we want to see right across the country.
Jim Shannon (Strangford) (DUP)
In Northern Ireland, there has been a significant rise in the number of people who want to buy their properties. After five years, they can get a discount of up to £24,000. Quite clearly, it is a popular scheme and one that I support. Will the Minister confirm whether the investigation that was carried out by the Office for National Statistics will also be carried out in Northern Ireland? If so, will the Minister responsible for that area in the Northern Ireland Assembly be contacted first?
Brandon Lewis
I am happy to have a conversation with the hon. Gentleman outside the Chamber to make sure that we get this matter into the right place.
Andy Slaughter (Hammersmith) (Lab)
Like the Minister’s rent and planning policies, this is all about the destruction of social rented housing, especially in high-cost housing areas. It is a piece of tawdry social engineering that exacerbates the housing crisis. Will he answer this question, which he has been asked several times and which he has refused to answer? Where council properties are being sold—we are talking about 50%, with more than 6,000 being sold in Hammersmith—will they be replaced like for like in the same borough so that people can move into those homes before the housing waiting lists get worse than they are at the moment?
Brandon Lewis
The hon. Gentleman keeps talking about replacements as if homes are disappearing, but they are not. When people buy their home through right to buy, they will be living in that home. The income from that in the area will be used to build extra homes. The simple answer is that we want extra homes to be built, and I should have thought the hon. Gentleman would want to support us and his local authority in seeing more homes built to support the homeownership aspiration of people in London.
Wes Streeting (Ilford North) (Lab)
I am afraid that there could not be a wider gulf between the Minister’s responses this afternoon and the reality facing ordinary Londoners, who are finding it increasingly hard not just to own but to rent their own home. Since he has so far shown himself incapable of answering very simple and straightforward questions from my right hon. Friend the Member for Tooting (Sadiq Khan) and pretty much every other Member from London, let us give him another go. Will the Minister answer this question without obfuscation: will he guarantee that any home sold under the scheme will be replaced like for like in the locality from which it has been sold, such as a London borough? That is a straightforward question, so may we have a simple answer?
Brandon Lewis
I thank the hon. Gentleman for the tone of his question, but he should bear in mind the fact that to have more homes available in London across the tenures, we need more homes to be built. Right to buy accesses finance to allow local authorities to build extra homes. More homes will be built—not just replacements —in London for Londoners.
Catherine West (Hornsey and Wood Green) (Lab)
I declare an interest as the vice-president of the Local Government Association. Is the Minister aware of the cross-party disquiet among local government leaders, adding to their headaches about the announcement he is about to make of the cuts for this Christmas? Has an assessment been carried out by the DCLG of the impact on London’s economy of this backward move?
Brandon Lewis
I am not sure that I follow the hon. Lady’s exact point. For example, the chairman of the LGA is absolutely in favour of right to buy and supports the aspiration of people who wish to own their own home. The Government will continue to do that.
Points of Order
Sir Nicholas Soames (Mid Sussex) (Con)
On a point of order, Mr Speaker. I rise on a very serious matter indeed: to ask you whether you have had any request from the hon. Member for West Bromwich East (Mr Watson) to seek your permission to make a personal statement apologising for the way in which he has so vilely traduced the late Lord Brittan, and further for him to have a chance to apologise to Lord Brittan’s dignified and courageous widow?
Mr Speaker
I am grateful to the right hon. Gentleman for his point of order. The short answer is that I have had no such request. It is incumbent on each Member to take responsibility for his or her statements within this House, and there is a wider obligation, of course, to comply with the expectations and requirements of the code of conduct that applies to all Members. However, the hon. Member for West Bromwich East (Mr Watson) is signalling to me that he would like to respond to what has been said and it is right that he should have the opportunity to do so.
Mr Tom Watson (West Bromwich East) (Lab)
Further to that point of order, Mr Speaker. I understand that right hon. and hon. Members feel aggrieved that Leon Brittan was interviewed by the police and that they are angry with my use of language, but I am sure that they would also agree that when anyone is accused of multiple sexual crimes by numerous completely unrelated sources, the police have a duty to investigate, no matter who it is. My letter was prompted by Jane’s concern that procedures were not followed. It is not for me to judge the validity of these claims, but I believe I was right to demand that the guidelines were adhered to. I also believe that very many victims in this country have been too terrified to speak out for too long. It is not all over just because a few famous people have gone to prison, and it has not all got out of hand just because people in high places are scared. The survivors of child abuse have been belittled and ridiculed for too long. That is the real scandal here.
Earlier, the Prime Minister said that I should examine my conscience. I think we all need to examine our consciences in this House. We have presided over a state of affairs in which children have been abused and then ignored, dismissed and then disdained. If anyone deserves an apology, it is them. [Interruption.]
Mr Speaker
Order. This is not an occasion for a debate on this matter, and to be fair I do not think any Member would expect such. The right hon. Member for Mid Sussex (Sir Nicholas Soames) has perfectly properly raised his point of order—I thank him for the terms in which he has done so—and the hon. Member for West Bromwich East (Mr Watson) has responded, and we must now leave it there and proceed with our next item of parliamentary business.
Robert Neill (Bromley and Chislehurst) (Con)
On a point of order, Mr Speaker.
Mr Speaker
Order. The hon. Gentleman must resume his seat. If he seeks to raise a totally unrelated point of order—that is to say, not related to anything that we have just covered and on which I have given a definitive ruling—I will hear him, but I rather suspect from the prevarication that it is not totally unrelated.
Mr Speaker
Order. The hon. Gentleman will speak when I give him the opportunity and not before. If he has his opportunity, he had better not be a chancer and he had better not fluff it.
Robert Neill
I hope, Mr Speaker, that you will give guidance to Members as to the proper means of raising legitimate concerns about public authorities, to ensure that matters that should properly be raised, which concern all Members of this House, are not handled in such a way as might appear to impinge on the independence of judicial and investigative processes.
Mr Speaker
The hon. Gentleman is kind—I have known him for years and he has always been kind—but he somewhat over-interprets my brief and my wisdom. It is not for the Chair in this House to counsel Members as to how to proceed in such matters. We have, as citizens, the same rights as everybody else. In respect of our membership of this House we have certain additional freedoms and privileges, which must be exercised with great care; we also have responsibilities, and I referenced those, as the hon. Gentleman will acknowledge, with particular regard to the code of conduct. I know that the hon. Gentleman only ever seeks to be helpful, and I hope that he is either content or will at any rate today satisfy himself with my response. We will leave it there.
Backbench Business
Superfast Broadband
Matt Warman (Boston and Skegness) (Con)
I beg to move,
That this House notes variations in the effectiveness of roll-out of fixed and mobile superfast broadband in different parts of the UK; and calls on the Government to host a not-spot summit to consider ways to tackle this issue.
Hon. Members reading the Order Paper could be forgiven for thinking that this debate is about the roll-out of superfast broadband across the UK, but it is about much more than that. It is about making sure that the farmer in my constituency who needs to communicate with DEFRA can do so without driving miles to a nearby town. It is about making sure that he can grow his business and employ more people. It is about the disabled woman in a hamlet in my constituency who must currently choose between paying £20 a month for a dire mobile connection or face the isolation of living effectively without access to much of the modern world. It is also about the school in the heart of urban Boston teaching some of the most vulnerable young people, and doing so sharing a single 4G connection because their existing broadband connection is not good enough.
Broadband makes a profound difference today to businesses, to shopping, to entertainment, to education, to healthcare and to everything that goes with life in the 21st century. The £1.2 billion of public money invested so far could not have gone on a better cause, and we should remember that the coverage obligations imposed on a single 4G licence amount to a further £2 billion of public subsidy. But at its heart today’s debate is about making sure that we do not allow the digital divide to widen and deepen. A one-nation Government must deliver the same digital opportunities for all of us.
Ian C. Lucas (Wrexham) (Lab)
The hon. Gentleman talks about a one-nation Government. Does he think that it was a mistake in 2010 for the incoming coalition Government to jettison the Labour Government’s commitment to universal broadband, which would have delivered what he has described?
Matt Warman
I will come on to the universal service later.
The possibilities that the web offers to level the playing field between rural and even deprived urban areas and the best connected will alleviate the pressure on roads and on almost every public service that we offer. Although we are in the middle of a roll-out programme that has been among the fastest in the world, there remains a widening and deepening digital divide in Britain.
Mark Field (Cities of London and Westminster) (Con)
I warmly welcome not just this debate, but my hon. Friend’s words about the importance of this issue. He stressed, and I want to put on the record, the concerns that many of us have, even in the centre of this capital city, here in central London, where there are major problems with superfast broadband, and the importance of ensuring that we have as much competition as possible to put BT and Virgin Media on their mettle to make sure that we get the improvements for which my hon. Friend is so passionately making the case.
Matt Warman
I stress to my right hon. Friend that this is a debate not about rural broadband, but about national broadband roll-out. It is likely that by the end of 2017, 95% or 96% of British premises will be connected, but the one in 25 or one in 24 premises that will not be connected are not evenly spread across the country. Without serious investment in helping to connect the final 5%, we risk isolating not only individuals but entire communities, and splitting the super-connected and those for whom the 21st-century economy is another country.
Ms Karen Buck (Westminster North) (Lab)
I congratulate the hon. Gentleman on introducing this debate. Does he, like the right hon. Member for Cities of London and Westminster (Mark Field), recognise that central London and Westminster, with its enormous economy, is seriously compromised by slow broadband speeds? If anyone from BT is watching this debate, is it not extraordinary that a local authority has to ask the population if they want superfast broadband in order to be able to make representations for such investment? Is it not obvious that, as the hon. Gentleman says, individuals, businesses and the economy deserve superfast broadband speeds?
Matt Warman
Indeed, and I suspect that people from BT will be watching this debate closely. It is right that connecting the whole UK on an even footing offers opportunities greater than those from the roll-out of the railways or the motorway network.
Mark Spencer (Sherwood) (Con)
I recognise that my hon. Friend represents a very rural constituency, like Sherwood. Does he recognise the frustration of my constituents and his when they hear discussion about the difference between superfast broadband and broadband, when my constituents are on dial-up and can get only a very small document downloaded in an hour?
Matt Warman
Absolutely, and I am keen to emphasise throughout this debate the huge range of connections, where we have people on a gigabit for the same price, effectively, as people on dial-up. Today’s debate calls on the Government to hold a “not spot” summit, although at times Members could be forgiven for thinking that Prime Minister’s questions, Business questions, Department for Environment, Food and Rural Affairs questions and Treasury questions are all “not spot” summits.
Neil Parish (Tiverton and Honiton) (Con)
I thank my hon. Friend for holding this debate. In Devon and Somerset we find that BT is getting to those easier to reach areas and leaving the “not spots” and harder to reach areas behind. May we urge the Minister, through the debate, to put more pressure on BT to get out to those hard to reach areas, instead of taking the lowest hanging fruit, as it is doing at present?
Matt Warman
Indeed. At its heart, the debate is about getting the best possible value for money for taxpayer subsidy and making sure that the commercial roll-out goes as far as it can.
Robert Neill (Bromley and Chislehurst) (Con)
Given the importance of value for money, does my hon. Friend accept that in London, where four of the 12 constituencies with the worst roll-out are located, it is particularly important that the summit has proper data on unused fibre capacity and on upload speeds, both of which are critical to maximising the value obtained from the network?
Matt Warman
Transparency is critical. On that point, 17% of the UK still does not even have the option of a superfast broadband connection, and 8% of the country cannot receive the 10 megabits connections that Ofcom says are required for mainstream services, and 500,000 still lack even basic broadband.
Tom Tugendhat (Tonbridge and Malling) (Con)
My hon. Friend is making a brilliant speech. I would like to mention one of the many communities in my constituency that are divided by this. In Ightham, half the village can access some rural broadband from BT, but to the other half BT is promising things that it will simply never deliver, because it has realised that the economics do not add up. In the meantime, companies such as Gigaclear seem to be rolling out broadband perfectly happily to villages such as Plaxtol and Golden Green. Will he please urge the Minister to encourage more competition, and therefore greater roll-out?
Matt Warman
I would be delighted to do that, and I welcome the mention of what I think will be the first of several small villages to be mentioned in this debate—
Several hon. Members rose—
Matt Warman
Perhaps I could just finish my sentence before giving way.
There is a universal service obligation coming at 2 megabits a second, and there are moves to raise it to 5 megabits in the autumn, and that still falls below what Ofcom says is the typical need. As BT’s roll-out continues, many of the villages that I am sure will be mentioned later will find that their connections are improved. However, the communities that stand to benefit most are those that economically are the hardest to roll out to, so it is vital that whatever Government subsidy is available is pushed as far and as fast as possible.
Victoria Borwick (Kensington) (Con)
I concur with those colleagues who have mentioned the issues in central London. Obviously, all Members across the House welcome the push to ensure that more of the country has broadband and superfast broadband, but I am concerned that there are still a significant number of “not spots” in our capital city. Will my hon. Friend please ensure that his “not spots” include those in central London. I am speaking in particular about constituents in Kensington. I urge him to look again at the relationship in London with BT—
Matt Warman
In the time remaining I want to look at three crucial issues, all of which are aimed at providing maximum value for taxpayers’ money and, crucially, promoting maximum competition so that the free market drives the roll-out as far as possible. The first issue is transparency. It is a source of huge concern to all our constituents who do not have superfast broadband that it is often impossible to find out when, if ever, they might get it. Councils are often unwilling to reveal that, for reasons of commercial confidentiality, despite assurances from Ministers and BT that they can do so.
Dr Julian Lewis (New Forest East) (Con)
I am incredibly grateful to my hon. Friend, who has surely come to recognise that he will not get to the end of his speech until every single Member in the Chamber has mentioned one village in their constituency. Does he accept that even when BT does reach out, as in the case of Beaulieu in New Forest East, in the next-door village of Boldre the “not spot” remains? I have mentioned two villages, and each has been treated very differently.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Before the hon. Gentleman proceeds with his speech, I must inform the right hon. Member for New Forest East (Dr Lewis), and the rest of the House, that regrettably he is wrong. The hon. Gentleman will get to the end of his speech without taking interventions from every Member in the Chamber. That would simply be unfair, because 41 hon. Members have indicated to me that they wish to make a speech. I will impose an initial time limit of four minutes, but it is likely to be reduced to three minutes later in the debate, because there is another important debate to follow. If hon. Members think that the Chair will not notice if they make long interventions on the opening speaker, they are also wrong. I am watching very carefully, and if anyone thinks that they can make a long intervention now and then be called to make a speech later, I am afraid that they will have to think again.
Matt Warman
Thank you, Madam Deputy Speaker. I think I need all the help I can get with these interventions.
Hon. Members should accept that it is not possible to produce a 100% accurate map of everywhere that superfast broadband will go. There are areas where commercial roll-out, Government-subsidised roll-out and decent mobile network speeds will not make it. I call on the Government to ensure that there is much greater transparency on where those areas are and that that is a central outcome of the summit which I hope will result from this debate. It is not enough for mobile networks to provide maps relied on by businesses that imply comprehensive coverage when in fact people have to stand in the middle of the road or hang out of the window. It is not enough for my constituents to struggle to determine when BT’s roll-out will get to them. I would rather give them bad news than no news so that communities can start to work out what they can do for themselves.
Graham Stuart (Beverley and Holderness) (Con)
Twenty-five per cent. of all businesses in England are based in rural areas—a greater proportion than that of the population—and yet companies such as Agenda Security Services in my constituency have had to invest tens of thousands of pounds to get any kind of usable service while their counterparts in cities have no such disadvantage.
Matt Warman
Absolutely; the contrast is the most painful thing.
I would hope that greater transparency might come from BT, but it may come across all networks only with much tougher regulation. That transparency would also allow companies and councils to make a better case for putting state aid into areas where it is not currently permitted.
Matt Warman
If I can just get on to my second point, I am sure my hon. Friend will be able to have another go.
The second issue is the role of BT within the current roll-out. I am sure many Members will say that BT is, in effect, a monopoly and that its Openreach division should be split off, and accuse the company of creaming off Government subsidies and spending them on sports rights while failing to provide a consistent service across the country. In my constituency and across Lincolnshire, BT’s roll-out is ahead of schedule and under budget. Moreover, with take-up ahead of expectations, unexpectedly large revenues are being ploughed back into extending the network further than we had expected. None the less, rival networks will say that Openreach could raise more money and invest more widely as a separate company.
Alex Chalk (Cheltenham) (Con)
Is there not an important issue about priorities? In my constituency there are places on dial-up speeds. They do not have broadband at all, let alone superfast broadband, and the concern is that they are not being prioritised in the state money used by BT.
Matt Warman
I absolutely sympathise with those problems.
It is unfashionable for Members of Parliament to admit that there are things they do not know, but as someone who covered broadband’s roll-out as a journalist for 10 years or so, I admit that I do not know whether the roll-out would be better if BT were to be split up as a company. I am certain, though, that regulation needs to be simpler and more rigorous however the company ends up, because we must promote more competition. I am also certain that Ofcom’s assessment of what is best must be absolutely robust so that whatever decision is reached is not a matter of perpetual debate. I urge the regulator to consider all possible options now.
Stephen Timms (East Ham) (Lab)
I agree with the hon. Gentleman about the importance of greater competition. Whatever the future for BT, does he not agree that it is extraordinary that so far all the public subsidies for superfast broadband roll-out have been handed to a single company? How can that promote competition?
Matt Warman
The money that has been handed to BT occurred after a tendering process. We should not forget that.
Some argue that splitting up BT would delay this vital roll-out unnecessarily. I would say that we should not put our principles before a vital national infrastructure project, and that if any delay would harm businesses and families, Ofcom should assess what the impact of breaking up BT might be in the short term.
Patricia Gibson (North Ayrshire and Arran) (SNP)
It is all very well to talk about competition, but we are discussing a form of social exclusion. I speak as somebody who has the dubious distinction of having a constituency that is ranked 592nd out of 650 on broadband access. In North Ayrshire and Arran, 32% of data zones have no access to superfast broadband—including Arran, parts of Dalry, Largs and Cumbrae, West Kilbride and Seamill—and there is a higher than average number of “not spots”. It is all very well to talk about competition, but does the hon. Gentleman agree that we must remember that we are discussing the social exclusion of those who have no access?
Matt Warman
I agree that access to broadband is an issue of social inclusion. However, I remember as a journalist visiting the highlands and islands of Scotland to see BT’s publicly subsidised roll-out, so those areas have benefited.
Simon Hoare
In the spirit of promotion, I am grateful to my right hon. and gallant and learned Friend for giving way. Setting aside philosophical ideas about competition and splitting up BT, does he agree that most of our constituents—this is certainly true of mine in North Dorset—are just keen to get the damned thing delivered as quickly and as cost effectively as possible, to allow them to grow their businesses? Would it not be sensible to park the governance discussion until a later date and to focus today on the delivery?
Matt Warman
I humbly disagree with my hon. Friend. Although it is right to focus on the roll-out of our current plan, we are in the process of making a plan for the final 5%. That is why this is the right time to have this debate and for the Government to focus on “not spots”.
Sammy Wilson (East Antrim) (DUP)
I thank the hon. Gentleman for giving way; he is being very generous. Does he accept that, even though this is a publicly subsidised roll-out to try to counteract market failure, far too often BT approaches it from a purely commercial point of view and that it is simply used as another way to extend the profitable parts of the market?
Matt Warman
I give way to the Chair of the Culture, Media and Sport Committee.
Jesse Norman
I am grateful to my hon. Friend for the diligence and energy with which he has pursued this topic into this debate and I apologise for missing the start of it. As he may be aware, my Committee is still interested in taking evidence on the universal service obligation and in receiving submissions from constituents and from colleagues across the House. The work will begin fully next month.
May I share with my hon. Friend a thought on BT? It is not just a question of whether the relationship of BT to Openreach is supporting competition. It is also a question of whether Openreach is itself being starved of capital because it is located within BT with its new, emerging consumer and retail orientation. If it at least had its own balance sheet it might be able to borrow at very low rates and therefore support capital roll-out with it.
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Even the hon. Gentleman, who makes extremely good arguments, must make them quicker and briefer than that. We will never get through this debate if people keep making long interventions. It simply is not fair.
Matt Warman
I agree with my hon. Friend that that is the counter-argument to keeping BT together.
Finally, the issue of a universal service obligation, which I mentioned briefly earlier, must be addressed in a more meaningful way. The current 2 megabits per second must be raised, but to raise that dribble to a mere trickle of 5 megabits per second is not enough when 10 megabits should be regarded as the minimum. We must accept that some parts of the country will exceed the minimum by much more than others and therefore set the minimum as high as is practically possible. I for one would like Ofcom to consider whether the current definition of superfast broadband could be that minimum, in line with the aspirations of various Governments around the world, especially when taking into consideration fixed broadband and mobile signal. That will be especially important, as a host of niche schemes come forward across the country, to connect the final 5%.
Additional mobile spectrum may be the answer, but according to Ofcom it will not be available for use until 2022, which will not provide much hope for many of our constituents. 4G will not reach 98% of the UK population until 2017, leaving millions currently with no manageable broadband connection, wireless or fixed.
The solutions to the final 5% will be many and varied, and I am sure that more companies will join those that have already used church towers, tractors and their own trenches to build a new network where it was previously thought impossible. Satellite must play a part, as will many of the exciting new projects in the Government innovation fund.
Mr Alan Mak (Havant) (Con)
I thank my hon. Friend for securing the debate. Many hon. Members have talked about the problems experienced in urban and suburban areas. Villages such as Northney in my constituency are both rural and coastal. Can he assure me that in his work and engagement with Ministers those communities will not be forgotten?
Matt Warman
As a Member of Parliament for a rural and coastal constituency, I can assure my hon. Friend that they will absolutely not be forgotten.
To conclude, if the Government are to achieve their manifesto commitment to near-universal superfast broadband by the end of the next Parliament, as well as ultrafast broadband at nearly all UK premises as soon as is practicable, a brave regulator, much greater transparency and serious Government investment must be forthcoming. Some 12% of our GDP is generated through the internet, which puts the UK significantly ahead of other countries. That status will only be maintained if we do everything we can to further narrow the digital divide, and I hope the Government will agree that the “not spot” summit for which the motion calls will be a positive and constructive part of that vital process.
Several hon. Members rose—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Before I call the next speaker, I shall announce formally what I indicated earlier: I have to impose a time limit of four minutes on Back-Bench speeches.
Albert Owen (Ynys Môn) (Lab)
It is a pleasure to follow the hon. Member for Boston and Skegness (Matt Warman). This is not the first occasion on which he has initiated a debate on this subject. It is good to see the Minister. He is a great survivor, and has been in the same role since 2010. Not only is he knowledgeable but he is responsible for many things. He cannot blame the previous Government, but he can blame himself for some of the issues that I am about to raise.
I represent a rural and periphery constituency—an island community. Although the hon. Member for Boston and Skegness said that this is not just about rural areas, they do suffer the most. There is a double whammy for periphery communities. If people live far from large towns and cities they have to pay more for their utilities—they are not on the gas mains, for example, and mobile phone coverage is poor by comparison. Too often, rural and periphery areas are in the slow lane, so we need Government subsidies to help address that. A lot of money has been allocated, but in many areas the 95% threshold in the Government agreement with BT is simply not good enough. I have long supported universal coverage. We should start from 100%, and if there are issues, we should tackle them, rather than set a low bar of 95%, as that 5% is predominantly in rural and periphery areas.
In the recess, I went out with BT engineers to see for myself what the issues were in my predominantly rural area. I saw some of the problems that they had to consider when they rolled out broadband and moved from copper to fibre. Yes, it is a big task for them, but they have received a lot of money to do it. I suggest that the Minister should consider going for universal coverage.
There are a number of players in the field—it is not just about whether it is private or public—including the regulator, the UK Government, BT and service providers. They keep blaming one another, and the Minister and the Department should get a grip on that and place responsibility where it lies. The Welsh Government have taken a lead in Wales with a roll-out programme that brings together UK Government money—the European Union has helped with state aid—the Welsh Government and BT. I can confirm that the result in Wales is slightly better than in most parts of England. The Minister should look at best practice in devolved Administrations. In my constituency, 80% of cabinets are live, so 80% of households can access broadband, but other areas—the 5% I have mentioned—are hard to reach.
Albert Owen
Do I get an extra minute if I give way, Madam Deputy Speaker? If so, I will give way.
Jake Berry
I draw hon. Members’ attention to my declaration of interest as a property owner on the island of Ynys Môn. Does the hon. Gentleman agree that an island such as Anglesey would be a perfect place to roll out mobile broadband, given that Holy Island, which is just off the coast, is relatively flat with some high points? Have the Welsh Government considered using the European money to roll out mobile broadband to get to those hard-to-reach properties?
Albert Owen
It is good that I get the extra minute, and the hon. Gentleman has also covered a couple of pages of my speech. I am happy to defend and fight for his interests and those of his parents on the island.
The serious point is that we want the £129 million clawback to be used properly. The Welsh Government have offered grants of £1,000 to the 5% of difficult areas, £900 of which the Welsh Government provide from that pot of money and £100 of which comes from the customers and community groups that want the wireless connection. I urge the Minister, who is a very reasonable person, to look at such things rather than have a summit because, with the greatest of respect, summits are about talking and what my constituents want is action.
My constituents do not want to be in the slow lane. They do not want to be on the periphery when it comes to 21st-century technologies. I would have liked to see pilots in rural areas. Smart metering for gas and electricity is the next big issue for the country, but the providers are already saying that they cannot reach 100% of households. I want my constituents and constituents in other rural and peripheral areas to be first-class citizens in this country. They must have not only the same rights and responsibilities, but the same services. Rural areas need to compete with large towns, so we need 21st-century infrastructure. Those who say that the market can deliver should look at the mobile phone coverage in my area. It is very poor and patchy, and the market is not delivering. We want all the main players to work together to ensure that rural and peripheral areas get 100% attention and 100% broadband and mobile coverage.
Nick Herbert (Arundel and South Downs) (Con)
I thank the Minister for everything he has done and is doing to promote the need for broadband in our constituencies. There is general agreement across the House that superfast broadband can no longer be regarded as a luxury, but is becoming increasingly essential for public services, individuals and businesses. There is a danger that a digital divide is opening up for the households that will not be able to access superfast broadband under the proposals.
It is an achievement that such a large number of additional premises have been connected to superfast broadband and that so many will be by 2017. I recognise the Government’s subsidy and support for that, as well as the work of the Minister. He tells me that some 19,000 premises in my constituency will receive superfast broadband by 2017 owing to the public funding. However, that means that some 6,500 premises in my constituency will not be able to access superfast broadband. That is not 5% or even 10% of premises in my constituency, but 15% or one in seven.
Catherine West (Hornsey and Wood Green) (Lab)
Is the right hon. Gentleman aware that this is not just an issue for rural communities? Even in the London Borough of Haringey, there is a massive gap in provision in the Alexandra Palace area, which is increasingly seeking to be a destination for leisure and so on.
Nick Herbert
The hon. Lady makes her point well, but she will forgive me for being concerned about rural areas, since I have a rural constituency of some 250 square miles.
I wish to raise two issues. First, the time has come for us to address seriously how the digital divide will be closed. There is an existing programme and I recognise that it is steadily increasing the number of premises that can access superfast broadband, but it is clear from the Government’s figures that there will be a gap. As hon. Members have said, what our constituents want to know is how that gap will be closed.
Here is a clear case of market failure. The market says that it does not have the resources to supply the remaining percentage of difficult-to-reach households. There is a case for ensuring that public subsidy is directed at securing access for those areas that are hardest to reach, and that will undoubtedly involve a mix of technologies. I doubt that satellite technology will provide sufficient access speeds for the future, but we need to hear how the Government will ensure that rural areas are not permanently disadvantaged. Some households in my constituency can barely access broadband at all—they have the lowest possible speeds—let alone access superfast broadband. They need to hear now about future plans, recognising that their neighbours have successfully achieved that superfast access.
I believe there is a lack of competition in this area and that a shake-up of the market is needed. It is not satisfactory that 75% of new superfast broadband customers on the Openreach network are BT or BT subsidiary customers. Openreach has seen a decline in investment in that area, particularly with the copper wires that are still necessary because we do not have fibre-to-the-premises connection. The customer service provided by Openreach is simply unacceptable. One of my constituents had a delay of up to 20 months when receiving a phone line from BT, and 2,500 Sky broadband customers in my constituency who rely on Openreach have reported a fault. We know that Sky provides about one third of that service in my constituency, which means that 7,500 constituents have been affected by poor customer service. That is a constant report from my constituency.
Some 82% of my constituents wait for more than 12 days if they want to switch from BT to Sky, and there is evidence that investment by BT has been going not to the essential infrastructure necessary for Openreach but towards the acquisition of sporting rights for BT Sport on which more money has been spent. We should not be willing to accept that situation, and the merger between BT and EE is likely to make things worse because Openreach will be a smaller entity within the overall size of the group and will not be focused on such issues.
The time has come to persuade Ofcom to take a serious look at the lack of competition in this area and make a referral to the Competition and Markets Authority. We would not accept such a lack of competition in the energy sector, yet there are fewer providers in the telecom sector for broadband than in the energy sector. The electricity market was referred to the CMA; it is now time for a similar referral for broadband to ensure that we increase investment in the area, that we have a disruption to encourage new entrants to the market, and that we future-proof new technology so that we close the digital divide.
Ronnie Cowan (Inverclyde) (SNP)
I congratulate the hon. Member for Boston and Skegness (Matt Warman) on securing this debate. I am aware of his continued interest in this area, and it is an interest that I share as I have more than 35 years of experience in the IT industry.
The technology required to facilitate the universal roll-out of high-speed broadband across the UK already exists. If a village in rural Sweden can have superfast broadband, so can any village in the United Kingdom if money is invested to provide it. If superfast broadband coverage on the Isle of Wight can reach 90%, so it can on any other island in the United Kingdom. Existing technology will no doubt continue to develop and improve, and it can provide homes or businesses in the UK with superfast broadband if there is the will and funding to provide it.
That is easy for me to say, but we have a precedent. Throughout the 20th century the UK Government have had to meet the rapidly changing technological challenges of the time, whether the establishment of a reliable telegram service, or the affordable installation of telephones in family homes. Our youngest constituents would be perplexed by the idea that providing multiple premises with a shared telephone landline was once the pinnacle of our technological achievements.
The economic, business and social advantages of superfast broadband are self-evident. Indeed, lack of connectivity stifles business growth and can accelerate emigration, particularly in fragile rural communities. I am aware, for example, that the rural communities of Durness and Tongue in Sutherland are to get fibre-optic broadband.
It is welcome that these small centres of population will have access to quality broadband services, but the same cannot be said for the small crofting communities in between the two villages—a distance of about 20 miles. One of those missing the opportunity of high-speed broadband is the internationally renowned ceramics artist, Lotte Glob. Her business, which is based in Laid on the shores of Loch Eriboll, is severely restricted by her lack of access to superfast broadband. I have no doubt that each and every Member, if they were inclined to, could identify such businesses in their constituencies. Lotte’s is just one of many.
It is not only rural communities that are affected, however. Many urban areas are plagued by difficult economic conditions and the associated problem of emigration. Increased connectivity can be an important tool in reversing this trend. Inverclyde has a relatively low availability of superfast broadband of at least 24 megabits compared with other constituencies. It is important to appreciate the gap in service provision between urban and rural areas, but we must also recognise that it is too simplistic to characterise the issue as primarily affecting only rural communities.
Gavin Newlands (Paisley and Renfrewshire North) (SNP)
Does my hon. Friend agree that, despite the fact that his constituency and mine are neighbours in the central belt, there are areas such as Bridge of Weir and Houston that might as well be on the dark side of the moon when it comes to broadband speeds, and that the superfast broadband roll-out provides an ideal opportunity to end the postcode lottery on broadband speeds?
Ronnie Cowan
I would, and I could add to that list Kilmacolm and Inverkip since we are playing that game.
Businesses in Inverclyde and across the UK will attest to the competitive advantage that super high-speed broadband gives them. Their ability to research, advertise, communicate and sell is enhanced by having access to the fastest possible connection, as well as a customer base that has good broadband speeds. To underline the importance of broadband services, we need only to listen to the Federation of Small Businesses, which believes that access to fast, reliable broadband is now essential for a modern business and should be considered alongside other utilities such as gas, water and electricity. FSB research also found that 99% of small firms rate the internet as “highly important” to their business, with 51% of FSB members already offering services online and a further 15% planning to do so in the future.
I look forward to seeing more detail about the UK Government’s commitment to a universal service obligation for broadband, in addition to more information about what is considered an appropriate speed requirement for a legally binding obligation. It is surprising that the current USO commits only to internet speeds appropriate to dial-up modems. The FSB indicated that in 2014 there were still about 45,000 businesses operating on dial-up internet speeds, which is simply unacceptable with the current technology we have at our disposal.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
The hon. Member for Boston and Skegness (Matt Warman) mentioned the investment of public funds in the highlands and islands. What he perhaps did not mention was that funding actually coming from the Scottish Government, the Highlands and Islands Enterprise and councils to help to develop broadband. Does my hon. Friend agree that that is making the difference for the highlands and islands?
Ronnie Cowan
It is certainly a great enhancement to the process we are trying to force through.
The Scottish Government are helping to meet this demand through the Digital Scotland Superfast Broadband programme, which is divided into the highlands and islands project and the rest of Scotland project. Significant progress has already been made towards the goal of 95% coverage of superfast broadband in Scotland by 2017. The Scottish Government are undoubtedly making great strides in rolling out superfast broadband across the country, particularly when our challenging geography and spread of population are considered, yet even if we meet our target of 95% of premises with superfast broadband by the end of 2017, there will still be a small but significant number of people without access until 2020. I therefore commend Scottish Government’s measures being implemented to ensure that we eradicate all “not spots” from our network. The rural broadband scheme is just one example. Its £9 million of additional funding will reach out to harder-to-reach areas that might not otherwise benefit from the wider programme.
Whether it is grandparents Skyping with their grandchildren, students researching for exams, gamers burning the midnight oil or businesses trading with customers and clients, the experience is more positive and beneficial on a faster secure connection. Therefore, as we make the final push towards universal coverage, it is vital that we accelerate the rate of implementation and ensure that none of our constituents is left behind.
Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)
I thank my hon. Friend the Member for Boston and Skegness (Matt Warman) for helping to set up the all-party group on broadband and digital communication, which we chair together. He rightly said that neither of us was an expert in the field of technology, but along with colleagues in this House and the other place we are passionate about getting broadband rolled out across the country. It is important to remember that the group was set up in response to the incredible feedback we received during the election from people absolutely sick to death of not being able to get broadband. Somebody said to me in Somerset: “We have broadband apartheid”. It was possibly over the top, but I understood what they meant.
I wish to speak about the problems in my constituency and in Somerset more widely. In fact, three of us from Somerset are here, as my hon. Friends the Members for Wells (James Heappey) and for Taunton Deane (Rebecca Pow) are also in their places. [Interruption.] Of course, I give way to my hon. Friend the Member for Wells.
James Heappey (Wells) (Con)
Forgive me, I was not trying to intervene; I was merely indicating that our hon. Friend the Member for Somerton and Frome (David Warburton) was also present.
Mr Liddell-Grainger
I apologise. It was mentioned before that my hon. Friend is here, but I thought he had gone. So four out of five Somerset Members are here.
One of the big problems in Somerset is that we have tied ourselves up with Devon in Connecting Devon and Somerset. The Minister has been extremely helpful, but we are one of the few parts of Britain that does not have a phase 2 plan. The county councils—not the MPs—not only did not sign the agreement but leaked to the BBC the fact that they were not going to sign it before they told us, which left us in a difficult position. One problem now is that the Minister and his team are trying to arrange procurement through Europe so that we are not left behind. I believe the only other area of Britain that has not got 95% roll-out tied up is Scotland—I am sure one of its Members will correct me if I am wrong.
Places such as Exmoor will have to rely on wireless technology, as might places such as the Mendips and the Blackdowns, but that will not help when surrounding areas, in Somerton and Frome—get that in—and elsewhere, are missing out because we cannot guarantee the same roll-out across the whole area. In Exmoor, they will have to put up 50 masts, which is an enormous number for a national park to give permission for. Is it not better to work with BT—exasperated as some of us are with it—to get superfast cable out? It is not satisfactory just to go for satellite, as my right hon. Friend the Member for Arundel and South Downs (Nick Herbert) said, or wireless. It is not the same. As my hon. Friend the Member for Boston and Skegness said, the technology is not up to it.
We are in a difficult position, because unless we roll out broadband across the United Kingdom, including in places in Scotland such as Inverclyde and elsewhere, people are going to get more and more disillusioned. In areas such as ours, where people depend on broadband if they want to work from home, we cannot get it. It is still quicker in parts of Somerset to send a letter than an email. In parts of Exmoor, people cannot get television without a Sky box. Does anyone want to put all their eggs into Mr Murdoch’s basket? The answer is no. So the situation is difficult right across the area.
The Minister has an extremely good team in the Department—I know because I have met them—helping with procurement in Somerset. Chris Thompson, who heads that team, is first rate. We need to take this further. The time allocated for this debate is not adequate—three or four minutes per speech is not enough to get the message across. Could we continue the debate at another time, either through the Backbench Business Committee or in Government time?
Will the Minister announce that his team will help the areas in difficulty? He now helpfully sends out his monthly bulletin, which is extremely good and gratefully received, but places such as Devon and Somerset are stuck, partly owing to the incompetence of councillors—I will not mention names, unfortunately, but he knows who I am talking about—and partly because people are not prepared to take this seriously. I therefore urge him to announce today that his team will help these places. We have heard from places such as Inverclyde. There is no difference between Inverclyde and Somerset and Devon. We are all in the same boat, and it is going down, and we have certainly lost the paddle.
Stephen Timms (East Ham) (Lab)
I, too, would like to congratulate the hon. Member for Boston and Skegness (Matt Warman) on securing and opening the debate. The question I want to address is why, as we are hearing from the debate across the Chamber, this roll-out is proving so disappointing. [Interruption.] The Minister says it is not, but one simply has to listen to the contributions made from Members from rural and urban areas to realise that there is deep disappointment about what is happening.
I think that the essential problem—the Minister knows my view—is that Ministers have lost sight of the lesson that competition needs to be at the heart of telecommunications policy. We have heard lip service paid to competition since 2010, but have seen no serious attempt to drive forward competition in telecommunications —and now we are paying the price, as seen in the complaints aired in this debate.
Earlier this month, there was a very interesting leading article in The Financial Times, pointing to the willingness of the Conservative party
“to cosy up to corporate champions and established business interests.”
It continued by saying—Conservative Members should listen—that the Conservatives’
“penchant for protecting corporate interests is not healthy. With productivity still the UK’s biggest economic challenge, their instinct should be to promote competition. Politicians of the Thatcher generation must be astonished that the lesson still needs to be learnt.”
I think The Financial Times is absolutely right.
Richard Drax (South Dorset) (Con)
I am delighted to hear an Opposition Member talking about competition. If the right hon. Gentleman’s new leader has anything to do with it, there will be no competition—there will just be the state.
Stephen Timms
I simply refer the hon. Gentleman to the many examples of the effectiveness of competition in telecommunications policy—perhaps most strikingly in the design of the 3G spectrum auction in 2000. That auction was structured to make absolutely sure that there was a new entrant, and one of the licences was taken up by a company that had not previously been in the market. I think we would all agree that over the last 12 years that new entrant has had a dramatic impact on reducing prices, improving quality, extending coverage and promoting innovation. There is no shortage of examples of the beneficial impacts of competition.
As I said in my intervention, it remains astonishing to me—I raised the issue with Ministers at the time—that no effort was made to ensure that there was at least some diversity of provision in the publicly funded roll-out of superfast broadband. Instead, all the money has gone to BT. The consequence today is that BT has Ministers over a barrel. Ministers have no levers whatever to address the problems we are hearing about from Members of all parties—and they are getting progressively worse—relating to our disappointing position on superfast broadband roll-out.
I make no criticism of BT, which has simply done what any effective company would do when presented with a gift horse—it has accepted it. It is now recognised that BT was overpaid for the infrastructure it provided, so it has to start paying back some of the handout it received. Usage of the infrastructure has been a good deal higher than predicted, so BT is paying back some of the windfall it has enjoyed, but I believe only half of it. As with the 3G spectrum auction, this exercise should have been structured to make sure that there was at least some diversity of provision. Other companies bid; BT beats all of them every time. We therefore have nobody else with which to compare BT’s performance, no alternative approaches to consider and no levers at all through which the Minister could try to promote better services in the future.
In a few minutes, the Minister will do his duty and assure us that everything is fine with the roll-out of superfast broadband, but the reality, as this debate is making clear, is otherwise. What Ministers need to do even at this very late stage is to relearn the lessons embraced by their Conservative predecessors and to find ways to inject some competition into this market—a market that, as we are rightly being reminded, is very important for the productivity and prosperity of Britain.
Caroline Nokes (Romsey and Southampton North) (Con)
I, too, congratulate my hon. Friend the Member for Boston and Skegness (Matt Warman).
I shall try to keep my comments brief, because many Members are present. I am sure that that is because we all share the same frustration at the slow roll-out and the lack of availability of fast broadband, especially in rural areas. I use the word “fast” rather than the word “superfast” because in chunks of rural Hampshire we aspire not to superfast broadband, but just to something that is usable. Town and country appear to have split, and not even neatly, into the haves and the have-nots, with the digital divide most keenly felt in villages where downloading from Netflix is merely a romantic dream and the mundane tasks of tax returns and communicating with the Rural Payments Agency , or even just shopping online, are at best painfully slow and at worst impossible.
Lucy Frazer (South East Cambridgeshire) (Con)
My hon. Friend is highlighting all the important aspects of being connected to the internet, and of broadband, to individuals. Will she also acknowledge that the rural economy is worth £400 billion, and that it is therefore especially important for rural areas to be connected to broadband?
Caroline Nokes
My hon. Friend has made an excellent point, which I shall deal with later in my speech.
At this point, I could lapse into a great long list of villages in my constituency where broadband is slow and unreliable, but let me first point out that this is Hampshire. It is not Inverclyde, or rural Somerset, but a county that is the largest in the south-east and has a population of nearly 2 million. At its closest point, my constituency is just 65 miles from Westminster—not, of course, that that appears to be a guarantee of good service: as we heard from the right hon. Member for East Ham (Stephen Timms), London suffers as well. Earlier this year, the villagers of Barton Stacey were celebrating the upgrade of the nearby exchange at Sutton Scotney because they finally had access to a speed of 0.5 megabits. That is the harsh reality for people in such villages. Anything is better than nothing, but it still is not good enough to enable someone to do their homework.
Let me briefly turn to the positives. The National Audit Office has reported that phase 1 of the roll-out is progressing well, but the Minister’s own figures indicate that, by the end of 2017, 13% of my constituency will still be waiting. The superconnected cities vouchers were a great initiative, but rural businesses tell me of their frustration that they were not eligible although they had started from a worse position.
Across the Test valley, planning policy has for years been to convert redundant farm buildings into commercial premises. We have countless attractive barn conversions where entrepreneurs are employing people and contributing to the national and rural economies, but are being hampered from competing in a digital world. Their perfectly reasonable question is, “If this is crucial for urban businesses, why is it less important for the rural ones?”
Of course, the problem is not limited to businesses. Home owners moving into new developments often find that fast broadband is not only not available, but not even scheduled to be available. New developments appear to have been simply forgotten as part of the process. One constituent in Stanbridge Lakes was recently quoted a figure of £27,000 to be connected, an amount way beyond the means of any ordinary person.
I urge the Minister to make superfast broadband a requirement for developers as part of the planning process, and potentially as part of the section 106 process. In 2015, no one would dream of building a development with no access to electricity, water or adequate drainage, but it seems to be perfectly possible to build large housing developments with no access to the fibre network. According to information from Hampshire county council, Hampshire will not, in fact, have 95% coverage by the end of 2017. It will be September 2018 before wave 2 of this complex engineering project reaches that target—across the county, that is; rural constituencies such as mine aspire to a target of 87%. I know that there are satellite solutions—of course there are—but, according to my constituent David Hepworth, from Up Somborne,
“good reviews of satellite broadband seem rather hard to find”.
Householders, local authorities and businesses all feel that they are over the proverbial barrel. The only game in town is BT, whose reputation in villages such as Sherfield English, Lockerley, West Tytherley and East Dean is poor. The service is slow and patchy, phone lines are notoriously unreliable, and there is a lack of capacity. Contractors even routinely disconnect one household in order to add a line to another: that has happened four times to one of my constituents, Ian Forfar. A resident of Lockerley has had her phone number unilaterally changed by BT with no warning, and Mrs Sara Gruzelier of West Dean has told me that BT seemed perfectly happy to send her husband and Brigadier Hargreaves (retired)—with a combined age of 150—up a ladder to do its job for it.
What my constituents want is some reassurance from the Minister that he will look at the timescales for roll-out, make sure promised deadlines are met and that alternative technologies are in place for the 13% who suffer from that digital divide, and work with DCLG and local authorities on new developments. None of this is unreasonable, but for rural areas of Romsey and Southampton North it seems a long way from Openreach and more like “out of reach”.
Alan Brown (Kilmarnock and Loudoun) (SNP)
Like other Members, I welcome this debate. Setting percentage targets for the UK as a whole can mask huge variations within regions, as we have heard from many hon. Members. That is why a debate and ongoing scrutiny by Members are required.
This was further demonstrated by the fact that, just as the UK Government have set a 95% UK target for connectivity to superfast broadband, the Scottish Government have done likewise for Scotland. However, the reality is that for this to happen in Scotland the Scottish Government and local authorities have had to invest more money than has been provided from Broadband Delivery UK. That is not how I would foresee the funding proportions working. Going forward, I hope there will be further UK moneys for the 5% gap. This also shows that future strategies on broadband and mobile coverage need to focus on difficult-to-reach areas from the outset so they can set true budget requirements. That needs to be considered for 4G.
My constituency has a large rural element, and there is undoubtedly a lack of broadband access in some of the rural areas. I also represent Kilmarnock, which is one of the bigger towns in Scotland, and worryingly there is an area in Kilmarnock that still has broadband connectivity that is, to quote a resident, “worse than dial-up”.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
My constituency has superfast broadband connectivity of 61%, far below that of many other urban constituencies in the UK, and certainly falling short of the UK average of 79%. Does my hon. Friend agree that roll-out seems to be inconsistent, with some constituencies appearing to receive a higher priority than others?
Alan Brown
I agree, and we have heard that from other Members today, too. My constituency has a similar connectivity rate.
There is an area of Kilmarnock that is not going to have superfast connectivity. That is because BT has decided it is not economic. This follows on from inadequate investment in infrastructure previously by BT. I call on BT to reconsider that.
Returning to rural considerations, an early engagement I had as an MP was attending a BT Openreach consultation event in a local village. What struck me was that the majority of the people who attended went away disappointed because they lived in the rural locality and so would not be included. This is typical of the difference between expectation and reality in terms of broadband.
It is a fact that HMRC and agricultural claims have to be done online, and welfare requirements and job applications will have to be done online in the future, too. We also know that more people want to work from home. This again illustrates the fact that we need better rural connectivity.
I would contrast this slightly with the UK Government’s £150 million investment to have connected cities. That is welcome, but it exacerbates fears for those areas still missing out and left in the final 5% sweep-up. There are concerns about how long that is going to take.
The Industrial Communities Alliance publications “Whose Recovery” and, more recently, “Growth Beyond the Big Cities” illustrate perfectly that only certain regions of the UK have had any form of sustained recovery and, importantly, city growth often does nothing for the wider rural hinterland, both in terms of wider job growth and access to city jobs because there are issues to do with connectivity to the cities. We must ensure that in future rural areas do not have the same connectivity issues online.
I stay approximately 25 miles from Glasgow city centre, yet my constituency is one of the 10% most affected in terms of households with broadband access of less than 2 megabits per second; and currently only 69% of households have access to superfast broadband. These statistics illustrate the contrast within my constituency and neighbouring constituencies. A more detailed analysis is required of the UK general target of 95% coverage for superfast, and we need to understand that some households are missing out. My constituency is also in the bottom 10% with regards to unemployment statistics. The wider rural area has open-cast coal legacy issues, and unfortunately the UK Government are washing their hands of that.
I call for additional UK broadband funding to allow digital access for all. That would be a good way forward. It is counter-intuitive to have connectivity issues where there is higher unemployment and in some cases general remoteness. That point will be echoed in other constituencies. A “not spot” summit should look at how that marries with unemployment and at where there is the greatest need for future investment.
The Scottish Government have made their commitment clear and are doing all they can, and in my constituency have been supported by the local authority. I call on the UK Government to develop a strategy, to provide the necessary funding for those who will currently miss out on superfast broadband, and to provide timescales for that.
James Heappey (Wells) (Con)
I congratulate my hon. Friend the Member for Boston and Skegness (Matt Warman) on securing this debate and on all his hard and well-informed work on this subject. I also congratulate the Minister on indulging my fairly regular correspondence on these matters and replying promptly and thoroughly every time.
I also welcome the work of the Connecting Devon and Somerset programme, which for all its faults has accelerated its work over the summer, and ever more homes are now coming online not only in my constituency but across those counties. I am encouraged by the Minister’s comment in his letter to me last week suggesting that phase one will reach 82% coverage in my constituency, but that clearly means there is a great deal left to do in phases two and three, and I wish to make some points on those phases.
First, there is a belief that there is an inherent flaw in the fibre-to-the-cabinet model that is being rolled out. Across the Wells constituency, and I suspect in similar constituencies across the country, as cabinets go live there are large numbers of properties—indeed, whole villages—that do not benefit from the upgrade of the cabinet because the run of copper from the cabinet to the villages or houses is too long. I encourage BT and the programmes across the country, particularly Connecting Devon and Somerset, urgently to embrace the fibre-to-the-remote-node solution so that fibre can be taken much further into those villages and premises can benefit.
Neil Carmichael (Stroud) (Con)
My hon. Friend is making some very good points, and the key one is about BT and the question of competition, which was amply made from the Opposition Benches today. Does my hon. Friend agree that we need to see more competition, certainly in respect of BT?
James Heappey
I very much agree. It has been suggested to me by people whose analysis I have come to trust that the fibre-to-the-cabinet model suits BT and it is therefore rather convenient that Openreach should be pursuing that model. It seems to me that if Openreach were not a part of the BT group and was completely independent it may be free to pursue other models and technologies that might work just as well for other service providers and therefore, crucially, deliver more competition in those communities.
There is an urgent need for transparency. According to statistics provided by Ofcom, the Wells constituency is ranked 593rd out of the 650 constituencies represented in this House for broadband coverage of 24 megabits per second or better. The statistics show that coverage in my constituency is 43%, but in the course of my correspondence with the Department for Culture, Media and Sport the Department has suggested that the constituency has 62% coverage. That lack of clarity and certainty over the state of the roll-out is very worrying as we go cabinet by cabinet, village by village and indeed house by house to ensure that every single premises, be it domestic or commercial, is connected. I cannot believe that the only way to get a snapshot of the coverage in our constituencies is to provide the electoral roll to the programme so that it can examine every single house. There must be a better way of giving us the data we require.
We are talking today about “not spots”, and my concern is that they relate not simply to broadband but to mobile coverage, too. As the industry moves towards bundling, whereby the providers of television, mobile, broadband and landline services will provide bundled packages, the difference between the haves and the have-nots will become ever more stark. We therefore need to future-proof the solution that we are delivering, and to ensure that, across the country, superfast broadband and genuinely decent mobile coverage—ideally with 3G as its benchmark—are achieved sooner rather than later. I very much welcome the fact that the aim of this debate is to call for a “not spot” summit. I simply ask that we do not hold that summit until all of us are equipped with the data we need to contribute to it properly on behalf of our constituents.
Stuart Blair Donaldson (West Aberdeenshire and Kincardine) (SNP)
The main problems that fill my inbox on a daily basis are complaints about BT, so it is fitting that my office manager has texted me today to inform me that our internet connection has gone down. So, BT, if you are listening—that needs to be fixed. Given that BT is a telecommunications company, communications with its customers seem to be a particular problem. For superfast broadband roll-out in Scotland, it has been given £286 million collectively from the Scottish Government, Scottish local authorities, the EU and the UK Government. It is therefore unacceptable for BT to push back installation dates for business by three months from the original date. It is also unacceptable for someone to have to take two days off work to wait for an engineer who fails to turn up. A survey of my constituents has shown that only 33% were contacted to tell them of delays or cancellations relating to their appointments. That is unacceptable.
Furthermore, given the levels of public investment in the programme, it is also unacceptable for BT-employed contractors to be sent from Glasgow to north-east Scotland to do a 10-minute job. For those unfamiliar with the geography of Scotland, that is roughly a six-hour round trip. My constituents have found it extremely difficult to complain to BT about their issues. They contact the company, only to find that they have to contact Openreach, which then bounces them back to BT. For many customers, BT Openreach is one and the same company, and this grey area makes it even more difficult for BT to be held to account.
Rural areas will achieve their full potential only with the arrival of superfast broadband. BT continues to roll it out to rural areas, but significant issues remain, as the hon. Member for Wells (James Heappey) mentioned. There might be fibre to the cabinet, but the use of copper wires means that anyone living more than 2 miles from the cabinet is unlikely to receive superfast broadband. The situation is made even more frustrating by BT’s odd choice of locations for the fibre cabinets. For example, in the village of Marykirk in my constituency, the cabinet is three quarters of a mile from the village centre, at the bottom of a flooded field.
Rural areas such as those in my constituency need BT to provide a consistent and reliable service. We also need to be able to hold BT to account for the service it delivers. That is why we must give serious consideration to Ofcom’s review and the proposal to split BT and Openreach. For rural areas to survive and thrive, we need a reliable, fast internet infrastructure capable of sustaining 21st century jobs and lifestyles.
Victoria Prentis (Banbury) (Con)
I add my thanks to my hon. Friend the Member for Boston and Skegness (Matt Warman) for securing the debate, and to the Minister for listening to our tales of woe today.
I can start on a slightly happier note than some did. It was not in the first week of May this year that my family’s lives were changed significantly, but in the first week of March. Previously, the internet in our small village had not been at all reliable at peak times, or when it rained, as it occasionally does in north Oxfordshire. Then, overnight, my husband stopped commuting and joined the army of those who work at home, I found that I could answer emails in seconds, and the children found to their amazement that they could watch reruns of “Top Gear”, on a variety of devices, in every room of the house. For me, the advent of superfast broadband will for ever be associated with Jeremy Clarkson. Quite simply, reliable fast internet changed all our lives.
I am sure that the Minister is as proud as I am of our local branch of Broadband Delivery UK. I was able to meet representatives of the branch during the recent recess. Better Broadband for Oxfordshire is committed to doing just what its name implies. To date, it has delivered on target, on time and under budget for the two years it has been in existence, and it is ranked fourth in the country for delivery. It can surely be no coincidence that the Minister represents the neighbouring constituency to my own. Better Broadband for Oxfordshire is funded from a variety of interested groups, including our local enterprise partnership, BDUK and our district councils. Despite all this excellent work, however, much of my casework still concerns the lack of broadband.
One issue is that commercial providers of broadband declare an interest in providing services for a particular area. If they are successful, those declarations remain valid for three years, and the service might not be provided until the end of that period. That is a long time for a village or an industrial estate to wait. Better Broadband for Oxfordshire has in some cases needed to challenge those delays, and has on occasion needed to take over the delivery of the service. However, a better solution could be to shorten the period allowed for delivery, and to insist that the service is provided in a timely fashion.
Another big issue in Oxfordshire is attenuation. Much of our network is still reliant on old copper lines, and copper replacement will need to take place if we are truly to realise the potential of broadband, but that will require enormous investment. The older lines are a particular problem in rural areas, especially for farmers. As much farming is conducted online as it is in the cowshed these days. Those of us who have tried to download Department for Environment, Food and Rural Affairs manuals, or even to fill in a tax return, over a less-than-perfect connection know how frustrating that can be. If a provider can be found to install fibre-optic cables to remote farms, that has to be paid for. There is some confusion over whether an EU subsidy of, I believe, about £3,000 is available to assist farmers in paying for that installation. The National Farmers Union and the Country Land and Business Association take slightly different views on whether the subsidy can be claimed by those who also claim the single farm payment. I would be grateful for clarification on that point. It is important that the Government do not assume that all Government business can be conducted online before we have achieved more universality of service. I hope that, following the “not spot” summit, I shall be able to go back to my constituents in north Oxfordshire with concrete ideas and timetables for the future.
Richard Arkless (Dumfries and Galloway) (SNP)
I should like to thank the hon. Member for Boston and Skegness (Matt Warman) for securing this debate on what is perhaps the most important economic issue for rural constituencies. My inbox, like that of my hon. Friend the Member for West Aberdeenshire and Kincardine (Stuart Blair Donaldson), seems to be bursting almost daily with messages from vast swathes of people in rural areas who cannot connect to the internet at anything better than dial-up speeds.
All broadband policy, under successive UK Governments, has focused on covering a certain percentage of population rather than a percentage of the geographical land mass. That is fine if you live in London, Glasgow or Manchester, because that is where the numbers are, but it is completely useless if you live in my constituency. My main message over the medium to long term is that this House needs to change that focus. We need to change tack. We need to focus on geographical roll-out instead of having this fixation with speed in populated areas.
My constituency is rural, running 100 miles from east to west and with 200 miles of coastline. Our biggest town is 80 miles from our second largest town. In between, thousands, if not tens of thousands, of my constituents live more than 2 miles from a superfast broadband exchange cabinet. That is the key to rural digital connectivity, as was alluded to by the hon. Member for Wells (James Heappey). People in my constituency are in line to receive superfast broadband only if they live within 2 miles of a fibre-optic exchange, and people often need to be within 1 mile of that exchange to get workable speeds. This will leave thousands of my constituents with no prospect of any kind of workable speeds. It is rural communities, with low-wage economies, dispersed public services and many infrastructure challenges, that need the help the most.
My constituency has more small businesses per head of population than anywhere else in Scotland, which is an incredible statistic given the digital disadvantages we suffer. Rural businesses are the driving force in my constituency. They are our biggest employers and it is essential that they are given the tools they need to grow. Let us consider our farmers, for example. Ours is a farming region, and our farmers, already squeezed by milk prices and other pressures, are being asked increasingly to rely on an almost non-existent connection. They have to deal with common agricultural policy applications, VAT and pay-as-you-earn returns, and applications for livestock passports and for animal registrations. All those jobs should take minutes with superfast broadband, but in reality they take hours and days with little better than dial-up speeds. That drains not only valuable commercial time, but huge amounts of what I would describe as rural gold-dust enthusiasm. They face all that before they attempt to diversify, which, amazingly, they are doing fantastically well despite being lumbered with a digital ball and chain.
Madam Deputy Speaker, you can never fully appreciate how encroaching on modern life digital exclusion can be unless you experience it for yourself. For that reason, I suggest that the “not-spot summit” be held in my constituency. People could come to Dumfries and Galloway to meet the young people who cannot get connected to the internet and to talk to our older people. They will be happy to explain how isolating it can be not to be able to see the photographs of the new baby or the grandchild’s first day back at school. People could come to meet our business leaders and ask them how they can expand their customer base or even stay still with these non-existent speeds. When it comes to booking a hotel room, people could ask our hoteliers how this affects them.
In another generation this place felt it proper to enact a universal obligation for telephone lines. This generation says it is now time to do the same for superfast broadband.
David Warburton (Somerton and Frome) (Con)
I know that many of my constituents will have been very pleased to hear about the targets for broadband roll-out for phases 1 and 2, but although they are a loyal and robust bunch I do not think they will be placing any bets on seeing those targets met in Somerset. The people of Somerton and Frome are not only noble in reason, but infinite in their many faculties. Their fingers are right now poised over innumerable mice, waiting to start an avalanche of innovative businesses and new ventures, but they cannot do so because, depending on whom you believe, my constituency rejoices in being either the 10th or the 14th-worst connected constituency in the country. BT and Connecting Devon and Somerset have so far completely refused at the fence of phase 2.
The Government’s recognition of the importance of rural broadband and the possible consideration of a universal service obligation are therefore both extremely welcome, particularly alongside the planned wider physical infrastructure investment in the south-west, but we have seen some extraordinary anomalies so far. In the planned upgrade of Wincanton, for example, much of the town will see improved connectivity but the business park—the economic heart of the town—has been overlooked. That is one example of many, and I have spoken to a number of business that feel they may even need to move their operations outside Somerset in order to remain viable—moving from Somerset is, of course, a dreadful prospect for anyone to contemplate.
This dismal digital disconnectivity does not only affect businesses, but contributes to the exodus of young people from Somerton and Frome. I have highlighted before the fact that three quarters of our young people leave Somerset after their education. How can we persuade them to stay in the west country and make it somewhere to achieve their dreams unless we provide the tools they need to render those dreams in their full digital glory? The negative effects of inadequate broadband can only grow exponentially worse. In the past few years we have seen the bursting forward of the so-called sharing economy, and there are community projects in my constituency that are totally dependent on online co-ordination and organisation. I am thinking of tremendous organisations such as Frome’s excellent and very famous Electric Car Club, which harness the natural generosity and the entrepreneurial spirit of Somerset. It is arguably sad but true that nothing has greater potential to stimulate today’s rural economy than rural broadband, and it will be dire for our local economy if our entrepreneurial zeal remains stuck in the 1990s while our neighbours disappear into the 21st-century horizon.
Properly managed, a comprehensive broadband roll-out can, with one leap, act literally as a fibrous ligament binding together businesses, charities, communities and people, not only to other parts of Britain, but to each other and the rest of the world. Therefore, I very much welcome the motion, as a “not-spot” summit would certainly be an invaluable step forward. In combination with the physical infrastructure investment that the Government are providing, those fibrous ligaments will soon grow flesh and can bit by bit become muscular tendons, perfectly placed to propel the rural economy into the future.
Julie Cooper (Burnley) (Lab)
I am grateful for the opportunity to speak on this important issue. As has been said, this is not just about superfast broadband, because too many people in Britain have no access to any broadband—even slow broadband is a much sought-after luxury in the rural parts of my constituency. Believe me, I know about this. I can speak from personal experience. In 2007, I moved 3 miles up the road into a house with the most breathtaking views, right in the heart of rural Burnley. Prudently, I thought it wise to check with BT before moving about access to broadband, and I was assured that there would be no problem. However, when I moved in and tried to get a connection I was told that I was too far from the exchange after all. Eventually I managed to secure broadband via a satellite, but that was expensive and never totally satisfactory; strong winds would regularly require the dish to be realigned, incurring yet more expense, and the speeds were low and never sufficient to give wireless access, so only one person could use the internet at any one time. Downloading the smallest of files was a time-consuming nightmare. I did not even have the option of using 4G to access emails, because it is a fact that I got a better mobile phone signal in the middle of the Serengeti than I ever had in my home.
I only live in rural Burnley, 5 miles from the town centre, not on top of a mountain in the middle of nowhere—welcome to 21st-century Britain! Now, a full eight years later, I have finally got a fully functioning broadband service from BT. It is not superfast, but it works. Alas, many of my constituents still have no broadband service at all, and as recently as last week BT confirmed that there are no plans to provide 100% coverage in my constituency in the foreseeable future. So much in our lives now requires us to be able to get online. Whether for someone struggling to run a business from home or an old person trying to order online groceries, this current state of affairs is frankly not good enough. In the current dotcom economy those without online access are second-class citizens. How can we expect Britain to compete with other countries when our broadband coverage is so poor? Not only is the coverage patchy, but a recent Guardian money investigation highlighted the fact that we are being overcharged for the privilege. Over the past four years, British home phone and broadband customers have seen prices rise by between 25% and 30%. Prices are as much as 50% higher than standard prices in Europe. We have seen a number of mergers and acquisitions resulting in reduced competition and higher prices. There are strong similarities with the energy sector where loyal customers are exploited. There is even greater reluctance to change internet supplier than to change electricity supplier because of the fear of losing connectivity.
I welcome and support the motion and look forward to seeing a Government action plan that will address this issue and give a 100% coverage to Britain in the 21st century.
Several hon. Members rose—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. The House will be aware that most speeches have not taken four minutes. That is perfectly fine as there have been interventions. A debate is supposed to have interventions as they are what makes it lively and worth while, but after the next speaker, I will have to reduce the time limit to three minutes. The last speaker with four minutes is Mr Richard Drax.
Richard Drax (South Dorset) (Con)
I am most grateful to you, Madam Deputy Speaker, for allowing me to slip in here so that I get the extra minute. May I refer Members to my entry in the Register of Members’ Financial Interests and also thank my hon. Friend the Member for Boston and Skegness (Matt Warman) for securing this timely debate? I pay tribute to the Minister, who has listened to me and to colleagues from all parts of the House for many months. I am afraid that my message now is that he will have to go on listening for many months more until we all get the broadband that we so desperately need. In general, I agree with nearly everything that has been said and the concerns that have been expressed.
I wish to focus briefly on a tiny museum in a very beautiful part of my constituency called Kimmeridge—I am sure that some Members have been there. At the moment, the staff communicate by using smoke signals, a Coca-Cola can and some string or flags. In fact, they have to use anything they have to hand, as the lack of communication is so serious. Steven Etches, who has been a plumber all his life and who is now in his mid-50s, is one of the world’s most renowned collectors of fossils. He has dedicated those fossils to a special museum, which won lottery funding of some £2.5 million. In addition to that remarkable achievement, he has also won an MBE—and rightly so. He was promised that, in 2017, a wonderful state-of-the-art museum would be built. It would attract people into South Dorset, educate both grown-ups and children about what used to stomp across our cliffs—no, not the Liberal Democrats—millions of years ago and help us learn all about our history. It was to be properly provided with internet broadband. Unfortunately, he has now learned that that is not the case, and the building work currently under way has been plagued with problems. John Woodward is the project director. He says the project has no broadband and virtually no mobile signal. The contractors who are used to dealing with suppliers and architects by telephone and email have been cut off. Consequently, the entire design team has been forced, at extreme expense and time, to come down to Kimmeridge to ensure that things are going to plan. This is what is happening in 21st-century Kimmeridge in South Dorset.
Mr Woodward tells me that BT appears to be totally unable to upgrade the village landlines, and indeed, recently, the entire village was cut off. The museum has asked BT for nine telephone lines, but Mr Woodward is not hopeful. He says that BT can provide temporary lines by pairing with existing ones, but for permanent lines it would have “to do something”. In the end, the fossil museum, local farmers, businesses and private individuals will be piggybacking on the new VoIP—voice-over internet protocol technology—to be installed by French oil firm, Perenco. That will give a signal of 30 megabits and will cost £99 a month. BT was quoting somewhere around £100,000. Without private enterprise, this particular scheme would not have met its deadline. Something has to happen. Something can happen with a little imagination, competition and flair. Let us get off our backsides and jolly well connect up the country.
Steven Paterson (Stirling) (SNP)
Like many other hon. Members, I have been contacted by many businesses in rural areas in my constituency regarding the availability of superfast broadband—or rather the lack of it. It is a serious issue in my constituency, which is why I wanted to speak in this debate.
Telecommunications is a reserved matter. However, the UK Government have not done enough in supporting rural areas with the development of modern technologies, and that threatens to send the message that large geographical chunks of my constituency are closed for business, which is absolutely not the case. The Government will argue that increases in spending on broadband development projects have seen Scotland receive a rise in funding, and that is true. However, the rise is not significant enough and the Scottish Government have stepped in to match that funding. They have doubled its value to try to deliver the upgrades that are required.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
I do not want the hon. Gentleman to give the wrong impression to the House. When he says that telecoms is a reserved matter, it is the case that the Scottish Government are in charge of the roll-out of superfast broadband in Scotland. He said that the Scottish Government stepped in to top up the money. Every project area in England, Scotland and Wales has provided match funding. It is not as if the Scottish Government came to the rescue; that was always the deal.
Steven Paterson
The Scottish Government are looking after the roll-out of broadband coverage in Scotland. However, telecommunications is reserved in this place, and the Government, of which the Minister is a member, must take responsibility, and I hope that they do.
Steven Paterson
The Minister is responsible for the funding for it.
Despite these efforts, much of Scotland’s rural zones are left in digital darkness, and that frustrates those in my constituency and in many others. The fact that the Scottish Government, a devolved Administration with no responsibility for telecommunications, have had to play such a role in this situation is not acceptable. The roll-out is inadequate for the businesses that I represent. According to Ofcom’s 2014 figures, superfast broadband services were accessible by 75% of the people in the UK. Broken down, that figure was as high as 77% for England, and as low as 61% for Scotland. At the bottom of the scale was Wales with just 55%. There is a clear disparity across the United Kingdom that must be addressed.
In Stirling, a diverse constituency of urban and rural areas, only 57% of people have access to superfast broadband. A constituency that can benefit from a wealth of business opportunities, has a rich cultural and historical heritage and has the potential to expand its tourism industry needs broadband. As technology moves on, we must invest. Stirling, which is a constituency with so much potential, is currently 543rd out of the 650 UK parliamentary constituencies for superfast broadband access, so Members can see why this is such a big issue in my part of the world. Indeed, 2014 figures show that 8% of the Stirling constituency only has access to slow connections—defined by access speeds lower than 2 megabits per second. I hope the Minister will agree that we must make progress on this matter.
It is also important to recognise the efforts of Stirling Council, which joined other local authorities across Scotland in investing in the digital broadband Scotland project. Last year, with all-party support, the council invested £600,000, and it should be congratulated on so doing.
Ofcom currently safeguards the existing universal service obligations for postal and telecommunications services. A similar obligation for broadband providers was announced by the Chancellor, and I welcome that. However, it is important to note that businesses—the majority of which will rely on high bandwidth in order to expand their online presence—will benefit only to a limited degree unless the megabit limit is as high as we can achieve. I do not think that 5 megabits will be high enough and it should be revised upwards.
In conclusion, the UK Government have much to consider in their approach to the investment in broadband. I look forward to following the ongoing debate.
Lucy Allan (Telford) (Con)
I thank my hon. Friend the Member for Boston and Skegness (Matt Warman) for securing the debate and I also thank the Minister, who has listened to the voices from constituencies up and down the country.
I represent a new town and want to make one simple point, which I will definitely make within my three minutes. We have significant areas of new build property in Telford, so this is not just a rural issue. People come to Telford to buy the dream, but they get their value-for-money new build housing and suddenly discover when they arrive that they have been sold a pup. When I moved to Telford in 2013, I just assumed that broadband and mobile coverage would be a given—a normal expectation of everyday life—yet in parts of Telford, in modern fast-growing areas such as Lightmoor, Lawley and Trench Lock, that investment in basic infrastructure was not there. Similarly, in the Ironbridge gorge, a world heritage centre that is a mecca for tourism and leisure, there is no mobile coverage at all. Businesses and residents alike struggle with the daily frustrations that that creates.
In 2012, the Labour-controlled local council turned down Government funding to tackle the problem, saying that
“in an ideal world we would like to invest in broadband but we do not live in an ideal world”.
So the council said, “ No thank you, Government. We do not want the money and do not want to invest in broadband.” Online community champions such as Telford Live and Lightmoor Life, along with the Shropshire Star, campaigned for change and, fortunately, three years on, Telford and Wrekin Council has changed its mind—we are now in an ideal world—and a deal with BT and Broadband Delivery UK has been signed. I am looking forward to 2017, when it will all be absolutely fine, but it could have happened a lot earlier if we had had a co-operative council—and I do not mean that in the sense that Labour would mean it.
Let us remember that new homes need infrastructure. They cannot be built in a void, as though they have just landed from Mars. Basic infrastructure in the 21st century means fast broadband and mobile coverage. Connecting Telford, as well as many other constituencies across the country, is vital for business, jobs and growth. I thank the Minister for his patience. I know that it has been very frustrating for him to have to listen to all these gripes, but I am so glad that he is in the Chamber to do so.
Liz Saville Roberts (Dwyfor Meirionnydd) (PC)
I, too, thank the hon. Member for Boston and Skegness (Matt Warman) for securing this debate. Access to high-speed internet has become something that most people who live in cities take for granted. It is so intrinsic to everyday life that it has almost become an assumed utility, but that is not the case for everyone. For those without access to it, it is a luxury enjoyed by others while they are progressively denied effective internet services and media.
The people of Wales have been promised that 96% of households will have access to superfast broadband by 2016, although the term superfast is interpreted differently by the Welsh Government and means speeds of 24 megabits a second rather than the European definition of 30 megabits a second. All but 1% of that target will be delivered through the Superfast Cymru scheme, which is jointly funded by the Welsh Government, the UK Government and the European Union. The issue of whether the target will be met by 2016 is one matter, but equally important, if not more so, is what will happen to the remaining 4%. Neither the Welsh Government nor the company contracted to deliver the programme—BT, of which we have heard a lot—is prepared to disclose which areas will fall within or outside the 96%, but clearly installing superfast broadband in a cabinet in the middle of Cardiff will reach far more people than doing so in a cabinet in rural Meirionnydd. Until we are informed otherwise, we must expect that the 4% who fall outside the Welsh Government’s targets will be in rural communities.
Access to high-speed internet, as we have heard, is crucial for the rural economy. Businesses in rural areas do not have the high-density footfall of big cities, nor can they rely on passing trade.
Jonathan Edwards (Carmarthen East and Dinefwr) (PC)
Does my hon. Friend agree that the compressed work and leisure time people face in the modern economy means that there is an opportunity for rural areas to offer wide leisure portfolios and pastimes, such as those that are available in the areas we represent? However, for people to set up businesses in those areas they need infrastructure, and we should be pushing ahead with getting broadband into rural areas so that we can use our natural capital as an economic advantage.
Liz Saville Roberts
We have heard already that tourism and agriculture, our principal rural industries, are highly dependent on effective internet services for marketing and their statutory data returns. There is a real issue with isolation and loneliness, and poor internet speed is doubly damaging in rural areas given the equally poor, if not non-existent, mobile data signal. Just 17% of Gwynedd is covered by the 3G data signal compared with a UK average of 84%, and most of that area is in the university town rather than my constituency. We have no 4G whatsoever—it is easy to remember that statistic. Our businesses are crying out for high-speed internet access and the Welsh Government are failing them. Given the importance of growing the private sector to meet the task of growing the Welsh economy, given the rural nature of the Welsh economy compared with that of the rest of the UK and given in particular the importance of high-speed internet to the rural economy, what will the UK Government do to ensure that the remaining 4% are not left without superfast broadband?
Poor broadband provision is putting rural businesses at a disadvantage and might stop businesses investing in rural Wales, as we heard previously about Somerset. That is why Plaid Cymru considers digital infrastructure equally important to the Welsh economy as transport infrastructure. If we want all corners of these islands to be prosperous and to break the long-standing dependence on the south-east of England, we must create the conditions for economic growth in all parts of the UK. For years now, Plaid Cymru MPs have been campaigning for a rebalancing of power and wealth across the UK and although that has been traditionally associated with transport infrastructure investment and empowering national Governments with fiscal responsibility, it also means investment in digital infrastructure. For example, a Plaid Cymru Welsh Government in 2016 would deliver full superfast broadband at the EU definition of 30 megabits a second to 100% of Wales. If we are serious about growing the economy throughout the UK, we must do that.
John Glen (Salisbury) (Con)
It is a great pleasure to make a short contribution to the debate and I commend my hon. Friend the Member for Boston and Skegness (Matt Warman) for his tireless work on this issue during his five months in Parliament.
From Wiltshire, I can report good progress in the roll-out of superfast broadband but, as we have heard from Members across the House this afternoon, good progress is not good enough for the minority who have not secured a date or any sense of when they will be likely to receive superfast broadband. In Wiltshire, we have moved forward significantly with a postcode checker, an improved website, better communications and clawback from the programme to deliver for the remaining 5% to 8%.
People in the remaining 5% to 8% want to know what they can hope to secure, when they can hope to secure it and how it will be delivered. We need clarity on the options, because although the Government have done considerable work to pilot different modes of delivery for the remaining 5%, there is uneasiness about how it will work out practically, how it can be accessed and how it might relate to a potential phase 3, if the local authority puts together the money for that extra push after 2017. Clarity is required if people are going to be satisfied.
BT Openreach’s relationship with other internet service providers, other than the rest of BT, needs serious scrutiny. Its role in the superior access given to other components of BT rather than to other ISPs is not clear. It is very difficult to get a clear answer about where such protocols exist, how they exist and whether ISPs other than BT can get BT Openreach to act with the same sense of urgency.
Anne Marie Morris (Newton Abbot) (Con)
Does my hon. Friend agree that an additional challenge is to ask the Government to review those parts of the country included in the commercial roll-out and to include some of them back in the BDUK project for phases 2 and 3?
John Glen
That is a sensible point, and I know the Minister will respond to it in a few moments.
I want to finish by addressing the progress in Wiltshire and south Wiltshire on the infrastructure project for mobile telephony. I thank the Minister for what he has done to catalyse the development of that across four sites in my constituency. There has been good dialogue with local parishes and positive outcomes to deal with “not spots” and make sure that there is mobile coverage in parts where people never thought they would receive it.
I urge the Minister to examine how the process for the remaining 5% will work, and how more clarity about that process can be achieved—whether parishes or local authorities will be involved, or whether individuals can access grants for the range of options that exist. One of the biggest frustrations has been that other commercial providers have been circling, desperate to provide where BT or the local authority in partnership with BDUK will be unable to do so, but they do not have that information early enough. As many have said, it is essential that we get this right if the rural economy is to be strong and is to be able to develop. If there can be clarity over that last 5%, this will go down as an effective project by this Government.
George Kerevan (East Lothian) (SNP)
I want to be somewhat novel for an Opposition Member and thank the Minister, not only for attending but for seeming to listen. In my short experience in the House, that is not always the case, so my thanks are genuine.
I suspect that the Minister has heard it all before and that he feels a little complacent because he has, he thinks, almost delivered. It was always going to be hard to deliver broadband right across the country; there were always going to be some problems at the edges. However, from the start of the deployment project in 2010 to the end of this Parliament, when we may get the full roll-out of superfast broadband, it will have taken 10 years. World war two took six years, during which we organised the Normandy invasion and invented nuclear weapons. Ten years is too long. I respect the Minister’s hard work, but I think that that is a reasonable criticism.
Ten years is too long because the demand for bandwidth never diminishes. Once we have superfast, we will need ultrafast. The demands of the economy are constantly changing, partly because of where people are. My constituency, sadly, is 572nd in the list of constituencies regarding broadband roll-out, but I know that in the next 10 to 15 years its population will rise by 25,000, so the problem will reset itself. We have a mix of areas—rural, coastal, urban, hills—but above all we have fast-growing local businesses, and they are being held back. If the population increases and broadband has moved on to the next stage, ultrafast, there will be an issue about how we get it.
Which spider lies at the centre of the web of problems that have led to the process taking 10 years? The answer is BT Openreach. We can argue about the issues and about what BT has done right and what it has done wrong, but it always comes back to the fact that we had a monopoly supplier. We have to address that. I am not being specific about what the issue is or how we deal with it, but if we do not address the fact of Openreach, we will never move on and be able to solve the ultrafast broadband problem when it arises, as it will.
Jake Berry (Rossendale and Darwen) (Con)
I congratulate my hon. Friend the Member for Boston and Skegness (Matt Warman) on securing this debate, which is hugely important for all Members of the House. It has been a very interesting debate, with Members demonstrating time after time how important the broadband connection is to them and their constituents. As we move towards the “not spot” summit, which I sincerely hope will happen because it will tackle an issue pertinent to all our constituents, I hope that the Minister will have in his mind two issues that I want to raise.
The first concerns the inability of rural businesses to get broadband even when they are relatively near to—within one or two miles of—a fibre-enabled cabinet. I was visited by someone from a new business on Broadhead Road in Edgworth in my constituency which had just secured United Utilities as a client. United Utilities is the only FTSE 100 business in the north-west, and a relatively small start-up contracting with a FTSE 100 company is a fantastic success story. Part of the business is laying ground infrastructure, such as drains, pipes and water mains, and United Utilities asked my constituent to do a 15-minute turnaround on some plans. Despite the fact that he is relatively near a fibre cabinet, it took him over an hour even to download the plans when they were sent to him, let alone comment on them, amend them and send them back, and that is putting his business at serious risk.
Another constituent works for a crowdfunding business, which is entirely online. Crowdfunding is becoming such an important way of financing businesses in our country that we have to find a way to make sure that they can grow and succeed throughout the north of England. On Dean Lane in Water, my constituent is unable to work from home despite being within a mile of a fibre-enabled box.
There has been a lot of criticism of Openreach today, but at this point I would like to praise Openreach and Superfast Lancashire because they are coming to do a roadshow in each of those locations in my constituency. They are looking at a nodal approach—I do not claim to know what that means—to see what can be done about connecting those two individuals. I hope that the “not spot” summit will ensure that the same approach is taken all over the country.
Mr David Nuttall (Bury North) (Con)
Does my constituency neighbour agree that one problem is that different authorities are carrying out different plans, and that they ought to work more closely for the benefit of those on the edges of constituencies?
Jake Berry
I could not agree more. My hon. Friend and I have worked very well on cross-border issues in Edenfield in my constituency which borders Ramsbottom in his constituency.
My final point is about the universal service. An Opposition Member made the point that in the 1990s we thought it was so important that people had universal access to a landline that we put it in legislation when we privatised British Telecom. We did more than that; we provided a social tariff, saying that those people on low incomes or receiving benefits could secure a landline at a lower rate because we believed that it was so important. Now, when we are considering universal service for broadband, is the time to ensure that there is a social tariff for those on low incomes to access broadband. That is not so that people can sit at home surfing the internet, booking holidays or watching catch-up TV; it is for their children. Most schools in my constituency now both set homework and ask for it to be submitted online, and £15 a month for line rental plus possibly another £10 to £15 a month for a broadband connection is too expensive for many households. We will entrench intergenerational deprivation, both digital and actual, if we do not find a way to enable those on low incomes to get connected.
Ms Margaret Ritchie (South Down) (SDLP)
I congratulate the hon. Member for Boston and Skegness (Matt Warman) on securing the debate. I agree with the hon. Member for Dumfries and Galloway (Richard Arkless) that this issue is critical to the development of our local economy throughout the UK, whether we live and work in urban communities or rural communities. Like many of the Members who have spoken today, I represent a rural constituency that has been left behind in the broadband roll-out. A number of my constituents are experiencing digital exclusion and the social and financial implications that that entails.
Sammy Wilson
Does the hon. Lady accept that her constituency and mine are the worst two in Northern Ireland for broadband coverage, in terms of availability or speed? Does she accept also that part of the problem is the monopoly that BT has and its emphasis on getting line rental rather than looking at innovative ways of ensuring that broadband is more widely available?
Ms Ritchie
I thank the hon. Gentleman for his intervention. He, like me, has heard stories from constituents in both the residential and the business sector who are unable to access broadband. For example, in a major town in my constituency is a business centre. It has a box in its business complex which accommodates 60 businesses, but the box is not enabled. That has a significant impact on the location of local investment and urgently needs to be addressed. In other cases, owing to the topography of the Mourne mountains, many young people cannot do their homework as they do not have access to broadband. They are forced to travel some 8 or 9 miles to a local library to do that simple task. That is totally unfair.
Let us look at the statistics. Of the £1.7 billion to provide superfast broadband throughout the UK, £11.6 million for phase 1 and phase 2 was allocated to Northern Ireland. Phase 1 aims to provide superfast broadband to 90% of premises. Phase 2 will seek to further extend coverage to 95%. At present my constituency has about 63%, and by June 2017 it will have 64%. Yet again, it is ordinary businesses in the agricultural sector, which is now expected to do everything by digital means, and the business community and ordinary residences that will be affected. It is believed that the format for broadband supports the majority in the wider community, rather than the minority—those isolated, inaccessible businesses in rural communities that make up our local employment base.
I urge the Minister to announce tonight that he, with BT, is going to deal with the issue, as the hon. Member for East Antrim (Sammy Wilson) said, and not only hold the “not spot” summit but take immediate action to ensure better access to broadband. Our local economy, our local financial and business sectors and the wider retail economy, as well as ordinary citizens in their homes, depend on that for their future economic survival.
Victoria Atkins (Louth and Horncastle) (Con)
I join others in the Chamber in thanking my hon. Friend and neighbour the Member for Boston and Skegness (Matt Warman) for bringing this debate to the Floor of the House. I welcome the Government’s laudable aim to transform broadband access across the country, and much has been done. The Minister was kind enough to write to me to provide me with figures that show that by June 2017, 40,135 premises in my constituency will have access to superfast broadband, but 8,712 premises will not have access. I fear that villages such as Harrington and Langton will continue to have to sellotape their dongles to their living room windows in a vain attempt to connect with the outside world.
We have heard a lot today about the impact that that can have on businesses and I will not repeat that. Instead, I will offer an example of a solution. A local company, Millhouse Manufacturers, in the village of Kirkby on Bain has 25 employees and is a real success, but it needed to upgrade its broadband access from 2 megabits per second in order to continue to grow and flourish. BT quoted the company a total of £120,000 to dig a trench two miles from the nearest exchange. For a small business, that is unaffordable, but I am proud to say that this little business in a village in rural Lincolnshire found a solution. For the sake of brevity, I will not explain the technicalities, but basically it put a pole in a field, courtesy of a local farmer. That means that it will get 100 megabits per second, rather than the 2 mbps that it was receiving before.
James Cleverly (Braintree) (Con)
My hon. Friend raises an important point. It is all well and good for BT to provide fibre to the box, but it is the last mile or two which require a much more imaginative approach to the distribution technologies. Will she join me in persuading the Government to be much more technology-agnostic in that final mile or two to the home or business?
Victoria Atkins
It is as though my hon. Friend has been reading my speech over my shoulder.
That was a very innovative solution, but it cost £3,000. Even though it was not as bad as the BT quote, it still cost £3,000, which is not affordable for many people. I hope the Minister can offer some assistance and tell us whether money can be found in the overall scheme to help fund such innovative solutions, particularly as suggested by the Chancellor in the spring Budget.
I am conscious of the time, but one other point that has not been raised is the impact on villages that are close to others that have already had superfast broadband fibre fitted. In the past two weeks two parish councils, Scamblesby and Maltby le Marsh, have contacted me. They are some 17 miles apart but they both report that when villages near them have had the fibre fitted, their broadband coverage has fallen. Mr Baildon tells me that until four weeks ago, his village had 1.5 megabits, but since a village nearby has had fibre fitted, reception has dropped to 0.34 megabits. Will the Minister please look into this, as it seems rather a coincidence?
Finally, may I end with news of my own summit, not just on “not spots” but on everything else? In a few weeks’ time I am launching in my constituency the constituency commission for Louth and Horncastle, in which I am asking everyone who lives and works in my constituency for their views on what is working, what is not working, and ideas for the future. It does not take a magician to guess that I shall be knocking on the Minister’s door in a couple of months with the evidence and asking him how we can help the 8,712 premises that will not have access to superfast broadband.
Cat Smith (Lancaster and Fleetwood) (Lab)
There has been a consensus across the House that the economic and social benefits of reliable broadband are undeniable. I spent the summer touring village halls around my constituency for “chats with Cat”, and that subject certainly came up in the rural parts of my constituency. I have spoken in this place before about Broadband for the Rural North—a group of people in my constituency who decided that they were not prepared to wait for BT to deliver superfast broadband, so they dug the trenches and laid the cables themselves, and now they have eye-watering speeds of up to 1,000 megabits per second—yes, 1,000. Calling that superfast broadband would be an understatement.
It is clear from my rural communities and my recent meetings with the local branch of the National Farmers Union that our communities need reliable internet access in order to access Government services, including applications for the basic payments scheme. However, it is not just our rural communities that are missing out on access to good broadband. I have received a great number of complaints from residents of the Highgrove estate in Lancaster. They certainly do not consider that they live rurally—indeed, it is about a half-hour’s walk from where they are to the centre of Lancaster. They have been complaining to BT that they were not receiving the superfast broadband, whereas neighbouring housing estates were. Their frustrations continued when they felt that BT was ignoring them.
The issues relate specifically to cabinet 76 at the corner of Caspian Way and Lindbergh Avenue. The cabinet is within the commercial roll-out of broadband and in an area where there is the possibility of competition, known as a “grey area”, according to my recent letter from the Minister. Because of this potential commercial competition, it is outside the scope of the publicly funded project. However, my constituents, many of whom work in our local NHS hospital down the road and at Lancaster University, need decent reliable fast internet to download X-rays, for example, or to stream academic conferences. They find that the lack of internet is frustrating their work and they are unable to take opportunities such as working from home. In the words of one resident who is an orthopaedic consultant, “My parents live in a village in India and they have high speed broadband, yet I have to campaign for it here.”
If the UK is to continue its role in the world, we must make sure that our broadband can compete internationally. A petition signed by 71 households from the Highgrove estate should be landing on the Minister’s desk any day now. They are calling on the Government to act in their bid for superfast broadband. I hope that he will consider their petition.
Jo Churchill (Bury St Edmunds) (Con)
I, too, would like to thank my hon. Friend the Member for Boston and Skegness (Matt Warman) for securing this debate. I will keep my comments fairly short, because I think my voice might expire before my three minutes are up. I reiterate the comments made by my hon. Friends the Members for Salisbury (John Glen), for Somerton and Frome (David Warburton), for Wells (James Heappey) and for Banbury (Victoria Prentis) and by the hon. Members for Dumfries and Galloway (Richard Arkless) and for East Lothian (George Kerevan): whether we are talking about broadband width, rural farmers, the nodule—whatever it happens to be—it affects us all, and it affects us all in the same way.
The word “superfast” is lovely, but parts of my constituency would be glad just to have broadband. We have been told that 90% of the UK will have superfast broadband by 2016. Indeed, Better Broadband for Suffolk hit 80% in August this year and received an extra £3.9 million as a result of the uptake, for which I thank the Minister, because that kind of incentive is most welcome. However, we have suffered a little slippage, as the Environment, Food and Rural Affairs Committee highlighted in its report of February 2015, and are currently ranked 513 out of 650 in the country.
We live in a digital age, unless we live in Bacton, Buxhall, Pakenham, Old Newton, Botesdale, Stowmarket or Bury. Suffolk is now a net contributor to the Treasury, but businesses are looking to move out of my constituency because they cannot grow. If we are serious about using technology optimally, we must not accept 90%, or even 95%. I am afraid that we must hold the Minister’s feet to the fire—and BT’s and anyone else’s—in order to get to 100%. Broadband is going to be the fourth utility, and the Minister is going to deliver it.
Simon Hoare
My hon. Friend is obviously right to hold the Minister’s toes to the fire, but does she agree that there is now a golden opportunity for local government also to play a part, given the announcement about business rates? It will be able to plough some of that into investing still further in broadband provision for the commercial community in her constituency and elsewhere. That will help while also taking some of the pressure off the Department for Culture, Media and Sport.
Jo Churchill
My hon. Friend makes a valid point about using what resources we have in a much more intelligent way.
We need to ensure that at the planning stage there is communication between deliverers and providers and that we lay service ducts for broadband as housing and commercial developments are built, a point that several Members have alluded to. The Government are demanding digital platforms for most services, including tourism and education, so we need these things to be happening.
The word “rural” has been repeated in this Chamber time and again today. We should not be disfranchised simply because we have the pleasure of living in England’s beautiful counties. It is right and proper that our cities should have high-speed broadband, but it is not right that we should not.
Jo Churchill
I will indeed. I thank the Minister most kindly for it. However, I also point out that there are still many houses and businesses in my constituency that would be grateful if that largesse reached them too.
Broadband is also needed to deliver medical facilities in a 21st century fashion. A leading medical practice in the constituency has just started trialling the delivery of healthcare online. If we are to save money across the board, we need to take these technologies forward.
Furthermore, the mobile technology in my constituency is also not good. I am lucky enough to have some of the best “not spots” in the country, so we are championing greater coverage down in Suffolk. The A143 has some of the worst connectivity in the country. I recently surveyed my constituents, much as my hon. Friend the Member for Louth and Horncastle (Victoria Atkins) is doing with hers, and found that 30% feel their connectivity is either poor or very poor. When someone is without broadband or mobile coverage and then BT fails, it really is grim.
Jo Churchill
Indeed I will. I see that I have run out of time. I will follow the Minister wherever he drives us to ensure that we have 100% mobile connectivity, as France will have by 2020.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
I, too, congratulate the hon. Member for Boston and Skegness (Matt Warman) on securing what has turned out to be a truly superfast debate. I rise to speak about many of the issues that have been covered by other Members. There is a lot of common purpose in the Chamber about the need to connect those people in the 5%—in the highlands and islands it is even more than 5%—who are struggling to get by without the kind of connectivity that is taken for granted in other urban areas.
We have heard from my party colleagues about what the Scottish Government and councils in Scotland have been doing to take forward additional work to ensure that we reach those places that have not been covered by the commercial proposition. In fact, only a few weeks ago I was delighted to be on the shores of Loch Ness for the launch of superfast broadband there. That would never have taken place under the commercial schemes, so the Scottish Government and the other agencies involved, including the UK Government, should be congratulated on that.
I must also point out that the UK Government need to do more strategically to ensure that that is taken forward. There are opportunities in digital learning, telehealth, business and leisure in rural communities that can only be taken up with what is important infrastructure. I know that the Minister is keen to listen and work with good ideas. I also urge him to look at some of the Community Broadband Scotland projects, such as the one in Badenoch, where Badenoch Broadband is looking to deliver more than 30 megabits per second. There are models to follow in Scotland.
I echo what the hon. Member for Lancaster and Fleetwood (Cat Smith) said about technology and the advances that can be made. Let us not make the mistake of thinking that the technology we are deploying today will be sufficient in the coming decades, or even in a couple of years’ time. We should be looking at a robust universal service obligation, and we should also be looking not only at 3G and 4G, but at 5G and the opportunities for new technology to roll out further connectivity for rural areas. The Minister could take this opportunity to make a commitment that when it comes to licensing for the 5G spectrum, he can include a universal service obligation that covers rural areas, such as those that have been represented today by other hon. Members and Inverness, Nairn, Badenoch and Strathspey.
Antoinette Sandbach (Eddisbury) (Con)
I join other Members in congratulating my hon. Friend the Member for Boston and Skegness (Matt Warman) on securing this debate. In the digital donkey derby we have heard from the hon. Member for North Ayrshire and Arran (Patricia Gibson), whose constituency is ranked 563rd for connectivity, and from my hon. Friend the Member for Wells (James Heappey), whose constituency is ranked 562nd. Well, my constituency is ranked 561st, which means we are very grateful for the 43% of premises that are connected to superfast broadband. However, the remaining premises—BDUK says that it is 70% and Ofcom’s digital survey says that it is 43%—still need to be connected. I support calls for transparency, so that we can get the real figures and understand why there are those different percentages.
I echo the calls for a universal service obligation, because that will deliver real change to my constituents in rural areas. It, along with the nodes that have been mentioned, may allow people to connect who have hitherto been unable to do so, even though fibre has gone to the cabinet, because they are more than 2 miles from the cabinet. A lady in Wrenbury, 2 miles from the cabinet, emailed to say that her business was suffering as a result of a poor connection, with speeds regularly falling below 1 megabit per second.
I have already started the process that my hon. Friend the Member for Louth and Horncastle (Victoria Atkins) mentioned by surveying my constituents. Eighty-five per cent. of those who responded to the survey have not been connected to superfast broadband, which may reflect the 43% figure in the Ofcom infrastructure report. Nearly 70% of constituents have not heard from Connecting Cheshire or BT about when work will take place to connect them to superfast broadband. Regrettably, Connecting Cheshire is not updating its website, so someone who goes to check the figures is informed that they will be connected by March 2015. That has not been helpful to businesses or residential customers in my constituency. Eighty per cent. of respondents are having connection problems, and nearly 65% of them have not had their connection problems resolved. More than 90% of respondents have highlighted low connection speeds as their biggest issue.
I urge the Minister to consider the universal service obligation to impose 10 megabits per second, for which many organisations are campaigning, including the Countryside Alliance and the Country Land and Business Association—and, indeed, several Members of Parliament who are desperate to see such a figure in their constituencies.
Rishi Sunak (Richmond (Yorks)) (Con)
I echo the thanks to my hon. Friend the Member for Boston and Skegness (Matt Warman) for his relentless work on this topic.
When one thinks about cutting-edge digital technology, the rolling hills and dry stone walls of the Yorkshire Dales might not be the first image that comes to mind, but I assure the House that this is an issue of vital importance to my constituents. We have heard a lot about farmers today. We know them as the proud stewards of our landscape who are working out in the fields with their hands to provide the food we require, but they are also cutting-edge innovators reliant on the latest in farming techniques and seed technology, and increasingly compelled by the Government to interact online with agencies such as the Rural Payments Agency. If they cannot access the internet, they are forced to use the services of a farm agent, who adds incremental costs to their business. They desperately need good broadband.
Jeremy Quin (Horsham) (Con)
Talking of rural areas, the situation is the same in my constituency. My hon. Friend the Member for Rossendale and Darwen (Jake Berry) referred to education. With regard to educating our next generation of farmers, without access to broadband people find homework and sourcing things on the internet very hard to achieve. Does my hon. Friend agree that that is a problem?
Rishi Sunak
I completely echo those sentiments. I had a similar conversation with villagers in Moulton in my constituency who were worried about young families leaving the village because they were unable to get access to the internet for their children to do their homework. They took it on themselves to install a community broadband scheme, at a great cost of over £1,000 for the village as a whole and a few hundred pounds for households, so desperate were they to correct the problem and ensure that young families stayed there.
There are many rural businesses in the Yorkshire Dales, including bed and breakfasts, pubs, and small hotels. When we go on holiday, perhaps the first thing we look at on Expedia or elsewhere is whether the place will have internet and wi-fi access. When I speak to pub landlords in my area, their desperate cry to me is that they need such access to attract customers.
I very much support the motion and hope that the “not spots” summit can be organised quickly. I urge those in charge to consider two areas for discussion that I hope can provide some relief. The first is the use of satellite broadband vouchers. Satellite is not a perfect technology—it has latency issues—but in rural areas such as mine it can provide a panacea to those requiring a basic level of broadband. Those who want it complain to me that the up-front cost can be prohibitively high, often hundreds of pounds. Although meaningful, that cost needs to be put into perspective with the current costs of some of the BDUK schemes, which can run into thousands. In some areas, satellite can be a cost-effective solution for those in need.
Simon Hoare
I apologise to the House if I am banging on about local government today. Does my hon. Friend agree that if satellite is to be successful in a lot of our very pretty villages with listed buildings, conservation areas and so on, we will be looking to our planning authorities to show a degree of leniency instead of stopping the charge towards satellite by saying, “This is a very important building and you can’t have a satellite dish there”? We cannot have this held up for those reasons.
Rishi Sunak
I fully support those comments and those made by the Minister earlier. We must adapt the planning laws to ensure that mobile masts and satellite can deliver this vital service across rural areas, and I think that many of the rural communities in my constituency are aware of that.
The second topic for the summit could be transparency of BT’s roll-out. Satellite is one solution, but there are many areas where fibre will not work—the last 5% where it will be technically impossible or prohibitively expensive. In those areas, the Government are admirably backing the innovation fund to come up with new technologies. In my constituency, many of the alternative technology providers complain to me that they are unsure about BT’s future roll-out plan, and that uncertainty prohibits them from making the investments required to bring some kind of broadband to rural communities. This has been noticed by Select Committees as well. It would be wonderful if the summit considered what could be done to alleviate this blockage.
I commend the Government for their efforts thus far. Five years ago, only 50% of homes in my constituency had access to superfast broadband; today the figure is over 80%. That is terrific progress, but we must do more. This Government are committed to being a one-nation Government bringing opportunity to every part of this country, but if we are truly to build an inclusive society and economy that spreads opportunity to our great rural areas as well as our cities, we must ensure that broadband is there to turn those aspirations into reality. I join colleagues in urging that the summit happen as soon as possible with continued efforts to bring broadband to every part of the country.
James Cartlidge (South Suffolk) (Con)
I too congratulate my hon. Friend the Member for Boston and Skegness (Matt Warman) on bringing forward this incredibly important debate.
I have asked only one question of the Prime Minister so far, and it was about “not spots” in my constituency. The Minister will be interested to hear that I received a very exciting reply saying that there would be three new mobile masts in my constituency to tackle “not spots”. In reality, unfortunately, the installation of those masts through the mobile infrastructure project—MIP—has been mixed, to say the least.
I am going to join in the chorus of the village people and mention three villages. In Assington Green, near Cavendish, people were very excited about the new mast, but it has died, it is finished, and it is not going to happen. It did not reach the deadline date, and we do not even know why; communication has been extremely poor. The Minister’s staff have been very helpful when I have emailed them questions about the masts, but there is no updating process and nothing to let us know what is happening. The second mast in Hitcham is a much better story, and I thank the Minister for that. The scheme was approved today, and Hitcham is likely to have a new mast by March.
The third mast was to be in Boxford, a village in which I have an interest because my children go to the local school. It is another beautiful village but a genuine “not spot”. The loss of this mast is very disappointing, because there was huge public support for it. At the very last minute, the owner of the land—a farmer—where the mast was going to be based withdrew because of very strong opposition from a small number of his neighbours. People in Boxford found that for commercial reasons there was not going to be a mast. They needed that intervention from us and were very grateful for it, so what prospect is there of it happening? Given the possibility of such last-minute interventions, is there any kind of flexibility in the timing of the MIP? Unlike the copper wires in our villages, the Minister does not have the problem of distance from the Cabinet. Will he use that influence to try to persuade the Chancellor to keep money going for next year, because if we have the time we can build the public support to get these masts built?
Finally, I hope the Minister will confirm that he will hold the summit. As well as inviting BT, will he invite small providers, such as County Broadband, which serves Suffolk and Essex and of which I am a customer—it provides a fantastic service—so that they can be on the same level? What role does the Minister see small providers playing in delivering innovative solutions to the problem of spreading broadband in our villages?
Rebecca Pow (Taunton Deane) (Con)
I, too, commend my hon. Friend the Member for Boston and Skegness (Matt Warman) for securing this debate, which I am pleased to support as a vice-chair of the all-party group on broadband and digital communication.
I will, of course, focus on my own patch of Taunton Deane. We have the Connecting Devon and Somerset superfast broadband programme, which has been mentioned so eloquently by other fine Somerset speakers. I give credit to the Minister and the Government: this £90 million project is the largest broadband roll-out in the country. Things are going pretty well to get to the 90%, but—there is always a “but”—Devon and Somerset are the only two counties in the UK without a 95% minimum phase 2 broadband contract in place.
I held my own mini-summit on Friday night up in the Blackdown hills, an area of outstanding natural beauty. I am afraid the event drew together a whole room of disgruntled people from Bishopswood, Otterford, Churchinford, Churchstanton and Pitminster—I sound like Clement Freud on “Just a Minute”—who were all concerned about when the second phase of the contract will be signed to get them from 90% to 95%. They fear they are going to be left out.
Representatives from Connecting Devon and Somerset appeared at the meeting, put on a good show and said they were in negotiation with 15 people who might bid for the contracts, but they will not do so until the new year, which means, realistically, that the work will not even begin until June. That will be a year after the contract negotiations with BT collapsed, and there is still no indication as to whether many of the people affected will be included. I would be really grateful if the Minister would comment on that and on how he sees the situation progressing.
I know that time is short, but I would like to pass on a few more comments that were made at my summit in the Blackdowns. I ask the Minister whether value for money could be considered on a slightly different basis. Perhaps investing in broadband could be looked at in terms of how much rural businesses give, meaning that it would become not a numbers game in terms of people, but a business game. The more businesses that are connected, the more the economy will get going, which is something this Government support.
Jo Churchill
May I suggest that my hon. Friend ask her summit attendees to provide the Minister with feedback and helpful information on the potential impact of the lack of broadband on their local economy?
Rebecca Pow
I thank my hon. Friend for that useful comment. I was going to continue feeding in a few more comments from my mini-summit. Many have already mentioned this, but can we be clearer about which communities are outside the scope of the current roll-out? That would at least allow residents and businesses to take decisions on whether they wish to pursue other options such as satellite broadband connection.
Above all, attendees wanted assurances that rural properties will continue to be connected by whatever means—poles, wireless, satellite, fibre, fibre to the remote node or anything else the Minister might come up with. Community fibre partnerships might be relevant, although that would mean that people would themselves have to pay. There are rumours that the Minister might send vouchers wafting their way, but they are not terribly keen on them, for various reasons. Similarly, when the clouds come down and the rain rushes on to the Blackdowns, satellite does not work terribly well, but perhaps we should consider it as a temporary measure.
Helen Whately (Faversham and Mid Kent) (Con)
Kent has been very keen on vouchers and was only recently allowed into the broadband voucher scheme, but we fear that funds are running out. Does my hon. Friend agree that extending funding for broadband vouchers should be a priority for the forthcoming spending review?
Rebecca Pow
That is an interesting point. People in the Blackdowns were quite negative about vouchers, but perhaps they should consider them more closely. I believe that people can receive £3,000 as an up-front contribution towards a satellite dish and to help with installation, but they have to pay for it monthly. Perhaps we should be a little more magnanimous in the Blackdowns and look more closely at that. The overall consensus was that fibre optic is still the best option for whoever wins the contract for the remoter parts of Taunton Deane.
In conclusion, let us have fibre to all premises and new houses in future; let us look very carefully at the Ofcom review of connectivity; let us fight for rural connection and our urban “not spots”; and let us do it all through this summit.
Robert Jenrick (Newark) (Con)
Having spoken in February’s debate held by my hon. Friend the Member for Hereford and South Herefordshire (Jesse Norman), which itself built on several other debates in the last Parliament, I am sure my hon. Friend the Minister must feel that this debate is somewhat like the film “Groundhog Day”, albeit with some new and very welcome characters. Rather like the protagonist in that film, he is doomed to repeat the same debate over and over again until we get it right.
I welcome the Government’s support and commitment. Almost 30% of the properties in my rural Newark constituency have gained access or the ability to access broadband as a result of public subsidy. That is not what failure looks like. None the less, 20% of properties remain unconnected, which will be the subject of the summit proposed by my hon. Friend the Member for Boston and Skegness (Matt Warman), if the Minister takes him up on it.
Nottinghamshire is on the cusp of another significant stride forward, for which I need the Minister’s help. I apologise to the rest of the House that this is specific to my own county. Further to the initial superfast extension programme funding, Nottinghamshire County Council and Broadband Delivery UK agreed to allocate an additional £1.3 million to Bassetlaw and Newark in my constituency. However, it remains to be contracted as we do not yet have the BDUK state aid assurance for the change request. Once we have that assurance—I look to the Minister for help with that—I understand that the contract can be exchanged very quickly, and once he makes that crucial intervention, the Minister will be feted in the villages of Nottinghamshire like a latter-day Robin Hood, or perhaps, in the Minister’s bearded days, Friar Tuck.
The word “summit” seems to be overused, but I, too, have held one and have two brief observations to make. The first relates to something that has not been discussed yet, namely demand. The present value-for-money test as to whether a community can get broadband depends on an opaque view of how many residents will take it up. It does not actually look at the reality. We have polled residents in some of my constituency villages, some of which have said that up to 75% of constituents will take it up. I believe them, because they are an engaged and thoughtful lot. That would have tipped the formula in favour of investment, but it was not taken into account.
Conversely, as my hon. Friend the Member for Rossendale and Darwen (Jake Berry) has rightly said, we need to address low take-up. On average, the figure is 18% to 20%. It is absurd for us to debate this level of public subsidy and investment if take-up is 10% or 15% in some parts of our country, particularly in deprived areas such as the city of Nottingham a few miles from my constituency. We should campaign as hard for higher take-up in deprived areas in particular as we are for subsidy and investment in more prosperous ones.
Amanda Milling (Cannock Chase) (Con)
I add my congratulations to my hon. Friend the Member for Boston and Skegness (Matt Warman) on securing this debate.
The variations stated in the motion exist in my constituency. Earlier this year, I was thrilled to learn from a survey conducted by uSwitch that Sandy Lane in Cannock was the street with the fastest broadband in the whole country. If people are looking for fast broadband, they know where to come—move to Cannock! I add a word of caution, however: although that is excellent news, it is unfortunately not the case that our broadband and mobile coverage is good for all residents and businesses across my constituency.
I was recently contacted by a resident of Fair Oaks in Birches Valley. Their property is served by the Rugeley exchange and a street cabinet, both of which have been upgraded to deliver fibre broadband. However, given the way in which the technology has been deployed, the property is too far from the enabled street cabinet for a cable to be connected—an issue raised by my hon. Friend the Member for Wells (James Heappey). That leaves a number of rural properties in the valley with no immediate hope of superfast broadband. They only have a hope if and when the next phase of upgrades takes place, and if their location is factored into plans.
The House can imagine my surprise when I went on to the Superfast Staffordshire website. It stated that the valley was enabled for superfast broadband, which was “available to order”. Well, it is not, nor is that included in future plans. We must ensure that such properties do not miss out. I noted from the website that Keys business park is not connected and that the time frames for connection have not been confirmed. Bluechipworld Sales and Marketing Ltd is a fascinating business in that business park, and I visited it only a couple of weeks ago. It designs and manufactures high-tech devices from its sites in Cannock and China. Its designers are employed and based in the UK—in Cannock—and, importantly, that gives young people career opportunities.
Jake Berry
My hon. Friend’s point about a high-tech company in her constituency creating employment is similar to the one that I made in relation to my constituency. Perhaps the Minister will say what vouchers could be made available for business customers, not just individuals, who want to bring high-tech engineering companies to our constituencies.
Amanda Milling
My hon. Friend makes a good point.
Broadband speeds are important for that technology business, because it can take four to six hours to transmit its designs to China. We rightly talk about productivity, and I am sure that hon. Members will agree that this is an example of why we desperately need to roll out superfast broadband quickly, efficiently and universally.
I welcome the motion, and I hope that residents and businesses across Cannock Chase, including in Birches Valley and Keys business park, will enjoy the broadband speeds that those on Sandy Lane in Cannock experience.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
I, too, congratulate the Backbench Business Committee on holding this debate and the hon. Members who have pushed for it. I applaud the many informed and moving contributions that we have heard, particularly from my hon. Friend the Member for Ynys Môn (Albert Owen), my right hon. Friend the Member for East Ham (Stephen Timms), and my hon. Friends the Members for Burnley (Julie Cooper) and for Lancaster and Fleetwood (Cat Smith).
I am pleased to stand at the Dispatch Box for the first time as shadow Minister for the digital economy.
Chi Onwurah
Well, it has been a long time. Before entering Parliament in 2010 I spent 20 years as an electrical engineer building telecoms networks around the world. I confess to having had a geeky worry that my technical knowledge would suffer as part of the privilege of being elected to the House. The Government have been so ineffectual, however, that my technical understanding remains as relevant as ever. Ministers should be ashamed of that, because it is their failure.
The UK has the sixth largest economy in the world, and is a developed nation with aspirations to lead the digital world. It is a country where Government services are “digital by default”, yet we have heard from many speakers in all parts of the House about the dire state of our digital infrastructure. I am not going to repeat all the terrible tales that we have heard: 1.8 million homes that cannot get broadband; dial-up speeds; businesses unable to do business. The economic benefits of better digital infrastructure—or, in some cases, of any kind of digital infrastructure—have been emphasised. The UK’s productivity problem was mentioned, and it is one of the biggest challenges that our economy faces. We have the second worst productivity in the G7. Ministers contribute to the problem, with a lack of productivity when it comes to providing the digital infrastructure that this country needs. The Government’s own broadband impact study states:
“It is now widely accepted that the availability and adoption of affordable broadband plays an important role in increasing productivity”.
The Minister laughs, but this is serious for many of his MPs. Better infrastructure increases productivity by
“supporting the development of new, more efficient, business models, enabling business process re-engineering to improve the efficiency and management of labour intensive jobs, and enabling increased international trade and collaborative innovation”.
Many Members on both sides of the House have given examples of that. As the new Leader of the Opposition and the new shadow Chancellor told conference this year, at the heart of our forward-looking narrative will be plans for investing in the future, including “investment in fast broadband to support new high technology jobs”.
Jake Berry
Does the hon. Lady accept, with the thought of the new Leader of the Opposition in her mind, that the natural step after the renationalisation of the railways is the renationalisation of BT?
Chi Onwurah
It is possible, as the last Labour Government demonstrated, to have a telecoms network that includes competition if there is a strong regulator and a Government who are committed to ensuring that competition delivers services for consumers. Unfortunately, that is no longer the case.
The internet provides social benefits, as we have heard. Online shopping is often cheaper, and the internet opens up access to public and private services. It is not right that some people cannot access Government services for which they pay or, even worse, that they are penalised for not being able to access them online, whether they are farmers or people on benefits trying to sign on and do their job hunting online. The internet opens up a world of free education and is a window on the globe. It is absolutely ludicrous that the Government have not been able to provide what has become the fourth utility.
The Government attack the right to strike for working people, but they have effectively withdrawn their labour when it comes to superfast broadband. Underneath the polite tone of the motion, Members in all parts of the House know that anger is growing among their constituents, especially in rural areas. The truth is that it will take more than a summit to reverse a failure by the Government to deliver on their promises, which lacked ambition to begin with. When the Labour Government left office they left fully funded plans for basic broadband—[Interruption]; I am sorry, it is the truth—to be delivered in two years and superfast broadband to be delivered to 90% by 2017. The remaining 10% would be covered by mobile broadband.
Now we are falling further and further behind our competitors. Australia is aiming for 100 megabits for 93% of premises by 2021, and South Korea will have 1 gigabit by 2017, yet we do not have a target this decade for getting everyone online.
Instead, we have had five years of ad hoc funding announcements and vanity projects whenever the Chancellor has wanted to sweeten the latest round of punishing austerity—a series of disconnected policy initiatives that were never very ambitious, but that have suffered from delays nevertheless.
The crown jewel in all those projects—the £790-million rural superfast broadband programme—was handed entirely to one company because of a badly designed, monopoly-favouring procurement programme that has been panned by every Committee to have considered it in this House and the other place and criticised by anyone who has taken a passing interest in it. That is the fault not of BT, but of Ministers.
What we need from the Government is a vision for a market-led, future-proof, universal digital infrastructure. Ultimately, that means fibre going to premises and real investment. It will not come along on its own. Ministers need to set out a vision for our digital infrastructure. They need to tell us how we will get there and ensure that it happens. Instead, all we have is complacency and chutzpah. Demand in this debate has outstripped supply, as is the case with broadband in the UK. I urge hon. Members to remember the importance of digital skills and digital inclusion, as well as digital infrastructure. There are still 5 million households that have no access to the internet and 1 million more who do not feel confident using it.
The Government have no coherent strategy. There is a lack of vision and a staggering level of incompetence in implementation. There has been a super-slow crawl-out, rather than a roll-out, to just 2 million premises so far, with constant delays.
Chi Onwurah
I am afraid that there is no time.
The Minister says that we are the best in Europe, but he chooses which countries to compare us with. We are 10th out of all the countries in Europe. As we have heard, there is better coverage in the Serengeti than in some parts of the UK.
We will not oppose the motion, but the Labour party does not believe that a summit can overcome the five years of complacency and incompetence from this Government or can fulfil Britain’s broadband potential.
The Minister for Culture and the Digital Economy (Mr Edward Vaizey)
It gives me great pleasure to respond to this important Back-Bench debate and I congratulate my hon. Friend the Member for Boston and Skegness (Matt Warman) on securing it.
I congratulate the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) on becoming the Opposition spokesman. I have always regarded her as, in effect, the shadow spokesman on this matter. Rather like the new leader of the Labour party and shadow Chancellor, I have left some very unhelpful quotations over the past five years in which I have praised her knowledge and expertise. I obviously resile from them all now that she is the official Opposition spokesman.
I was asked earlier whether this debate felt like groundhog day. I have to say that I have welcomed every single speech from those on the Government Benches—they have been brilliant, original and effective, and have displayed yet again the huge range of talent that exists on our Benches in representing our constituents and putting their issues on the agenda. The point when I thought it was groundhog day was when the hon. Member for Newcastle upon Tyne Central gave her speech. It is 2015 and the Labour party is still talking about a policy that it came up with in 2009. That policy was uncosted, required a tax that did not exist and contained no plans, yet it would have brought only 2 megabits to the country. Quite rightly, when the first Conservative Secretary of State came in, those plans were torn up because we knew that the country wanted 24 megabits. It wanted superfast broadband, which is what we have delivered.
While we have heard a lot of fine speeches from Government Members, I have to mark out the speech by the right hon. Member for East Ham (Stephen Timms) for sheer brass neck. It is astonishing that he talks about BT’s failure, when it was his Government that presided over the digital region project in south Yorkshire, which went bust, resulting in £50 million of taxpayers’ money being written off. The only superfast broadband project that started under his Government was the one in Cornwall, which relied on European money and involved BT. Cornwall is now one of the best connected regions in Europe.
The right hon. Gentleman accused me, because I happened to say that I might be mildly sceptical about the break-up of BT, of cosying up to corporate interests. Of course, those who are calling for the break-up of BT include such small businesses run out of a back bedroom as Sky, Vodafone and TalkTalk. It is absolutely astonishing.
Stephen Timms
The accusation about cosying up to corporate interests came from the Financial Times, not me. Does the Minister not accept, with the benefit of hindsight, that he should have ensured that some of the public subsidy went to a provider other than BT?
Mr Vaizey
The right hon. Gentleman cannot say that BT has me over a barrel when it has just paid back £129 million seven years early, thanks to the contracts we negotiated.
Let us look at those contracts. We said that we would deliver superfast broadband to 90% of homes and businesses in the country by the end of 2015. That is exactly what we will do. Three contracts have finished and 38 are ahead of schedule. I remind hon. Members that the reason BT bid for the contracts and that Virgin, for example, did not was that the state aid conditions required open access. Therefore, only companies that were prepared to see their networks used by their competitors were going to bid for the contracts. That is why BT was the only bidder in town.
Many of my hon. Friends have talked about Connecting Devon and Somerset, which did not sign a phase 2 contract with BT. I have sat in a room with hon. Friends and listened to officials from Devon and Somerset telling me that BT was not delivering. I now hear from my hon. Friends that BT is delivering.
As I have said, we have got £129 million back, thanks to the contracts. We are now going further. We have said that we will get to 95% of homes and businesses by the end of 2017. I am confident that we will deliver that as well. New technology and competition will help. Virgin has announced £3 billion of investment to compete with BT’s roll-out. It will get to 3 million to 4 million homes. Sky and TalkTalk are building a network in York to see how it can roll out fibre to premises.
That is a good example of how councils have to partner with telecoms providers, because they have to help with the planning. It is important that we keep the costs down. I hear people complain about the lack of broadband in central London, but Kensington and Chelsea refused to give planning permission to a single green box of BT’s for two years because it did not like the design. Councils have to get with it. As my hon. Friend the Member for South Suffolk (James Cartlidge) said, when we want to put up a mobile mast, we can suddenly find that the landowner has withdrawn their permission because of local objections. If we are going to build this infrastructure, there has to be a bit of give and take. Councils and local communities have to accept that the infrastructure has to be built. We might need to have taller masts and some structures in rural settings.
Now that BT has announced the roll-out of its G.fast technology, I am confident that 10 million homes will get speeds of 300 megabits or more over the next five years. We have the fastest roll-out and take-up of 4G in the world. We inherited a stalled auction programme from the last Labour Government that we had to resurrect and we are now back on track.
It was appalling to hear the hon. Member for Newcastle upon Tyne Central say that we should have a policy like Australia’s, which is massively over budget and involved a huge legal battle over many years effectively to nationalise the main telecoms operator. That pretty much cost the last Labour Government in Australia the election. We will not go down that road—that is for sure.
My hon. Friends are, of course, interested in the remaining 5%. I have written to all hon. Members setting out where broadband has got to in their constituencies in the last quarter, how many homes are being connected and, importantly, how many homes are not being connected. I am prepared to sit down with all my hon. Friends and visit their constituencies over the next six months to discuss areas that are not getting broadband, so that we can work together to deliver it.
Albert Owen
The Minister echoes the success of the Welsh Government in delivering to my constituency because it was a partnership. Will he sit down with Welsh Government Ministers, and others, to see what best practice could be used so that England can follow in the tracks of Wales?
Mr Vaizey
As my hon. Friends will be aware, I should have singled out the hon. Member for Ynys Môn (Albert Owen) because a Labour Government in Wales are responsible for rolling out superfast broadband and—guess what?—according to the Labour party, superfast broadband is brilliant in Wales but terrible in England. I was interested to hear that the hon. Member for Stirling (Steven Paterson) could not make up his mind whether he wanted to condemn or support the roll-out of superfast broadband in Scotland by the Scottish Government and the SNP. I take all such critiques with a great pinch of salt.
Chi Onwurah
The Minister said that I wished for a policy that is the same as that in Australia, but that is not what I said. I said that we needed a target as ambitious as Australia’s and the one in place by the new conservative Prime Minister there.
Mr Vaizey
I am all for targets but let us have some delivery. Australia has an ambitious target and zero delivery. We have a realistic target that we have hit time and again, and we will continue to do so. We have passed superfast broadband to more than 3 million homes and businesses, and when the next figures come out it will be close to 4 million. We must also deal with the last 5%, and by the end of this year we will set out our plans.
It is no secret that we are looking at a universal service obligation, and we will not be tied to some piddling European target of 5 megabits. No, when we look at a universal service obligation we will look at a British universal service obligation to deliver the kind of British broadband speeds that British citizens and businesses require. Over the last four years we have delivered that to more than 3 million homes and businesses, and we are fast approaching 4 million. We are hitting our targets time and again. We may not be able to beat the Australians at Twickenham, but when it comes to broadband we beat them hands down!
Matt Warman
I thank the Backbench Business Committee for granting this debate. I do not think that many debates secured by that Committee will have included contributions by Members from Scotland, Northern Ireland, Wales and England, and this debate has shown that superfast broadband is genuinely a national problem that needs a national solution.
My hon. Friend the Member for Rossendale and Darwen (Jake Berry) suggested a social tariff to emphasise how much this problem affects those who have the least money to spend on subscriptions, and my hon. Friend the Member for South Suffolk (James Cartlidge) said that small providers will play a crucial role in the future. My hon. Friend the Member for Richmond (Yorks) (Rishi Sunak) spoke about people leaving villages because of the digital divide, and that emphasises the scope and scale of the problem that we face. This is not just an English problem and it is appropriate to end by citing the hon. Member for Dwyfor Meirionnydd (Liz Saville Roberts), who said that if we want all four corners of these islands to be prosperous, we must create the conditions for economic growth. That is what this debate has been about, and the “not spot” summit that I hope the Government will organise shortly will be a crucial part of the solution to the national problem of superfast broadband roll-out. I commend this motion to the House.
Question put and agreed to.
Resolved,
That this House notes variations in the effectiveness of roll-out of fixed and mobile superfast broadband in different parts of the UK; and calls on the Government to host a not-spot summit to consider ways to tackle this issue.
Stormont
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Danny Kinahan (South Antrim) (UUP)
I beg to move,
That this House has considered the political situation in Stormont.
I am extremely grateful to my hon. Friend the Member for Tewkesbury (Mr Robertson) who has co-sponsored this debate, to all those who supported my efforts to secure this debate, and to the Backbench Business Committee that gave me this opportunity.
I know that the eyes of some hon. Members—especially those who are not here—may glaze over when they see that the debate is about Northern Ireland yet again, but I do not apologise for that. This is about my home, our home, my constituency and my family, and it is as important to me as I expect each hon. Member’s constituency is to them. Yes, I am afraid it is Northern Ireland to be debated.
Danny Kinahan
Thank you. In my maiden speech three months ago, and in numerous interventions, I continue to make the point that the devolved Government of Stormont does not work. Indeed, the First Minister has publicly described it as “dysfunctional”, and it could not be more so. I raise this matter today because I am fiercely proud of my home country, of being Northern Irish, both British and Irish, and in fact a large part Scottish too. I long to see my country at peace with itself.
In my maiden speech I chose as one of my key points to call for a real push for the Union and for all parts of the United Kingdom to work together, not just for Northern Ireland but for all members of the Union. I firmly believe that the majority in Northern Ireland want a Union for everybody that lives up to the core values of fairness, tolerance and freedom of speech, and embraces the spirits of enterprise and hard work that make these islands great. I enjoyed hearing the Prime Minister make the very same points in his speech in Manchester last week.
Why do I raise this issue? It is because I want all hon. Members—Labour, Liberal, Conservative, SNP and each party present in the House—to take an interest and help to move Northern Ireland to the next level of normality. We want a peaceful society where diversity is respected and cherished, and a society that has a functioning Government and Opposition, protection for minorities, and dynamic and decisive politics without a criminal element linked to it in any way. I am extremely happy and proud that my party recently made the brave decision to move into opposition in an attempt to move Stormont forward.
Lady Hermon (North Down) (Ind)
I am grateful to the hon. Gentleman for allowing me to intervene so early in his contribution, and I congratulate him and the Chair of the Northern Ireland Affairs Committee on securing this debate. The hon. Gentleman touched on the fact that the Ulster Unionist party’s withdrawal of its one Minister from the Executive in many ways precipitated the current crisis. For the benefit of my constituents and the people of Northern Ireland, will he outline when and under what circumstances the Ulster Unionists will take their place in the Executive again?
Danny Kinahan
I thank the hon. Lady for that interjection, and we will wait to see what happens in the next elections before we decide whether we, and others, go back in. Yes, it was our party that precipitated things, but we only moved into opposition. The actions of others may have precipitated things further.
I know that all hon. Members will support the aims I have mentioned, and all will have done so in their constituencies throughout the United Kingdom. I wish to emphasise that we cannot simply devolve and forget, and all four countries will always benefit from working together in the Union. At Home Office questions today we saw a perfect example of that when I mentioned the lack of visible policing on the ground which allows paramilitaries to fill the void. The Minister just said, “Talk to Minister Ford.” That is not satisfactory.
We owe so many people so much for all they have done for Northern Ireland—the politicians, the armed services and people from many other walks of life—and we in Northern Ireland are for ever grateful. We all want to see better, and we all believe in better. In 1998, almost three quarters of a million citizens—more than 71% of those in Northern Ireland—supported the Belfast agreement. That was a ringing endorsement for putting the past behind us and looking with hope to a brighter future. They supported the vision that Northern Ireland could be a country of equals where religion, culture and heritage would not define opportunity or aspiration. I remember the excitement and genuine belief that this was a change that would offer future generations not only a better life but the chance to be themselves with no fear of intimidation or violence.
I came home in 1984, after serving my time in the Army. I remember the dark days when Belfast was somewhere many avoided, where armed soldiers and police patrolled the streets, where shopping bags were searched at checkpoints, and where the temptation to eat out or go to the cinema really did not exist. In 1998, the Belfast agreement lifted the lid. Enjoyment, excitement and the genie of a thriving economic future were released. The sheer buzz that I think the majority felt in Northern Ireland was quite wonderful: we had a hope of a better future and it was in our hands. It was not a perfect solution, but nevertheless a hope we have so nearly squandered. It was meant to create a system that would adapt and change over time, and become a form of government that lived up to the principles of that 1998 agreement. Instead, the very system put in place and supported by individuals during the referendum on both sides of the border has been changed, without the opportunity for those same individuals to voice concern or disagreement, into this dysfunctional quagmire.
Mr Gregory Campbell (East Londonderry) (DUP)
The hon. Gentleman alludes to the dysfunctionality of the system of government we have, and he quoted others who have said likewise. Does he accept and agree that his party and other parties were the architects of the structures that he now describes as dysfunctional?
Danny Kinahan
I thought that might be the question. We certainly were the architects, with others, who took great risks. I have already said it was an imperfect system. What came later was much more imperfect, but I do not want to change this into a petty debate.
Changes, such as the election of the First and Deputy First Ministers, have removed ownership of the process from the Assembly and forced every future election to be a purely sectarian headcount. Northern Ireland is now locked into mechanisms that actively stop any improvement happening. Today, we need the support and leadership of this House to help us to move forward. We have an election process for the First Minister that means we have, in reality, a co-equal First Minister and Deputy First Minister, neither of whom can do anything unless the other agrees it. It is an admirable idea, but one doomed to failure as so often neither First Minister—that is what they both are—can agree with each other. It is almost an endless game of brinkmanship, a game of chicken that sees Northern Ireland’s people suffer each time there is a disastrous crash because neither First Minister will give an inch. We have an Executive of all parties, with the intention that those parties will work together and decide together. Again, that is an admirable idea, but not when the two main parties squeeze and ignore the other parties at every turn, forcing matters through and then claiming that they were agreed under the excuse of collective responsibility. All this must change.
Part of the structure of the Good Friday agreement was the creation of a petition of concern. This was a legislative tool to safeguard the rights of minority groups by offering either the nationalist or Unionist community the ability to veto legislation that would infringe their rights. This tool, designed with the right intentions, has been misused in the most underhand of ways. Since the last Assembly election in 2011, it has been used no fewer than 34 times to block issues including: better recycling, allowing the National Crime Agency to work in Northern Ireland, the provision of services and support for military veterans, to prevent Ministers even being held to account, and, of course, to stop same-sex marriage. It is obvious that the petition of concern no longer protects minority groups, but in many instances has actively been used to undermine them. The intention was never to use this as a vehicle to reinforce such politics, but that is exactly what it does.
Sammy Wilson (East Antrim) (DUP)
The hon. Gentleman talks about the dysfunctionality of the existing Assembly. Does he not accept that for the past eight years, while the Democratic Unionist party has been the largest party, the Assembly has not had to be suspended once? It has not collapsed on numerous occasions, which it did when his leader and the leader of the Social Democratic and Labour party were in charge and First and Deputy First Ministers in the Assembly.
Danny Kinahan
Thank you very much. I take those points very much on board. Rather than get buried in petty Northern Ireland politics, I will just point out that most of those collapses were actually caused by the hon. Gentleman’s party.
Those who were involved in the construction of the Good Friday agreement recognised that a simple or quick fix could never be an option. Indeed, those who were key in bringing this agreement to the people saw this as a first step towards a fair and equal society. They recognised that paramilitarism, segregated education, identity, culture and how to deal with victims and survivors were all complex issues that would need to be addressed many years beyond implementation of the 1998 framework. Sadly, in the 17 years since the signing of the agreement these issues have simply not been addressed.
Mark Durkan (Foyle) (SDLP)
I thank the hon. Gentleman for giving way. Going back to the question of the suspension of the Assembly on four different occasions up to 2002, does he recall that on none of those occasions was a suspension brought about by a disagreement between the parties that held the First and Deputy First Ministerships? The suspensions were all caused by crises relating to the decommissioning issue, usually because of decisions and antics involving the British Government and certainly not involving the SDLP.
Danny Kinahan
Thank you very much. I am in a very good sandwich here, or between two thorns on a rose. I very much take those points on board.
The squabbling that has ensued, due to the mistrust of politicians, has not only made these matters even more divisive but has allowed them to taint issues such as healthcare, social justice and the economy.
Danny Kinahan
No, I am going to carry on for a moment.
Indeed, every avenue of life in Northern Ireland in which politics has a role to play fights against the stagnation that those politics have created. The current impasse, which is nothing more than the outworkings of this mismanagement and the mistrust of the major parties leading the Assembly, has placed Northern Ireland in a precarious position, not only economically, as political parties have failed to agree the implementation of welfare reform, but socially as the continued bickering and public statements of dislike and intolerance further drive a wedge between the sections of nationalist and Unionist communities.
Danny Kinahan
I will later.
Our youngest generation, those who grew up in a post-1998 world, are among those who despair most at our inability to govern and our seeming fixation on creating obstacles instead of solutions. This was the message given to me loudly and clearly on the doorstep in the May elections. I am aware that, like those young people, many Members of this House are frustrated by the seeming inability of politicians at Stormont to see beyond narrow orange or green-tinted positions and genuinely attempt to make the brave and bold steps required to move our country forward. Nowhere is this more apparent than when we look at Stormont’s inability to implement policy or offer the leadership Northern Ireland deserves to rekindle that sense of hope, opportunity and aspiration I alluded to at the beginning.
Ian Paisley
I thank the hon. Gentleman for giving way. We are now 15 minutes into his speech and there is not a lot of what he has put to the House this evening that I disagree with, but the current impasse in Northern Ireland is nothing to do with bickering. It is nothing to do with people falling out. It is to do with blood shed on our streets and the murder of an individual. The hon. Gentleman needs to address that point. We will agree or disagree and fight in the Assembly about all the other minor points, but this House needs to hear about the growth of criminality in Northern Ireland, and what this House is going to do about challenging that criminality, that murder and that mayhem.
Danny Kinahan
I will get to that point towards the end of my speech, because I think it is absolutely key.
Jo Churchill (Bury St Edmunds) (Con)
I entered the House with hope that the four corners of Britain could come together to form a solid table to hold the hopes and aspirations of everybody. My friends in Northern Ireland now enjoy 40,000 more people in employment than in 2010; unemployment has fallen for 27 months in succession; and employment is up to 67.8%. Surely these are things to hang on to—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. Interventions are meant to be short. We are struggling with time, and I want to get everybody in.
Danny Kinahan
I could not agree with the hon. Lady more. I entered the Chamber with hope, and I intend to keep fighting for exactly the same things as she—
Danny Kinahan
It is better to start off negative and end up with hope. The hon. Lady gave some good examples, but they have happened despite, not because of, the Government in Northern Ireland.
I want to offer some examples of the failures. The social investment fund was created in 2011 with the intention of providing £80 million for key programmes and infrastructure projects that would directly benefit the most economically and socially challenged communities in Northern Ireland. By 30 March this year, £2 million was all that had been allocated; £78 million might now never be spent, with community groups and the most vulnerable being the ones who suffer. As of this June, only £3.5 million of £12 million available for childcare provision had been spent, which meant another £6.5 million had been lost. This is appalling, considering the number of working families struggling owing to the lack of accessible and affordable childcare in their area, especially given the present welfare debacle. Some 20% of the population are currently on health waiting lists, some of which reach beyond 18 months. It is a situation recognised as unacceptable by national experts.
On shared education, which most recognise as the holy grail in addressing so many of the issues, recent research found that almost half of Northern Ireland’s school children were being taught in schools where 95% or more of the pupils were of one religion. In the 2011-12 academic year, 180 schools had no Protestant pupils on their rolls, and another 111 taught no Catholic children. In October 2010, the First Minister said:
“I believe that future generations will scarcely believe that such division and separation was common for so long.”
He said that consideration should be given to tasking a body or commission to bring forward recommendations for a staged process of integration. Five years later, little if anything has changed. Under the Stormont House agreement, if it can be agreed, we are about to tie ourselves to spending £150 million on investigating the past, yet our own Justice Minister has said it will only really clear up one or two cases. Just think how much better that money could be spent elsewhere. Our victims and survivors need justice and support, but there has to be a better way.
There are many more examples, especially from the last four years of the dysfunctional Northern Ireland Assembly, but time prohibits me from listing every one.
Danny Kinahan
I will keep going, otherwise the hon. Gentleman will not have time to speak later.
Commentators inside and outside politics recognise that the primary reason for this continued dysfunction is the creation of what we in Northern Ireland call the silo mentality of Ministers. When the coalition Government was agreed in 2010, neither coalition partner got exactly what it wanted out of government, but both parties were able to set personal and ideological positions aside to do what they deemed was right for the nation. Sadly, the opposite is now true at Stormont. Ministers are challenged by Executive colleagues not because of their policy approach, but because of party political or ideological differences. It is said that a house divided against itself cannot stand. The Stormont Executive have proven that nowhere is that more true than in that political Cabinet.
If the UK Government were to design an education policy that ran contrary to their health policy or an inclusion policy that ran contrary to their housing policy, the electorate would quickly become fed up and ask for a new Government. That is unavailable to the people of Northern Ireland. Without a formal Opposition, there is no chance for change. Again, I congratulate my party as the one that made that brave step in creating the ’98 agreement and now, 17 years later, is doing the same for a strong Opposition. If those elected cannot be held to account, removed from Government or placed in a position where party comes second to the needs of those they represent, is it likely they will ever produce an effective Government?
Finally, I come to the elephant in the room of political debate in and about Northern Ireland: the continued undermining of political and social progress by criminals under the guise of terrorism—those who wish to rely on the violent struggles of our past at the expense of a political future. The House must recognise that the vast majority of acts carried out by these groups are not ideological but criminal and range from drug dealing to tobacco and fuel smuggling, punishment beatings, prostitution and racketeering. These ugly groups use Northern Ireland’s dark past and the Assembly’s inability to deal with these issues as cover to get away with the most heinous of crimes, including cold-blooded murder, with absolute impunity.
If any Member sitting on these Benches were considered to have a direct link with an active criminal or terrorist gang, I am sure that every other Member would not let that person remain here, occupying a seat in the greatest of all Parliaments. We all know that one party will not take its place in the House, meaning that we cannot include its Members in the debate or hope they will have the courage to speak and defend themselves in front of Members. I do not stand here to call out individuals, political parties or groups, although to make certain points I have had to do so; I stand here to highlight that without confidence in those we expect to govern with a fair hand, no citizen can truly support any elected body.
I have perhaps painted what some might see as a negative and rather depressing landscape for Northern Ireland, but I wish to emphasise that nothing could be further from the truth. The resilience of the people of Northern Ireland ensures that no matter how tough the challenge or how demanding the task, they rise above it and do what they have always done best: show hospitality to those who visit, continue to see the funny side of the challenges facing them and do what is best for them, their families and their neighbours. Many years ago while travelling, I met an Alaskan pipeline worker who had travelled around the world three times. When I asked him where the best place was, he replied, without knowing where I was from—surprising that!—“Northern Ireland”. He said that its inhabitants were the friendliest and loveliest of people. Above all, I wish to ensure that that remains the case.
I know you want me to finish, Mr Deputy Speaker, and I am very nearly there.
Mr Deputy Speaker
Order. The hon. Gentleman was advised to take about 20 minutes, but he is now on 23 minutes. A lot of Members want to speak. If we do not get other Members in, we are going to kill the debate.
Danny Kinahan
I was going to give the House some examples of some great Northern Irishmen and women, such as Mary Peters and Rory McIlroy, to show that we are a great country. To end, I wish to note that the constituency of my hon. Friend the Member for Fermanagh and South Tyrone (Tom Elliott) is the happiest place in the UK. I thank Members for listening to me.
Mr Deputy Speaker
I advise Members that I am now introducing a five-minute limit that might have to go down to four, so please let us try and get through the debate as quickly as possible.
Mr Laurence Robertson (Tewkesbury) (Con)
As a co-sponsor of this debate, I acknowledge the hon. Member for South Antrim (Danny Kinahan) as the force behind persuading the Backbench Business Committee to allow us to have it, and he made a thoughtful speech tonight. He is a new but valuable member of the Northern Ireland Select Committee, and I know that he will contribute to its work for some years.
When beginning a speech in this place, it is normal to say what a pleasure it is to take part in the debate, and while it is always a privilege to speak in this Chamber, it is rather regrettable that yet again we have to hold a debate on Northern Ireland because of problems in the Province, especially when, as the hon. Gentleman said, so much is right and working there.
Looking across at the Opposition Benches, I see representatives of three parties and an independent. Although I see some disagreement, I also see a determination in all of them to make things in Northern Ireland work. Sadly, however, problems seem to get in the way of the institutions functioning as well as they might.
As I see it—I have only five minutes—there are two problems to address tonight and in the next few weeks. The first is the crisis—it is a crisis—of government in Northern Ireland, where there are no longer properly functioning institutions. We could say that that resulted from the very bad murders that took place—indeed, as the hon. Member for North Antrim (Ian Paisley) pointed out, we cannot skate over them—followed by the Chief Constable’s assertion that one of the murders was carried out by the IRA, which was supposed to have disbanded a long time ago. We cannot ignore the fact that that is what brought about the immediate crisis.
It is also right to recognise—the hon. Member for South Antrim devoted much of his speech to this point—that the institutions were not functioning before that. The real and deeper reason for this problem, as far as I can see, is the design of those institutions. We know why they were put together all those years ago—to bring people together and to get them talking to each other instead of firing at each other—and there could be no better reason than that for designing those institutions. No one’s heart could have failed to leap at the sight of Dr Ian Paisley sitting with Martin McGuinness. That really gave us hope. Thinking back, we have to accept that the way in which the institutions were designed—with those who wanted to be elected to the Assembly having to designate themselves Unionists or nationalists or neither—could be said to have institutionalised the very sectarianism we were trying to get away from.
It is important to address the longer-term problems. I do not think we shall get solutions this side of next year’s elections in Northern Ireland, but from that point on we have to look at ways of ensuring an effective decision-making body. The institutions have brought people together, and we should not underestimate that magnificent achievement, which is a tribute to all those who worked so hard to bring it about and to the people of Northern Ireland and the great resilience they have shown.
It would be unfortunate, however, for anyone to suggest that revisiting the Belfast agreement in order to improve it is somehow an attempt to unravel it. That cannot be the case. An attempt to make sure that the institutions work better in the future would enhance the principles of the Belfast agreement, and we have to show courage in doing that. I would rather see proposals for improvement come from Northern Ireland—from the Assembly, but also from ordinary men and women in Northern Ireland rather than from this place. It is up to the people in Northern Ireland in those institutions to agree them and make them work.
We must address the immediate crisis. I would say to anyone on the Assembly in Northern Ireland who is listening to the debate that I led for the Conservative party many times when we were in opposition. Direct rule from a Committee Upstairs gave no one in Northern Ireland an opportunity to have their say on major parts of legislation. It is surely better to make the institutions work.
Deidre Brock (Edinburgh North and Leith) (SNP)
I am grateful for the two contributions so far, which I found thoughtful and interesting. I thank the hon. Member for South Antrim (Danny Kinahan) for bringing this debate before us today, but all of us here and those who sit in Stormont are in danger of losing the confidence of the population of these islands through a seeming inability to find a resolution and get government back on its feet. If we take it that all parties are acting in good faith, we are left wondering why no one can find the common ground where all sides need to stand.
Very few politicians furth of Scotland have a good understanding of Scottish politics, so I am going to imagine that most politicians this side of the Irish sea will have a similar difficulty in fully understanding the politics of Northern Ireland. I hope that any shortcomings I have will be forgiven.
The continued impasse surpasses understanding. It surely should not be beyond the wit of politicians to find a way to work together even when they do not agree.
It is easy to understand that there is a different dynamic in Belfast, thanks to the unique governance arrangements and the need to ensure power sharing. It is easy, too, to understand that there are issues in politics in Northern Ireland that we do not have in our constituencies—or at least not to anything like the same extent—and that we do not have the same political history to contend with.
That said, I cannot bring myself to believe that any voter would cross a ballot paper in the hope that their elected representative would enter into a disagreement and find ways to continue it. I do not believe that either side of the great divide was carried to power on a wave of hope that they would create a situation that prevented anything from happening. If nothing else, the history of devolution in Northern Ireland has shown that the strongest wills on both sides of the fence can sit together and plan a common future, can work together and find accommodations to suit, and can make changes that do not require anyone’s capitulation, humiliating climbdown or pyrrhic victory.
I can well understand the position of wanting nothing to do with implementing the welfare cuts that are being forced on the poorest in our society, but I cannot understand the thinking that says that shutting down government is the better option. Equally, is not the continued existence or otherwise of the IRA or any other organisation that might appallingly choose violence as a route to social change a matter for the police and the security services rather than a point of argument for politicians? The people who elect us are entitled to expect better.
The Stormont House agreement, which appeared at first to be an excellent piece of collective decision-making has become something of a millstone and a point of contention, which is very unfortunate. The agreement could be the basis for forward movement if all sides were prepared to act in good faith and allow others the opportunity to do the same.
It would be remiss of me not to mention the work done by the Secretary of State in getting the agreement made. I acknowledge the work that she continues to do to try to get a resolution. It is not often that someone from my party will praise a Tory Minister and I will admit it sticks a bit in my craw, but the praise is very much deserved on this occasion and I hope her representative will pass it on to her. I hope he will also pass on my plea to her to keep the shadow of direct legislation, as mentioned by the hon. Member for Tewkesbury (Mr Robertson), from this debate and to keep trying to get a resolution. Her deadline is, I think, at the end of this month—fewer than three weeks away. I hope she will be prepared to extend that deadline if it looks like there is a chance of striking a deal.
Getting Stormont back on its feet is the priority, but making sure that the parties working there come to an agreement on the basis of trust and respect might be the harder job. The political parties of Northern Ireland must, I believe, be prepared to accept that the other side of the argument might actually be acting in good faith and that although the Stormont House agreement might not be the best they could get, it is what is on the table just now. Posturing instead of acting could be damaging.
The Parliamentary Under-Secretary of State for Northern Ireland (Mr Ben Wallace)
In the spirit of what the hon. Lady has said, if for whatever reason the financial settlement made it impossible for Stormont to continue functioning, would she support the Government legislating on welfare if it were the only option?
Deidre Brock
I do not feel that I am qualified to answer that, if the Minister will forgive me. I certainly feel that we must take every opportunity not to interfere in the discussions, and that any form of direct rule should not at present be looked at. I still feel that there is scope within the discussions to take that idea forward and ultimately to reach some agreement.
Posturing instead of acting could do damage that might take too many years to repair—and refusing to compromise could do the same. I believe that the people deserve no less than a compromise.
Nigel Mills (Amber Valley) (Con)
It is a pleasure to contribute to the debate, and to follow the excellent speeches that have been made so far. I will not detain the House by repeating all the good words that have been spoken about how important it is for an enduring settlement to be achieved, although it is clearly very important for Northern Ireland to find a stable political process that can deliver for its people. I think we would quite like to avoid the annual round of crisis talks, and to get this matter sorted out for the long term.
On a more flippant note, I must say that I am surprised that we have got this far in the debate without anyone mentioning rugby or football, given the weekend’s events. May I be the first to congratulate the Northern Ireland football team on qualifying for the European championships? [Interruption.] I know that I should not have mentioned rugby—it is all going to go wrong—but that is an example of Ireland’s working together, and it could be a template for how we can move forward.
Let me now turn to a rather more parochial English activity. The Secretary of State has repeatedly said that the solution to the crisis cannot be yet more money from Westminster and the taxpayers, that the parties in Northern Ireland must find a solution within their existing budgets, and that there is no way of buying them out of the problem. I welcome that, because I think it must be the right solution. Every time we back down over here and offer more money, we create a problem, because in a few years’ time there will be another dispute that the parties cannot resolve between them, and they will think that there is some way in which we can fix it for them.
I urge the Government to be very cautious about taking the power to carry out welfare reform, because I think that that will mean a cop-out by politicians in Northern Ireland. They will not have had to find the money; they will not have had to fix their own budgets; they will not have had to choose their own welfare system. If we do this for them, they will be able to run around saying, “We never agreed to it. All those evil people in Westminster forced this terrible scheme on us. We would never have done anything like this.” They need to make a choice between welfare spending and other budget priorities, and that is what we should be saying to them.
We need the Minister to explain the Government’s time frame. How far can we go with no effective government of Northern Ireland without forcing an Assembly election? Can we really limp on until the end of March and the start of the election period? Is there any real prospect of a deal before the Irish and Northern Irish elections, or will there be another six months of to-ing and fro-ing and hokey-cokey, with Ministers being appointed and then resigning on the following day? Is there, realistically, a solution without the holding of elections in Northern Ireland a great deal sooner than next May?
I said that we should be very cautious about taking over the welfare reforms, but I think that there must come a point at which, if there can never be a deal in Northern Ireland, we cannot just sit back here and watch government fall apart and public spending descend into chaos. At some point we must say, reluctantly, that there really is no other way, although I think that that would be a rather poor outcome. I ask again, however, “What is the timetable?” Is the end of October, which we just heard mentioned, the hard deadline for a deal, or can we allow this to drift on until Christmas and try to deal with it in the new year?
At some stage we must be clear and say, “Here is the time frame: sort this out, or we shall have to do it for you, no matter how bad that is”, but we must also be clear about the fact that it is a last resort, and not the outcome that we want to see.
Mr Nigel Dodds (Belfast North) (DUP)
I think it worth highlighting, at the outset, the reasons for tonight’s debate, and why the political situation in Stormont is so fraught.
First—and I was glad to hear the Secretary of State say this explicitly in Manchester last week—there is the failure of the two nationalist parties to proceed with the agreement on welfare reform into which they entered at Stormont House in December last year. Secondly, there is the murder of Kevin McGuigan by people who, according to the Chief Constable, are current members of the IRA, an organisation which—again, according to the Chief Constable; not according to Unionists, not according to politicians, and not according to speculation —is still in existence.
Let me say something about the immediate aftermath of the Belfast agreement. We have heard a litany of faults in relation to Stormont, and I agree with much of it, but the hon. Member for South Antrim (Danny Kinahan) ought to remind the House that all the issues that he spoke about in connection with the First Minister, the Deputy First Minister, Ministers in the Executive, all-party government and petitions of concern were issues that we opposed at the time, and that he and his party supported and implemented. Let me say, with the greatest respect, that he should not come here and try to revise history. It should also be remembered that when, after the Belfast agreement, the previous Assembly kept being suspended and there was dysfunctionality, people such as David Trimble were prepared to proceed regardless of what the IRA did. Even when there was no decommissioning, even when people were being murdered on our streets by the IRA, and even when police assessments were made and far more was going on, no action was taken.
As we have demonstrated, the DUP is not prepared to carry on with business as usual, or sweep such matters under the carpet. They cannot be swept under the carpet. Imagine if a political party in government here had some kind of militia or paramilitary organisation doing such things on the streets! It would not be tolerated for a minute, and no one else should tolerate it either. If we truly value democracy, we must make clear that only those who are committed to exclusively peaceful and democratic methods should be eligible for places in Government, and that if they are found to be not so committed, action must be taken.
Later this week, some of us will gather in the Undercroft to commemorate the loss of Ian Gow. The despicable contempt for democracy that robbed the House of Commons of that gallant Member lives on in the men who ordered his murder and the murder of so many others. Let me say directly to the Secretary of State and to Ministers that if they will not act to protect peace and the political institutions in Northern Ireland, we not only will but must act. However uncomfortable and however awkward that may be, we will not sit idly by and let terrorists return us to the dark days of the troubles. Others may want to run away, but we will not. We will stick to the task of making Stormont better, and making it work.
The current crisis is precisely what is expected when, time after time, one participant in government thinks that it can play by a different set of democratic rules from those applying to the rest of us. In so doing, it is causing severe damage to Stormont, and to the type of peaceful, stable future that the people of Northern Ireland want and deserve.
What must be done now to salvage Stormont from the place in which republican killers have left it? Twenty years into the process, the paramilitaries must go away. In the words of the Secretary of State, they must disband. Whatever emerges from the talks process this time must do the job that the Independent Monitoring Commission plainly did not do last time. The Government must be honest with us, and tell the public what is being achieved—or, just as important, what is not being achieved. A new mechanism for ridding us at last of the scourge of republican and so-called loyalist criminal gangs must be credible, independent, robust and transparent. There must be an end to the smuggling, the racketeering, the drug dealing and the fuel laundering. Criminality must be tackled. For some time we have suffered because republican “untouchables” have grown fat and still more corrupt. Let us now have some British Eliot Nesses. The Prevent strategy that the Home Secretary employs against home-grown Islamist terrorism is full of useful lessons for the Northern Ireland Office. It is time that we got results in dealing with paramilitaries and criminals.
Damian Collins (Folkestone and Hythe) (Con)
I am following closely what the right hon. Gentleman is saying. Does he agree that the full implementation of the Stormont House agreement remains the best hope for the people of Northern Ireland and its institutions?
Mr Dodds
I entirely agree. Even before the resolution of the crisis became unavoidable because of the killing of Kevin McGuigan and what flowed from it, we had the deadlock and chaos that resulted from the failure to implement the Stormont House agreement, and the failure to get on with welfare reform that had been agreed by the SDLP and Sinn Féin, resulting in the fact that we could not have a proper, sustainable budget on which to base future plans for the Assembly of the people of Northern Ireland.
Sammy Wilson
My right hon. Friend has referred to criminality. In the wake of the killing of a member of the Garda on the border this week, the Garda have said that there is a corridor of criminality along the border. Does my right hon. Friend agree that that needs to be addressed?
Mr Dodds
I totally agree, and I want to take this opportunity to express the sincerest condolences to the family of the Garda officer who was so despicably murdered as he went about doing his duty on behalf of people in the Irish Republic.
We must create some kind of high-profile taskforce to take on the terrorist godfathers and their criminal activity. We should give Her Majesty’s Revenue and Customs, MI5, the National Crime Agency, the Police Service of Northern Ireland, the Army and our friends in the Irish Republic security forces the tools they need to do the job. We need targets and we need results. The public have suffered at the hands of these crime lords for long enough.
Mr Dodds
I cannot, as I do not have any more time left to give way and other Members want to speak.
We must get on and implement the Stormont House agreement. We cannot go on wasting £10 million each and every month, as we have to do in Northern Ireland with, effectively, the Executive handing that over to the Treasury. It could pay for more than 2,100 people to get knee operations or more than 1,800 people to receive hip operations. Instead, we are handing that money back to the Treasury as a result of this nonsense that is going on in Northern Ireland at the moment.
The past is part of the talks process. Let me be very clear that, as far as the DUP is concerned, we do not want to visit the fantasy land the current Leader of the Opposition seems to dwell in. We are very clear that we will not let the past be rewritten. We know who the terrorists were and there will be neither amnesties nor excuses granted. Nothing that emerges from the talks process will lead to anything other than an honest accounting of the past, as far as we are concerned.
We want a settlement that endures in Northern Ireland: one that works, one that delivers for our people, one that sees us co-operate for the good of all. Sinn Féin faces the same choice it has always faced: either choose to become truly democratic politicians like the rest of us, or stay in a crime-tainted world. Sinn Féin cannot be allowed any longer to stand in the way of peace and progress.
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I congratulate my hon. Friend—I want to call him that as I have known him for 30 years—the hon. Member for South Antrim (Danny Kinahan) and the Chairman of the Northern Ireland Affairs Committee, my hon. Friend the Member for Tewkesbury (Mr Robertson), who have been successful in securing this debate.
I am not going to pretend that I have a great family lineage in the Province; I do not, but I was brought up on the atrocities that took place during the troubles and dominated the news headlines during the 1970s, 1980s and 1990s. I was present at the Harrods bombing in 1983 and the Brighton bombing in 1984. Over the last five years, as a member of the Northern Ireland Affairs Committee, I have gained a better understanding of the issues and challenges facing this great Province.
These challenges break into three separate parts: the need to rebalance the Northern Ireland economy, especially welfare reform; the threat from organised crime and terrorism; and confidence in the justice system and the legacy from the troubles.
The Northern Ireland economy is very similar to that of my constituency in Plymouth in that they are both dependent on the public sector. In my patch, over 32% of people work in the public sector. The proportion in Northern Ireland is similar, at over 30%. That issue must be dealt with.
Bob Blackman (Harrow East) (Con)
Does my hon. Friend agree that the Assembly having the opportunity to change the rates of corporation tax could encourage the private sector to help to rebalance the Northern Ireland economy?
Oliver Colvile
I thoroughly agree, and that is why I hope that there will be some movement on that come 2017. I ask this question: why has Northern Ireland not got a city deal? We in Plymouth have not only ended up getting a city deal, but land has been released which the Navy no longer needs and we also have an enterprise zone. My hon. Friend is right that movement on corporation tax is the right thing to do.
I welcome the hon. Member for Gedling (Vernon Coaker) on his return to the post of shadow Secretary of State for Northern Ireland. I hope he will continue the bipartisan approach he took the last time he held the post. I also hope he can help convince his leader and the shadow Chancellor to give up their support for IRA terrorists. Perhaps he might like to take them to meet the victims of the atrocities to hear at first hand of their real anguish at losing close relations, and maybe they can get an education.
I also pay tribute to Anthony Golden, who was killed earlier this week. It appears that his murderer was facing charges of membership of dissident republican groups and was out on bail. That proves that terrorism is not only an issue for Northern Ireland, as it also happens in the south and to us all here on the mainland, too. What discussions is my hon. Friend the Minister having with his opposite number in the Republic to tackle organised crime and terrorism?
I also want to speak a little about confidence in the justice system and the legacy issues. We should remember that my city of Plymouth, through its military, made major sacrifices and lost lives during the troubles. During my visits to Northern Ireland, I have met a number of victims’ families and they all want to see justice. So, last November, I supported the Government’s proposals on the European arrest warrant. The warrant gives powers to our police forces to apply for the arrest of potential criminals and for them to be returned to the UK to face justice. Will my hon. Friend the Minister explain why the PSNI has refused to apply for a European arrest warrant to bring Rita O’Hare back to the UK?
Rita O’Hare was put on trial in the 1970s for plotting to kill someone in the Army. She was given bail and subsequently escaped to the Republic to become Sinn Fein’s envoy to the United States. Tony Blair and Jonathan Powell were approached by Gerry Adams and Martin McGuinness to bring her back to the UK. Despite their support, Blair was told by his Law Officers that he could do not that as she would be arrested. I have pressed the PSNI to apply for a European arrest warrant, but I have been told that there was not enough evidence to proceed. I am sorry, but if there was enough evidence to bring her to trial in the 1970s, why is there not enough now? This is ridiculous; she should be brought back to the UK to face trial.
Since the decision to give Northern Ireland what I would call home rule and to devolve responsibility, it appears that the Executive have had difficulty on occasions in taking responsibility for what goes on in Northern Ireland. Welfare reform, rebalancing the economy and dealing with legacy issues should be the responsibilities of the Executive and the Assembly. Ministers and the Northern Ireland Committee have roles to play, but the Northern Ireland Executive have to be more willing to take responsibility for devolved matters. I will continue to press for the Northern Ireland Committee to help by undertaking an audit of what has happened since the Good Friday agreement, to ensure that we can deliver on that and have better community consultation. The hon. Member for South Antrim (Danny Kinahan) is quite right to call for help from Whitehall when there is no alternative, but that should be the last port of call. In short, it is time for grown-up politics and for Northern Ireland to work as part of the Union.
Mr Ivan Lewis (Bury South) (Lab)
I congratulate the hon. Member for South Antrim (Danny Kinahan) and the Chair of the Northern Ireland Committee, the hon. Member for Tewkesbury (Mr Robertson), on securing the debate. This is my first speech as a Back Bencher for more than 14 years, so I hope that hon. Members will forgive me if I am a little rusty. I never sought the role of shadow Secretary of State, but it turned out to be an immense privilege and left me with a deep affection for Northern Ireland. That affection is built on the straight talking and warmth encapsulated as “the craic” among so many people I met.
I feel a great sense of pride but also responsibility as a consequence of my party’s legacy in helping to bring peace to Northern Ireland. Whatever the collective political failures of recent years, it is important to recognise that many of Northern Ireland’s leading politicians would hold their own intellectually and administratively at the highest levels in any democracy.
I want to take this opportunity to welcome back my friend and colleague, my hon. Friend the Member for Gedling (Vernon Coaker)—who is not in his place at the moment—as shadow Secretary of State. He is widely trusted and respected in Northern Ireland. I also want to take this opportunity to thank my hon. Friend the Member for Ealing North (Stephen Pound) for his tremendous support during my period in the role. I strongly support both of them in maintaining Labour’s support for a bipartisan approach. The principle of consent must apply to any change to Northern Ireland’s status within the UK. It is also important that my party should maintain equidistance between Northern Ireland’s mainstream parties.
So, what are the causes of the culture of crisis that has led to a cycle of despair and, in turn, to public disillusionment with the political system? There are a number of factors involved. Three successive years of elections have meant that politicians are reluctant to make compromises that might affect their core support. Sinn Féin’s overriding political priority has been to make progress in the south and to do nothing in the north to undermine its anti-cuts, anti-austerity position. Also, post-Ian Paisley senior, the Democratic Unionist party has been wary of being seen to work in an authentic partnership with Sinn Féin. An accommodation is not a partnership. Furthermore, too many people are still trapped in worklessness and inter-generational poverty and not seeing their lives getting better via a peace dividend.
What might the solutions be? The Stormont House and Stormont Castle agreements must form the basis of a way forward. There has to be a viable budget that takes account of agreement on some measures to mitigate the impact of welfare changes, including non- implementation of the pernicious bedroom tax, but Sinn Féin has to accept that such a viable budget is a reality facing all democratic Governments. This will require tough choices including changes to the welfare system. The only case I can see for further additional UK Government finance is a new fund to support the development of a new universal mental health service to tackle the inter-generational trauma unique to Northern Ireland. There also has to be a plan, with measurable timelines, to oversee the disbanding of all paramilitary structures. Such structures should be anathema in today’s Northern Ireland. The structures to deal with the past need to be agreed as soon as possible, and the Government should honour the Good Friday agreement commitment to a public inquiry into the Finucane murder. This can and should be time-limited, with a finite budget.
An incoming 2016 Executive, and, where appropriate, the UK Government, should commit to the implementation of the excellent Heenan-Anderson Commission recommendations to systematically tackle worklessness and inter-generational poverty. Alongside that, we need an economic plan that includes a city deal, and investment in skills and infrastructure, essential if the devolution of corporation tax is to make a real difference. It is right that there should be the establishment of an official recognised Opposition, preferably from 2016 onwards, but we also need a new movement binding together civil society, business, trades unions and the Church to apply pressure to politicians and to create the space and permission for politicians with courage and vision.
Seventeen years on from the end of the troubles Northern Ireland is a much better place, but it is still a society emerging from conflict, coping with the wounds of its past. In truth, that means it will take at least a generation, perhaps two, to move from a cold to a lukewarm peace and then to a normal society. What is needed more than ever is courageous political leadership, coupled with a shared and ambitious vision for prosperity and social justice.
Lady Hermon
I just want to pay tribute to the hon. Gentleman, who worked extremely hard as the shadow Northern Ireland spokesman for a considerable time. I am curious to know whether his experience and expertise on Northern Ireland have at any stage been asked for by the current leader of his party. I think his plea tonight was almost for his party leader to read what he was saying about Northern Ireland. Has his party leader ever sought his view?
Mr Lewis
I thank the hon. Lady for her generous comments, and I thank all Northern Ireland politicians represented in this House for the tremendous support they gave me during the time I did that job. They do not get enough credit for the many constructive and positive things they do to try to move Northern Ireland forward. In direct answer to her question, I can say that in the context of the reshuffle I did have a brief conversation with the leader of my party about the challenges facing Northern Ireland. When I meet the leader of the Labour party in the next few weeks on a one-to-one basis I will certainly be raising a number of issues with him, one of which will be my analysis and my view of the appropriate position that my party needs to take if we are to continue to adopt, along with the Government, a constructive bipartisan approach to moving Northern Ireland forward. There are many things we could do that may undermine that, and we must resist the temptation to change our long-established positions, which have, despite some disagreements, on the whole earned the respect of all of Northern Ireland’s political parties. I am delighted that my hon. Friend the Member for Ealing North, the shadow Minister of State, has insisted that we stay true to those positions. On that note, I will bring my remarks to a conclusion.
Bob Blackman (Harrow East) (Con)
It is an honour and a privilege to follow such a forceful and well-argued contribution from the hon. Member for Bury South (Mr Lewis), and I think we would welcome his comments —we certainly would on this side of the Chamber. I also congratulate my hon. Friend the Member for Tewkesbury (Mr Robertson) and the hon. Member for South Antrim (Danny Kinahan) on securing this debate. While we are on the subject of congratulations, let us congratulate the Irish rugby football team on having achieved qualification where England could not, the Northern Ireland football team on qualifying for Euro 2016 and even the Republic on getting to the play-offs for Euro 2016.
I wish my right hon. Friend the Secretary of State the best in conducting the negotiations, as I am sure the whole House does. They are at a delicate stage and they clearly need firm but fair guidance.
Let me discuss my personal history. I was at university in Liverpool in the 1970s, where I represented people from both sides of the sectarian divide. I visited Northern Ireland for the first time then and I was shocked by what I saw. I was there on business in the 1980s and 1990s. It was a very different sort of world to the one it is today. The opportunities that arise in Northern Ireland for business, for tourism and for the greater good of its people are legion. We should look at the positive things that have taken place. Personally, I have had to work with people whom I could not stand in various different political institutions. I take my hat off to those who have to work with people who were literally seeking to murder them only a few years ago. The positive aspect of the changes that have taken place needs to be emphasised. People must understand what can happen when things move forward.
I well remember the words of the late Jim Callaghan who said that it was an easy decision to send in troops to Northern Ireland, but a very difficult one to get them out. Clearly, what we do not want to do is go back to some form of direct rule, because it will then be much more difficult to get a settlement that will lead to proper—
Bob Stewart
I thank my hon. Friend for giving way. Just as a point of fact, in the spring of 1970, I remember Jim Callaghan telling my platoon that the British Army would be out of Northern Ireland by Christmas 1970.
Bob Blackman
I thank my hon. and gallant Friend for his contribution. He makes the point quite clearly.
Dialogue clearly needs to take place between the different political parties in Northern Ireland, but paramilitary organisations and criminal gangs have no part in that dialogue. We must give full support to the police in ensuring that the rule of law and order is instituted in Northern Ireland.
I congratulate the hon. Members for Gedling (Vernon Coaker) and for Ealing North (Stephen Pound) on their steadfast support for a proper process and a bipartisan approach. I am concerned that those paramilitaries may have been encouraged by other Members of the Opposition, and that they may be instituting some of their attitudes. I have school friends who were in the pubs in Birmingham when they were bombed. I was in the bar in the Grand Hotel in Brighton an hour before it was bombed. I have personal memories of what happened during those days. We must never go back to them, and we must ensure that we institute proper democratic solutions to the problems of Northern Ireland.
Time is running out. I ask the Minister, in his reply to this debate, to set out how we can ensure that the budget for Northern Ireland is delivered. I also ask him to set out very clearly the position on welfare. We cannot have a situation in which one part of the United Kingdom is carrying on with a huge deficit and not implementing the Budget. Equally, we need to ensure that we implement the Stormont House agreement as opposed to just allowing things to drift. Clearly, the legislation will take some time to pass through this House. We cannot have deadlines being set and then being ignored.
I accept that my right hon. Friend the Secretary of State is at a delicate stage in her discussions with the political parties in Northern Ireland, but we cannot allow this impasse to continue unabated. Encouraging news emanates from those talks, but no agreement seems to be taking place. It is not right that some political parties that are not present in this Chamber can hold up the talks and express platitudes but not implement the agreement to which they have put their names. Clearly, we need to impose some deadlines and some structure and ensure that the people of Northern Ireland can benefit from the economic recovery that will flow from democracy, institutional investment and the rebalancing of the economy so that the private sector can improve the jobs and the life prospects of all the people of Northern Ireland.
Mr David Anderson (Blaydon) (Lab)
I congratulate the hon. Member for South Antrim (Danny Kinahan) and the Chair of the Select Committee, the hon. Member for Tewkesbury (Mr Robertson), on getting the Backbench Business Committee to agree to this debate.
It will come as no surprise to most people in the Chamber who know me that I am going to talk about the role of trade unions. The trade unions in Northern Ireland are one of the very few voices that are genuinely non-partisan and cross-community. With no disrespect to those sitting on the Northern Ireland Benches to my left, we have seen tonight that there are clear disagreements within the political parties, but the trade unions in Northern Ireland have always played a role in representing people regardless of where they come from or what their beliefs are. These are the people who have to face the reality of Government policy on the ground, whether that is a public sector pay freeze, the cost of living squeeze or the impact of welfare benefit cuts, and I asked them for their view today. On behalf of Unison, the biggest trade union in Northern Ireland, I received the following response:
“trade union members in Northern Ireland fear a return to sectarian violence, a return of a gang law-enforcement culture and a breakdown of institutions and public safety.
The unions…are fighting to save the peace process and Good Friday Agreement, from a politically engineered dispute between the DUP and UUP in the run up to the 2016 elections.
DUP ministers are only…taking office for one hour a week then resigning, and taking full salary”
to progress their policy—[Interruption.] If Members want to intervene, I am happy to take an intervention.
Mr Dodds
I hope the hon. Gentleman will clarify that that is not the case. Indeed, the crisis came about not as the result of some kind of Ulster Unionist-DUP dispute but because of the IRA murder of a person on the streets of Belfast. That is what we should all be concerned about.
Mr Anderson
I take on board what the right hon. Gentleman says, but, as I said earlier, this is not what I am saying; it is what was said to me by those who represent people on the ground in Northern Ireland. That is their view, and the view of the people who try—
Mr Anderson
Well, what I said is the case.
The Irish Congress of Trade Unions, which represents trade unions across the whole of Northern Ireland and the Republic of Ireland, took a motion to the European TUC, which represents 60 million workers across Europe. The ICTU is convinced that without the input of both Governments and the US Government there will be no movement forward in Northern Ireland. The congress supports fully the devolved Administration of Northern Ireland, wants the Government to be involved and to give a financial stimulus to ensure the continuation of the political institutions, and believes:
“The austerity measures being imposed on the citizens of Northern Ireland by the…Government are a major impediment to the resolution of the political impasse.”
Despite all the progress, Northern Ireland remains a society emerging from conflict:
“A society which has the lowest levels of any region in the UK of investment, educational attainment, and the highest levels of mental ill-health.”
The suicide rate is some 70% higher than in any other region, and poverty, the security spend and economic inactivity are all higher on any scale. The unions believe:
“The failure to achieve a political resolution in the talks…will result in the fall of the political institutions and direct rule...by the Westminster Government”,
which is the last thing that anybody over there wants. That will be unforgivable. The unions believe it will take us back to where we were and will
“result in the emergence from the shadows of the so called…para-military groups”.
While Members speak about the fact that one thing that led us to where we are now was what the police lead us to believe was the involvement of the IRA in the killing earlier this year, the unions believe that the failure to get the system up and running again will take us back to the full-blown impact of what we saw for far too many years.
I suggest that the people involved on behalf of the Government should sit down with the trade unions once in a while. I know that they are not very keen on talking to the trade unions on this side of the Irish Sea, but perhaps they might like to talk to the trade unions on the other side of it, which are genuinely committed to seeing the community go forward. Their track record shows that they have been there and shows their work with people on the ground, so the Government should ask for their view and work with them to try to make things go forward. At this moment, we are facing an impasse that will not be helped by having direct rule imposed in any shape or form.
Kevin Foster (Torbay) (Con)
It is a pleasure to speak in this debate. The hon. Member for South Antrim (Danny Kinahan) who introduced it was almost apologising that we should be discussing Northern Ireland again. I far prefer to have politicians sitting in the House of Commons talking about Northern Ireland than have young men out on the streets of Northern Ireland killing each other, so it is always a pleasure to be able to take part in such a debate.
Murder should have no place in politics. It is ballots, not bullets, that should decide issues in the 21st century in this United Kingdom. When a culture of violence develops, we see a Garda officer from the Republic to which the person in question claims to have loyalty shot dead while going about his duties. That is what happens when a culture of violence and criminality is allowed to fester under the excuse of a flag of political belief.
It is also important that we have budgetary and fiscal responsibility. It is safe to say that there are considerable differences between the Administrations in Westminster and Edinburgh on Scotland’s future fiscal direction, yet they have managed to agree a balanced budget, and will implement it regardless of the outcome of the Scottish Parliament elections next year. That sends a message to others.
Sammy Wilson
Does the hon. Gentleman accept that in Scotland we are dealing with a one-party Government, while in Northern Ireland we are dealing with a five-party Government, some of whose members would make the leader of the Labour party look like a member of the Conservative party?
Kevin Foster
It is clear that in Northern Ireland everyone, not just some Members of the Assembly and the Government, needs to take responsibility for making balanced budget proposals and agreeing an effective Assembly Government based on sustainable finances, a point that I have made following the last two statements to the House by the Secretary of State. If people do not agree, it behoves them to state what they would agree to and then be prepared to discuss that to keep the whole system going. We could spend all night listing issues with how the Assembly works, and there are some who are not prepared to accept some of what was signed up to. It can be easy to get an agreement, but implementing it is usually slightly more difficult.
There is a golden opportunity to secure a peace process for the future. The speech that I was looking for in this debate was the one made by the hon. Member for Bury South (Mr Lewis). We could have a fascinating debate lasting until the early hours listing all the problems, but the hon. Gentleman set out solutions. I may not agree with every point that he made, but he was certainly right to say that there needs to be a positive approach to finding a solution to the current impasse. All parties, not just some, need to take responsibility.
I hope that the Government will continue to move down the path set out in the Belfast agreement, support the implementation of the Stormont House agreement and support Northern Ireland’s politicians in coming to a point where they are able to govern on behalf of the people of Northern Ireland and deliver many of the benefits that devolution should be bringing. That, for me, is the core of the matter. I want to see a time when Northern Ireland debates in this Chamber are about the economy, jobs and the future, rather than the past and the constitutional situation. I am as fervent a Unionist as the next person; I believe that the four nations are better together than they are apart. Clearly, there are those in the Chamber who disagree with that statement, but to be fair they show that one can pursue their argument through democratic debate, not by any other means. For me, the solidity of the Union lies in being able to discuss those issues rather than constantly coming back to the constitution.
Tom Elliott (Fermanagh and South Tyrone) (UUP)
I think that we all want to discuss the economy and the good things about Northern Ireland and the rest of the Union. Does the hon. Gentleman accept that we cannot ignore criminality, paramilitary actions and murder on our streets?
Kevin Foster
No, we cannot have murder as part of our political debate. Paramilitary groups have no place in this country. They should disband and respect the fact that, as I said earlier, decisions nowadays will be taken by ballots, not bullets. We go about achieving that by making sure that we have an agreement that all parties can take forward. No devolved Assembly can live for very long without a sustainable financial position. Governments in Wales and Scotland agree balanced budgets despite huge political disagreements with Westminster. I hope that we can see some parties take a lesson from that in Northern Ireland to allow the Assembly and Executive to proceed with sustainable finances for the next few years.
It has been a pleasure to have the chance to contribute to the debate. I hope that we can go forward on the basis of a positive plan that allows us to put Northern Ireland’s future back exactly where it should be: in the hands of Northern Ireland’s people and their elected representatives, not coming back to a Committee Room in this House for direct rule.
David Simpson (Upper Bann) (DUP)
It is good to follow the hon. Member for Torbay (Kevin Foster), a lovely part of the world, and to hear his contribution. I am glad to have this opportunity to take part in the debate and to say a few words, but I will be brief as I know there are still a few Members who want to contribute. We have had so many debates in this Chamber about Northern Ireland, and I have listened with interest to the speeches tonight.
We have had a number of history lessons going back to the 1970s and 1980s, but the general public out there in Northern Ireland want to know where we go from here. Make no mistake—the Assembly is in a crisis. As we have this debate here tonight and as we discuss other issues tomorrow and on Wednesday, the discussions will be ongoing in the Assembly to try to find a resolution to the issues and concerns that there are in the structures of the Northern Ireland Assembly. Any deal or understanding that we come to at the end of these talks, and any agreement, if there is one, needs to be comprehensive. It needs to deal with the issues that were agreed in the Stormont House agreement.
Unfortunately, a number of parties reneged on that. Although we know the reputation of Sinn Féin and we know its links to the provos, as history has shown us, I am extremely disappointed in the stance of the SDLP. On SDLP Members’ understanding of economics, the hon. Member for Foyle (Mark Durkan) is a former Finance Minister so he understands finance, or he should understand finance. Every Member of this House will understand that if there is no money in a business, cash flow stops. It is all over. That is exactly the problem in Stormont.
Yes, we have had a murder on the streets of Belfast, and that is important. Blood on the streets of Belfast—we cannot ignore that; it must be dealt with. The paramilitaries must be dealt with, whether they be republicans or loyalists. They need to go away, in the words of the Secretary of State. But without money one cannot run a business. That is the problem of the Assembly. Welfare reform needs to be agreed, and quickly.
The point was made earlier that we are handing back tens of millions of pounds to the Treasury. Where is the business sense in that? Why? Because Sinn Féin and the SDLP, but more so Sinn Féin on this issue, are facing elections in the Republic of Ireland and they believe that it will have a detrimental impact on them if they agree to welfare reform. Welfare reform has to be implemented. The Government and the Prime Minister only recently said that there was no more money. Do we like that? No, but we have to go with it because there is no finance. Stormont needs to be resolved. We are a devolutionist party, and I believe that Northern Ireland is ruled better from Stormont, but there must be trust. At present the trust is not there. It needs to be re-established.
Mark Durkan (Foyle) (SDLP)
In following the hon. Member for Upper Bann (David Simpson), I will respond to his challenge to my party, but I do not want to respond only to the issue of welfare reform and the challenges in the devolved budget resulting from the Treasury’s budget bullying tactics. The Treasury is imposing a fine on the block grant that is given to the Northern Ireland Executive under the Barnett formula. It adopted that tactic because it thought that creating budget stress for the Assembly would force through welfare reform, but that budget stress became a budget crisis, and that in turn is feeding a political crisis.
The Treasury needs to take a different course. I ask hon. Members to contemplate what would happen if the British Government decided to introduce a provision in the Scotland Bill that would require any disagreement between Ministers in London and Edinburgh on welfare issues in Scotland to be resolved according to the terms they are using in Northern Ireland. How would those on the Treasury Bench react if some of us proposed a new clause that would specifically forbid the Treasury ever doing in Scotland what it is now doing in Northern Ireland: using budget interference to impose a different view of welfare reform?
Although the scheme for devolution set out in the Scotland Bill is different from the notional legislative devolution that Northern Ireland has, the fact is that there is a scheme for devolution there, and it requires and presumes, by the nature of the legislation, agreement between Ministers, but there is no provision for when there is disagreement. It certainly would not work if Scotland were to be treated in the way Northern Ireland has been treated. Therefore, if the Treasury would not treat Scotland that way in relation to the future of devolution and welfare, it should not treat Northern Ireland that way now.
Sammy Wilson
Does the hon. Gentleman not accept that using the word “fine” misrepresents the situation? The money that is being paid back to the Treasury is the difference between what is being spent and would have been spent had the welfare changes introduced across the rest of the United Kingdom been introduced in Northern Ireland. The fact that the Northern Ireland Assembly has made a choice means that there is a difference in the amount of money spent, and that is why the money has to be paid back.
Mark Durkan
Whether we call them fines or penalties, as the hon. Gentleman and his party have done previously, or savings forgone, which is the language the Treasury uses, they are the same thing and the result is the same: serious pressure on our budget. There are other pressures on our budget as a result of some of the choices that the Executive have made. They are not choices that I would have made when I was Finance Minister—given that my period in that office has been brought up—but they are not choices that I had to make either.
Let me return to the issues that now confront all the parties in the Stormont House talks. Serious attention is rightly being paid to the question of paramilitarism in its various manifestations and manipulations. We are glad that that issue has come to the fore, although we regret how it has come to the fore. In the scoping for the original Stormont House negotiations late last year we said that we wanted paramilitarism, organised crime and criminality on the agenda. Unfortunately we did not get support from others, because they did not seem to believe that it was a relevant issue. It clearly is. Many hon. Members have touched on some of the features of criminality that clearly derive from our troubled experience. Whether people want to pretend that some of these people are simply privateers, having been privatised from some other paramilitary group, or something else, the fact is that collectively we have to confront what that means. We have done that before in previous debates on a cross-party basis—for example, when looking at organised crime in the border areas and elsewhere.
We, as parties, must also ensure that we are not divided on the issue of paramilitarism by taking a differential approach to it depending on what side of the community it appears to come from. We should avoid making different demands on and criticisms of the police according to their response or non-response to one feature of paramilitarism, as opposed to another, because that would send out a signal that we are still divided and that the paramilitaries are somehow attached to and serve particular sides. Nor should we create difficulties for the police. Parties should be robust in using the accountability mechanisms for policing to challenge and engage policing at all levels, but we should not catch the police in the middle of our party political differences.
That is why at Stormont House my party is advocating a whole-community approach to dealing with paramilitarism. If we are to create a whole community in Northern Ireland, we need to overcome historical sectarian divisions and all the convulsive ruptures that aspects of our culture and traditions have sometimes brought about, such as parades. At Stormont House—this is often forgotten—we agreed new financial commitments on shared and integrated education, but we need to go further. We need to invest in shared housing to build more intentionally shared communities close to the new shared education estate so that one will reinforce and support the other in changing society.
When people voted for the Good Friday agreement—I am probably the only person in the Chamber who was there negotiating it, and I take my share of whatever people want to say in the way of blame or criticism—we were proved absolutely right in the way we had done it. It was about creating transformational politics in Northern Ireland, and not, at best, episodes of transactional politics where people appear to share power now and then, and turn their backs on each other and let the community down at other times. We need to use these Stormont House negotiations not just to make good the better promises of Stormont House but to go back to the original promises of the agreement.
Several hon. Members rose—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. To get everybody in with equal time, we are going to move to a three-minute limit.
Tom Elliott (Fermanagh and South Tyrone) (UUP)
The hon. Member for Torbay (Kevin Foster) said that we should be more positive about some aspects. How much more positive can we get than Northern Ireland qualifying for the European football championships for the first time at the weekend, and the Ireland rugby team topping their group in the rugby world cup, although there were quite a number of Ulstermen playing for Ireland as well? Let us be fair—there are some positives. Perhaps we should just let the sportspeople of Northern Ireland run Northern Ireland. Would we have a better place? I do not know. It is difficult to replicate the euphoria in the sporting world in Northern Ireland in politics at the moment, but that is what we need to try to do. However, we cannot ignore what is happening on our streets—the murder and the criminality. All those aspects must be dealt with.
It is incumbent on us to go back to where we were in December. Not every party agreed with the Stormont House proposals. In fact, Sinn Féin was the only party that totally signed up to them. Let me quote what some of its members said at its party conference in March this year. Gerry Adams, the Sinn Féin leader, said of the deal they got at Stormont House in December:
“Welfare reform is a fresh start that we need to seize with both hands”.
Deputy First Minister Martin McGuinness referred to a
“remarkable achievement which has the potential to give the executive a fresh start…Against all the odds we have forged a way forward, we have achieved a deal in the interests of the people…We are immensely proud of the achievement”.
Only a couple of days later, they reneged on that deal. Why? Is it because they want to demonstrate that Northern Ireland is unworkable? There is a real challenge for us to prove that it is workable. We need to bond together—perhaps without Sinn Féin, but we need to do it. We need to bond together with unions, with representatives of the community, with public representatives, and, dare I say it, with sportspeople to make sure that Northern Ireland is a workable country and that Sinn Féin and those who are determined to drive that away cannot be successful.
Sammy Wilson (East Antrim) (DUP)
First, may I say that the negativity in some of tonight’s speeches is not representative of the record of the Northern Ireland Assembly? Indeed, parties as diverse as Sinn Féin and ourselves have been forced to work together, yet have brought forward a programme for Government that, as was pointed out in an earlier intervention, has seen the economy through the recession, kept employment levels higher than ever through that kind of trough in economic activity, and introduced innovative policies, including taking unemployed teachers off the dole queue, helping young people with literacy and numeracy problems, and changes to business rates, which have now been replicated in Scotland and Wales. There have been innovative policies and good work has been done, despite the fact that many of the parties’ views have been so diverse.
We have a problem at the moment. Economics was always going to be an issue for the Northern Ireland Assembly, given the fact that there are people there who are to the left of the leader of the Labour party, and others who would be quite happy sitting on the Tory Benches. There was always going to be a problem with economics and we have now come to the issue of welfare reform.
Part of the problem is the way in which the Government have handled the issue. Instead of making it very clear from the start that no leeway would be given beyond the substantial changes made and that no handouts or further money would be thrown at the problem, that hope was always held out. There are still people in Northern Ireland who say, “If we went collectively, we could somehow or other escape the changes that have had to be made in the rest of the United Kingdom.” That is nonsense, but unfortunately it has been assisted by the unwillingness of the Government to take on Sinn Féin and tell it and the SDLP, “Look, we have allowed changes to be made on welfare in Northern Ireland and it’s going no further.”
The Government have to make it clear to Sinn Féin that criminality and the party’s association with criminals who launder money and engage in illegal activities, and its defence of them because they are former comrades, will not be accepted and that it has to be dealt with. Until that clear message goes out, I believe the present impasse will remain.
Ms Margaret Ritchie (South Down) (SDLP)
I echo the comments of my hon. Friend the Member for Foyle (Mark Durkan) and congratulate the hon. Members for South Antrim (Danny Kinahan) and for Tewkesbury (Mr Robertson) on securing this debate on the political situation in Stormont.
The SDLP is committed to the talks process for the people of Northern Ireland. Our citizens have well and truly lost patience with the political situation in Stormont, with it hurtling from one crisis to the next because of the dysfunctional mismanagement by the two parties at the centre. The parties, and the British and Irish Governments, must commit to full and comprehensive outcomes.
Sinn Féin completely refuses to acknowledge the Chief Constable’s assessment of the possibility of paramilitary involvement in the murder of Kevin McGuigan in the Markets area of Belfast earlier this summer. There is also, of course, the failure of the DUP to work the institutions. Their approach of 10-minute Ministers going in and out has resulted in the public being sick, sore and tired of long waiting lists for healthcare. Our Minister for Health is a Minister for 10 minutes one day and then not a Minister for five days. That compounds an already difficult situation in that Department.
There is also a situation with renewable obligations for energy and renewable technologies in Northern Ireland. The people were told that they would last until the end of March 2017, but what the 10-minute Minister of Enterprise, Trade and Investment refused to tell them was that they were actually going to end in March 2016, thereby impacting on local industry and local capability, where there are enormous opportunities.
Ms Ritchie
I thank the right hon. Gentleman for his comments. I do not think that that is exactly what our party leader said.
Ms Ritchie
What I would ask is whether the DUP is fully up to power sharing, because that is the kernel or particular issue.
Lady Hermon
I can assure the hon. Lady that I will not follow the comments made by the right hon. Member for Belfast North (Mr Dodds), but he is quite right to ask the question.
The issue I wish to raise is quite different. The people in my constituency certainly want to know whether, if Sinn Féin agreed to some form of welfare reform, the SDLP would follow suit. When is the SDLP going to agree to the welfare reforms that have been rolled out across the rest of the United Kingdom?
Ms Ritchie
The SDLP wants the best possible implementation of the Stormont House agreement for all the citizens of Northern Ireland. In fact, in February in the Assembly, it was the SDLP which tabled numerous amendments to the Welfare Reform Bill. The DUP and Sinn Féin refused to support the measures. They voted down amendments that would have improved the Bill. We were able to give the Minister—[Interruption.] In many instances, the amendments were cost-neutral.
Ms Ritchie
Yes, that is right.
On another aspect of the issue, Northern Ireland needs to move into a shared future that fosters tolerance and respect across the entire island. We cannot do so if we do not confront our past. The north’s past will not simply be dealt with through the passing of time. The SDLP is not happy with the proposed legislation on the past, because we believe that it is an impediment to dealing with those issues and the recovery of truth and accountability. In my constituency, six innocent men were murdered in Loughinisland in County Down on 18 June 1994. We are still waiting on information regarding the truth; we are still waiting on justice. Above all, we are waiting to find out who perpetrated those murders and why they were perpetrated. Was there state involvement and was there involvement by the Royal Ulster Constabulary? We need to find out, which is why it is crucial that the Bill dealing with the past addresses those issues.
I am in absolutely no doubt, nor is my party, that Northern Ireland has considerable economic potential. We need a rebalancing of the economy, and we need balanced regional development. There is an opportunity for reconciliation, which must deal with the past and the situation of our current citizenry, so to speak, so that we can deal with the future. We must have a prosperous future, and we must be able to unite the people of the island of Ireland in terms of a reconciled future.
Jim Shannon (Strangford) (DUP)
It is 10 years since the IRA was supposed to decommission its weapons, 10 years since the IRA was to disband its military operations, and 10 years since a party now at the heart of the Northern Ireland Executive began its transition to a party that was, at least so it said, committed to exclusively peaceful means. Ten years on, we have murder on the streets of Northern Ireland and it is that supposedly decommissioned, supposedly disbanded terror group that is once again making the headlines and putting Northern Ireland in the news for the wrong reasons.
We are holding this debate because armed terrorists carried out executions on the streets of the United Kingdom of Great Britain and Northern Ireland. If this were any other part of the United Kingdom there would be a national outcry. Just how many lies have been told? How many more lies are we expected to believe? We were told the IRA had gone away and had left the stage. It was described as withering away by none other than the Independent Monitoring Commission. Do we believe Bobby Storey when he says that the IRA has disappeared into the air like a butterfly? Cassius Clay said that he floated like a butterfly and stung like a bee. When the IRA stings, people die. That is the difference. Do we believe Bobby Storey or do we believe the IMC? Do we believe the assessment of the IRA by the Chief Constable of the PSNI or do we believe that political colossus, Gerry “I was never in the IRA” Adams? Who do we believe?
Is it any wonder that Stormont is in crisis when the largest nationalist party cannot tell its partners in government the truth about its supposedly former terror wing? We cannot expect simply to brush all this under the carpet. After all the hurt, pain, suffering and death that the IRA caused, it is beyond an outrage that Sinn Féin cannot understand the angst not just in the Unionist community, but throughout the Province. Up and down Northern Ireland, normal hard-working families are worried—worried for the future, worried that terror is back on the streets, worried that they cannot trust those at the heart of our Executive and worried that it will affect them.
Mr Gregory Campbell
Does my hon. Friend agree that last week we saw an opportunity for the police to recruit from all communities across Northern Ireland, but that in some cases terror was manifested and threats were made? This weekend, there is one of the delayed recruitment procedures in the north-west of Northern Ireland, which offers an opportunity to politicians, trade unionists and the wider communities to stand united in opposing terror and ensuring that everybody across the community can join up with the police to ensure that terrorism never wins.
Jim Shannon
I thank my hon. Friend for that intervention. He covered my next point. Over a weekend when the PSNI tried to recruit across the whole of Northern Ireland, there were threats and bomb hoaxes. That may be the future that some republicans want to see, but we do not want it.
If Sinn Féin is willing to hide from the truth on this issue—an issue so close to home for many people across our United Kingdom—one must ask what else it is hiding. If Northern Ireland is truly to enjoy a new era and a true process of reconciliation, it is time for republicans to step up to the plate and start taking their responsibilities seriously.
The hon. Member for South Antrim (Danny Kinahan) referred to the elephant in the room. It very clearly is in the room.
Northern Ireland deserves better than this. After all that we have been through, I implore the House to support those who are rooting out the scourge of terrorism within our society so that Northern Ireland can enjoy the true peace and stability it so deserves.
Mr Speaker
Order. If I am to call the remaining two speakers, they must each be brief because I want to hear the winding-up speeches from the Front Benches as well. If they could speak without interventions, that would help the House.
Gavin Robinson (Belfast East) (DUP)
I am happy with the ruling that I should not take any interventions.
Had you been here earlier, Mr Speaker, you would have heard a number of contributions that could best be described as jaundiced, if not entirely negative. I am pleased that the debate is not entitled the political “crisis” in Stormont, but the political “situation”. I was pleased to support the hon. Member for South Antrim (Danny Kinahan) in his request for this Back-Bench debate and I believe that it has been important. Aside from the jaundiced contributions, there have been a number of encouraging contributions.
I always like to believe that the glass is half full and there are reasons for optimism. It is important that we will receive an analysis this week of the situation that paramilitary organisations find themselves in and of the operations that they may or may not have been involved in, and that we will hear at first hand an independent assessment of what we should believe and what the threats are to Northern Ireland.
The hon. Member for South Down (Ms Ritchie) referred to the state of play in the Northern Ireland Executive. Members may well be aware that one member of the Executive resigned, not for any principled reason, but entirely for political opportunism. Few people in Northern Ireland recall who that individual was, never mind what was achieved.
There is a clamouring in Northern Ireland for our Executive Ministers to get back to their jobs full time. Irrespective of how disappointed people are about how things have progressed over the past few weeks, they want devolution to work. They want Stormont to succeed and they want to see delivery in Northern Ireland, as in the rest of the UK. That is hugely important. We want to be back in our places in Stormont castle and in the Assembly.
We know what needs to change, and last week I was encouraged when the Deputy First Minister seemed to herald a shift in his position. That has been described as a preparing of the ground for a U-turn by Sinn Féin on welfare reform, and if that is right it is to be welcomed. It is disappointing the hon. Member for Foyle (Mark Durkan) has not taken the same view and still stands over the intransigence on welfare reform.
On criminality—the Minister will wish to respond to this—we need to get away from all those who have held us back in Northern Ireland, and from those who currently pillage and persecute their own communities and hold our community back. The Minister knows that he has our full support on that, whether on the Northern Ireland side of the border, in the Republic of Ireland, or internationally. Such positivity should not be misplaced and absent from this debate, and we look forward to a resolution to the current impasse.
Margaret Ferrier (Rutherglen and Hamilton West) (SNP)
Like many others, I have been concerned about recent developments in Northern Ireland. Paramilitary activity has no place in society, and it is right that the Secretary of State has called for an independent review to assess the status of paramilitary organisations in Northern Ireland. I hope that that review will facilitate the talks that ensue.
It would be a travesty if Northern Ireland were to return to direct Westminster rule. Such a regressive step would be a hammer blow to the peace process, and could effectively mark the failure of the Good Friday agreement—a deal that was agreed by a majority of citizens in Ireland, north and south, and by the UK and Irish Governments. Peace has been a rocky road in Northern Ireland, and I acknowledge the work of a great many individuals in ensuring that it has lasted.
I am deeply concerned that the peace process does not appear to have been handled as sensitively as it ought to have been in recent years. Failure to find consensus on key areas such as dealing with the past, and external factors such as imposed austerity, are seriously hindering progress. The latter point is a key concern of mine because, as an anti-austerity politician, I find it alarming that such matters are impeding the peace process.
Northern Ireland has real and ongoing issues that are directly attributable to the legacy of the troubles. The situation is deeply complex, and the legacy of the troubles has left long-lasting socioeconomic problems. Northern Irish constituencies, although few in number, regularly sit atop the UK’s unemployment charts. Last month’s figures show that three of the Province’s 18 constituencies are also included in the five highest out-of-work benefit claimant rates per percentage of economically active population. There are generational issues and, not coincidentally, those three constituencies top the tables for unemployment among 18 to 24-year-olds—an age group too young to remember the actual troubles. Those are serious issues, and the root causes need to be addressed as part of the peace process.
The bedroom tax has caused misery for millions across the UK, and real damage to the governance of Northern Ireland. Although the Scottish Government protected citizens from that cruel levy, it has caused chaos over the water. It has not been easy, but the Holyrood Administration have done a commendable job of protecting the most vulnerable. At Stormont, however, the power-sharing Executive have been unable to reach a consensus and have repeatedly been thrown into turmoil on that key issue.
I hope that I am not a lone voice of common sense when I state my bemusement that Tory welfare reform is even being mentioned in relation to the peace process. It is clear that the Stormont House talks did not effectively resolve those issues in the way that they were meant to. Although it is not my place to comment on or dictate the nature of talks, agreements or resulting legislation, I hope to see progress and consensus on key issues. I am eager to see a positive outcome to the current talks, and I truly hope, for the sake of all those living in Northern Ireland and the decades-long peace process, that a lasting resolution can be found.
Mr Speaker
Order. We are extremely grateful to the hon. Lady. Unfortunately there will not be time for a Back-Bench winding-up speech. The opening contribution was substantial, for which we are grateful, but we now need to wind up the debate with the Front-Bench speeches.
Stephen Pound (Ealing North) (Lab)
I congratulate all those who have spoken this evening. Last time I spoke from the Dispatch Box on Northern Ireland matters I was able, proudly, to congratulate Kyle Lafferty on scoring the goal that took Northern Ireland forward. Tonight, it would be wrong and remiss if I were not to mention Josh Magennis and Steven Davis, as well as Michael O’Neill and everyone at the Irish Football Association. They should be proud of their achievement. I am sure this House will be supporting the green and white army in France next year.
It is important to put on the record the position of the Opposition. There has been much welcome regarding the return of my colleague, my hon. Friend the Member for Gedling (Vernon Coaker), and we welcome my hon. Friend the Member for Stoke-on-Trent North (Ruth Smeeth) to the team. There has been no change in the policy of the Labour party with regard to Northern Ireland. We reiterate, on the record, the bipartisan approach. It is vital that we place on record our unwavering commitment to the people of Northern Ireland and to the rule of law, and to reiterate the remarks made by my hon. Friend the Member for Gedling at the Labour party conference when he made it clear that we are fully supportive of the principle of consent as expressed in the Good Friday agreement and subsequent agreements.
We have heard some first-class speeches tonight. For anyone who has talked about negativism, I have to say that I have heard knowledge and I have heard people speaking from the perspective of experience. The hon. Member for South Antrim (Danny Kinahan), who secured the debate, should be given credit. He referred at one stage to a “dysfunctional quagmire”, a dramatic expression that will no doubt enter the parliamentary lexicon. It is not one I have heard before. He may be expressing his own personal concerns and fears, but there is, of course, much more to this debate than that.
We have heard from so many Members about the difficulty of moving forward from the past. None has made the case more dramatically than the right hon. Member for Belfast North (Mr Dodds). On 30 July 1990, Ian Gow was killed. Twenty five years have passed since then. The three new commemorative shields over the door to the Aye Lobby will not have escaped the notice of the House. They represent not just Major Charles Lyell, who was the Member of Parliament for Edinburgh South, but Captain Dr John Joseph Esmonde, who was the Member for North Tipperary and the famous Lieutenant Tom Kettle, that great poet from East Tyrone.
The past is all around us. The past is everywhere. We cannot ignore the past, but we have to move forward. One statement we heard tonight shows us how we are still facing terrible problems. The right hon. Member for Belfast North referred to Garda Anthony Golden, who was killed this week. Let us not forget that Garda Golden was the father of three young children. They no longer have a father. What we are talking about here tonight is not some abstract matter. This is not some political game or constitutional discussion. This really is a matter of life and death. It was rightly said that it is much more important that we talk about these issues here and in Stormont than resort to the alternative.
My hon. Friend the Member for Bury South (Mr Lewis) said that he might be rusty. I think the House owes my hon. Friend thanks and gratitude for his work from the Opposition Front Bench. He was not rusty. As ever, he was incisive. He was as sharp as a razor and absolutely to the point. We have much to learn from him and from the positivity he expressed.
In addition to trade unions, my hon. Friend the Member for Blaydon (Mr Anderson) mentioned Washington. We should refer in these debates to the role of Dublin and the Irish Government, as well as Washington. We need all the friends we can get in resolving these matters. They have proven to be good friends.
Let us not forget the comments made by the hon. Member for Torbay (Kevin Foster). He talked about the future, not the past. That is so important: let that be the key factor. Above all, the hon. Member for South Antrim brought this debate to the House not in a mood of despair, but, as far as I could see, in a mood of optimism. I hope we can resolve these issues.
I would like to put a couple of points to the Minister. The first is on the issue of welfare reform. The hon. Member for Rutherglen and Hamilton West (Margaret Ferrier) raised these points. As he will know, Northern Ireland is not like any other part of the UK. We who have not lived through them cannot understand the effect of those traumatic and horrifying acts of terrorism and bloodshed. The post-traumatic stress and other mental health illnesses that blight and curse that community are beyond the imagination and experience of many of us on this side of the water. Does the Minister share the concerns on this side of the House that further reductions to services as a result of welfare reform threaten to enhance the cycle of generational problems of worklessness? What assistance will the Government be offering to ensure that mental health support services in particular are protected?
I reiterate the Opposition’s support for the Stormont House talks, but I would be grateful if the Minister could update the House on the response he has received from the various political parties regarding the proposed legislation. Why is the implementation and reconciliation group referred to not included in the legislation? Finally, what progress is being made with the talks?
I could say more—we could all say more—but I will conclude by thanking, as I think we all do, the hon. Member for South Antrim, not just for bringing this debate, but for the conciliatory, gentle, positive and hopeful way in which he did so. He referred to the greatness of the people of Northern Ireland. We all agree with that. I hope that now is the time for the people of Northern Ireland to prove that they are not just a great people with a great past, but a great people with a great present and future. That future is ours to seize. Let us do it.
The Parliamentary Under-Secretary of State for Northern Ireland (Mr Ben Wallace)
Before I start, may I add my and my right hon. Friend the Secretary of State’s condolences to the family of Garda Office Anthony Golden? Whatever side of the Northern Ireland border one lives, we all support the PSNI and the Garda in the work they do every day, putting themselves at risk trying to keep people safe. The loss of Officer Golden’s life is truly a tragedy brought about by people who still stick to the path of violence. May I also make a brief apology for my right hon. Friend not being here? She is, of course, in Northern Ireland involved in the talks process.
This all started last December, when, after an 11-week period, the Stormont House agreement was brought about. It was designed to make a more prosperous, stable and secure Northern Ireland and to ensure that all the problems that had arisen since the Belfast agreement were put behind us, and we underpinned it with a generous settlement of £2 billion. I assure my hon. Friend the Member for Amber Valley (Nigel Mills) that there is no more money. We funded the deal and put together the £2 billion package last year, and there is no open chequebook. The option is clear: to implement in full the Stormont House agreement. It is regrettable, therefore, that this year Sinn Féin decided to break the agreement. Had it not, I think that Stormont House would still be operating and on the path to producing a more prosperous and better Northern Ireland.
For the sake of people in Northern Ireland, however, we cannot allow a non-functioning Stormont to continue, which is why my right hon. Friend convened the talks—to try to work through the impasse. The Government and many other parties have stuck to their part of the Stormont House agreement. We have paved the way for corporation tax legislation at Stormont to allow flexibility and reduced levels to be put in place to encourage the desperately needed businesses to grow, and we are on the cusp of introducing legislation to deal with the legacy of the past. I can assure the hon. Member for South Down (Ms Ritchie) that nothing in the proposed legislation will prevent her from finding out the truth of what happened to her constituent or justice from being served on the perpetrators, if they are identified.
We have also rolled out and started the process of that £2 billion package: the voluntary exit scheme for civil servants, the £150 million to deal with the legacies of the past and the £350 million towards the economic pact, but unfortunately welfare reform seems to be the sticking point. The hon. Member for Bury South (Mr Lewis) could not have put it better. Whatever one’s position on welfare and my Government’s welfare policy, it needed to be implemented. I say to the hon. Member for Foyle (Mark Durkan) that it was something that the parties signed up to in December last year. It is simply part of the politics we have to face and implement. Yes, we have allowed flexibilities—flexibilities that the constituents of the hon. Member for Bury South (Mr Lewis) in Lancashire and I do not have. We have allowed flexibilities for Northern Ireland with its generous block grant to make accommodation for the troubles and their impact. It is important to see this through.
We cannot overlook the brutal murders that took place this year, culminating in the murder of Mr McGuigan in the Short Strand. Let me make it absolutely clear that there is no place in Northern Ireland or the rest of the United Kingdom for the paramilitaries or the existence of paramilitary organisations. This Government will fully support the investigation of the PSNI no matter where it leads. We will not interfere with it; we will only support what the Chief Constable of the PSNI does with his operational freedom to pursue justice. That is no more and no less than we should expect.
I support the Justice Minister in the devolved institution, Mr Ford, on his work with the organised crime task force. He is making progress. Only a few weekends ago, we had a successful search, arrest and charging of an individual linked to republican terrorism in west Belfast. I say to the hon. Member for South Antrim (Danny Kinahan) that we are making progress in bringing people to justice. With explosives taken off the street, they will not be available to cause harm to, and murder, people as they go about their business. The aim of all this is to bring violence and the men of violence to an end.
As for the contributions, I think that the hon. Member for South Antrim should not have apologised for bringing this debate. We should have more debates on Northern Ireland: it would give me more practice, but I am also delighted that Members of all parties have so fully engaged in the debate.
The hon. Member for Edinburgh North and Leith (Deidre Brock) focused on action, and I totally agree that we must take action to ensure that Stormont continues. My first time in politics was in the Scottish Parliament. I saw what a working Scottish Parliament can do for the people of Scotland. I would say that a working Stormont is the best path to peace and also the best path to prosperity. We should not let obstacles bring that institution down. If that means tough decisions being taken here, we might have to do that. I hope that the Scottish National party would not rule that out unconditionally.
To my hon. Friend the Member for Amber Valley, I repeat that there is no more money. The right hon. Member for Belfast North (Mr Dodds) made a valid point, however, and I welcome his support for the full implementation of the Stormont House agreement. The point is to see this agreement through—the agreement signed and sealed in December last year.
My hon. Friend the Member for Plymouth, Sutton and Devonport (Oliver Colvile) talked about his experiences of Northern Ireland and the chaos and murder that were brought to the mainland of the United Kingdom. We should not forget that the IRA blew up people going about their business shopping, including children and families in this country, in Northern Ireland and all around Europe. We should not forget that when we ask people to condemn the actions taken in the past.
I think the hon. Member for Bury South demonstrated why he deserved to be the shadow Secretary of State for Northern Ireland. His speech spoke very much about him being a mature politician who delivered what the UK Government should be delivering for Northern Ireland—a bipartisan approach, neutral to the extent of not favouring one party or the other, but focusing on the issue of consent and trying to move forward to the future rather than dwelling on the past.
My hon. Friend the Member for Harrow East (Bob Blackman) asked how long have we got. The money is running out; there is no magic money tree. We have gone as long as people will want to tolerate withdrawal of their services, as hospitals go into crisis and education is not able to function in Northern Ireland. We have as long as it takes, but my view is that the people of Northern Ireland will not tolerate it much longer—and neither should the parties of Northern Ireland.
The prize is great; the prize is in front of us. Northern Ireland is an exciting, confident place—better than when I was there in the ’90s. If we can resolve this Stormont House impasse, I think Northern Ireland will go from strength to strength—like its football team and the Irish rugby team.
Question put and agreed to.
Resolved,
That this House has considered the political situation in Stormont.
Business without Debate
Civilians in Syria
(8 years, 6 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Jo Cox (Batley and Spen) (Lab)
Every decade or so, the world is tested by a crisis so grave that it breaks the mould: one so horrific and inhumane that the response of politicians to it becomes emblematic of their generation —their moral leadership or cowardice, their resolution or incompetence. It is how history judges us. We have been tested by the second world war, the genocide in Rwanda and the slaughter in Bosnia, and I believe that Syria is our generation’s test. Will we step up to play our part in stopping the abject horror of the Syrian civil war and the spread of the modern-day fascism of ISIS, or will we step to one side, say that it is too complicated, and leave Iran, Russia, Assad and ISIS to turn the country into a graveyard? Whatever we decide will stay with us for ever, and I ask that each of us take that responsibility personally.
To date, neither side of the House has a record to be proud of. Let me start with my party. One of the reasons it is such an honour to be standing on this side of the House is the deep, deep pride that I have in Labour’s internationalist past. It is pride in the thousands of people from our movement who volunteered to fight tyranny alongside their fellow socialists and trade unionists in the Spanish civil war; pride in the leaders of our party—and Robin Cook in particular—who demanded action to stop the slaughter of Bosnian Muslims in Srebrenica and elsewhere, in the face of outrageous intransigence from the then Conservative Government; and pride in the action we led in government to save countless lives in Kosovo and Sierra Leone. In recent years, however, that internationalism has first been distorted, and now risks being jettisoned altogether.
My heart sank as I watched in 2013 when, following President Assad’s use of chemical weapons against civilians, we first voted against a military response and then supported taking military options off the table. Responsibility for the mishandling of that critical vote, which had such far-reaching international implications, falls principally on the Government, but we on these Benches carry some culpability for letting Assad ride roughshod and unchallenged across what should have been a sacrosanct red line. As a result, the international community lost all credibility in our subsequent efforts to stem the spread of, and the suffering in, this horrific civil war. Indeed, our failure to intervene to protect civilians left Assad at liberty to escalate both the scale and the ferocity of his attacks on innocent Syrians in a desperate attempt to cling to power.
I understand, of course, where our reticence comes from. It comes from perhaps the darkest chapter in Labour’s history, when we led this country to war in Iraq. Many Members in all parts of the House have been scarred by that experience, and understandably so; but let us all be clear about the fact that Syria is not Iraq. I opposed the war in Iraq from the beginning because I believed that the risk to civilian lives was too high, and their protection was never the central objective. I knew, as we all knew, that President George Bush was motivated not by the need to protect civilians, but by supposed weapons of mass destruction and a misguided view of the United States’ strategic interest.
I marched against that war, and have marched against many others in my time. Indeed, before I joined the House I was an aid worker for a decade with Oxfam. I have seen at first hand the horror of war and its brutal impact on civilian populations. I have met 10-year-old former child soldiers with memories that no child should have to live with. I have sat down with Afghan elders with battle-weary eyes. I have held the hands of Darfuri women, gang-raped because no one was there to protect them. From that experience, alongside a horror of conflict, I have the knowledge that there are times when the only way to protect civilians requires military force. I might wish that it were not so, but it is. That is why I firmly believe that the Labour Government were right to champion the adoption, in 2005, of a landmark global commitment to the best and most fundamental of our human ideals: the responsibility to protect civilians. I still firmly believe that a legitimate case can be made for intervention on humanitarian grounds when a Government are manifestly unwilling or unable to protect their own civilians. Sovereignty must not constitute a licence to kill with impunity.
The history of Iraq hangs over us all, and it should, but its legacy is awful enough without supplementing it with a new one of ignoring the slaughter in Syria. We must not let it cloud our judgment or allow us to lose sight of our moral compass.
The war in Iraq led to the deaths of thousands upon thousands of civilians. Its legacy must be to make us all put the protection of civilians at the centre of our foreign policy, not to make us sit on the sidelines while hundreds of thousands more are killed and millions flee for their lives.
Jim Shannon (Strangford) (DUP)
I am greatly concerned about the persecution of Christians in Syria. Some 600,000 Christians have been displaced from Syria. They have been given the ultimatum of “convert or die”. Does the hon. Lady feel our Government could do more to put pressure on Assad and parts of ISIS to make sure the persecution of Christians stops?
Jo Cox
I thank the hon. Gentleman for his intervention and I will come on to that subject later in the speech.
I shall now turn to the Conservative party’s record. For four years the Government have categorically failed on Syria, and it is not just the UK that should be judged so harshly. The failure to develop and then implement an effective strategy on Syria left this conflict free to create a horrendous European refugee crisis and provide a haven for the barbarism of ISIS to take root, allowed chemical weapons to be used unchallenged and even emboldened Russia. In particular, since the Prime Minister’s mishandling of the 2013 Syria vote, the Government have let this crisis fester on the “too difficult to deal with” pile. There has been no credible strategy, nor courage, nor leadership; instead we have had chaos and incoherence interspersed with the occasional gesture. Indeed, it has been a masterclass in how not to do foreign policy and a stark lesson on what happens when we ignore a crisis of this magnitude. Britain—with our proud tradition in international affairs, our seat on the UN Security Council and one of the best diplomatic, humanitarian and military services in the world—has been a political pygmy in this crisis.
None of us has a proud history in this affair. If we are to put this right, we must put that behind us; we must put party politics to one side and focus on what really matters—the protection of Syrian civilians.
Let me first turn to two of the arguments that do most disservice to a serious discussion of this crisis. First, please let us stop casting the humanitarian, diplomatic and military responses as mutually exclusive alternatives. They are not. If we are serious about addressing this crisis, we need to stop pretending that any one of them offers a panacea and instead weave these strands into a coherent strategy. Secondly, let us not be duped into believing that we need to make a choice between dealing with either Assad or ISIS. On the surface, this may seem appealing, but it is not an option. There is no choice.
We can, and must, address both Assad and ISIS for two principal reasons. First, a sole focus on ISIS will not end the conflict and the threats to our interests. The Assad regime ignited, and continues to drive, the violence in Syria. This year alone, it has killed seven times more civilians than ISIS, so a strategy that only focuses on ISIS will not end the fighting or the threat to regional stability. It will not stem the tide of desperate refugees pouring into Lebanon, Turkey and Jordan, or trying to get into Europe.
Secondly, and crucially, a myopic focus on ISIS will not lead to its defeat. It will not work. Assad is ISIS’s biggest recruiting sergeant, and as long as his tyranny continues, so too will ISIS’s terror. Indeed, a sole focus on ISIS while ignoring the regime’s ongoing bombardment of civilians risks inadvertently strengthening the jihadis’ narrative, which is fuelled by the idea that the west is colluding with Shi’a forces in Tehran and Damascus in a crusade to subjugate Sunni Arabs. That is why, to make good on our past failures, to protect our interests and to live up to our proudest traditions, we need urgently to develop a comprehensive and coherent strategy.
I believe that there are three core elements to such a strategy, none of which is easy and all of which are critical. First, I shall talk about the humanitarian aspect. Four years on from the start of the conflict, there are now 240,000 dead—some credible estimates put the figure at over 330,000—and more than 12 million people are in need of humanitarian assistance. The scale of the human disaster is breathtaking. One area in which the UK Government have shown considerable and commendable leadership is in the regional humanitarian response to the refugee crisis, where we have led the way with the US and our European partners. I now urge the Government to go further.
As the Minister will be aware, the vast majority of Syrian refugees are in the region and those countries are buckling under the strain. The G20 summit in Turkey in November should be marked by the launch of an ambitious plan to meet refugees’ urgent needs, to invest in their education and livelihoods and to support Syria’s neighbours in reconstruction and development. Equally important is the UK’s response to the refugee crisis, which has, to date, been woefully inadequate. Taking 20,000 refugees over five years is simply not good enough; it sends an awful message about how seriously we take civilian protection. Whether it is the response to the drownings in the Mediterranean or our offer to take Syrian refugees, the Prime Minister has been pushed into climbdown after climbdown, embarrassed into action by the humanity of the British public. It is time for him to lead, not follow.
But let us be clear that, no matter what our humanitarian response is to this crisis, it will never be enough. It cannot end the conflict. That is why we also need to invest far more in diplomatic efforts to find a political solution. There are clearly no easy answers, but we can at least be clear on the principles. First, this needs to be a much higher-level conversation. We saw some improvement in that respect at the UN General Assembly last month and in the reopening of the UK’s embassy in Tehran. However, the Foreign Secretary and Prime Minister need to make it clear that ending the conflict in Syria is their No.1 international priority, and to challenge other world leaders to match their commitment.
Secondly, we must not let the urgent need to find a political solution cloud our judgment about what a credible one looks like. If four years of continuous vicious conflict have taught us anything, it is that the current regime is no longer capable of bringing peace and stability to Syria. Whatever its exact complexion and character, and whatever the complex negotiations and compromises needed to get there, a credible political solution has to involve a transition to a new Government that represent all Syrians and that enjoy sufficient trust and legitimacy that all but the delusional fanatics of ISIS will be willing to lower their guns and work together to rebuild their country. Russia’s recent intervention makes the route to a political settlement more complicated but it does not change the necessity for one. A political solution is the only way to end the conflict between the regime and the opposition in Syria. Only when that conflict has ended can ISIS and the handful of other extremists allied to al-Qaeda be defeated.
The third element of the strategy has to be military. While I do not believe that there is a purely military solution to this conflict, I do believe that there will be a military component to any viable solution.
The threat from ISIS—to the region, to the west and to Syrian and Iraqi civilians—is real and growing. I do not believe it to be ethical to watch from the sidelines as Syrian villages are overrun by ISIS fighters who make sex slaves of children, terrorise minority groups and slaughter fellow Muslims. In addition, their call for individual sympathisers to attack westerners anywhere and anytime requires a robust response.
The estimated 20,000 foreign fighters in Syria and Iraq, many of whom hold western passports and can therefore travel freely in Europe, present a real and serious threat to us here in the UK. In addition, ISIS’s spread to new havens in Libya, the Sinai peninsula, Afghanistan, Yemen, Nigeria and elsewhere convinces me of the need for active UK involvement—but only if that is part of a comprehensive strategy to protect civilians and end the conflict.
Mr Andrew Mitchell (Sutton Coldfield) (Con)
The hon. Lady is making a good and brave speech on this important point. Will she emphasise the point we set out in our joint article over the weekend, which is that the safe havens are not an intervention in the politics of Syria but are strictly a humanitarian measure to ensure safety for those who are fleeing their homes and communities, often under gunfire, and the extreme violence in Syria today? This is the sort of intervention that the United Nations was set up to co-ordinate, and we really must ask why more is not being done by the international community to promote this important initiative, which both of us supported at the weekend.
Jo Cox
I thank the right hon. Gentleman for that, and we do share common cause on the need for humanitarian protection for civilians in Syria.
Let me get back to my point about a myopic focus on ISIS being counterproductive. If selective air strikes against ISIS are the only action the west takes in Syria, we will never defeat ISIS—and we could even strengthen it. At least 75% of all civilian deaths in Syria are a result of action by Syrian Government forces; aerial bombardment by the regime is by far the biggest killer, taking around 200 lives every week. It is horrifically indiscriminate; 95% of the victims are civilians. For these reasons, and in the light of the fact that an ISIS-only approach will not protect us from the threat it poses, our objective must be to stop the indiscriminate aerial bombardment in Syria. Not only would that provide much-needed relief to Syria’s embattled population, who are still being bombarded by 50 to 60 barrel bombs a day, but it could help empower Syria’s remaining moderate opposition, who are essential not only to finding a political solution but to holding back and ultimately defeating ISIS.
Stopping the bombs would also take away a significant radicalising factor in the conflict and could breathe new life into the political process, changing Assad’s calculations and forcing him to the negotiating table. As we saw in 2013, the Syrian Government’s response to the credible threat of force was to make a political deal, not to risk escalation. As such, I believe it is time for the Government urgently to consider deterring the indiscriminate aerial bombardment of civilians in Syria through the willingness to consider the prudent and limited use of force.
A no-fly zone would be an enormous military undertaking, and would entail significant risks, particularly now that Russia has joined the regime in the Syrian skies. But what I call a no-bombing zone, enforced from maritime assets in the Mediterranean so as to avoid engaging Syrian air defences, would save lives, uphold international humanitarian law and breathe life into the political process.
Bob Stewart (Beckenham) (Con)
I totally endorse what my right hon. Friend the Member for Sutton Coldfield (Mr Mitchell) said about the hon. Lady making a brave speech. My worry is that she can do nothing without a Security Council resolution, which gives political top cover and the legal right to go into a sovereign country.
Jo Cox
I thank the hon. Gentleman for the intervention. I agree that we should try to secure a UN Security Council resolution, but I do not think we should limit ourselves to not acting without one. I believe a no-bombing zone is feasible if it is enforced from maritime assets in the Mediterranean, so as to avoid engaging Syrian air defences. This would save lives, uphold international humanitarian law and breathe life into the political process. A well-designed deterrence operation would impose a cost on the Syrian regime for any indiscriminate bombing of civilians—for example, by targeting the military airbases where barrel bombs are stored and flown from. Any attempt by the regime to escalate would trigger additional punitive strikes, rendering aerial bombardment counterproductive. In those circumstances, it is far more likely that Assad and Russia will be forced to the negotiating table.
To conclude, this conflict has proved time and again its propensity to escalate month on month, year on year. For moral reasons—and national self-interest—we can no longer afford to ignore Syria. Indeed, inaction will only see a growth in the number of Syrians killed, the number of refugees fleeing and the potential threat to British national security from ISIS. I urge all Members to look to the best traditions in the history of their parties and to think about the personal role that they can play to protect civilians in Syria and further afield.
The voices of Syrians have been absent from this debate for far too long. They have been asking for protection for years and no one has been listening. It is now time for us to listen and to act.
The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Tobias Ellwood)
I congratulate the hon. Member for Batley and Spen (Jo Cox) on securing this important debate. She brings a huge amount of expertise to the House, which is very welcome. I have just returned from the UN General Assembly, where this subject was very much on the agenda. She went into a huge amount of detail, but I am sorry that she chose to wander down a bit of a political path. I will write to her with more details on the issue of British leadership. As my hon. Friend the Member for Beckenham (Bob Stewart) said, unless we have a UN resolution, it is very hard to march forward. I am afraid that, on more than one occasion, either China or Russia has vetoed attempts to move this situation forward. I also disagree with her about the choice between ISIS or Assad. We have never made that statement—quite the opposite, in fact.
I am sorry that we are debating this matter for only 30 minutes. The sheer number of Members in the Chamber on a Monday evening on a one-line Whip shows that this is a very important matter. I hope that the usual channels are listening, and I urge them to consider a far longer debate on the subject. [Interruption.] Let me finish. We are meeting our 2% of GDP commitment and our 0.7% official development assistance commitment. With a long history in the middle east, we have the ability and desire to do more to assist in this terrible conflict, but we seek consensus over how we might do that. A fuller debate would explore how these matters might be pursued in more detail.
The Syrian civil war is now in its fifth year. As the hon. Lady has said, 250,000 people have been killed, almost 8 million displaced internally and more than 4 million refugees created. This is a crisis caused and fuelled by the Assad regime, which is responsible for the vast majority of deaths. Almost 90% of the civilian deaths are a result of the regime’s indiscriminate bombing, its shelling of urban areas, its siege tactics and its use of chemical and toxic substances. This instability has fuelled a migration crisis that affects neighbouring countries, the wider region and Europe as well.
Assad’s failure to recognise the Sunni people, who make up two thirds of the country’s population, has acted as a recruiting sergeant for ISIL. Today, ISIL poses a threat not just to the region but wider afield to the UK as well. The horrific attacks in Sousse, Kuwait, France, Australia, Turkey and elsewhere demonstrate that the threat knows no borders. But alone, Assad has neither the intent nor the capability to defeat ISIL. The ultimate solution both to the migration crisis and the threats emanating from Syria is a political transition that involves a mechanism for Assad to step down. It is for the Syrian people to decide exactly how that happens. It may be part of a transition process, but the process cannot be open-ended, and Assad can have no part in Syria’s future.
Mr Ellwood
I will not give way, because of the time.
The UK supports the efforts of the UN envoy, Staffan de Mistura, who faces a complex and challenging task. The UN Security Council and the wider international community must support Mr de Mistura’s efforts as he works with the Syrian parties to deliver a political process that brings about an inclusive transition.
Mr Ellwood
No, I will not give way.
The Russian Government’s increased support for Assad has further complicated an already complex situation. They must take responsibility for their part in escalating the Syrian war. By predominantly hitting non-ISIL targets, they will only fuel more extremism and more radicalisation.
We call on Russia to cease its attacks on the Syrian opposition and civilians and to focus its efforts on ISIL. Observers of the middle east will know that Russia’s strong links with and interests in Syria are not new. Secret agreements offering diplomatic and political support were signed even before Syria gained its independence from France. The Soviets offered military help to form the Syrian army in the first place and Hafez al-Assad sided with the Soviets during the cold war and agreed the permanent basing of naval, land and air assets. This is not just about global posturing but Russia’s actions in shoring up a tyrant who was on his way out, and it will lead to Russia’s losing influence in the long term.
It took six days for Russia to strike any ISIL targets at all. More than 85% of Russian strikes have been—
Mr Ellwood
I will not give way. I have made it very clear that time is short and I am answering the hon. Member for Batley and Spen. I hope that the hon. Gentleman will hang on to his seat and I will be delighted to speak to him after the debate.
It is clear that Russia’s priority is not to defeat ISIL but to prop up Assad. Russia has violated Turkish airspace three times in the past week and the UK strongly condemns these provocative violations of NATO members’ sovereign airspace. It is important that allies show solidarity to ensure the inviolability of NATO airspace is respected, so we call on Russia to stop targeting civilians and opposition groups, which are part of the future of Syria. This is Russia’s biggest air deployment beyond its borders since the cold war, with fast jets, helicopters, unmanned aerial vehicles, electronic warfare and air defence systems propping up an ailing Syrian regime whose military is exhausted, depleted and demoralised.
Russia’s entry, with all its propaganda, will no doubt delay a resolution and the political transition about which the hon. Member for Batley and Spen spoke rather than expediting them. It will also widen the extremism footprint for Russia, as significant numbers of foreign fighters supporting ISIL will no doubt react to Putin’s actions.
The hon. Lady mentioned safe zones, and I have taken a lot of time over the summer to consider the issue in detail. We will continue to look at all options along with our allies to protect civilians in Syria. There has been talk of safe or protected zones, no-fly zones and so on, but history tells us that implementing genuinely safe zones is difficult and must be accompanied by an international mandate that would provide the will, the authority and the full means to ensure that they have a chance of being effective. It would also involve significant military commitment. As we have seen, that can be hard to come by from the various Parliaments across the world.
We should also bear in mind the legal justification for intervention in another country has five means. One is a UN Security Council resolution—
Mr Ellwood
I will not give way. The other legitimate means for engagement include article 51 of the UN Charter, or the right collectively to defend others, or intervention to prevent a humanitarian catastrophe, as we saw in Kosovo. The final such means is an invitation by the leader, which is what we saw in Iraq.
The hon. Member for Batley and Spen mentioned the humanitarian situation. The UK has been at the forefront of the humanitarian response to the conflict in Syria. I am pleased to say that we have pledged more than £1.1 billion in aid in response to the crisis in Syria and the region. I visited the Zaatari camp in north Jordan in the summer and my hon. Friend the Minister for the Armed Forces, who is in her place, has just come back from Azraq. I am pleased to say that we are seeing how well British money is spent. It is clear that refugees want to stay in the region where they have family and cultural ties, and the cost of housing one refugee in the UK equates to supporting more than 20 refugees locally. Let me make it clear that the standard of that support is very different, but that just illustrates the difficult decisions people are having to make in every country about how much money we spend domestically and how much we spend in the region.
The Prime Minister also announced on 7 September the expansion of the Syrian vulnerable persons relocation scheme to resettle up to 20,000 Syrians in need of protection during this Parliament. Since the crisis began in 2011, the UK has granted asylum to nearly 5,000 Syrian nationals and their dependants.
In conclusion, we are well aware that Syria remains the greatest humanitarian tragedy of our time. We must support the desire of ordinary Syrians for a future free of the cruelty of Assad and the barbarity of ISIL. I end by apologising to Opposition Members for not being able to take interventions. As they can see from my notes, I have plenty more to say on the matter—
Mr Ellwood
I will not give way, no. The hon. Gentleman is not going to tease me at this last moment. I invite and encourage a wider debate that lasts longer than 30 minutes, which I would very much welcome—
Mr Ellwood
We can go on later into the night if you want, Mr Speaker, but I think that time is against us. I look forward to debating the matter in further detail. [Interruption.]
Mr Speaker
Order. The business managers can perfectly well facilitate such a debate, and at whatever hour of the night it took place I should be very happy to be in my place. Obviously a lot of people have things to say and would like to do so.
Question put and agreed to.
Draft Electricity Capacity (Amendment) (No. 2) Regulations 2015
(8 years, 6 months ago)
General CommitteesRead Full debate Read Hansard Text
The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)
I beg to move,
That the Committee has considered the draft Electricity Capacity (Amendment) (No. 2) Regulations 2015.
May I say what a pleasure it is to serve under your chairmanship today, Mr Percy? The regulations amend the main secondary legislation package for the capacity market scheme, which was part of the electricity market reform programme in 2013. The powers to make this implementing secondary legislation are found in the Energy Act 2013. Following scrutiny in this House and the other place, the 2013 Act received Royal Assent in December 2013, with cross-party support. The two changes in the regulations will simplify the process for applicants to the capacity market and were overwhelmingly supported by respondents to our consultation.
Before I explain the changes in more detail, it may be helpful if I say a few words on the background of the capacity market as a reminder to hon. Members, particularly new hon. Members. The capacity market will address our medium-term electricity needs and ensure that there is sufficient electricity supply towards the end of the decade and beyond. In brief, the capacity market will achieve that by making a regular capacity payment to providers that are successful in capacity auctions. In return for that payment, providers must meet their obligations to provide supply or reduce demand when the system is tight, thereby ensuring that enough capacity is in place to maintain security of electricity supply.
Ensuring that families and businesses across the country have secure, affordable energy supplies on which they can rely is our top priority. That is why, working closely with National Grid and Ofgem, we already have firm mechanisms in place to maintain comfortable margins in the system for coming winters. Beyond that, it is essential that generators have confidence that they will receive the revenues they need to maintain, upgrade and refurbish their existing plant, as well as to finance and build new plant to come on stream as and when existing assets are retired. Equally, we want to ensure that those who can shift demand for electricity away from periods of greater scarcity without detriment to themselves and the wider economy are incentivised to do so. That is why we have the capacity market.
The first auction, which was held in December 2014, saw a good outcome for consumers. Fierce competition between providers meant that we obtained the capacity we will need in 2018-19 at prices below the levels that many had expected, and that translates to lower costs on consumer bills.
The regulations make two minor changes to improve the capacity market, based on feedback from stakeholders. The first is to substitute a new definition of “relevant grant” in regulation 17 of the Electricity Capacity Regulations 2014. The second is to regulation 59(3) of the 2014 regulations and will extend from five to 15 the number of days in which applicants can submit credit cover after receiving a conditional pre-qualification notice.
The amendment to the definition of “relevant grant” will ensure that grants, which are there to support feasibility studies or research and development in relation to carbon capture and storage, will not preclude participation in the capacity market. The essential feature is that the carbon capture and storage support should not have provided effective material support that would put a provider at an advantage compared with others that did not get that support. That will not be the case for such early-stage grants for CCS purposes. The regulations extend the number of days from five to 15 to enable applicants to have slightly longer to submit credit cover.
My Department consulted on the two changes in March 2015 and received 22 responses. The vast majority of stakeholders who responded were content with the changes proposed. I look forward to hearing what hon. Members have to say.
Dr Alan Whitehead (Southampton, Test) (Lab)
It is a pleasure to serve under your chairmanship, Mr Percy. The changes put forward in the regulations are unexceptional and uncontroversial, so the Opposition will not seek to divide the Committee. This is a useful occasion, however, to seek a little clarification from the Minister on the wider purposes of the changes.
Although, as we have heard, the changes were consulted on in the spring, it looks as if the main change to the regulations passed into law last year is perhaps to correct an omission. It appeared that CCS projects that had received some kind of grant support, through either European Union funding or departmental grant arrangements for early-stage developments such as front-end engineering and design, might be in a difficult state of definition as far as the pre-qualification arrangements are concerned because someone had not put the right wording in the 2014 regulations.
I welcome the new, proper wording, which clarifies the circumstances under which CCS projects will be not disadvantaged if they have received a grant, or advantaged if they have received a grant specifically in relation to a capacity market unit. Nevertheless, a problem still appears to arise, because as far as I am aware, the Government do not intend to enable CCS to access operational support to capacity markets. Indeed, on the contrary, the Government’s intention, which they made clear in their scoping document this spring, is that whereas grants will be available in advance of a contract for difference being issued for the operation of a CCS plant, operational support should in principle take place through some form of modified CFD. In the long term, that closes the door to support of any kind for CCS arising through capacity auctions, and I doubt whether any CCS developer is under any illusions otherwise.
Therefore, prudent though it may be to close the door on possible sloppy wording, I wonder whether the whole premise of the regulations is not a little redundant. Perhaps the Minister will help by clarifying those matters a little, unless CCS is intended eventually to pre-qualify for capacity auctions in its operational phases and across the board, which would be quite a turnaround in policy.
Andrea Leadsom
I can only assure the hon. Gentleman that there was no case of wrong wording the first time around. As he will know, the point of not allowing those who are already in receipt of Government subsidies to participate in a capacity market is sound, because otherwise they would effectively be paid for something they were already being subsidised to produce. The implication of being given a grant was not specifically dealt with, so it was not a case of wrong wording; it was more that that was subsequently pointed out and carried sufficient support to be worth making an adjustment.
The hon. Gentleman’s other point was that CCS may not ever take part in a capacity market. I am not aware that we have come to a conclusion on that either way at this point. As he will know, we do not as yet have any deployed carbon capture and storage in this country, but we are looking at it closely, and two competition projects are currently considering their own ability to develop an industry that could be very valuable for the long-term use of fossil fuels.
Question put and agreed to.
Lambeth and Southwark Milkspots
Westminster Hall
(8 years, 6 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
Cannabis
(8 years, 6 months ago)
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Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Mr Nigel Evans (in the Chair)
Mr Speaker has agreed that, for this debate, members of the public can use handheld electronic devices in the Public Gallery, provided that such devices are silent. I am sure, however, that people will be so gripped by the debate that they will not be distracted at all by their handheld devices. Photos must not be taken.
Paul Flynn (Newport West) (Lab)
I beg to move,
That this House has considered an e-petition relating to making the production, sale and use of cannabis legal.
I am grateful for the opportunity to speak under your chairmanship, Mr Evans, because you have played a distinguished part in debates on this issue—indeed, I might well quote some of the things you have said. One time, you complained that cannabis contained several hundred compounds, and the New Scientist wondered whether you knew how many compounds were in the cabbage you had had for your supper that night.
Before we start, I would like to illustrate how this Government—like all Governments—have handled this issue. It is typified by the response we had to this thunderously eloquent petition, which has been signed by 220,000 people. The response was trite: it could have been written 20 years ago. It does not reflect our current knowledge and experience, the great work that has been done, particularly in the last 20 years, or the serious case that has been made for decriminalising cannabis.
Let me start with a recent revelation about how the Government’s mind works. I put down a parliamentary question that could have been answered with one word. I asked how many prisons were free of illegal drug use; the answer that came back was that, for a month last year, 81 were. That was not the answer I was expecting, so I put down another question, asking how many prisons were free of illegal drug use for a year. The answer that came back was that one prison, Blantyre House, reported no drug use for a year. My next question was how many prisoners there were in Blantyre House, and the answer was none, because it had been closed down. The Government, in their secretive, defensive way, which denies the information, discovered that the answer to the drugs problem in prisons was to get rid not of the drugs, but of the prisoners—it is simple, really.
I am afraid that, since the decisions taken in the 1970s, Governments have been denying the truth that is before them: the attempt to reduce drugs in prisons has been a continuing, abject failure. They will not face up to that; they are in denial. The case I want to put today is that that failure has been going on for about 45 years. In the 1960s, the United Nations decided it would eliminate all illegal drug use throughout the planet in a decade. Many countries introduced laws. We introduced the Misuse of Drugs Act 1971, which was supported by all parties and by two Governments—there was a change of Government. The Act was going to be the answer; it was going to eliminate all drug use.
We have introduced the harshest punishments in all Europe, with the result that, although there were fewer than 1,000 heroin and cocaine addicts in 1971, there are now 320,000, and cannabis use has increased exponentially. It is amazing that, throughout that period—this argument has been going on for a long time—Governments have said, “We have tried a tough policy, but it has not worked, so we will try a tougher policy.” When that does not work, we get a different tough policy. No Government have had the sense to introduce a policy that could be described as intelligent. We urge the Government to consider that today.
The Government response begins with the statement that “cannabis is…harmful”. We want to legalise it because it is harmful—of course it is; we do not want to legalise it because it is safe. We need to replace the current system in Britain, where we have the worst of all worlds, spending billions each year trying to restrict the use of drugs. We jail more people as a proportion of the population than anywhere else on the planet, except the United States. We end up with all the problems that emanate from the abuse of drugs, but we gain none of the medical advantages that we would have if we liberated people so that they could use their medicine of choice.
Graham Stuart (Beverley and Holderness) (Con)
My constituent Bernadette McCreadie suffers from Crohn’s disease and psoriatic arthritis, and she is allergic to most of the pharmaceutical medicines that are prescribed —in fact, they have given her ulcers. She has found effective pain relief only through cannabis. Does the hon. Gentleman feel that the ban on the use of cannabis in non-medicinal ways has led to a failure to allow people such as Bernadette to use a drug they find essential to their wellbeing? Sadly, the current situation sees her forced into the company of illegal drug dealers.
Paul Flynn
I am grateful to the hon. Gentleman. I have a host of stories going back to the ’80s and early ’90s, when we first had demonstrations in support of medicinal cannabis. It is a sad story. I have looked into the eyes of so many people who have said, “This is the only thing that gives me relief. Why on earth can’t I take it?”.
Cannabis is the oldest medicine in the world. It has been trialled and tested by tens of millions of people over 5,000 years. If there were any problems with natural cannabis, that would have been apparent a long time ago. However, all we have is this wall of denial by Governments who are afraid of the subject, afraid of becoming unpopular and afraid of it being said that they are going to pot.
I am not unrealistic, and I do not expect the Government to make a volte-face on recreational cannabis, but they should explain their position and realise what is going on. However, the case for medical cannabis, including in its natural form, is overwhelming. We can have it in Sativex, but there are problems with the drug, which is of limited value. The National Institute for Health and Care Excellence does not like it, because the cost is very high.
Medical cannabis can now be used in 23 states in America. The best form is one produced in the Netherlands, which can be used in about a dozen countries in Europe. A change has to come. It is barbaric to deny people their medicine of choice. There can be no justification for doing that.
Caroline Lucas (Brighton, Pavilion) (Green)
I congratulate the hon. Gentleman on securing this important debate. Does he agree that the biggest scandal is that this Government, like successive Governments, have set their face against the evidence? If we look at an evidence-based approach, there is absolutely no correlation between a drug’s legal status and the amount it gets used. In other words, prohibition simply does not work.
Paul Flynn
I am grateful for the hon. Lady’s intervention. We look at the United States with incredulity because it does not accept the evidence on gun possession. We can all see the evidence; it has been shown over and over again that the more guns there are in society, the more deaths and murders take place. However, the United States will not accept that. We are in a similar state of denial on cannabis. Many places in the world now recognise that prohibition has been a continuing disaster—a disaster more serious than the prohibition of alcohol in the United States—yet we refuse to recognise the fact.
Mr George Howarth (Knowsley) (Lab)
I congratulate my hon. Friend on securing the debate. Does he accept that his analogy with gun control in America proves exactly the opposite point? The problem with guns in America is that there are too many of them and they are too easy to get, so I am not sure the analogy supports his argument in the way he used it.
Paul Flynn
The analogy is with the fact that we deny evidence. We do not look at evidence. As I illustrated, the evidence is that controlling drugs in prison has failed. The Government went to the idiotic palaver of requiring three questions to be asked before they admitted that there is not a prison in Britain free of illegal drug use. The point is about that defensive attitude and the denial of information.
I believe the word is spreading throughout the planet now. In the United States, which was the worst of the lot and the most in denial, four states are now selling cannabis recreationally. Has the sky fallen? Has it been a disaster? It has been a great success. In 2000, we saw politicians of great courage in Portugal introduce a depenalisation scheme. It was unpopular with other politicians, the press and the public, but they went ahead and it has turned out to be a brilliant success in every way. They cut down the number of deaths within five years. They have invested more money in health systems and support systems, and the scheme was widely praised by our own Health Committee when it went to Portugal. It also went to Colombia, and its report in 2012 asked for an investigation into drugs. It based its conclusions, after a year of investigations, on the success of Portugal, but do we talk about that? Are we going to follow suit? We do not have to take the courageous step now; Portugal has done it for us. It has done the work, which has been hugely beneficial.
Lady Hermon (North Down) (Ind)
The hon. Gentleman will be aware that we have many particular problems in Northern Ireland due to paramilitary activity. Paramilitaries in Northern Ireland have made a fortune out of the misery of others by selling illegal drugs, including cannabis. Has he had a chance to calculate what the impact on the activities of paramilitaries in Northern Ireland would be if cannabis were legalised?
Paul Flynn
I have not been to Northern Ireland to discuss this, but I went to the Oireachtas a number of years ago following a report on this issue; there were terrible problems with the criminal market in Dublin, as the hon. Lady will know.
What we are against is the fact that we have a substance of great popularity, used by millions of people, but the market for it is controlled by irresponsible criminals with little regard for the results for customers. They do not pay taxes. We have an empire of criminals building up throughout the world, exploiting their customers. The sensible way forward is to replace that market with one that is run by the state, has strong controls and does as much as it can to keep drugs out of the hands of vulnerable people, including those with mental health problems, the young, pregnant women and so on. No one is asking for free-for-all drug use; we are asking for an intelligent system that can be run and controlled.
It is ludicrous that these drugs should be known as “controlled” drugs when they are totally out of control. I have had constituents come to me and say, “Well, I thought it was legalised anyway.” The police are now very reluctant to arrest for these minor offences. It is many years since a case of someone using cannabis medicinally has been taken to court, because the juries are refusing to convict and it is a waste of everyone’s time, but that is still the law—the law supported by those who are against legalisation here.
If we can take the control of the drugs trade out of the hands of criminals, it will be an all-round improvement. That is what is happening elsewhere in the world. I mentioned the United States, but it is also going on throughout south America. A number of groups have come here recently from Mexico, Honduras and Bolivia to talk with the all-party groups about their revulsion at the drugs state and the terrible effect it has had on their countries. They were the producers, but the problems were in downtown Chicago; the consumers were on the other side. The most serious problems of drug trafficking and warfare involved people in south America.
One major benefit for countries—particularly Mexico—that border the United States, where they have seen the control of drugs taken into the hands of the state, is that there is less trafficking. Fewer drugs are going across the border, which will be a benefit.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
My hon. Friend describes some quite exotic places, but I want to give an example from the Recovery Interventions Service Ealing, a drug and alcohol support service in my constituency. RISE put the point to me that these things are often about working smarter, not harder. It might be about not necessarily being punitive, but looking at joined-up thinking with other agencies. RISE has a joint working initiative with the West London Mental Health Trust to reduce harm, because it reports that the strength of some varieties of this drug—particularly skunk—is higher than it was 10 or 20 years ago. It has joint risk assessments, wrap-around treatment, and database and information sharing with other agencies. Does my hon. Friend agree that that is a good way forward?
Paul Flynn
A great deal of good work has been done by the agencies and those who work in this area. The previous MP who ran the all-party group on drug misuse in this country pointed out that there is an establishment of people who are involved and have a vested interest in drug prohibition. He went every year to a group who were helping people with drug problems, but he noticed in his 15 years in Parliament that there were more people coming every year.
Great work is being done, and it will always need to be done to rehabilitate people who are afflicted by drug addiction. One accepts that, but what has taken place in this country and throughout the world in the past 45 years of prohibition is hugely increased drug use. It is going down now, because of the matter to which the Chair referred at the beginning of the sitting: young people are obsessed with the new addiction of playing with their iPhones and iPads. They do not have time to roll a reefer. That is the new addiction, and it has a beneficial effect. That is the fashion throughout the world, and it probably does not do them much harm. The Home Office has admitted that there is no correlation between harsh punishment, harsh penalties and the use of drugs. It is entirely to do with fashion and what young people regard as acceptable and what they regard as naff.
We imagine that we can control what is going on, but we cannot. The whole process is out of control. Holland has given us a fine example over the past 40 years by de-penalising cannabis use. Now and for nearly all that period, cannabis use in Holland has been far less than here in the United Kingdom. There is a good reason for that: people in Holland can go to any coffee shop and have a cannabis cake with their grandmother. Where is the fun in that? They have taken away the allure of forbidden fruit.
In America, groups of young former hippies were sent out to the sticks to deter drug use. At that time, drug use was rampant in cities, but not in rural areas, so these attractive, long-haired hippies went there with guitars and said, “We’ve been subject to degradation. We’ve been through hell. We’ve been through sexual orgies. It was terrible. For goodness sake, don’t do drugs.” Their message was: “Drugs are dangerous. They will upset your parents and destroy your health”—rather forgetting that young people all know that they are immortal. Danger is an attraction, as is upsetting their parents and establishing their own identity, and drug use followed the drug education programme as surely as night follows day. This futile experiment, lasting 45 years, should now come to an end.
Let me give just one example of what has happened. People in America suggested that if cannabis were decriminalised for recreational purposes, there would be all kinds of consequences, but in Colorado and Washington, decriminalisation of recreational drugs took place a year ago, and the disasters have not occurred. The evidence shows no spike in cannabis use among young people and no increase in road fatalities. What there has been, of course, is a large reduction in the criminal market because the state now runs 60% of the market. In Colorado, they are nearing control. If the state government decides that problems are emerging, they can change things, because they pull the levers. They can decide what happens, instead of allowing criminals to use their drugs freely and sell them irresponsibly to build up their criminal networks, as happens in Northern Ireland, or to sell them to people whose mental health is fragile.
Lady Hermon
I am grateful to the hon. Gentleman for prompting me to get to my feet again by mentioning Northern Ireland; it is so kind of him. In response to my first intervention, he referred to his first trip to Dublin, but not to Northern Ireland. As he knows, cannabis is still illegal in the Republic of Ireland. Will he give some attention to the thought that, although cannabis remains illegal in the Republic of Ireland, we have a very porous border, and it is easy to move into Northern Ireland and therefore into the rest of the UK? What does he believe the impact would be of changing the status of cannabis in the UK but not in the Republic of Ireland?
Paul Flynn
Similar concerns were expressed about the Netherlands and other countries when the laws were changed. It was said that there would be drug tourism and that people would flock across, and there have been examples of that, but one hopes that the world will gradually come to its senses, through a gradual process—it is happening now—and that laws can be synchronous and work in that way, as happens in many other areas. My trip to the Oireachtas happened because I was writing a report for the Council of Europe at the time. I was representing the United Kingdom, rather than my own opinions on the matter. What we saw in Dublin with regard to criminality was horrendous. It was very much a replay of what happened in the ’20s in America, and we have yet to learn that lesson.
One of the interventions reminded me of our attitude in this place. We have been talking about this for many years, and I prize the memory of one debate in which the Opposition spokesman and the Minister in charge had to leave. They could not stay for the full period because they needed to go outside the Chamber for a fix—they were both tobacco addicts. They did not see any contradiction in denouncing the use of an addictive drug in the Chamber, for young people, while they were themselves addicted to another drug.
I will not mention any names, but I recall another Conservative MP saying to me, “I just can’t understand it. I went to a prison and my constituent told me he wanted to get hold of some paracetamol for his toothache. He was told, ‘You can’t get that until you go and see the doctor tomorrow morning. You might be supplied with it then.’” The MP’s constituent made this point: “I can go out of this cell now and within 10 minutes, I can get heroin, cocaine”—Mr Evans, you might recall this story—“and cannabis as well”, because they were freely available. Can we persuade the Government to face up to the abject failure that has occurred over this long period?
I have spoken for longer than I intended, and I know that there are many other Members here with a long history in this subject who want to speak. I particularly welcome the hon. Member for Brighton, Pavilion (Caroline Lucas), for the Green party, and the Liberal Democrat Members who—I read in my copy of The Guardian this morning—are going to take up this issue in a more serious way. No party in this House has contributed more to this subject and the cause of reform than the Liberal Democrats. It is sad to see that a number of them lost out in the last election, particularly the former Member for Cambridge and the former Member for Lewes. Those people have perhaps been punished by the press and possibly the public for having been caught in possession of an intelligent idea, but they deserve credit from this House. I look forward to hearing what Members have to say.
I shall conclude my remarks with a story about a person called Elizabeth Brice, who campaigned under the name of Clare Hodges. Sadly, she died in 2011. Elizabeth Brice led protest after protest here, and she single-handedly convinced the Belgian Government in 1998 to change their law on medicinal cannabis. She was an extremely gifted woman; she was a producer for a television company and a classicist. Among her more bizarre achievements, she was translating the Noddy books into Latin, of which I have a prized copy. I mention her story, although I am grateful to all the people who have written to me recently—there is no way that I can do justice to the number of letters and submissions I have received.
Elizabeth wrote:
“Multiple Sclerosis is a cruel disease. You develop it when you’re young and healthy, and slowly but surely you lose all your faculties, abilities and functions. Nowadays you can expect to live your full life span often until you are completely dependent. And of course this is a very depressing prospect…all the future seemed to hold was deteriorating health and no medicines that really helped.
When I did try cannabis, the physical relief was almost immediate. The tension in my spine and bladder was eased, and I slept well. I was comfortable with my body for the first time in years. But, just as important, I felt happy that there was something, after all, that could help me. It was as if a huge weight had been lifted from me.”
She stated:
“Cannabis helps my body relax. I function and move much easier. The physical effects are very clear. It is not just a vague feeling of well-being.”
On one of her visits to the House of Commons, she committed a serious crime. Out on the Terrace, she asked for a cup of hot water, to which she added a green substance—I am sure that the staff were curious about what those green specks were in the cup afterwards. She had taken herbal cannabis in the House of Commons. The law at the moment says that she could be put in prison for five years, for the crime of seeking relief from pain. Does anyone believe that that law is sensible? That law is an ass. For so long, this House has been held back from full-scale reform by the timidity of Members of Parliament, because of a reluctance to reform for fear of being attacked by the media and losing votes. Now is the time for compassion and courage.
[Interruption.]
Mr Peter Lilley (Hitchin and Harpenden) (Con)
It is a pleasure to follow the hon. Member for Newport West (Paul Flynn), who for many years and with great consistency has pursued his campaign on this front and, sadly, has not yet achieved his objective.
Some years ago, members of the press asked Front Benchers from both parties whether they had ever consumed cannabis. I found that I was one of the very few who had never done so then, and I have not since. That may be why I had a clear enough head, when looking at the evidence, to conclude that we need not just to decriminalise cannabis, but to legalise its sale and use.
I duly wrote a booklet—it is still the definitive work on the subject—called “Common Sense on Cannabis”, which is available, I suspect, from the Social Market Foundation or free on my website and in which I advocate legalisation. I still believe that that is the right policy and I shall explain why. I believe that not because I am an advocate of the use of cannabis. I abhor the stuff and, as I said, have never used it. I am not an advocate of it except for medical use, and I am sure that we could all agree that cannabis and its derivatives should be made available for medical use when it can bring the relief that the hon. Gentleman described and that many of us will have heard about from our postbags. Even Queen Victoria allegedly used cannabis to relieve menstrual pain. If it is a Victorian value, surely it can be made more widely available.
There are practical reasons for wanting to move to legalisation. First, attempts to prohibit the sale and use of cannabis have failed. It is readily available and widely used. Until recently—it may still be the case—there has been a higher level of usage in this country, where it is illegal, than in Holland, where it is legally available. Nearly 30% of citizens of this country have at some stage or other used cannabis and few of them had any difficulty in obtaining it, so those attempts have failed. The second point is that they have failed despite the fact that 80% of the effort in the so-called war on drugs goes on trying to prohibit the use of cannabis. If we provided some legal outlets for cannabis, that enforcement effort, the treatment effort and so on could be diverted to tackling hard drugs, which really do harm people, enslave people and, sometimes, kill people.
Thirdly, keeping on the statute books a law that is widely ignored and impossible to enforce undermines faith not just in that law, but in law and the legal system more generally. Finally, legalisation would deprive the criminal world of a large and lucrative market. As the hon. Member for North Down (Lady Hermon) pointed out, that is particularly important in Northern Ireland, where that market is exploited by gangs—well, by and large by the IRA and other paramilitaries, who are likely to use that resource for the most odious and nefarious reasons.
Those arguments have led many to conclude that we should decriminalise cannabis; we should no longer make it an offence to possess or to use the stuff, but supplying or selling it should remain illegal. That is de facto the situation in some parts of the country, but I believe that as a policy it would be a mistake, and let me explain why. One of the key reasons used by prohibition advocates is that cannabis is a gateway drug. They say that once people have tried a soft drug such as cannabis, it awakens a desire for stronger drugs and leads them on to cocaine and heroin, so they must stop going down the slippery slope. There is no evidence for that at all. The truth is that it is only the criminalisation of the supply of cannabis that makes it into a gateway drug. Because cannabis users can obtain it only from illegal sources, they are forced into contact with the illegal gangs that will try to persuade them to move on to hard drugs. Prohibition of cannabis drives soft drug users into the arms of hard drug pushers. Only by providing some legal outlets for cannabis can we break the contact between cannabis users and those pushing cocaine, crack and heroin. In my view, such legal outlets should not be numerous and we should ban active marketing, sales to minors and use of cannabis in a public place.
I invariably find that most arguments against legalising cannabis are based on the supposed health risks. I entirely accept that heavy and sustained use of cannabis can be harmful, but at the time of writing my pamphlet, I quoted the Lancet review of all the medical evidence on the use of cannabis, which said that
“on the medical evidence available, moderate indulgence in cannabis has little ill-effect on health, and…decisions to ban or to legalise cannabis should be based on other considerations.”
I emphasise “moderate” and “little”. I am not saying that it has no effect or that heavy and sustained use is not harmful, but I specifically stated then that moderate and occasional use of cannabis has few ill effects on health. None the less, people constantly bring up the health arguments, and I notice that when they do, they always say, “Oh, there’s just been a study that counteracts all that went before.”
Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)
It is easy to quote studies, but the Royal College of Psychiatrists, which does not take a view on the criminality but takes a view on the medical evidence that is presented and gives people an option to make up their own mind, does point out that even moderate use in younger years can lead to increased risk of mental illness in later life.
Mr Lilley
My hon. Friend has not stated a specific study, but certainly that was not the view in the Lancet review of cannabis. I find that there is a searching around for evidence. It is policy-based evidence—evidence that has been looked for to justify a policy, rather than being found and leading to a policy. It is similar to the sort of thing we find in the global warming debate.
Norman Lamb (North Norfolk) (LD)
I find myself agreeing with everything that the right hon. Gentleman has said, perhaps with the exception of what he has just said. Does he agree that if a product is potentially dangerous, it is better to purchase it in a regulated market, with controls, rather than purchasing it from a criminal?
Mr Lilley
That is absolutely right. The product is most likely to be unhealthy if it is illegally obtained and probably impure—of course that is even more true of hard drugs—and likely therefore to cause side effects that are not necessarily caused directly by the cannabis itself. Obviously, it is usually used in association with tobacco, which is itself undoubtedly harmful.
Paul Flynn
Does the right hon. Gentleman recall that the former chairman of the Advisory Council on the Misuse of Drugs, Dr Nutt, made this assessment? I shall repeat what he said, to try to put the issue in perspective: we would need to stop 5,000 people taking cannabis to stop one possible case of psychosis. Although one in 5,000 is a tiny number, it is not a matter that one can ignore altogether, but it certainly should not be exaggerated, either.
Mr Lilley
Yes, I think the hon. Gentleman puts the issue in perspective with that remark. There is evidence that cannabis may precipitate psychosis in those prone to it anyway, and they should certainly be discouraged from using it, as I would discourage everyone from using it, but it is better that it be available and regulated than illegally supplied but readily available in any case, and with a high level of usage in this country.
Another argument that people invoke is, “Cannabis nowadays is different from what it was in your youth, Mr Lilley.” Since I did not take it in my youth, that does not make a great deal of difference, but people say that it is now available in much stronger and more potent forms. Of course, that is partly a symptom of illegality. In the same way, during prohibition people moved from beer to spirits, because the more concentrated alcohol was, the easier it was to transport and supply, while escaping the authorities.
Mr George Howarth
The argument of the right hon. Gentleman and my hon. Friend the Member for Newport West (Paul Flynn) is that cannabis, whether for medical purposes or general recreational use, should be decriminalised. However, does he accept—as, I believe, my hon. Friend does—that he might make more progress if he concentrated for the time being on whether a product could be developed with the right efficacy to justify it in medical terms, rather than focusing on general decriminalisation, which I believe is more problematic?
Mr Lilley
I certainly agree that the medical arguments are overwhelming. I cannot think of any good reasons for not allowing the use of cannabis and its derivatives for medical purposes, although there clearly are arguments, which I do not find compelling, for prohibiting it generally.
The more I examine the arguments for prohibition, the clearer it is to me that although the pretence is that it is for health reasons, the actual reason is moral disapprobation of drugs. I am probably one of the few people in this room who is prepared to say that I share that moral disapprobation. Of course, the greatest sin that one can commit in this country is to take a moral view on anything; that is the supreme immorality. I do think that it is wrong, however, to get stoned out of one’s mind on anything. It is degrading. God gave us minds to see things clearly, not to befuddle and bemuse. There are greater moral arguments, the traditional one being that it undermines one’s self-control and leads to other, more serious wrongdoing. For all those reasons, I am against using it and I would discourage people from using it.
Those who are motivated by moral disapproval of the abuse of drugs make two mistakes. First, they confuse use and abuse. Occasionally to have a relaxing spliff is one thing. I have never done so, and I would not advocate it, but I occasionally go home and drink a glass of wine to relax after a hard day of looking at 38 Degrees petitions, and I do not see any great difficulty in that. I would, however, discourage people from abusing either alcohol or cannabis.
Secondly, those who are motivated by moral disapproval jump to the conclusion that because something is morally wrong, it should be against the law. Lots of things are morally wrong that are not against the law. Adultery is wrong; one should not betray one’s spouse, but we should not put people in jail if they do. We have to get used to the idea that in a free country, people will have to make many moral decisions themselves without being told by the law what to do. We would be a healthier and better country if we gave people that moral responsibility, without saying that it is something that we approve of. It is a choice that people should make, and those of us who disapprove of certain decisions should make the moral arguments against them, rather than dressing them up as, or hiding behind, largely spurious and bogus health concerns, which are at best greatly exaggerated, and at worst non-existent.
Norman Lamb
I want to intervene briefly to say that that was the most perfect explanation of liberalism, and I applaud the right hon. Gentleman for giving it.
Dr Paul Monaghan (Caithness, Sutherland and Easter Ross) (SNP)
I am grateful for the opportunity to contribute to the debate, and I congratulate the hon. Member for Newport West (Paul Flynn) on securing it. A debate about the regulation of cannabis to reduce harm is welcome. I will immediately declare an interest. For many years, I have had the privilege of being the director of the Inverness Multiple Sclerosis Therapy Centre. Cannabis has brought some relief to some sufferers of MS, and I am anxious to support those individuals. I am also the vice-chair of the all-party group on drug policy reform. That widely respected group has undertaken significant research into the medical and social use of cannabis, and its findings are, I believe, unassailable.
There are strong arguments to support the regulation of cannabis for social use, but I will focus today on the medical use of cannabis. I urge all right hon. and hon. Members to consider urgently the legalisation of cannabis for medical use. The many applications of cannabis as a medicine are impeded by its inclusion in schedule 1 of the Misuse of Drugs Act 1971. Schedule 1 drugs are controlled substances considered to have no medicinal value. A simple change to schedule 2 would recognise the drug’s undoubted medicinal value and place it on a par with opiates. It would also enable research to be carried out into the vast potential for a range of medical applications and facilitate relief for thousands of people, including the many who suffer from MS and epilepsy who are not helped by other medicines.
Cannabis is already an important medicine. The utility of cannabis and its derivatives has been established through analysis of the treatment of a range of conditions including multiple sclerosis, epilepsy, numerous forms of chronic pain, glaucoma, and nausea and loss of appetite caused by chemotherapy or radiotherapy. Estimates suggest that some 30,000 people across the UK are at risk of breaking the law by using cannabis medicinally, but they do so primarily because it provides relief from chronic medical conditions and has relatively mild side effects.
There are a number of anomalies in the UK system. Sativex, which is a synthetic form of two of the main cannabinoids in cannabis, THC and CBD, is authorised in the UK as an extra treatment for patients with spasticity caused by MS. Sativex contains the same constituents as drugs classified in schedule 1 as cannabis derivatives, and it can cost more than 10 times as much as medicinal cannabis imported from Holland.
Cannabis’s schedule 1 status makes research into medical applications an expensive obstacle course. Such research involves a minimum outlay of £5,000 to cover licensing and security, and licence applications take about a year. In the UK, only four hospitals have been granted a licence to hold stocks of cannabis, although they can all hold heroin. It has been calculated that research into cannabis costs 10 times as much as, and takes significantly longer than, research into all other forms of drug.
It is worth noting that the recent Home Office report “Drugs: International Comparators” suggests that the severity of the cannabis drug control regime has had little impact on the prevalence of drug use. An adjustment to the UK control regime to give patients the right to medication that they believe works for them is unlikely to have any wider impact on the level of recreational cannabis use. Indeed, I would argue that no sensible argument can be mounted in support of the idea that medicinal regulation would impact adversely on other forms of illegal drug use.
The case for the regulation of cannabis for social use is primarily about ending criminalisation, reducing harm and creating separate drugs markets. Laudable as those arguments are, they are only tangentially related to the regulation of cannabis for medicinal use. That fact is evidenced in the drug’s regulation for use in many parts of the world. More than 20 states in the USA have provision for the supply of medicinal cannabis. In Europe, medicinal cannabis is produced in the Netherlands, and it is available on application by a physician in the following European countries: Italy, Finland, Switzerland and Germany. Recently, Canada also legalised the use of medicinal cannabis.
We must be clear that cannabis does have a legitimate medical use that is not recognised by its schedule 1 classification. Cannabis is, in fact, an important medicine with a legitimate role in treating a host of conditions including, as I have said, the symptoms of multiple sclerosis, epilepsy and various forms of chronic pain. There is mounting evidence to support its use as an effective treatment for Dravet syndrome, an extreme form of childhood epilepsy—sufferers have up to 100 seizures each day. Some families have reported that CBD is the only thing that has been effective in easing their child’s symptoms. Further research into this and the ability to access medicinal cannabis legally would be life changing for sufferers of the condition.
It is enormously important that we should be able to research the further potential medicinal use of cannabis. To do that, we need to change it from being a schedule 1 drug to being a schedule 2 drug and we need to do that soon. People could then be prescribed medicinal cannabis by a physician when appropriate. Patients who find the drug helpful for their condition would no longer need to break the law to obtain it and would have access to high-quality cannabis with monitored cannabinoid content. Such a change would greatly facilitate important research into the medical uses of cannabis. I hope the Minister will consider regulating cannabis for medicinal use. Quite frankly, our constituents deserve nothing less.
Dr Daniel Poulter (Central Suffolk and North Ipswich) (Con)
It is a pleasure to serve under your chairmanship, Mr Evans. I commend the hon. Member for Newport West (Paul Flynn) on bringing the debate to the House and on this grown-up, sensible discussion about a topic that is often taboo and should not be because it affects the lives of many of our constituents.
A number of issues have been covered, including the criminal justice system, which I will come back to. I will pick up on a couple of points made articulately by the hon. Member for Caithness, Sutherland and Easter Ross (Dr Monaghan) on the medicinal uses of cannabis. There are some issues with the current law that need to be looked at, which perhaps make the medicinal use and the research of medicinal use more challenging. I also want to touch on some medical evidence. My right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley) made some compelling points during his eloquent speech for the legalisation of cannabis. I am not, unfortunately, able to support him and I hope that my discussion of some of the medical background will help to explain why.
I have picked many of my remarks from a balanced review by the Royal College of Psychiatrists, which I hope we all consider to be well-resourced and an appropriate source of material for balancing the medical evidence on the use of cannabis as it looks at not only mental health, but physical health. Most of my remarks will be based on the evidence that it has collated. The college does not have a view on the legal position but, none the less, it wants people to look at the evidence and make up their minds. I will give my view, having reviewed some of that evidence.
Although there has been a steady reduction in the use of cannabis since 1996, about 2.3 million of those aged 16 to 59 have reported using cannabis in the past year. Frequent use of cannabis is more than twice as likely among young people. In spite of many Government and media warnings about health risks, many people see cannabis as a harmless substance that helps people to relax and chill—a drug that, unlike alcohol and cigarettes, might even be good for their physical and mental health. I will come to the point that that is clearly not the case.
It is worth quoting directly from the Royal College of Psychiatrists about how cannabis and cannabis plants have evolved over the past few years. My right hon. Friend the Member for Hitchin and Harpenden said that drug use is very different from when he was at university. That may well be the case, but the evolution of cannabis and the increasing frequency of high-potency cannabis—skunk, as a number of types of stronger cannabis in general are often referred to—has changed some of the health risks associated with cannabis use. As the Royal College of Psychiatrists says,
“Over the last 15 years, skunk has invaded the street market and its THC content is about 2-3 times higher than the ‘traditional’ cannabis used in earlier years.”
I will come to THC content and the different chemical components of cannabis, but the royal college continues:
“In the UK, most sold materials is home grown because of a loop hole in the law making it legal to buy seeds over the internet.”
I have some sympathy with the points raised by my right hon. Friend the Member for Hitchin and Harpenden: there are some challenges in the law and, de facto, we effectively have decriminalisation of cannabis in many areas of the country. I would be interested to hear the Minister’s views on that. Does he see a clear distinction between legalising a drug that we know to be harmful and a more decriminalising approach with police discretion, as we have at the moment? I believe the approach we have at the moment is probably the right one, given some of the harmful effects that I will speak about.
Paul Flynn
Will not the hon. Gentleman respond to what was said by his right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley): skunk—that expression is only used in this country because there are different strengths of THC—is a product of prohibition just as distilled spirit, the main killer drug, was in America? Does he agree that if we end prohibition and have a legal market, people will get to use the cannabis of their choice—not necessarily the one that the illegal market wants them to take?
Dr Poulter
I do not necessarily accept the view that stronger or different forms of cannabis are developed as a result of prohibition. Take Holland as an example: different varieties of cannabis are available in various cannabis coffee shops in Amsterdam. People there have an opportunity to decide which potency and strength they use. I do not necessarily accept that prohibition has driven a market towards creating stronger varieties of cannabis. We know that stronger types of cannabis, such as skunk, have a stronger correlation with psychosis and some of the harmful mental health effects that are linked with the use of cannabis and the chemicals it contains.
On that subject, there are about 400 chemicals in an average cannabis plant. The four main compounds are delta-9-tetrahydrocannabinol, cannabidiol, delta-8-tetrahydrocannabinol and cannabinol. Apart from CBD—cannabidiol—these compounds are psychoactive, the strongest being delta-9-tetrahydrocannabinol. The stronger varieties of the plant contain little CBD, while the delta-9-tetrahydrocannabinol content is a lot higher. We are talking about a number of psychoactive substances. The stronger plants and varieties tend to contain larger amounts of the more psychoactive components and compounds.
When cannabis is smoked, its compounds rapidly enter the bloodstream and are transported directly to the brain and other parts of the body. The feeling of being stoned or high—like my right hon. Friend the Member for Hitchin and Harpenden, I have not had the experience—is caused mainly by the delta-9-tetra- hydrocannabinol binding to a cannabinoid receptor in the brain. Most of these receptors are found in the parts of the brain that influence emotion, pleasure, memory, thought, concentration, and sensory and time perception. Cannabis compounds can also affect the eyes, ears, skin and stomach.
There are a number of effects, some of which people describe as pleasurable and some of which we know are harmful. I want to touch on the mental health problems associated with cannabis use in some detail. The Royal College of Psychiatrists has published information on the subject:
“There is growing evidence that people with serious mental illness, including depression and psychosis, are more likely to use cannabis or have used it for long periods of time in the past. Regular use of the drug has appeared to double the risk of developing a psychotic episode or long-term schizophrenia. However, does cannabis cause depression and schizophrenia”—
there is a legitimate discussion about reverse causality—
“or do people with these disorders use it as a medication?
Over the past few years, research has strongly suggested that there is a clear link between early cannabis use and later mental health problems in those with a genetic vulnerability”—
my right hon. Friend made that point—
“and that there is a particular issue with the use of cannabis by adolescents.”
On depression, the Royal College of Psychiatrists says:
“A study following 1,600 Australian school-children, aged 14 to 15 for seven years, found that while children who use cannabis regularly have a significantly higher risk of depression, the opposite was not the case—children who already suffered from depression were not more likely than anyone else to use cannabis. However, adolescents who used cannabis daily were five times more likely to develop depression and anxiety in later life.”
That covers the issue of reverse causality.
I particularly want to talk about psychosis, schizophrenia and bipolar disorder. The Royal College of Psychiatrists states:
“There is now sufficient evidence to show that those who use cannabis particularly at a younger age, such as around the age of 15, have a higher than average risk of developing a psychotic illness, such as schizophrenia or bipolar disorder.
These studies also show that the risk is dose-related. In other words, the more cannabis someone used, the more likely they were to develop a psychotic illness… a study in Australia recently showed that those who used cannabis could develop the illness about 2.70 years earlier than those who did not.
Why should teenagers be particularly vulnerable to the use of cannabis? It is thought that this has something to do with brain development. The brain is still developing in the teenage years—up to the age of around 20, in fact. A massive process of ‘neural pruning’ is going on. This is rather like streamlining a tangled jumble of circuits so they can work more effectively. Any experience, or substance, that affects this process has the potential to produce long-term psychological effects.
It is also known that not everyone who uses cannabis, even at a young age, develops a psychotic illness.”
My right hon. Friend articulately raised that point. The Royal College of Psychiatrists continues:
“The available research shows that those who have a family history of a psychotic illness, or those who have certain characteristics such as schizotypal personality, or possibly have certain types of genes, may increase the risk of developing a psychotic illness following the regular use of strong cannabis.”
Research increasingly shows that there is a strong link between psychosis and the use of cannabis, with young people having a particular vulnerability and susceptibility.
On physical health problems, the Royal College of Psychiatrists says:
“Even though the main risk to physical health from cannabis is probably from the tobacco that it is often smoked with, new research has found that the cannabis plant also contains cancerogenic mutagens that can affect people’s lungs.”
We now have evidence of potential physical harm caused by smoking cannabis, and the approach taken by this House over the years has been to discourage people from smoking and using substances that harm their physical health. There is emerging evidence of the physical harm caused by smoking cannabis, so there is a strong argument that we should be consistent by discouraging people, as much as possible, from smoking cannabis. That, as my right hon. Friend has said, could be done by legalising cannabis and giving people an open choice, but when there is compelling evidence of physical harm, it would be wrong to legalise a substance that we know to damage people’s mental health and, increasingly, their physical health.
Several issues have been raised about the medical use of cannabis. Cannabis is widely used by people who attend pain clinics—such people self-administer illegally obtained cannabis for symptom relief. At the moment, it is very difficult for medical researchers to research the potential benefits of some substances contained in cannabis in alleviating pain in palliative care or in other legitimate medical settings.
The hon. Member for Caithness, Sutherland and Easter Ross eloquently discussed Sativex, a drug used to treat multiple sclerosis. The drug remains a schedule 1 controlled drug, which means that under the Misuse of Drugs Act 1971 and in regulation there are no requirements on pharmacists to keep records or on the prescriber to write prescriptions in a form other than that required by the Medicines Act 1968—in other words, for prescription-only medications.
The Medicines and Healthcare Products Regulatory Agency has also issued the manufacturer of Sativex in the UK with a wholesale dealer’s licence and an importation licence for patients with MS. The Home Office has therefore been able to issue licences for such supplies, and has done so through a general licence that covers all doctors who apply on behalf of individual MS patients. Dispensing pharmacists are also covered by that licence, which is triggered by an application by the doctor to the Home Office Inspectorate. Supplies can be made directly from the company’s domestic stocks.
There is a challenging framework for the medicinal use of cannabis in this country, and it needs to be reconsidered. It was suggested earlier that we should consider changing cannabis from a schedule 1 drug to a schedule 2 drug, which would be consistent with opioids—doctors are able to prescribe, say, methadone as an alternative for someone who is being treated for heroin dependence. That merits some consideration, and I would be grateful if the Minister responded on that point. A number of studies in the United States have shown that cannabis has potential medicinal benefits for pain relief in palliative care, so will we in this country be able to consider some of those issues? If we can help patients use pain control better to manage the symptoms of terminal or progressive diseases or illnesses, that has to be a good thing. We would not want the unintended consequences of the current legal framework to get in the way of achieving that.
This is not a simple issue. I have looked at the evidence and, on balance, I am not currently persuaded that making access to a substance that is harmful to both physical and mental health legal, as opposed to decriminalised, would be a good thing. We need to make it easier to research the potential medical benefits of cannabis in pain control in terminal and progressives illnesses. Finally, there is a lot for us to do in the criminal justice system. There were encouraging words from the Secretary of State for Justice last week on the need to stop the cycle of reoffending by better supporting prisoners with mental illnesses or substance misuse challenges, including the misuse of cannabis and other drugs. We can help such people not by criminalising their activities but by supporting their rehabilitation and helping them to cope better with their substance misuse problems.
Norman Lamb (North Norfolk) (LD)
It is a pleasure to serve under your chairmanship, Mr Evans. It was good to hear the opening contribution of the hon. Member for Newport West (Paul Flynn), who has long campaigned on such issues. He has always been consistent, for which I greatly admire him.
It was also good to hear the contribution of the right hon. Member for Hitchin and Harpenden (Mr Lilley), who is my sister’s MP. I found myself agreeing with much of what he said. He thinks he is alone but, actually, I have never taken cannabis. I am instinctively hostile to the excessive use of any drug, legal or illegal, because of the impact on the individual and, sometimes, on their family and the wider community. It is precisely the potential health risks to which the hon. Member for Central Suffolk and North Ipswich (Dr Poulter) referred that make me conclude that cannabis should be treated as a health issue, not a criminal justice issue. Surely it is absolutely inappropriate to criminalise people the way we do at the moment.
The global war on drugs has been a catastrophic failure. It dates all the way back to President Nixon. Profits from the global trade in drugs, to the tune of £200 billion, go exclusively to organised crime. It is a remarkable failure of public policy to have enriched criminals so successfully. Despite the efforts of the UK and US military forces in Afghanistan, the production of poppies has increased threefold during the period of their involvement there.
We spend about £65 billion globally a year on enforcement, and it achieves absolutely nothing. Thousands of people lose their lives. We have seen many gruesome beheadings in Mexico of people caught up in drug wars. The trade corrupts Governments in central and south America. Critically—I suspect that Conservatives ought to recognise this—it undermines the rule of law, which is the foundation stone of a civilised society.
Incredibly, the war on drugs leads to the criminalisation of tens of thousands of young people in our country. Last year, 30,000 people were criminalised for the use of cannabis. I am acutely aware of the comorbidity of mental ill health and drug use, but often people who suffer from mental ill health resort to cannabis for relief. Then we choose to criminalise them. It is a remarkable thing to do in a so-called civilised society.
Yet there is extraordinary hypocrisy on the issue. Senior politicians are frequently challenged about their use of cannabis and other drugs in their teenage and early adult years. Those who admit to such drug use laugh it off as a youthful indiscretion, apparently comfortable with the fact that tens of thousands of their fellow countrymen and women—usually people less fortunate than the politicians who reach the top of Government—end up with a criminal record for doing precisely the same thing. We should be uncomfortable about that.
Although the right hon. Member for Hitchin and Harpenden and I have never taken cannabis, probably at least 50% of the Government have, yet thousands of their fellow citizens end up with a criminal record for doing the same. Incidentally, there is one notable exception. Lord Prior, the Conservative whom I defeated in North Norfolk, bravely admitted while Member of Parliament for North Norfolk to using cannabis as a student and called for reform of our drug laws. I hope that he maintains that view. I think that he does, but he is the exception that proves the rule.
The whole policy is disastrous in public health terms. Many people lose their lives unnecessarily through dangerous drug use. Someone who buys drugs from a criminal has no idea what they are buying, and the criminal has no interest in their welfare. That is catastrophic and must be challenged. At the same time, two of the most dangerous drugs available, tobacco and alcohol, are legal in our country. We talk about the potential risks of cannabis, but tobacco kills about 100,000 people in the United Kingdom every single year. About half of regular smokers end up dying of a smoking-related illness, and it is a legal drug.
Alcohol causes untold damage in our society to families. Thousands of families in my county of Norfolk have a problem alcohol user in the household, damaging children along the way. Violence on our streets and domestic violence are linked to alcohol. It kills 20 times more people in our country than heroin, yet the Government resist introducing even minimum unit pricing on alcohol as a regulatory limit that might reduce the carnage. My own former party leader, Charles Kennedy, lost his life to alcohol, a legal drug in our country.
We need a new approach. As the hon. Member for Newport West said, we need an approach based on evidence, but where national politicians have failed to take the lead, change is happening locally. Many police officers around the country show commendable creativity and openness of mind in challenging how things are done. Tom Lloyd, a former chief constable in Cambridgeshire, was a police officer who lead the way early. Now police and crime commissioners, recognising the pressures on public resources in their area, have moved away from criminalising people for taking cannabis. Ron Hogg in Durham, for example, has effectively decriminalised cannabis in his area. Alan Charles in Derbyshire has done the same. Martyn Underhill, an impressive independent police and crime commissioner from Dorset and an ex-police officer, has spoken of his support for those initiatives.
As the right hon. Member for Hitchin and Harpenden said earlier, decriminalisation is not ultimately the right legislative solution. We need to go further and introduce a regulated market. Internationally, things are changing and the momentum is growing stronger. In the United States, Colorado, Washington and Alaska—yes, the state Sarah Palin comes from, Republican to its core—have voted to legalise cannabis. Oregon, another western state, and Washington D.C. have also done so. Uruguay has decided to introduce a regulated market, which has now been established. California and several other states, including the deeply conservative Ohio, are now looking towards a legalised regulated market.
Some 23 states now allow the medical use of cannabis. As others have said, what possible justification can there be for continuing to criminalise people with multiple sclerosis who choose to relieve their pain? It is unbelievable. This Government could act straight away on that if they had the will to do so, and they would have massive public backing. In Europe, the Czech Republic is now pressing for reform, and there are cannabis social clubs in Spain.
An issue with UN treaties makes it difficult, on the face of it, for states to introduce regulated legal markets, but in October last year, the US assistant Secretary of State, William Brownfield, said that the international community should
“accept flexible interpretation”
of UN conventions,
“tolerate different national drug policies…accept the fact that some countries will have very strict drug approaches; other countries will legalize entire categories of drugs…How could I, a representative of the Government of the United States of America, be intolerant of a Government that permits any experimentation with legalisation of marijuana if two of the 50 states of the United States of America have chosen to walk down that road?”
That is commendable.
Change is happening, and I desperately want the United Kingdom to consider the evidence and not base policy on fear, stigma and prejudice. As the hon. Member for Newport West said in his opening remarks, my party, the Liberal Democrats, has established an expert panel to consider how a regulated legal market for cannabis could work in our country. Professor David Nutt, the former chair of the Advisory Council on the Misuse of Drugs, will sit on the panel, along with Tom Lloyd, the ex-chief constable who has been brave enough to speak out. Niamh Eastwood will also sit on the panel, which will be chaired by Steve Rolles of Transform. Let us have an approach that focuses first on health, not criminal justice. People know what they are buying in a regulated market. Let us focus policy on taking money away from criminals, taking control of the market and allowing tax revenues to be used to educate people about the dangers of drugs. Is that not a more rational approach? It is fiscally responsible—something the Government should recognise. It would be a better use of public money, protect young people and end the crazy criminalisation of many young people. That approach ought to be attractive to the Government.
The panel will focus on how to reduce harm and minimise the illicit market. It will look at Colorado and other states that have gone ahead with such work. The early evidence from Colorado is positive. There has been no obvious spike in young people’s use of cannabis, no increase in crime and no increase in road fatalities. As the hon. Member for Newport West said, the majority of the market is now regulated and has been taken away from criminals, thus reducing the profits of criminal networks. The tax revenues are used for a social purpose.
Lady Hermon
I am most grateful to the right hon. Gentleman for allowing me to intervene as he is coming to the end of his contribution. He rightly emphasises looking at the evidence. May I invite him—my right hon. friend from a different party—to revise what he suggested earlier in his contribution? I am not a member of the Government, nor do I wish to be, but he cited a percentage of the Government who he said were users of cannabis, and I do not think that he would want that percentage to stay on the record without correction, without evidence.
Norman Lamb
I am grateful to the hon. Lady for her intervention. Of course, my suggestion was speculation, but very many young people—about a third—choose to take cannabis at some stage. As the right hon. Member for Hitchin and Harpenden said earlier, that percentage of the population choosing to use cannabis starts to undermine the rule of law. Perhaps the percentage is a third and not a half, but one can make a reasonable judgment that a significant proportion of this Government will have used cannabis at some point. That is a reasonable assumption to make, yet the Government appear to be comfortable with other people in this country ending up with a criminal record. That is what I find distasteful and that is what has to be challenged. We need policy based on evidence, which focuses on health and not criminal justice.
Norman Lamb
I am conscious that other people want to contribute to the debate, so I must remain disciplined or I will be told off by Mr Evans.
The case is overwhelming. I urge the Government to act and listen to the evidence.
Caroline Lucas (Brighton, Pavilion) (Green)
It is a pleasure to serve under your chairmanship, Mr Evans, and a pleasure to follow the right hon. Member for North Norfolk (Norman Lamb)—I think I completely agree with everything he said. I thank the hon. Member for Newport West (Paul Flynn) for securing the debate and all the people who signed the petition, which raised the profile of this important issue.
I shall start with a few quotations:
“Drugs policy has been failing for decades.”
We need
“fresh thinking and a new approach.”
Not my words, but those of the Prime Minister, David Cameron, back in 2005 when he was a contender for leadership of the Conservative party. At that time, he also said that it would be “disappointing” if radical options on the law on cannabis were not looked at. Since then, he has reversed his position almost 180° and done what, sadly, all too many politicians do once they have secured power—ignored the evidence and, in the face of what can be a hostile media environment, retreated to the status quo.
My position, which I have set out repeatedly in the House, is that we should be guided by the evidence. We need an urgent review of the Misuse of Drugs Act 1971 to determine whether the legislation has been effective and to consider whether alternative approaches might better reduce drug-related harms. That other countries and some US states have been more committed to following the evidence on cannabis than the UK has been creates an opportunity for us to learn from their experiences, whether they be of decriminalisation or some form of regulation.
There are clear and compelling grounds to legalise cannabis for medical use in particular and, having studied the evidence, I am fully persuaded that we need to do just that. Not because it is popular—although it is, with 53% of the UK public backing the legalisation or decriminalisation of cannabis for medical and non-medical use, according to an Ipsos MORI poll from last year. Not because many of those who already use cannabis-based medicines testify to the positive effects—although they do, with many claiming benefits for chronic pain, including that caused by neuropathy, fibromyalgia and rheumatoid arthritis, and others, such as MS sufferers, citing its benefits. Not because the UK lags behind other nations when it comes to recognising the therapeutic value of cannabis—although it does, with 20 US states, Canada, the Netherlands, the Czech Republic and Israel, among others, legalising the production and supply of cannabis for medical use. I am fully persuaded, because a strong evidence base justifies looking in much more detail at exactly how we should regulate the production and supply of cannabis for medicinal purposes.
We owe it to people like my constituent, Charlotte, a 34-year-old mother living with a palliative cancer diagnosis. She told me:
“When you are faced with such a diagnosis, you either accept it and let the rot set in or you look outside the box!”
She believes that cannabis oil is saving her life and allowing her to live well:
“I would be dead or very, very ill if not for cannabis oil.”
She goes on to say that
“the Government is shooting itself in the foot, if it supported cannabis and proper evidence based trials were properly funded it would have a huge impact on the cancer costs.”
We owe it to Charlotte, and the many people like her who use or want to use cannabis medically, to stop our ideological opposition and start gathering, and then listening, to the evidence.
Trials of the regulation of medical-based cannabis could, for example, answer questions about how we differentiate types of use and how to avoid the potential for leakage into non-medical supply. They could facilitate research that might otherwise be hindered and, if successful, they could provide a potential stepping stone for regulated legal production and supply of cannabis more widely.
[Mrs Cheryl Gillan in the Chair]
It is important to note that in those countries where medical cannabis is already regulated, implementation and practice has varied enormously. Some models have successfully demonstrated what effective, controlled production and responsible prescribing or retailing can look like. Elsewhere, regulation has been inadequate, leading to over-commercialisation and irresponsible sales practices and promotions. All that and more must be looked at within an agreed framework of what might be achieved through regulation, so that any proposals brought forward in the UK have learned from and built on existing good practice. That principle applies not just to medical cannabis; we have an opportunity to learn from countries such as the Netherlands and Denmark and US states that have introduced various regulated models for the sale of cannabis for recreational use too.
Colorado, which in 2012 became the first jurisdiction in the world to legalise cannabis, demonstrates the benefits of ending the criminalisation of users and putting the Government in control of the trade. Despite dire predictions, early evidence suggests that legalisation in Colorado has had the following positive outcomes: no spike in cannabis use among young people; thousands no longer receiving criminal records; no increase in road fatalities; and a significant reduction in the size of the criminal market, as the state now controls 60% of supply.
In these times of austerity, it is also interesting to note that in Colorado, for example, legal marijuana tax revenues have been breaking records. Through the first seven months of this year, Colorado has brought in nearly $73.5 million, putting the state on track to collect more than $125 million for the year, with $40 million of that allocated for school building programmes. If that kind of benefit can be properly balanced with a regulatory regime that minimises individual and social harm, which theoretically Governments are supposed to do for the production, sale and use of alcohol, why does it not make sense to be open to alternatives to prohibition? There is growing pressure to learn from what is being tried in other countries. The Select Committee on Home Affairs concluded that Government action is needed “now, more than ever” to learn from the models adopted in, for example, Portugal.
We should also pay attention to the evidence from closer to home. When in 2004 cannabis was declassified from a class B to a class C drug in the UK, most estimates suggest that there was a decline in cannabis consumption or no change. A study from Newcastle University Business School also concluded that there is generally no evidence for an increase in the consumption of any other drugs by young people, in particular heroin, cocaine, crack, amphetamines, ecstasy, acid or glue, or for an increase in the consumption of any class A drug.
There is also no evidence for an increase in various forms of criminal behaviour, including drug production and distribution, with the possible exception of a small increase in property crime among 15 to 17-year-olds relative to those under 15. Finally, there is no evidence for an increase in antisocial behaviour, victimisation or any other types of risky or antisocial behaviour.
In other words, and this is borne out by looking at long-term trends across drugs and other different classification regimes, illegality or otherwise has very little effect on whether people use drugs.
Paul Flynn
Does the hon. Lady recall a very spiky example here of one of the scare stories about cannabis? It was said that cannabis users were on the slippery slope and that if they started with cannabis they would end in a life of degradation in the gutter. It was followed up by Ann Widdecombe, who wanted to introduce some new punitive laws, until half the shadow Cabinet declared that they had taken cannabis as young people. They ended up on the slippery slope to a form of degradation on the Tory Front Bench, but one that is not illegal yet.
Caroline Lucas
I thank the hon. Gentleman very much for his recollection. It is of a time before I was in this House, but he has made a very eloquent testament to the fact that cannabis does not act as a gateway drug; it does not drive people to crime or to act antisocially.
Successive Governments have used carefully calibrated snapshots in time in an attempt to illustrate that the laws are working to reduce drug use, but if one looks at overall trends over time the only thing that is really certain is that there is no link between illegality and use. For example, cannabis use has been in decline since 2000 and that trend was completely unaffected by the drug being downgraded in 2004 and subsequently upgraded again in 2009. In other words, the relative illegality of cannabis does not appear by itself to act as a deterrent.
That conclusion is also reached in research published in the Journal of Substance Use, for example, which corroborates previous studies that found that whether or not a drug is illegal has very little bearing on people’s decision to use it. One study compared Norway, which has a relatively liberal regime, with Sweden, where strict controls are in place, and both countries have similar levels of drug use. Again, that undermines any correlation between levels of punishment and levels of drug taking.
However, there is powerful evidence that the so-called war on drugs is actually making things an awful lot worse. Far from being neutral, in many cases the current model pushes users towards more harmful products, behaviours and environments. I know that many of us are concerned about the long-term effects of newer and stronger forms of skunk, for example, and prohibition makes it incredibly difficult to monitor or test new drugs, to evaluate their impact or to provide users with health information. On the other hand, regulation would allow individuals to make more informed choices and to reduce many of the risks associated with illegal consumption.
Therefore, it is crucial to differentiate the suffering caused by drugs and the suffering caused by drugs policy. The scandal is that it is the latter problems—those caused by drugs policy—that are the more serious, and they are the things that we could make a difference to if we could just garner sufficient political will and courage in this House. The vast majority of drug-related offending takes place not because people take drugs but because of drugs policy; users are driven to burglary and theft to buy drugs at vastly inflated prices in an unregulated market. There is enormous potential to reduce crime and its impact on our communities significantly if we were to adopt a different, regulated system.
Cannabis is a good place to start with that, so that we can introduce change gradually and safely, monitor the effects on individuals and wider society, and ensure that we have a model that minimises harms and does not encourage so-called drug tourism but instead educates users and—critically—removes the trade from the hands of the criminals and the gangs. This is a chance to take the best of what has been tried elsewhere and reject the worst, finding a legal, regulated model for the production, sale and use of cannabis.
This week, we will be giving the Cities and Local Government Devolution Bill its Second Reading, and I will argue that if the Government were serious about devolution they would also allow local authorities far greater scope to pursue drug policies that are shown to work locally, even if local priorities are at odds with national policy or legislation. Such an approach would be in keeping with the advice from the Global Commission on Drug Policy, which has recommended that national Governments allow local initiatives to experiment with locally designed policies that are, as the commission puts it:
“designed to undermine the power of organised crime and safeguard the health and security of their citizens.”
That is exactly what we tried to do in Brighton and Hove, the city that I represent here, because when I was first elected in Brighton, Pavilion, our constituency had the much unwanted title of the drugs death capital of the UK; at that time, more people were dying of heroin overdoses in Brighton than anywhere else in the UK. As a result, a group of us got together and set up a commission on drugs, and we looked at what we could do to try to make a difference, based on evidence. Although we made big strides forward, I have to say that the national policy framework was a real obstacle to our going as far as we would have liked to, in terms of some of the measures that we wanted to pursue.
None the less, by looking at the evidence, we have managed to achieve a 17% increase in the number of people leaving treatment successfully, compared with a national average of 7%; we have actively tackled concerns about whether people were too easily left on maintenance programmes, so that almost half the people leaving treatment services now do so in a drugs-free way, compared with 35% at the end of 2010-11; we have rolled out training to administer naloxone and reverse heroin or methadone overdoses, and we have reduced benzodiazepine prescribing rates; and the number of drug-related deaths in the city has also fallen, at a time of massive Government-imposed spending cuts and massive upheavals for the NHS and police services in particular.
In conclusion, the call contained in this petition that so many of our constituents have signed—930 in my own constituency alone—is an opportunity for the Government to demonstrate their commitment to the evidence, to genuine devolution and, indeed, to fiscal responsibility, and I hope that the Minister will be able to offer us reassurances on all those fronts.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
I thank the hon. Member for Newport West (Paul Flynn) for securing this debate today. It is an extremely important debate, which has been brought forward in response to an overwhelming petition by the public.
Cannabis is the most widely used illegal drug in the UK. Although it appears that there has been a steady reduction in its use since 1996, between 2013 and 2014 about 2.3 million 16 to 59-year-olds reported using cannabis. Frequent use of cannabis is also about twice as likely among young people, with nearly 5.3 million 16 to 24-year-olds reporting having used it during the same time period.
Despite Government and media warnings about health risks, many people see cannabis as a harmless substance that helps them to relax, and as a drug that, unlike alcohol or cigarettes, might even be good for their physical and mental health. Proponents for decriminalisation have also highlighted the potential medicinal properties of cannabis, and argued that legalising the production, supply and use of cannabis would also have a number of benefits for society as a whole. We have heard many of these arguments today.
Transform, a charitable think-tank that campaigns for the legal regulation of drugs both in the UK and internationally, argues that the current approach of prohibition is failing and will never be successful in protecting individuals or society from the misuse of drugs. It highlights that the unintended consequence of prohibition is that it creates an illicit market, which allows the drugs trade to be monopolised by organised crime factions.
A number of my constituents who feel extremely strongly about this issue have contacted me in the run-up to this debate. One of them, Paul, who wished to be mentioned today, supports a motion to decriminalise cannabis due to its medicinal properties, and he has told me that he feels that criminalising a substance produced from organic matter and that holds medicinal potential while allowing “over the counter” sale of many more harmful substances could be viewed as disproportionate, as could driving someone to use the black market to gain hope or relief from a medical condition, such as multiple sclerosis, because nothing else offers the same relief.
On the other hand, medical bodies have reported evidence indicating the significant potential harm that can be caused by cannabis. I am a clinical psychologist who specialised in addiction and forensic populations in my previous career, so the impact of cannabis on mental health is of particular interest to me. Literature published by the Royal College of Psychiatrists in 2014 has highlighted several issues of concern in this regard. While it is acknowledged that not everyone who uses cannabis will develop mental health problems, even among those in the groups in society identified as being the most vulnerable, the royal college’s publication highlights the growing evidence that people with serious mental illness, including depression and psychosis, are more likely to use cannabis or to have used it for long periods in the past. It also appears that regular use doubles the risk of developing a psychotic episode or long-term schizophrenia.
Research has found that adolescents who use cannabis regularly have a significantly higher risk of developing depression, anxiety and psychotic illnesses such as schizophrenia and bipolar disorder. A longitudinal study of 1,600 Australian adolescents, already described by the hon. Member for Central Suffolk and North Ipswich (Dr Poulter), found that while children who used cannabis regularly had a significantly higher risk of depression, the opposite was not the case, with children who already suffered from depression no more likely than anyone else to use cannabis to ameliorate their problems. The study found that adolescents who used cannabis daily were five times more likely to develop depression and anxiety in later life.
Evidence also shows that individuals who use cannabis, particularly at a younger age—around 15, which is when many people start to use it—have a higher than average risk of developing a psychotic illness. It has been found that the increased risk is related to increased use, and that those who use cannabis are also at risk of an earlier onset of illness compared to those who do not.
Available research shows that people with a family history of psychotic illness, or those who have certain characteristics or a certain vulnerability, may be at an increased risk of developing an illness following the regular use of strong cannabis. As has been eloquently described, research also indicates that the UK market has been flooded with stronger varieties of cannabis, such as skunk, which contain higher quantities of tetrahydrocannabinol, or THC, which is cannabis’s main psychoactive ingredient. It has been found that there is a higher risk of developing a psychotic illness from cannabis if it has high levels of THC, and if people are regular users. The easy availability of the stronger varieties carries a specific risk to young people with a genetic predisposition. In addition, it has been highlighted that cannabis with high amounts of THC can cause cognitive problems, such as with short-term memory and processing speed.
While in the past it was thought that cannabis was not addictive, current evidence suggests that it can be, particularly if it is used regularly and heavily.
Mr Lilley
We obviously listen with great respect to the hon. Lady because of her expertise, as we did to my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), who has similar expertise. I just wonder whether the studies that she and he have mentioned consider the prevalence of the illnesses in society as a whole, and whether the recent decline in cannabis use has led to a decline in the incidence of the illnesses. Similarly, when there was a rise in the use of cannabis, did that lead to a rise in their incidence? Is the incidence greater in countries with high cannabis use than in countries with low use, or has such research not yet been done?
Dr Cameron
The studies I mention do not specifically answer the right hon. Gentleman’s questions, but they indicate that people with particular vulnerabilities might be more likely to develop mental health problems, along with individuals with heavy and sustained cannabis use. It was not necessarily that a vulnerability was required for someone to go on to develop depression or anxiety.
Regarding physical health, it appears that the main risk from cannabis is that from the tobacco that it is often smoked with, although the British Lung Foundation reported in 2012 that cannabis smoking carries a greater risk of smoking-related disease than tobacco alone. It has also been reported that cannabis can affect fertility, and new research has found that the cannabis plant contains cancerogenic mutagens that can affect the lungs.
In conclusion, it is my position that further research, and perhaps the addressing of the level of schedulisation of cannabis, would be particularly helpful for medical conditions, and that at some point in the future there might be a case for prescribed use for certain conditions, where it is shown to have an ameliorative effect on an individual’s health. Overall though, there appear to be significant mental—and some physical—health concerns associated with cannabis use, which make it necessary for careful consideration to be given to the most effective methods of managing and addressing the issue and to any changes to legislation.
Anne McLaughlin (Glasgow North East) (SNP)
I congratulate the hon. Member for Newport West (Paul Flynn) on bringing the petition to the House and all those who signed it. That is probably the last time I will remember the name of a constituency; I have not yet got to grips with the constituencies, so I will probably point a lot.
It is clear from the petition that cannabis and its production, use and legislation is an important issue to the people of the United Kingdom. I received an email from a constituent yesterday informing me that more people signed the petition in Scotland than anywhere else, and that Glasgow was the city with the highest number of signatories, with my own constituency having one of the highest rates. For that reason, and because I am the Scottish National party spokesperson on civil liberties, I am pleased to contribute to the debate.
The frustration that the signatories to the petition must feel is that, although the issue evokes strong emotions in different quarters, there is no settled demand for any specific legislative change. Even today, most of the speakers, however they feel about the matter, acknowledged the other side of the debate. I do not envy those who have to make the decision, but I echo everyone else’s calls for much more research, so that we can get to the bottom of the argument.
The debate also reflects some of the idiosyncrasies of the current devolutionary settlement, in that control of drugs is reserved to the UK Parliament under the Misuse of Drugs Act 1971, but the treatment and prevention of drug problems is devolved to the Scottish Government. That is an unhelpful division in a policy area that is too important for there to be a fragmented approach, but it also illustrates that there are a number of facets to the issue: harm reduction and public health on the one hand and legality and criminalisation on the other. There is a strong argument—I have heard this a couple of times today—that public health should be the focus when considering drug and alcohol use and misuse. The right hon. Member for some constituency, which I am sure is wonderful—
Anne McLaughlin
The right hon. Gentleman made the strong argument that the Department of Health should consider the issue, not the Ministry of Justice. In Wales they do things differently—health is devolved to Wales. They have centres there where they carry out tests so that those who choose to use illegal substances can find out what is in them. I am interested in hearing more about the impact of those centres.
Taking a multifaceted approach stands in contrast to the often ill-informed populism that, as many hon. Members, including the hon. Member for Newport West, have said, often decided policy under all Governments in the past. There is a need, therefore, for much more research and more definite conclusions, to remove the debate from the realms of both an ill-informed populism —on both sides of the debate at times—or an abstract legalism.
Many hon. Members will know of the real difficulties that criminal records cause people in the poorest communities. Those communities are also often the ones most heavily blighted by the antisocial use of drugs. At this point, I want to do a “bit of a Jeremy Corbyn” and provide a voice for my constituents because, like most hon. Members , I have had many emails on the issue. I will quote just a couple of them, because they have asked me to be their voice here today, although they have differing views on the matter. Drew from Robroyston says:
“I understand arguments on both sides but it is hypocritical that we freely sell and consume substances such as alcohol and tobacco but prosecute those who choose to ingest less harmful drugs.”
Caroline, however, says:
“My brother was managing his schizophrenia until he started cannabis.”
William asks me:
“If the Misuse of Drugs Act is there to prevent social harm and alcohol and tobacco aren’t illegal, why am I made to be a criminal for smoking cannabis?”
Another constituent says:
“The fact that alcohol is legal is not an argument for also legalising cannabis. If we were considering legalising alcohol today, would we?”
The petitioners may not get all they are campaigning for today—they may; I have no idea what the Minister will say—but they need to know that their arguments are being listened to, and the best way to achieve that is to commit to researching the issues properly. Those opposed to the petition would surely be satisfied by that, because they believe that research will back up their arguments. It is a win-win for the Government, and I urge the Minister to commit to that research today.
One of the clearest things we know from the research that has already been done is how much work remains. The effects of alcohol and tobacco are well documented in our society, and the Scottish Government continue, via their minimum pricing regulation, to stand up for public health in the face of pressure from the industry and, sometimes, the public. However, the health effects of cannabis at a societal level, its relation to other drugs including tobacco and its relationship, causal or otherwise, with mental health problems require further study.
A very close associate of mine has bipolar. She was a regular user of cannabis. She asked two different psychiatrists, “Did that make it worse?”, and one said yes and the other said no. She asked them whether it caused her bipolar, and one said, “Possibly”, and the other said, “You possibly started to use it to cope with the effects of an undiagnosed condition.” That is the problem. I have heard a couple of Members say that there is conclusive evidence, but there is no conclusive evidence that cannabis does not exacerbate pre-existing mental health problems. Anyone with any experience of mental illness would never support anything that would exacerbate or cause psychotic episodes. Another argument that is put is on whether alcohol exacerbates mental health conditions. If research is done and it is found that cannabis has a serious impact on people’s mental health, that would be a strong argument against its legalisation.
On the other hand, we have to look at physical conditions. We have heard much today about medicinal cannabis. I was emailed by Michelle Anne; I think she probably emailed everyone. She was demonstrating outside today, and she is possibly in the Public Gallery. She described the physical symptoms of some of her conditions. I cannot read all the email out, but she talked about waking up and how before she moves, she has to fight spasms, cramps and electric shocks. She described it as like being
“thrown into a bed of nettles”.
She spoke movingly about how, as a result of her using what she referred to as organic, well-grown, cured cannabis, she now feels happy, sleepy and hungry—all welcome benefits.
Although we have heard arguments in favour of legalisation, it is clear that that is not a panacea. The evidence from the US states that have proceeded with decriminalisation indicates a variety of outcomes. All parties would probably benefit from a continued study of those jurisdictions and our European neighbours to inform policy in this country. It is surely a gift to us that we do not have to rely on a debate to come to a conclusion; we have evidence from around the world and other countries willing to share it with us. As the hon. Member for Newport West said, they have done the work for us, so let us use it.
There are clear arguments against legalisation, but the House would do well to heed some of the real problems associated with the policy as it stands. Those from our poorest communities and from black and minority ethnic communities are affected most severely by the criminalisation policy. The right hon. Member for Hitchin and Harpenden (Mr Lilley) talked about morality, but I would put it another way: there is a snobbish attitude to cannabis as compared with other drugs. As other Members have said, it would appear from various media reports that those of a middle to upper-class background can partake in illicit substances in their university days without ever jeopardising their future careers. However, for many people from a working-class background, a drugs-related conviction, no matter how minor, can have a devastating impact on their life chances in terms of employment.
Let us also consider one group of primarily black and minority ethnic users—Rastafarians. Their use of cannabis is part of their religious and spiritual beliefs. I am probably the only speaker here today—Members can prove me wrong if they like—whose partner is a Rastafarian. I might get shot down in flames for this, but he is probably the only Rastafarian who has never used cannabis. It is not compulsory for Rastafarians to use cannabis, but it is part of their spiritual outlook. He has asked, “If I choose to use cannabis because it is part of my religious beliefs, where are my civil liberties if that criminalises me?”
I end by making one final point. The international context of our drug legislation must be considered. The UN drug conventions are all more than a quarter of a century old, and there is growing anticipation ahead of the international discussions in 2016, which will be informed by a far broader base of evidence accumulated in the interim period. It is noteworthy that some of the countries that requested that the discussions be brought forward are very much at the forefront of what was once called the war on drugs. The Government should ensure that the United Kingdom participates fully in the UN discussions on drugs policy. That will allow us to act responsibly on the international stage, using UK evidence to inform international approaches and utilising the latest international research to influence policy here on these islands.
Lyn Brown (West Ham) (Lab)
It is a pleasure to speak under your chairmanship, Mrs Gillan. I start by thanking the Petitions Committee for scheduling this debate. I thank my hon. Friend the Member for Newport West (Paul Flynn) for his measured and well-researched contribution. The e-petitions process is an invaluable addition to our democracy, as it ensures that we can directly respond to the interests of the British public. That can only be a good thing. The petition that sparked this debate was signed by 125,000 people in just four days. It is clear that there is a degree of public interest in the legal status of cannabis, and it is right that we carefully consider the issue. The debate’s quality has allowed us to do precisely that, although this is clearly not the end of the debate.
Since the late 1990s, cannabis use in Britain has significantly reduced, particularly among the young. According to Home Office statistics, nearly 30% of 16 to 24-year-olds had used cannabis in 1998. In 2014-15, it was a little over 16%, although the percentage had slightly increased over the previous two years from 13%. We are still on a positive trend, although it would be invaluable to understand what has driven the increase in the past two years. I wonder whether that is related to the cuts we have seen to youth services. It is also important to note that there has been an increase in synthetic cannabinoids.
As has been discussed, Portugal and other countries have chosen to decriminalise cannabis and other drugs. I know some would like to see us go down the same route in Britain. When considering lessons from Portugal, we should be clear that its drug policy is far from permissive. It removes criminal penalties for simple possession of small amounts, rather than having the wholesale decriminalisation of possession, supply and production offences. Those caught with drugs are summoned before a tribunal or dissuasion commission, which includes a psychiatrist and a social worker, who often mandate rehabilitation services or issue financial penalties. There is still a concerted effort by law enforcement, working in conjunction with the health service, to reduce drug use and in particular to control production and supply.
I am aware that Björn Hibell’s study of European drug trends shows that cannabis use is reducing among the Portuguese young. However, we must recognise that cannabis use is decreasing even faster among British youths, although from a higher base, and that there has been an increase in the use of cannabis and other decriminalised drugs among older groups in Portugal.
I understand that one reason why many may have signed the petition is that too many people, young and old, feel that they have had their lives blighted by a conviction for the possession of cannabis. A conviction may well prevent someone from getting a job while it is still on their record, and some professions—in law, accountancy and medicine—even require the disclosure of spent convictions. Our police have discretion over how to enforce the law against possession. In some areas, such as Durham, that means a force-wide policy of not charging people for possession, or even for growing their own plants. In other areas, individual police officers are allowed to make their own judgment, which includes charging people with a first offence and the possibility of a custodial sentence. We have de facto decriminalisation in some parts of the country and enforcement in others. This is an extraordinary postcode lottery. Given that a drug conviction has such a serious impact on a person’s life, this postcode lottery is simply unacceptable.
We should also recognise racial disparities. Black people, on average, use drugs less than white people, but are six times more likely to be stopped and searched for drugs. This inequity needs to stop, so I say gently to the Minister that what we lack at the moment is Government direction and leadership. If the debate does nothing more, I hope that it will flag up to the Minister that he might have some work to do to ensure the equity of law across the country and for all citizens.
My hon. Friend the Member for Newport West has consistently campaigned for the use of cannabis to be legalised for medicinal purposes, and he has made that case again today with characteristic eloquence and sincerity. I have enormous sympathy for anyone who seeks the most effective way to access pain relief. I do not doubt the reports made by those with multiple sclerosis and other illnesses that drugs can bring pain relief and improve muscle control. However, I do not believe that we need to legalise cannabis to have access to its medical benefits.
THC, the active ingredient in cannabis, is used as an ingredient in the drug Sativex, which we heard about earlier. It is already licensed in the UK—in Wales—to relieve the symptoms of MS and other medical conditions. We can and do benefit from THC without legalising forms of cannabis that are used recreationally. I understand that this is something that the Government’s drug advisers, the Advisory Council on the Misuse of Drugs, support.
I am also aware that Sativex is not available on the NHS in England owing to the cost of the drug. Although that is ultimately a decision for NICE—I accept that—I ask that Ministers look at this again. Sativex is, after all, available on prescription in Wales, as I have said, and MS sufferers in England should not face greater pain and difficulty simply because they live on the wrong side of a border. Despite the medical benefits of THC, which can be accessed through Sativex, there remains real public concern about the negative impact that recreational cannabis has on health. I share many of those concerns. My main worry about the drug is its impact on mental health, as eloquently outlined by the hon. Member for Central Suffolk and North Ipswich (Dr Poulter). We know that regular users are more likely to develop psychotic illnesses, including schizophrenia. There is also a link between cannabis use and developing depression or anxiety, particularly among those who started smoking cannabis as adolescents.
Britain has some of the highest rates of mental illness in the world. The Mental Health Foundation and Mind tell us that one in four Britons suffers from a mental health problem over the course of each year. According to the Office for National Statistics, 15% of us will seriously contemplate suicide at some point in our lifetime. Given these mental health concerns, I think it would be irresponsible to support measures that may make the drug more readily available—something likely to occur if we legalise the drug.
As I understand it, Holland abandoned its model of completely ignoring personal possession due to the impact of the drug on mental health conditions. This is worrisome, especially given the potency of cannabis on our streets. According to the Home Office’s most recent potency study, intensively grown cannabis, which is the most common form of the drug in the UK, has on average a 15% THC concentration. Traditional cannabis, if there is such a thing, has just 9%. Strong strands of cannabis have all the more impact on minds. We also have the growing problem of synthetic cannabinoids.
In conclusion, I ask appropriate Ministers to look again at Sativex and the use of cannabis for those with particular physical conditions that can be alleviated by the drug. I believe the Minister should look at the postcode lottery of criminalisation due to cannabis possession and use, but I am not persuaded of the case for the legalisation of cannabis. In this place, we should always have mind to the impact of our actions on public health. Legalisation will not improve this. Legalisation has the potential to exacerbate the problems that we have with drug dependency and mental illness.
Mrs Cheryl Gillan (in the Chair)
Before I call the Minister, it may be helpful to tell you that I intend to call Mr Flynn, the proposer, at the end. He has indicated that he would like to speak.
The Minister for Policing, Crime and Criminal Justice (Mike Penning)
It is a pleasure to serve under your chairmanship, Mrs Gillan. I welcome the new shadow Minister, the hon. Member for West Ham (Lyn Brown), to her role. I did not get an opportunity to do so at Home Office questions earlier. We are friends, which is a dangerous thing in this place, and we agree on many things. In fact, I agree with most of what she has said in her comments today.
May I start by saying that I am not from the university elite who smoked cannabis when they went to university? I am not cynical and I am not horrible—I hope. I worked very closely with the right hon. Member for North Norfolk (Norman Lamb) when he and I were shadow Health Ministers and when he was a Health Minister with responsibility for mental health and I was in a different role.
I have every sympathy for my friends and members of my family who have had MS and the terrible pain and anguish that they go through because of an incurable disease. So I start from the premise of having sympathy. Let us see what we can do in the 21st century to take people out of that environment. However, I have real concerns about legalising cannabis. I congratulate the hon. Member for Newport West (Paul Flynn) on his position, which has not changed in 40 years. I also congratulate my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley). I expected him to be sitting here when I came in to the debate today.
We have had two contributions from people who are medically qualified and who know—not anecdotally—about the medical side and the patient’s point of view. Their contributions have been enormously significant. I believe that the debate would have been more useful if we had talked about the medical side and the help available, rather than the generality.
Mike Penning
If I can make a little more progress, I promise I will give way shortly. I am always generous in that way.
Although we have had a huge petition from people who are for legalisation, I am sure that colleagues in the House have also had people writing to them saying no to legalisation, as indicated by the SNP shadow Minister, the hon. Member for Glasgow North East (Anne McLaughlin), a moment ago. There is no petition from those who do not want to change the legislation, but a large petition from those who do. I think a significant minority also need to be considered in this debate.
Norman Lamb
I do not think there is any dispute about medical risk. The question is about how one responds to it. Does the Minister really think it is appropriate to give someone who is perhaps suffering from mental ill health a criminal record?
Mike Penning
To be fair, that is different from the point I was trying to make. In the modern way in which we police—not just in the past five years, but for many years—the discretion of a police officer to make a decision is an operational matter for them, and not for politicians. Also, it is not for police and crime commissioners to make such decisions. I know what the Durham PCC said, but operational decisions are for the chief constable. PCCs were not set up to make such decisions. We now have cross-party support for PCCs. I am pleased about the Labour party’s conversion since the election. That is not a snipe—yes, it is—but I am really pleased that there has been a change, because there are excellent PCCs out there and they do an excellent job.
I am also conscious that there are devolved Administrations looking at this matter differently. I will come to some of those points later. Let us see what positives can come out of this. I will not stand here and say, “We are going to legalise cannabis.” I am not going to say that from a moral, personal or Government position. However, we could look carefully, as was mentioned by my hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), at the research. We need to look at why the research is not taking place and at the effects of certain parts of the legislation.
Believe it or not, I took a week off the week before last and went to my favourite part of Norfolk: the Norfolk broads. I spent a week fishing while my wife and mother-in-law looked at the other beautiful parts of Norfolk. I used a lot of hemp—we discussed the seeds earlier in the debate. I live in and represent Hemel Hempstead. Some of the bread that some of us buy contains hemp seeds. My hon. Friend the Member for Central Suffolk and North Ipswich alluded to the problem of the seeds being legal, and the rationale behind that, although that does not mean we should not look carefully at the matter, and we will. There should be nothing in statute that prevents research into improving people’s quality of life. I will go away and work with other relevant Departments to see how we can do that.
My good friend the hon. Member for North Down (Lady Hermon) alluded to what would happen with the republican response. As a former Northern Ireland Minister, and having served in Northern Ireland in uniform in a different capacity, I know that the sad thing is that these thugs and organised criminals will find something else with which to raise money and destroy their communities, as they have done with diesel laundering and other things over the years. I do not think that legalisation would make a huge difference to what they do, but it might make a huge difference to the lives of the hon. Lady’s constituents, whether mentally or physically, according to the evidence we have heard today.
Another issue, which I discuss with my constituents, is the diverse views about where we should be on this subject. We are as one in wanting to protect our constituents, but we are perhaps looking at it in different ways. Going back to the point made a moment ago by my former right hon. Friend, the right hon. Member for North Norfolk, mental health protection for vulnerable people is probably one of the most difficult and important issues we face, which is why I am so pleased that, after the work we did in the past, so many police forces now have mental health professionals with them on the streets and in the custody suites, and use sections 135 and 136 less.
As we have heard, there is conflicting evidence from studies from across the world. The majority of the world has not legalised cannabis. There is movement, but the majority of the world is in roughly the same position as us. The shadow Minister talked extensively and absolutely correctly about Portugal, but they have a completely different strategy for working with people and moving forward, and that is true not only of their health service. Only last month, the Washington State Institute for Public Policy said that it is too early to decide whether what is going in that state is going to work. The evidence I have before me says that the institute thinks it will not be clear until at least 2017.
Mike Penning
I would like to make some progress. The hon. Gentleman will be summing up at the end, but I will give way shortly.
There will always be one expert in one part of the world saying one thing and another in another part of the world saying another, not least because there will always be such diverse views. Nevertheless, we have to listen to what is going on and use that as our evidence base, as was asked for earlier.
The situation in Holland is really interesting. We have heard different usage statistics today, but the latest figures I have—I might be wrong; if I am, I will write to colleagues and ensure that they know—are 6.5% or 6.7%, according to the crime survey for England and Wales for 2014-15, while the latest figures for Holland are 7%, which is a larger percentage than ours. Holland legalised cannabis and a different situation is occurring there: while usage is dropping here, it has stayed higher in Holland. I am not saying that what Holland has done is wrong—it is an independent country and it is absolutely right and proper that it has its own policy—but when we compare ourselves with Holland, we must not use statistics that might be out of date. If my figures are out of date, I apologise, and I will write to colleagues to correct them. Other points were raised on which I would like to write to not only those colleagues present, but every colleague in the House—those who were not able to attend this debate—to answer such queries.
To the hon. Member for Brighton and Hove, which I think is the name of that constituency now—
Mike Penning
I apologise. She is the hon. Member for Brighton, Pavilion (Caroline Lucas)—my civil servants will be told off later for the notes I was given. I say to her: do not believe everything that Ipsos MORI or any other pollster says. I was supposed to have lost my seat in 2010, but I returned with a majority of 13,000. Pollsters get it wrong; it is about the questioner.
Mike Penning
The hon. Lady can shake her head, but it is a fact that we were not predicted to win the election, yet we did. There are different views about what pollsters say and can measure, but our job is to protect our constituents.
Caroline Lucas
I was shaking my head only because the polls are one tiny part of the overall case that I and colleagues have been making. Our case has been about looking at the evidence. I find it shocking to hear from both the Minister and, sadly, the shadow Minister no real interest in looking at the evidence. Yes, we have heard two medically qualified people speak, but there is plenty of medical evidence out there that suggests that, for example, freeing up cannabis for medicinal use is a positive thing to do. Will the Minister undertake to look at the evidence?
Mike Penning
I am not certain that the hon. Lady was listening to what I said, but I suggest she read Hansard tomorrow morning. We have cross-party agreement that we will look at research and see how we can help people. I am committed to that, as is the shadow Minister. We will try to do that, but I cannot do it at the Home Office alone; it has to be done across the board. That is the most important thing that can come out of this debate. It is not about who is right and wrong; let us try to work out what can help individuals.
Paul Flynn
The Minister says that he is keen to look at evidence, so will he re-read the report of the Home Affairs Committee? With a Tory majority, it looked at the subject very seriously for a whole year, and concluded that what happened in Portugal was entirely beneficial, with no harmful effects, and is now supported by all parties in Portugal, as well as the police there. Why does he think that an anecdotal sideswipe at that is going to mean anything? Is he not relying on an evidence-free policy instead of taking up the Select Committee’s recommendation to set up a royal commission on this issue?
Mike Penning
The hon. Gentleman is never going to change his view, and that is fine.
Mike Penning
From a sedentary position he chunters on. Let us listen to what the royal colleges have said, because they are the experts. The Select Committee took evidence. I have sat on Select Committees and I know exactly what goes on. I think I am due to give evidence to the Select Committee next week. It is crucial that we do not set ourselves in one position but that instead, we ask what research could help take things forward. That is what I have committed to doing and it is very important.
Norman Lamb
I am delighted that the Minister visited the Norfolk broads. I wonder whether, when he was there, he enjoyed a pint in one of the many pubs. There is very clear, overwhelming evidence that alcohol is more dangerous than cannabis. Can the Minister give any explanation of why it makes sense for that more dangerous product to be legal while a less dangerous product is illegal?
Mike Penning
Well, I am not actually convinced, on the evidence, that cannabis is less dangerous for certain people. As was said earlier, if we were to start alcohol and tobacco policy again from today, of course we would not be where we are now. I accept that point.
In conclusion, I am committed to working with other Departments and whoever else wants to work with us to ensure that, in the 21st century, where cannabis can be helpful through pharmaceuticals, we will try to make sure that that happens. I am committed to looking at the research and at what work we should be doing. This debate has been enormously useful, but I cannot support the petition.
Paul Flynn
I am afraid that, as usual, the point of the debate has been missed. It is not my debate, but the debate of the 220,000 people who tried a new procedure—this is only the second time it has been used—to ask that the House debate this subject. Our chief task in this Parliament is to restore the reputation of this place. Democracy was invented in Greece 2,500 years ago and has come to us in stages. People had expectations that, because they signed the petition and we held this debate, they would hear a positive, sensible and constructive answer from the Government. They have been disappointed.
The great myth that is perpetrated is that if we ban something people do not use it and that if we make something illegal it stops being used, but the reverse is true. The prohibition we introduced in 1971 has been a continuing disaster. We heard medical evidence from the same source, and we have to take it seriously. The small percentages do not relate to the extent of the danger. I remind the House that Professor Nutt said that we would have to stop 5,000 people using cannabis to prevent one case of psychosis. That still makes it a serious problem, but the great lesson is that prohibition has caused people to suffer greatly. People have been criminalised, and their lives have been ruined.
I have only two minutes, so I will make a final point. Tens of thousands of people have written impassioned letters to us about their suffering. They want the Government to move their drug of choice, which is a natural substance, not a chemical one like Sativex—the natural form of cannabis has been used for 5,000 years without any serious side effects—from schedule 1 to schedule 2. Simple—it could be done. It has just been done in 23 states in America without any harm. I beg the Government to look again at the evidence to rescue sufferers of MS from their bed of thistles.
Mr Lilley
Surely the hon. Gentleman agrees that the one argument that those opposing our position have leant upon is the evidence of the Royal College of Psychiatrists studies, but the very fact that studies can be carried out on people who use and do not use cannabis shows that the present prohibition is not effective. It also suggests that, although there may be health risks, their incidence will probably not be altered by legalisation, whereas all the other issues that the hon. Gentleman and I have raised would be ameliorated. We hope the Minister will take that into account in his further consideration.
Paul Flynn
As the right hon. Gentleman said, there is a belief that persists. Recently, one of the legal highs was criminalised, and the result in my area was a 300% increase in its use. We cannot go on believing that we are the masters of the universe. We are throwing 2 million or 3 million of our young people into the hands of irresponsible gangsters. We should ensure that these drugs are controlled so that they are kept out of the hands of people with mental ill health and others whose health might be threatened, such as pregnant women. That is the point of a controlled drug, and we will get it controlled only with legalisation. We will carry on with the chaos, waste and cruelty if we continue with our mistaken policy of prohibition.
Question put and agreed to.
Resolved,
That this House has considered an e-petition relating to making the production, sale and use of cannabis legal.
Written Statements
(8 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text
Low Pay Commission: National Minimum Wage
(8 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for Skills (Nick Boles)
I am pleased to announce that the Government have published policy evidence to support the Low Pay Commission’s research towards recommendations due in 2016. I have written to the LPC to set out what we would like the Commission to consider on the national minimum wage and national living wage. This document contains policy information relating to the national minimum wage legislation and wider Government policy which may impact upon the Low Pay Commission’s recommendations.
Economic evidence will be published before the end of the year when the latest information on earnings and economic forecasts is available.
A copy of the evidence will be placed in the Libraries of the House and will be available from the BIS website at: www.bis.gov.uk.
[HCWS213]
Sahaviriya Steel Industries UK Limited
(8 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text
The Secretary of State for Business, Innovation and Skills and President of the Board of Trade (Sajid Javid)
I want to update the House on matters relating to SSI in Redcar, which entered liquidation on Friday 2 October 2015.
Both the Minister of State for Small Business, Industry and Enterprise and I were in Redcar during the recess. SSI’s work reviving steel making in Redcar has faced increasing challenges and this announcement came as deeply disappointing news, undoubtedly making for a tough time for the workforce and Teesside more broadly.
The Government cannot intervene in the liquidation process, which is now in the hands of the Official Receiver, however we are absolutely committed to helping the workforce and local economy.
The Government have announced a package worth up to £80 million to support people who have lost their jobs as a result of SSI’s liquidation, and mitigate the impacts on the local economy. The funding will include support for workers to retrain and help for local firms to grow and create jobs.
In addition, we have asked Amanda Skelton, Chief Executive of Redcar and Cleveland Borough Council, to chair a local taskforce which is examining what steps need to be taken to support the local economy and workforce.
Full details of the package are being worked through and discussed with local stakeholders, however I wanted to set out in more detail two of the elements of the support package that are already available to SSI’s employees.
First, both employees and contractors made redundant as a result of SSI’s liquidation will be able to access Jobcentre Plus’ rapid response service, which helps people to move quickly into alternative employment. This service is delivered locally with partners, is tailored to an individual’s needs, and can include some or all of the following elements:
Help with job searches including CV writing and, interview skills;
Help to identify transferable skills and skills gaps (linked to the local labour market);
Training to update skills, learn new ones and gain industry recognised certification that will improve employability;
Help to overcome barriers to attending training or securing a job or self-employment such as child care costs, tools, work clothes, travel costs etc.
This service has been mobilised and is delivering support to SSI employees following the first announcements of redundancies and Jobcentre Plus will continue to play a full part in the taskforce we have established.
Secondly, there are special arrangements in place to ensure employees who are dismissed on the insolvency of their employer receive a basic minimum of the debts they are owed from the National Insurance Fund. This includes payments for statutory redundancy, holiday and notice pay, and arrears of wages, subject to statutory limits.
The redundancy payments service (RPS) has issued SSI staff affected with a letter, explaining their rights and how to make an online claim for redundancy pay. If any SSI employees have not received this letter, they should contact the redundancy payments inquiry line on 0330 331 0020. The RPS has established a dedicated team to process these applications and make sure SSI employees receive their payments as quickly as possible.
Unpaid pension contributions are also payable, within specified legal limits, from the National Insurance Fund. If there are unpaid pension contributions, the pension fund trustee will lodge a claim with the RPS, so employees do not need to submit an application for this. If employees have concerns about their pension, they should contact their scheme administrator.
Turning to the steel industry more broadly, it is clear that the industry is facing extremely challenging economic conditions. We are working closely with the sector to help where we can, and as such, will be holding a Steel summit on 16 October to understand the challenges the sector faces and explore what more can be done to support the industry. I am pleased that not only the industry and the unions, but a number of MPs representing constituencies with close links to the steel industry have accepted the invitation.
Finally, I wish to place on record that on Friday 2 October 2015 an indemnity was provided to Ken Beasley, the Official Receiver, in his capacity as liquidator of Sahaviriya Steel Industries UK Limited.
It was urgent and necessary to provide the Official Receiver with this indemnity, so that he felt able to accept the appointment as liquidator of the company and ensure that the company’s site could be secured and health and safety concerns associated with the site addressed from that point.
The indemnity is uncapped. However it is limited to liabilities arising as a consequence of the Official Receiver:
carrying out the proper performance of his duties as liquidator of the company, and
maintaining, securing and funding the ongoing operation of the company’s undertaking, and distributing the assets of the company in the ordinary course of his duties as liquidator of the company.
The Government can terminate the indemnity by giving at least 14 days’ notice to the Official Receiver.
In accordance with the guidance contained in “Managing Public Money”, on 8 October, I wrote to the Chairs of the Public Accounts Committee and the Business, Innovation and Skills Select Committee outlining the indemnity committed to on behalf of Government and the reasons for the urgency in this case.
As a matter of record I have placed a departmental minute in the Libraries of both Houses explaining the procedure followed and containing a description of the liabilities undertaken.
[HCWS215]
Charter for Budget Responsibility: Autumn 2015 Update
(8 years, 6 months ago)
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The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
Today I have laid before Parliament an updated Charter for Budget Responsibility. It sets out a fiscal framework to entrench a commitment to reach surplus and maintain it in normal times. It also includes the updates to the Charter recommended by the HM Treasury review of the Office for Budget Responsibility, led by Sir Dave Ramsden and clarifications on the operation of the welfare cap.
The updated Charter laid today was published in draft on 14 September 2015. The Charter was first published in draft as it includes modified guidance to the Office for Budget Responsibility. Under Section 6(4) of the Budget Responsibility and National Audit Act, if the Treasury proposes to modify the guidance to the Office for Budget Responsibility included in the Charter, a draft of the modified guidance must be published at least 28 days before the modified Charter is laid before Parliament.
A debate and vote in the House of Commons on the updated Charter has been scheduled for 14 October.
[HCWS226]
Business Rates Reform
(8 years, 6 months ago)
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The Secretary of State for Communities and Local Government (Greg Clark)
Last week the Chancellor announced the Government’s intention to make significant reforms to the way in which local government is funded while taking a major step forward in our plans to place more power in the hands of local communities.
Since 2013, local councils have retained 50% of the proceeds of business rates, to ensure that when local areas take steps to boost business growth in their area, they see the benefit. The Government now intend to go further, with plans to move to 100% retention of business rates by the end of the Parliament.
All income from local taxes will fund local services, giving local people more control over how their money is spent and providing incentives for growth. Specifically, by 2020:
Local government will retain 100% of local taxes - including all £26 billion of revenue from business rates - to spend on local government services. This means the Government will no longer take business rates income into Whitehall for redistribution as grant.
Local authorities will have the power to cut business rates to boost enterprise and economic activity in their areas. This will complement existing powers to grant reliefs to individual businesses and will allow authorities more discretion to reflect local circumstances in their local tax regimes;
Directly elected metro mayors will be able to add a premium to business rates to pay for new infrastructure. They will need to have support of local business leaders through the Local Enterprise Partnership and the power will be limited by a cap; and
As well as phasing out the Local Government grant from Whitehall, these new powers will come with new responsibilities to ensure the reforms are fiscally neutral. The Government will set out further details in the Spending Review.
Redistribution between councils will remain important, to reflect the different need of different authorities. In developing the reforms we will consider the responsiveness of the system to future changes in relative needs and resources, while maintaining a strong incentive for authorities to grow their local economies. We will also consider how risk and business rates volatility can be better managed and how to protect authorities against significant falls in income.
Over the coming months the Government will work with local government, businesses and other interested parties on the detailed design of these reforms.
[HCWS221]
Right to Buy: Agreement with Housing Associations
(8 years, 6 months ago)
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The Secretary of State for Communities and Local Government (Greg Clark)
The Government are pleased to announce that they have reached an agreement with the National Housing Federation, which will extend Right to Buy discounts to at least 1.3 million more families across the country.
We want more people to be able to own a home of their own. The Right to Buy is a key part of this, and has already helped 2 million families to realise their dream of home ownership.
Until now, Right to Buy discounts have only been available to tenants in local authority properties and some former council properties. Extending these discounts to housing association tenants in England will end this unfairness, and will deliver our manifesto commitment to extend the Right to Buy to housing association tenants.
Under the agreement, all homes sold to tenants will be replaced on a one for one basis, delivering an overall increase in housing supply. Housing associations have a strong track record in the delivery of new homes, playing a major role in exceeding the Government’s 2011-15 affordable homes target by delivering nearly 186,000 homes.
The agreement will mean that the first housing association tenants will be able to start to buy their homes from next year.
In summary, the deal will enable the following:
One point three million families will be given the opportunity to purchase a home at right to buy level discounts, subject to the overall availability of funding for the scheme and the eligibility requirements. The presumption is that housing associations will sell the tenant the property in which they live.
The Government will compensate the housing association for the discount offered to the tenant, and housing associations will retain the sales receipt to enable them to reinvest in the delivery of new homes.
Housing associations will use the sales proceeds to deliver new supply and will have the flexibility, but not the obligation, to replace rented homes with other tenures such as shared ownership.
Government will continue to work with the National Housing Federation and its members to develop new and innovative products, so that every tenant can buy a stake in their home.
As part of the agreement, the Government will also implement deregulatory measures which will support housing associations in their objectives to help support tenants into home ownership and deliver additional supply of new homes.
We will now be working closely with the sector on the implementation of the deal, and I will update hon. Members in due course on the next stage of the implementation.
[HCWS222]
Members of the Reserve Forces in Support of UK Operations to Counter the Threat of ISIL
(8 years, 6 months ago)
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The Minister for the Armed Forces (Penny Mordaunt)
With the expiry of the call-out order made on 1 October 2014, on 21 September 2015 a new order was made under section 56(1 B) of the Reserve Forces Act 1996 to enable Reservists to be called into permanent service in support of United Kingdom operations to counter the threat of Islamic State of Iraq and the Levant (ISIL).
Under the call-out order made on 1 October 2014, 85 Reservists have been called out for operations. We anticipate a continued requirement for Reservists, with the right skills and experience, over the period the new order will be in force. This is fully in line with our policy of having more capable, usable, integrated and relevant Reserve Forces.
The order takes effect from 30 September 2015 and ceases to have effect on 29 September 2016.
[HCWS216]
Reserve Forces Call-Out Orders: Defence Objectives
(8 years, 6 months ago)
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The Minister for the Armed Forces (Penny Mordaunt)
Changes made by the Defence Reform Act 2014 allow for Reservists to be called out under section 56(1B) of the Reserve Forces Act 1996 if it appears to the Secretary of State that it is necessary or desirable to use members of a reserve force for any purpose for which members of the regular services may be used. Reservists called out under this power may be required to serve for a period of up to 12 months.
With the expiry of the orders made on 1 October 2014, on 21 September 2015 I made four new call-out orders under section 56(1B) of the Reserve Forces Act 1996 to continue to allow Reservists to be called into permanent service to support defence engagement activities (for example the provision of short term training teams and military capacity building overseas); global counter-terrorism and counter-piracy; the operation of our permanent joint operating bases (PJOBs) in the South Atlantic islands, British Indian ocean territory, Cyprus and Gibraltar; and maritime security objectives.
Under the orders made on 1 October 2014, 280 Reservists have been called out (193 for defence engagement, 66 for global counter-terrorism and counter-piracy, 10 for maritime security operations and 11 for the operation of PJOBs). We anticipate a continued requirement for Reservists, with the right skills and experience, over the period the new orders will be in force.
For operations that fall outside the scope of these orders, for example military aid to the civil authorities, or warfighting, or for operations which are likely to involve a large number of Reservists, I would expect to make separate call-out orders.
These orders take effect from 30 September 2015 and cease to have effect on 29 September 2016.
[HCWS217]
Future Unmanned Air Systems Capability
(8 years, 6 months ago)
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The Secretary of State for Defence (Michael Fallon)
The UK’s intelligence surveillance and reconnaissance capabilities and equipping our special forces are two high priority issues for the strategic defence and security review.
We have reached some early decisions in these two key areas. We will more than double the number of remotely piloted air systems in the RAF’s fleet, as we start to replace the 10 current Reapers with over 20 of the very latest air vehicles. We will also provide our special forces with new specialist weapons and clothing, as part of a programme to ensure that they remain at the cutting edge of technology.
The first RAF Reapers were deployed to Afghanistan in 2007, and are now flying vital missions over Iraq and Syria. We want to expand our capability as this area of technology rapidly develops, so we will start to introduce the new Protector aircraft. With its greater range and endurance, it will significantly increase our ability to identify, track, deter, and ultimately counter potential threats. Previously known as the Scavenger programme, Protector will substantially enhance the UK’s global intelligence surveillance and reconnaissance capability.
The new special forces equipment package will ensure we maintain clear operational advantage over adversaries, and enhance their ability to work with our key allies.
This investment will enable us to address sophisticated dangers both at home and abroad, and is only possible because this Government have committed to increase defence spending, meeting the NATO investment pledge and spending 2% of GDP on defence for the rest of this decade.
[HCWS220]
Jordanian Armed Forces: Gifting of Equipment
(8 years, 6 months ago)
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The Secretary of State for Defence (Michael Fallon)
I have today laid before the House a departmental minute describing a package of equipment, with a total value of £2,407,450 which the UK intends to gift to the Jordanian armed forces .
Conventional Jordanian forces lack the agility, as well as the training, equipment and command structures, to allow them to counter emergent threats on their Syrian and Iraqi borders. The new quick reaction force (QRF), a British-led multinational initiative is designed to address this by being able to deploy approximately 500 personnel at speed, to counter the ISIL and extremist threat at Jordan’s borders.
This gift will greatly enhance the QRF’s capacity and comprises a range of non-lethal command and control, manoeuvre and protective equipment.
Gifting is expected to begin soon after the completion of the departmental minute process.
[HCWS224]
Deaths of Corporal James Dunsby, Lance Corporal Craig Roberts and Lance Corporal Edward Maher: Inquest
(8 years, 6 months ago)
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The Minister for the Armed Forces (Penny Mordaunt)
On 15 July 2015 I made a statement regarding the inquest into the deaths of three Army Reservists, Corporal James Dunsby, Lance Corporal Craig Roberts and Lance Corporal Edward Maher who died as a result of training activity on the Brecon Beacons in Wales. I confirmed that following the conclusion of her inquest into the incident, HM Senior Coroner for Birmingham and Solihull highlighted a number of failings which contributed to the deaths of the three soldiers and made a number of recommendations to prevent future deaths. I responded to the Coroner on 14 September 2015 and, after allowing a short period for the Coroner and families to consider my response, I have today placed a copy of my response in the Library of the House. In addition to the improvements outlined in my letter we have a service inquiry under way to look at the wider safety aspects of such training and I will keep the House informed. My thoughts remain with the families of Corporal Dunsby, Lance Corporal Roberts and Lance Corporal Maher and we are committed to doing all we can to ensure such a tragic event cannot happen again.
[HCWS225]
Ukraine: Operation Orbital
(8 years, 6 months ago)
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The Secretary of State for Defence (Michael Fallon)
Further to my statement to the House on 25 February, Official Report, column 321 and my written statement of 6 March this year, Official Report, column 83, I wish to update the House on our support for the Ukrainian armed forces.
The February ceasefire agreement, which came into effect at the beginning of September, has seen a reduction in violence in much of the conflict zone. We very much hope that this will bring an end to the fighting and generate substantial progress with the other measures agreed at Minsk.
This Government are committed to supporting Ukraine’s sovereignty, independence and territorial integrity. As a result of their prolonged engagement in this crisis, the Ukrainian armed forces have faced a serious shortage of training and basic equipment and have requested help. The Ukrainians value highly the UK’s support to training their personnel through Operation ORBITAL, welcoming our flexibility and responsiveness to their requests for assistance, and highlighting that our training has made a tangible difference on the ground to their capability.
So far this year the armed forces have deployed 19 teams to train nearly 1,600 members of the Ukrainian armed forces. Over 2,000 troops will have been trained by April 2016. Given the continued importance of our support in developing the resilience of Ukraine’s armed forces I have agreed that the UK should extend our training into the next financial year, with the continued deployment of short-term training teams to deliver training to meet the Ukrainian armed forces requirements.
For the financial year 2016-17 this will see an increase from the current 75 personnel, announced last February, to around 100 deployed to Ukraine at any one time. This uplift will ensure we have sufficient flexibility to meet evolving Ukrainian requests without unnecessarily constraining activity. The UK co-ordinates our training support with allies, from November there will be a UK liaison officer in the new US-led joint multinational training group based in western Ukraine. In addition to Operation ORBITAL activity, the UK will continue with its wider support to institutional capacity building and defence reform in Ukraine.
[HCWS218]
Informal Meeting of EU Foreign Ministers (Gymnich)
(8 years, 6 months ago)
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The Minister for Europe (Mr David Lidington)
I attended the informal Foreign Ministers meeting on 4-5 September in Luxembourg.
The informal format of the Gymnich allows EU Foreign Ministers to engage in a free-ranging discussion on a number of issues. In contrast to the formal Foreign Affairs Council (FAC), Ministers do not agree written conclusions. The next FAC is due to be held on 12 October. The Gymnich was chaired by the High Representative of the European Union for Foreign Affairs and Security Policy, Federica Mogherini. Discussion centred on the Middle East Peace Process, Russia/Eastern Partnership and the migration crisis. As the discussion on migration overran significantly, Ms Mogherini decided to postpone the final discussion on Iran.
Johannes Hahn, Commissioner for European Neighbourhood Policy and Enlargement Negotiations also attended. Fernando Gentilini, EU Special Representative for the Middle East Peace Process, took part in the discussion on the Middle East Peace Process. Elmar Brok MEP, Chairman of the European Parliament’s Committee on Foreign Affairs attended the discussion on Russia/Eastern Partnership. Foreign Ministers from EU Candidate Countries joined EU Ministers for a session on migration.
Gymnich discussion
Middle East Peace Process
Ms Mogherini used her opening remarks at the Gymnich to announce a meeting of the Quartet with key Arab countries in the margins of the United Nations General Assembly. Her statement can be found at http://eeas.europa.eu/statements-eeas/2015/150904_01_en.htm
Ms Mogherini provided a sobering analysis of the situation on the ground including the fact that the humanitarian situation in Gaza remained dire.
I agreed with Ms Mogherini’s priorities for Gaza (access and port) and added power supply as a third priority. I also echoed other speakers in calling for the implementation of existing EU legislation applicable to settlement products.
Russia / Eastern Partners
There was general agreement that Ukraine needed continued EU support as the winter approached both in terms of security and continued reform. There was universal condemnation of Russia’s role in eastern Ukraine. There was however recognition of the constructive role Russia can play in international security issues, as it did in the Iran nuclear talks.
Ms Mogherini recalled that the Eastern Partnership was not just about Ukraine and highlighted the differentiated engagement needed with Moldova, Georgia, Belarus, Armenia and Azerbaijan.
Migration
The external aspects of the migration crisis were discussed in detail. The common view among member states was that this was the single biggest challenge facing the Union. There was recognition of the heavy burden currently being carried by some of the candidate countries, in particular Turkey. It was agreed that more work was needed on readmissions and returns. There was broad support for setting up ‘hotspots’, both inside and outside EU territory, to bring together EU institutions involved to deliver an integrated service in managing migrants.
A number of Ministers pointed to the need to address the factors prompting migrants to leave their homes, and increase the incentives for them to stay close to their source countries. We also needed to address the people-smuggling networks. Otherwise, there was a risk that the flow of migrants and refugees into the EU would increase to unmanageable levels. The Valletta Conference in November would provide an opportunity to develop such a strategy with African partners. There was discussion of a second possible international conference focusing on the Eastern Mediterranean/Western Balkans route.
Ms Mogherini concluded that all aspects of a comprehensive migration strategy needed to be pursued.
[HCWS219]
Ministerial Correction
(8 years, 6 months ago)
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The Parliamentary Under-Secretary of State for Foreign and Commonwealth Affairs (Mr Tobias Ellwood)
During the Westminster Hall debate “Arms Sales (Human Rights)” on Thursday, 17 September (HC Deb, col 407WH) I told my right hon. Friend, the Member for Twickenham (Dr Mathias), that Bahrain was “an example of a country that is on the list of concern”, referring to the Foreign and Commonwealth Office’s list of 27 countries of human rights concern, as set out in the 2014 Annual Human Rights and Democracy Report. In fact, Bahrain was not featured in the report as a country of concern, but rather as a country case study: http://www.hrdreport. fco.gov.uk/country-case-study-bahrain-reform-implementation.
Country case studies were introduced in 2012 as a way to report on countries which do not meet the overall threshold for a country of concern, but which we judge nonetheless to be facing human rights challenges, or to be on a trajectory of change with regard to their human rights performance.
[HCWS223]
Rail Investment
(8 years, 6 months ago)
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The Secretary of State for Transport (Mr Patrick McLoughlin)
On 30 September, I was pleased to confirm that work to electrify TransPennine and Midland Mainline railways would resume under plans announced as part of Sir Peter Hendy’s work to reset Network Rail’s upgrade programme.
Sir Peter Hendy, the Chair of Network Rail, outlined to me how work could continue. I replied to him asking Network Rail to un-pause this work.
Network Rail will work with the Department for Transport (DFT) and Rail North to develop a new plan for electrification of the TransPennine line between Stalybridge and Leeds and on to York and Selby to focus on delivering key passenger benefits as quickly as possible. This is an improvement on the previous plan which only changed the power supply of the trains.
The new plan will deliver faster journey times and significantly more capacity between Manchester, Leeds and York. The upgrade is expected to provide capacity for six fast or semi-fast trains per hour, take up to 15 minutes off today’s journey time between Manchester and York and be complete by 2022. When the work is finished, the whole route from Liverpool to Newcastle—via Manchester, Leeds and York—will be fully electrified and journey times will be significantly reduced compared to today’s railway.
Network Rail will also recommence work to electrify the Midland Mainline, the vital long-distance corridor which serves the UK’s industrial heartland. Sir Peter Hendy proposed that line speed and capacity improvement works already in hand are added to, with electrification of the line north of Bedford to Kettering and Corby by 2019 and the line north of Kettering to Leicester, Derby/Nottingham and Sheffield by 2023.
New Northern and TransPennine rail franchise awards will be announced before the end of the year. The new franchises will deliver new train carriages and remove out-dated Pacer trains; introduce free WiFi on trains; and offer a one-third increase in capacity with 200 additional services on weekdays and Saturdays and 300 more train services on Sundays.
Connecting up the great cities of the North is at the heart of our plan to build a northern powerhouse. The total programme of rail electrification and upgrades will completely transform the railways for passengers in the North and Midlands and help ensure that every part of Britain benefits from a growing economy.
[HCWS214]
Vehicle Emissions
(8 years, 6 months ago)
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The Secretary of State for Transport (Mr Patrick McLoughlin)
I wish to inform the House of the latest developments on vehicle emissions testing, following the revelations of Friday 18 September that Volkswagen Group had been fitting so-called defeat devices to some of its vehicles.
Volkswagen Group has admitted that defeat devices are present on almost 1.2 million vehicles in the UK. These are diesel-powered vehicles tested and approved under the Euro 5 standard. Other vehicle manufacturers have confirmed that defeat devices do not exist on their vehicles. We, of course, will be testing this for ourselves.
I have taken a series of actions to defend the interests of UK consumers, both in the immediate and longer terms. The actions of the Government will continue to be guided by the over-riding principle of protecting consumers.
First, I have applied considerable pressure on the company in the UK and on EU Ministers to resolve the immediate situation with speed and efficiency. This means clear information for affected drivers and acting quickly to put right the affected vehicles. I have been clear that I expect VW to take every step necessary to protect its UK customers but it is right that the Government carry out their own thorough and independent investigation.
Therefore, secondly, I have announced a UK programme to retest vehicles. The Vehicle Certification Agency, the UK regulator, is running laboratory tests starting with those VW Group vehicles for which VCA has provided approvals. These tests will compare real world driving emissions against laboratory performance. We are taking steps to ensure independence; neither the cars nor the testing facilities will be provided by the vehicle industry themselves.
Thirdly, I have called for swift action by the European Commission to co-ordinate a pan-European approach. This is vital for ensuring that test results are available to consumers on a timely basis and to avoid duplication across different European countries.
Fourthly, a key element of regaining consumers’ long-term trust in vehicle emissions testing is to have tests that mean what they say. The UK was in the minority among member states earlier in 2015 in calling for “real driving emissions” to be speedily introduced. These tests will provide useful information that consumers can trust.
I met my fellow EU Transport Ministers in Luxembourg on 8 October and tabled the issue of vehicle emissions testing. I pushed for both a co-ordinated approach to retesting of vehicles across Europe and for real driving emissions to be introduced as quickly as practicably possible. I will continue working with my European colleagues to achieve the UK’s objectives.
[HCWS227]
House of Lords
Introduction: Lord Young of Cookham
Introduction: Lord Smith of Hindhead
Oaths and Affirmations
Deaths of Members
The Lord Speaker (Baroness D'Souza)
My Lords, I regret to inform the House of the deaths of the noble Lord, Lord Kilpatrick of Kincraig, on 16 September and of the noble Lord, Lord Healey, on 3 October. I should also like to inform the House of the deaths of two retired Members: the noble Lord, Lord Luke, on 2 October and the noble and learned Lord, Lord Howe of Aberavon, on 9 October. On behalf of the House, I extend our condolences to the noble Lords’ families and friends.
Retirement of a Member: Lord Brooke of Sutton Mandeville
The Lord Speaker (Baroness D’Souza)
I should also like to notify the House of the retirement, with effect from 18 September, of the noble Lord, Lord Brooke of Sutton Mandeville, pursuant to Section 1 of the House of Lords Reform Act 2014. On behalf of the House, I should like to thank the noble Lord for his much-valued service to the House.
NHS: Mental Health Patient Assessment Needs
(8 years, 6 months ago)
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Baroness Gardner of Parkes
To ask Her Majesty’s Government what consideration they are giving to creating an NHS pathway for patients in need of urgent assessment who, due to mental health conditions, are unable to tolerate tests such as scans or blood tests without a general anaesthetic.
Baroness Gardner of Parkes (Con)
I beg leave to ask the Question standing in my name on the Order Paper. In doing so, I declare an interest, as my grandson is a severe case of autistic Down’s syndrome.
The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)
My Lords, we have not considered creating such a pathway. We would expect a patient’s mental and physical health needs to be taken into account when they access NHS services.
Baroness Gardner of Parkes
I thank the Minister for his formal Answer but I should go on to explain that my grandson, Christopher, now 23, has no speech and is unable to explain what is happening to him. He has changed from an apparently happy boy and a loving family member to a person suffering violent outbursts, in which he hits his head as if in pain or he attacks others. His increasingly erratic behaviour results in him being excluded from the health groups from which he has benefited so much in the past. Clinicians have already identified the need for a scan but this must be done under general anaesthetic. They are unable to access any NHS team able to do this as there is no clinical pathway, and in some cases patients known to these clinicians have had to wait up to two years. Why should any mentally disadvantaged child—as he was but he is now growing up—not be able to access a full and necessary examination within weeks rather than years?
Lord Prior of Brampton
It is obviously not possible for me to comment on an individual case but it sounds like a very tragic and a very difficult case. Of course, someone in that kind of position ought to have access to normal NHS facilities and care, and I am at a loss to know why my noble friend’s grandson has not been able to get proper access. The fact that a general anaesthetic is required, and has been said to be required by a clinician, should not make it any more difficult to access that kind of care. I am very happy to look at this as an individual case and, if it is not just an individual case but an example of a broader problem, I shall be very happy to meet my noble friend outside the Chamber to pursue the matter with her.
Baroness Walmsley (LD)
My Lords, is the Minister aware that NHS staff are a very resourceful group of people and that in the past many of them have found ways of helping patients through these scans and so on when they have found them very difficult? What are the Government doing to ensure that these creative responses to patients’ individual needs can be shared with other members of NHS staff? Will the Government consider some kind of restricted-access online resource centre, through which NHS staff can share their good ideas and what they have found to work?
Lord Prior of Brampton
My Lords, I think spreading best practice is a perennial problem in the NHS. The noble Baroness gave an example of that but I could give many, many others: we are not good in the NHS at spreading best practice. I hope that the newly reformed combination of the TDA and Monitor into NHS Improvement will be a very useful repository of good practice, in the same way as the IHI is in the USA.
Baroness Howarth of Breckland (CB)
My Lords, I find that reply singularly disappointing, as the Minister will know that any child exhibiting the kinds of problems that have been described today could be seriously ill—they could have a brain tumour or hydrocephalus. In addition, he also knows that the availability of good mental health services for young people, adolescents and those in their 20s is in serious difficulty at the moment. What are the Government doing to ensure that NHS England is improving these services and making a real effort so that we do not have cases such as this, for I am sure that it is not an isolated incident?
Lord Prior of Brampton
In picking up the general point that the noble Baroness made, the Government have committed a great deal of extra resource to the mental health needs of young people. For example, I cite the NHS mandate and the Health and Social Care Act 2012, in which there is a duty to establish parity of esteem between mental health and physical health. It is also true that one can never do enough, and when one hears about a tragic case such as that described by my noble friend earlier, one has to look very carefully in the mirror and ask whether one could do more. That is why I have offered to meet my noble friend outside this House to discuss the matter in more detail.
Lord Hunt of Kings Heath (Lab)
My Lords, on parity of esteem, is it not a fact that, in their allocations, clinical commissioning groups have reduced the proportion of resource going into mental health services? Will the Minister tell the House what he is going to do about that? He mentioned the mandate. He will know that, in 2012, the mandate said:
“By March 2015, we expect measurable progress towards achieving true parity of esteem”.
Can the Minister tell me that that progress has now been achieved?
Lord Prior of Brampton
I cannot tell the House that we have achieved parity of esteem. Demonstrably, across the country, we have not yet achieved parity of esteem, but we are on a journey to doing so. On the figures that the noble Lord raised, we spent £300 million more last year than the year before on mental health, and every CCG is spending more on mental health this year than the overall increase in their allocation. At the end of October, we will have the figures for the first six months, and perhaps then I can come back to the House and give him those figures in more detail.
Lord Christopher (Lab)
My Lords, was it not the case that a good deal of spreading the news of good practice was usefully done by the Audit Commission, which the Government abolished?
Lord Prior of Brampton
I cannot comment on the Audit Commission. I do not know how much good it did in that regard because I was not here at the time. However, I am very conscious of the fact that spreading best practice across the NHS, particularly operational and clinical best practice, could be a lot better. That would be true in a clinical specialty such as orthopaedics. However, it is also true that, in some hospitals, the flow of patients through the hospital is much better organised than in others. There is a great deal to be learned by spreading best practice. There is also a lot to be learned from around the world. I take the view that we have, in the NHS, probably some of the finest hospitals in the world. We also have some very poor hospitals. It should not be all that difficult for the poor to learn from the best.
Child Health: Play
(8 years, 6 months ago)
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Baroness Benjamin
To ask Her Majesty’s Government what plans they have to introduce a national strategy for play as part of a holistic approach to child health and fitness.
Baroness Benjamin (LD)
My Lords, I beg leave to ask the Question standing in my name on the Order Paper and declare an interest as the co-chair of the All-Party Group on a Fit and Healthy Childhood.
The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)
My Lords, local authorities have responsibility for commissioning services to enable healthy lifestyles, including active play. However, recognising the health benefits to children and young people from play, since 2013 we have been providing Play England with funding of £1.1 million to promote play. Public Health England’s Change4Life campaigns have supported families to make healthy choices, including being active, and we continue to support school sport, with investment of £222 million since 2011.
Baroness Benjamin
My Lords, the latest report from the All-Party Parliamentary Group on a Fit and Healthy Childhood concludes that play is important to a child’s healthy physical and mental development. It found that, despite government funding for school sports, 20% to 30% of those who do not participate in sport are obese children—the precise group that we need to focus on and target. What are the Government doing to engage with these children? Does the Minister agree that reducing opportunities for play has contributed to the rise of childhood obesity and that play is part of the solution in a whole-child health strategy? Will he agree to meet me to discuss the findings of the play report?
Lord Prior of Brampton
My Lords, when I am asked a question like that in such an engaging way, the answer has to be yes—and I look forward to it. I congratulate the noble Baroness and her team on the work that they have done with the all-party group on the fit and healthy child—I believe that the report is due to be published later this week. It almost goes without argument, and you do not need a lot of academic literature or UN conventions to know, that play is hugely important in the development of a child. On that, we are absolutely agreed, and I look forward to discussing with her ways in which we can help more in that regard later in the week or next week.
Lord Hunt of Kings Heath (Lab)
My Lords, perhaps I could come, too; it sounds a jolly interesting meeting. Does the Minister agree that while fitness is very important for young people, so, too, is diet? Would he like to comment on the story on the front page of the Daily Telegraph this morning which suggests that his boss has prevented Public Health England publishing a report which shows the direct link between too much sugar and obesity? Will he confirm that the Secretary of State has prevented PHE publishing the report and can he tell me what action the Government propose to take to reduce the amount of sugar in foods that children take?
Lord Prior of Brampton
I regret that I have not seen the report in the Daily Telegraph, so I cannot confirm or deny what was written in it. What I can say is that the Secretary of State regards the fact that one in five primary school-age children is now obese as being, in his words, a “great scandal”. The report on childhood obesity is due to be produced, I think, before the end of the year, and certainly within the next few months. I imagine that it will say that the problems are a combination of lack of exercise, lack of play and nutrition—but we will have to wait and see.
Baroness Jenkin of Kennington (Con)
My Lords, I am not sure whether my noble friend saw the report recently of a primary school which has introduced a running challenge where the children run one mile every day, to enormous benefit both mental and physical. Following on from the Minister’s previous remarks about best practice, is this something that the department could encourage other schools to do?
Lord Prior of Brampton
I wonder whether Members of this House might like to set an example in that regard as well by running a mile a day. There is no doubt that exercise is good for you. Not only is it good for all the problems associated with weight but there is plenty of evidence to suggest that exercise helps with mental health problems. Whether you are running or on your bike, I am wholly in favour of it.
Lord McColl of Dulwich (Con)
My Lords, although exercise is very important in terms of the heart and so on, the real answer is to eat fewer calories. We may criticise politicians of one party, but does the Minister realise that politicians of all three parties kept on saying that the answer to the obesity epidemic was exercise when it was nothing of the kind? It was eating fewer calories.
Lord Prior of Brampton
Clearly, my noble friend is right: nutrition and diet are fundamental to the whole debate about obesity. That does not alter the fact that exercise is also very good for you.
The Lord Privy Seal (Baroness Stowell of Beeston) (Con)
My Lords, we have not heard from the Cross Benches on this Question yet.
Baroness Finlay of Llandaff
Do the Government recognise that there is another group of children who must be considered—those who have illnesses limiting their mobility for a variety of reasons, some acquired and some congenital? The role of physiotherapy in paediatric departments is essential to ensuring that they can grow and develop and become as independent as possible. I declare my interest as president of the Chartered Society of Physiotherapy.
Lord Prior of Brampton
The noble Baroness makes a powerful and strong point. All I can do is agree with her 100%.
Baroness Stowell of Beeston
My Lords, I suggest on this occasion that we go to the Lib Dems as this Question started with the Lib Dems, although I acknowledge that there were two Conservative speakers in a row, which should not have happened.
Lord Addington
My Lords, does the Minister agree that if we are dealing with a sports policy that talks about competitive sport, getting some idea of creative play and competitiveness within play is vital? If we have a sports policy, it must have a foundation based on something like my noble friend suggested.
Lord Prior of Brampton
There is no question that competitive sports have a huge role to play, but many children do not wish to participate in competitive sports, so having resources and time made available for less competitive activities such as yoga, pilates or dance is also very important.
Professional and Career Development Loans
Viscount Hanworth
To ask Her Majesty’s Government how many professional and career development loans have been offered by the appointed banks to this year’s prospective postgraduate students, relative to the number of applications.
Baroness Evans of Bowes Park (Con)
My Lords, in the 2015-16 financial year, to date around 5,000 loan applications have been accepted by the banks. That is consistent with previous years. Only when a student commences study does the loan become live. At that point, the system identifies those undertaking postgraduate courses. As most do not begin until late October, it is not yet clear what proportion of applicants are for postgraduate courses.
Viscount Hanworth (Lab)
I thank the Minister for that Answer. The lack of information on this account is disturbing, since it means that the Government are paying too little attention to a matter of national importance. The truth, as I perceive it, is that inadequate financial support has been given to our native postgraduate students. It appears that the banks, on which the Government are depending to provide loans to students, have not been sufficiently forthcoming. Such loans are demanding the exorbitant rate of interest of 10%. That must surely have deterred many postgraduate students from contracting such loans. I seek an assurance from the Minister that the Government are aware of these deficiencies and that they are taking steps to amend the situation.
Baroness Evans of Bowes Park
Over 250,000 people have been lent over £1.1 billion since 1988 under these loans. But the noble Viscount will be aware that the Government have just closed their consultation on a new postgraduate loan, which specifically targets postgraduates. This would be the first time that such a loan would be introduced. We are due to publish the response and final scope of that policy in the autumn, but the NUS vice-president has welcomed it, saying that it is step in the right direction, and the chief executive of Universities UK has said that it is good news so we are certainly doing what we can in this area. This new loan will be extremely welcome.
Baroness Garden of Frognal (LD)
Will the Minister say what the Government are doing to work with universities to ensure that qualified UK postgraduates are encouraged to continue their academic careers—particularly those from disadvantaged backgrounds—and not deterred by unacceptable fee levels and the costs of loans?
Baroness Evans of Bowes Park
Well, as I said, obviously the professional career development loans exist at the moment, but the new postgraduate loan, which has been welcomed across the sector, will come in shortly. The consultation has closed and the full scope of that policy will be announced later in the autumn. Certainly, encouraging further study and making sure that everyone has access to the training and education they need are at the forefront of the Government’s mind.
Lord Stevenson of Balmacara (Lab)
My Lords, may I wish the noble Baroness a speedy recovery from what looks like a very awkward injury, attractively dressed in the blue to match her suit? For those who cannot see it, she is struggling to answer and almost strangling herself in the process.
It seems that almost a sense of panic is setting in. We have £50 million of emergency bursaries from HEFCE to bridge the gap until the new schemes come in. We have postgraduate and career development loans, which are £10,000 per student, but with 10% interest rates charged to be repayable within three weeks of graduating, and we then have the Government consulting on a £25,000 income-contingent loan. Yet there is a 10% reduction in the numbers of people going on to become postgraduates on taught courses. Is there not something more we can do?
Baroness Evans of Bowes Park
This Government will be the first to introduce a loan specifically targeted at postgraduates, so we are taking this extremely seriously. On the interest rate point on career development loans, over the course of the loan the interest rate is more like 6%, because the Government pay the interest while students are studying. That is not to say that more cannot be done, but I assure the House that the Government are focused on higher education and consider it to be extremely important.
Baroness Sharp of Guildford (LD)
Will the Minister please tell the House how far the Government are encouraging industry to help postgraduate students? Industry will benefit from the specialised courses that students do, so it is right that it should make some contribution.
Baroness Evans of Bowes Park
I entirely agree with the noble Baroness, and we are having regular discussions with businesses. Of course, a number of businesses have responded to the consultation. The noble Baroness is absolutely right that it is something that benefits business and the UK economy, and the Government are working hard to ensure that businesses play their part.
School Journeys by Car
Baroness Randerson
To ask Her Majesty’s Government how they plan to reduce the number of home to school journeys made by car.
Baroness Evans of Bowes Park (Con)
My Lords, local authorities are responsible for promoting sustainable travel and transport. The Government fund a number of schemes to promote and encourage parents, children and young people to make walking and cycling to school part of their daily routine.
Baroness Randerson (LD)
My Lords, 23% of peak-time traffic is caused by the school run, causing congestion and pollution, of course. The coalition Government introduced a local sustainable transport fund, which was a success story, and the organisation, Living Streets, has been able to reduce the number of school journeys by 30% in areas where it operates. But that is in only 15 local authority areas. Will the Minister explain the Government’s plans and whether they intend to increase the amount of money available for Living Streets, or similar organisations to work in other areas, so that those benefits can be felt across the whole country?
Baroness Evans of Bowes Park
I agree with the noble Baroness in welcoming the work that Living Streets has done. Certainly this is a priority for the Government. Our cycling delivery plan is a 10-year strategy on how we can increase cycling and walking across England. We have an ambition to increase the number of primary schoolchildren, in particular, walking to school to 55% by 2025. A number of Government schemes are available in which local authorities and schools can participate to help to encourage more walking and cycling to school.
Lord Storey (LD)
The Minister will be aware that there are some really good practices in terms of walking buses, travel plans and safe cycle routes, but for some schools and local authorities it just becomes a tick-box exercise. How do we incentivise schools and councils to make this important issue take root? It rather fits in with the Question of my noble friend Lady Benjamin about fitness in schools. A kitemark could be something that the Government might consider.
Baroness Evans of Bowes Park
The noble Lord is right that this is a priority, and it is important that we encourage people to be as healthy as possible. As he says, this is an area in which local authorities have a responsibility to work closely with schools to ensure best practice across the system. I shall take back his suggestion to the department.
Baroness Howarth of Breckland (CB)
I am sure the Minister agrees that what is often possible in urban areas is not possible in rural areas. Will she say something about helping children in urban areas who have to travel great distances to get to school so that parents do not feel that they are being stigmatised and are doing the wrong thing? I entirely agree with encouraging walking and running and certainly our rural school helps with that when the children get there. However, some children have to go by car.
Baroness Evans of Bowes Park
The noble Baroness is absolutely right. For instance, many local authorities charge young people a flat fee for bus passes. Particularly in rural areas we find local authorities encouraging buses to pick up children from other points so that they can access public transport. Again, it is the responsibility of local authorities, but they are very well aware of their responsibilities. Many are doing what they can to ensure that young people can access the good school that they need to in their local area.
Baroness Jones of Moulsecoomb (GP)
My Lords, is the Minister aware of School Streets, a scheme in Edinburgh, where streets around schools are closed to motor vehicles for an hour before and after school, which means that children and their parents automatically walk or cycle? There are fewer cars, so less air pollution. It seems to be a winner.
Baroness Evans of Bowes Park
I thank the noble Baroness. I was not aware of that scheme and I am happy to go away and look into it.
Lord Watson of Invergowrie (Lab)
My Lords, more than 70% of parents walked to school when they were children, but now fewer than 50% of children walk to school on a daily basis. Will the Minister say what recommendation she will feed into the spending review to ensure that there are adequate resources for the Government’s cycling and walking investment strategy, so as to encourage more children to walk to school?
Baroness Evans of Bowes Park
I welcome the noble Lord to his position. I assure him that we are focusing on this. In fact, the number of children in England who now walk to school is at a high level—it has risen over the last three years. As I said, a number of government schemes are available to help local authorities. It is also worth remembering that over the last three years local authorities have spent around £1 billion on transport in this area. It is something that they take seriously, despite facing a difficult economic climate.
Lord Cormack (Con)
My Lords, will my noble friend tell me how many academies have a walking and cycling strategy?
Baroness Evans of Bowes Park
I would love to. I do not have the exact figures to hand, but I can tell my noble friend that in some areas, for instance in Darlington, local authorities are working very closely with academies and free schools to develop transport plans. In fact, free schools are offering an option for parents to help to create new schools in areas where they have not had a local school. For instance, the Ongar Academy was set up in that town, which has not had a secondary school since 1989. Parents and teachers came together because they did not want children bussed out to other towns. We have seen the same in Ingleby Barwick’s Ingleby Manor academy as well. In their own way, free schools are helping to address this issue.
Lord Brooke of Alverthorpe (Lab)
My Lords, the noble Lord, Lord Prior, advised us that the Government will produce a report on obesity in children. He was not quite certain when that will come out. On this Question, will the noble Baroness say what her department will be inputting into that review? Will she tell the House what she will suggest should be done?
Baroness Evans of Bowes Park
The Department for Education and the Department of Health work very closely and will be in close contact in ensuring that a whole range of issues are included in this strategy.
Lord Harris of Haringey (Lab)
The Minister has repeatedly said how important it is that local authorities engage with getting children to walk or cycle to school. Part of it is also about enforcement and making sure, for example, that cars do not stop directly in front of schools on zig-zag lines. Why is it, then, that the Government put barriers in the way of local authorities on the use of CCTV and mobile CCTV, which would increase enforcement and make sure that parents cannot drop off their children in an irresponsible fashion?
Baroness Evans of Bowes Park
I am not aware of any examples, but I am sure that the noble Lord is. As I said, local authorities, schools and national government have to work together. Everyone wants to ensure that there is less congestion and pollution around schools. Everyone needs to work together to make this happen.
Baroness Randerson
My Lords, in her reply the Minister said that the Government have a number of strategies for walking and cycling to school. Will she inform the House how much money is being spent on this in total?
Baroness Evans of Bowes Park
As I mentioned, local government has spent £1 billion a year over the last three years. There are a number of schemes. I do not have every single one to hand, but, for instance, there is £90 million on the cycling ambition grants. Some £400 million is available to local authorities until 2020-21. As the noble Baroness said, there is also funding to Living Streets. There is a significant amount of investment going into this and the Government take it seriously.
Select Committees
The Chairman of Committees
That Lord Hope of Craighead be appointed a member of the following Committees: Administration and Works, House, Liaison, Procedure and Selection.
Enterprise Bill [HL]
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills and Department for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, why have we introduced this Enterprise Bill? A dynamic, open, enterprising economy is a priority for this Government. We want this Bill to help create a better business culture, in which the harmful effect of late payment on small businesses is recognised. It is a major concern to us all that the level of late payment debt owed to small and medium-sized businesses stands at £27 billion.
Despite the progress we have made, businesses still suffer from red tape, especially red tape from regulators, which hitherto has not been routinely monitored. This Bill will change that and help us to continue our battle against red tape. We are also determined to make apprenticeships a success. We want to make sure that everyone can have confidence that an apprenticeship offers a high-quality career route, consisting of employment with training.
There are three key elements to this Bill: the Small Business Commissioner, who will have a vital role to play in changing the culture around late payment; deregulation; and apprenticeships. There are also some other provisions. Small businesses make up 99.3% of all UK businesses. They account for around half of UK jobs in the private sector and a third of turnover. They are vitally important to our economy. Timely receipt of money is crucial for small businesses. It is wrong that, as research in January 2015 showed, the average UK small business waits for £31,900 in overdue payments. Late payment has a damaging knock-on effect on their ability to manage cash flow and plan for growth; and in the worst case, it threatens their very survival.
We have already legislated, of course, through the Small Business, Enterprise and Employment Act, to introduce a tough and transparent new requirement for the UK’s largest companies to report their payment practices and performance on a six-monthly basis. I believe that publishing these reports online will ensure transparency and help to bring about a major shift in culture. We have also strengthened the Prompt Payment Code to introduce a 60-day maximum payment term for all signatories. And now, this Bill will make it easier, quicker and cheaper for small businesses to settle payment issues with larger businesses by setting up a Small Business Commissioner. His or her role will be focused on helping small firms resolve disputes with large businesses they supply, and in particular tackling payment issues. This could be through providing advice and information, pointing them towards mediation or handling complaints and, of course, acting as a real disincentive to unfair behaviours.
This measure complements our other work to date to support small businesses, such as extending small business rate relief for a further year from April 2015—saving millions for small businesses—cutting £2,000 from the national insurance bills of small firms through the new employment allowance, and much else.
Under current law, there is no obligation for insurers to pay valid insurance claims to businesses within a reasonable time. These payments are vital for a business struggling to survive after an unexpected tragedy, such as a fire, break-in or flood. In the most serious cases, a business waiting for a late insurance payment can collapse. The Bill will make sure that insurers are under a legal obligation to pay up within a reasonable timeframe. Where this does not happen, they will be liable to pay damages. This provision is based on careful and detailed recommendations from the Law Commission, which worked closely with stakeholders to develop the criteria in the Bill and our proposed approach.
Another theme of the Bill is deregulation. The Government are absolutely determined to reduce costly, unnecessary bureaucracy for businesses. In the last Parliament, we reduced that burden by £10 billion through a wide range of savings, large and small. The business impact target created in the Small Business, Enterprise and Employment Act 2015 requires government to measure and report on the economic impact to business of any regulatory changes. However, business consistently tells government that the actions of regulators are at least as important as the content of legislation. In a recent survey, nearly half of businesses said that preparing for regulatory inspections and dealing with inspectors is burdensome, and nearly three-quarters of scale-ups said that they would be able to grow faster if dealing with regulators was easier—a frightening figure. The Bill will extend the business impact target to cover the regulatory functions of not just Ministers but regulators. This means that regulators will be required to assess the economic impact of new or amended regulatory activity in the scope of the target, and to obtain independent verification of the economic impact of those measures.
We will also be introducing new annual reporting requirements for regulators which are subject to the growth duty and the Regulators’ Code, thus increasing transparency and accountability for their actions in respect of these measures. We introduced the Regulators’ Code in 2014 to support regulators to design their policies and procedures in a way that suits business needs. The growth duty, which is due to be implemented in 2016, will require regulators to have regard to economic growth. By introducing these reporting requirements, we will be able to build a body of evidence on how the code and duty are operating, and make amendments to them as necessary. The new reporting requirements will apply to regulators subject to the Regulators’ Code, the growth duty, or both. Currently some 70 national regulators are subject to the code. We are planning to consult on the scope of the growth duty in the new year.
Primary Authority allows businesses to form partnerships with a local authority, giving them access to robust, reliable advice on a whole array of regulation to help them run their day-to-day businesses. Other authorities must then take this into account when carrying out inspections or addressing non-compliance, even if the firm trades across several local authority areas. Since its introduction, Primary Authority has doubled in size every year. There are now close to 8,000 Primary Authority partnerships, 85% of which are with small and medium-sized enterprises. In effect, the Bill amends and consolidates the existing legislation that underpins the scheme for ease of comprehension by enforcers and businesses, as can be seen in the Bill as published. It will give businesses the opportunity to receive tailored, assured advice from a primary authority in relation to key regulations affecting them. Pre-start-up enterprises, those regulated by only one local authority, and more groups of businesses—such as members of franchises or trade associations—will now be able to benefit from the scheme.
The Bill will also improve the business rates appeals system in England to make life easier for business. I am afraid that the current system is simply not working and appeals are taking too long to resolve, with speculative claims clogging up the system. This creates costs and uncertainty for businesses and is unfair to those who are owed a reduction in their rates bills. By introducing a more structured and rigorous system which is easier to navigate, cases can be resolved at an earlier stage and refunds paid out more quickly.
The Bill will also allow sharing of some Valuation Office Agency information with local government, saving businesses time and money as they will not be required to provide the same data twice over. These changes complement the Chancellor’s recent announcement on business rates, but the provisions, which are about improvement to the system, will still be needed.
I am glad to say that the Government have committed to delivering 3 million new apprenticeships during this Parliament. Investing in skills is a vital part of the Government’s plans to boost productivity in the UK but as the apprenticeship brand grows, we recognise that there is a risk that the term “apprenticeship” could be misused and applied to lower-quality courses. That is exactly the opposite of what we want to achieve. In our recent consultation exercise, we received evidence of people who thought they were doing an apprenticeship when in fact they were doing low-level qualifications and were not employed in a real job. We want to give employers, parents and apprentices confidence that apprenticeships are genuine and high-quality opportunities. The term “degree” is protected in legislation and by applying a similar protection for “apprenticeship” we will help safeguard the apprenticeships brand from misuse. When I was in retail, we used to have a special ceremony for graduating apprenticeships. I would like to see that sort of celebration and recognition everywhere.
We want to make sure that the public sector leads by example in the important area of apprenticeships. Across Whitehall there are already hundreds of apprentices learning the skills they need to be effective in the Civil Service, including one in the Permanent Secretary’s office at BIS and one in my own Enterprise Bill team. To pave the way to meeting our target of 3 million, the Bill will introduce apprenticeship targets for public sector bodies in England.
As we announced in our manifesto, we will also be putting a stop to six-figure, taxpayer-funded exit payments in the public sector. Only very recently, there was a payoff to a senior NHS manager worth more than £400,000. We simply do not believe that such huge exit payments, which are far in excess of those available to most workers in the private sector and wider economy, are fair or offer value for money to the taxpayer who funds them.
Finally, we are amending the Industrial Development Act 1982 to bring it up to date. First, the Bill will introduce an additional power to fund broadband projects across the country—a topic close to my own heart. This is on top of wider efforts to achieve 95% broadband coverage by 2017, which includes £1.7 billion of public investment to make superfast broadband available in areas where it would otherwise not be if left to the commercial sector. Secondly, we will increase the per-project threshold for providing financial assistance to businesses to reflect inflation since the 1982 Act was passed. This means that outside assisted areas, where different rules apply, it will be possible to provide a project with up to £30 million before a resolution from the House of Commons is required.
This Bill will contribute to the Government’s vital objective of making life easier for small businesses. We are progressing the Government’s commitment to backing businesses and not drowning them in red tape. It supports apprenticeships so that we invest in the skills we need now and achieve the objective, which I believe we all share, of 3 million quality apprenticeships. We have achieved a great deal already, mainly thanks to the enterprise, drive and hard work of businesses large and small, but it is now important to keep up the momentum. I commend the Bill to the House and I beg to move.
Lord Mendelsohn (Lab)
My Lords, I draw attention to my business interests as contained in the register. I start by thanking the noble Baroness for her courtesy in sending material on the Bill; it has been very helpful indeed.
I must confess that, during the course of the Queen’s Speech, my pulse was quite sent racing. I was very keen on the initial stated intentions of the Enterprise Bill, which were to,
“cement the UK’s position as the best place in Europe to start and grow a business, by cutting red tape and making it easier for small business to resolve disputes quickly and easily; and … reward entrepreneurship, generate jobs and higher wages for all, and offer people opportunity at every stage of their lives”.
I became slightly less enthusiastic when, on 17 September, the Government’s announcement of a series of publications rendered the latter intention as to,
“cut red tape for business, encourage investment in skills, and make it easier for firms to resolve payment disputes by setting up a Small Business Commissioner”.
That seemed to downplay somewhat the initial ambition of the Bill. It will therefore be no surprise to noble Lords to learn that the Bill as published has somewhat dampened my flame of excitement. The Bill states that it will,
“Make provision relating to the promotion of enterprise and economic growth; and provision restricting exit payments in relation to public sector employment”.
There are of course some measures that we will support. In fact, a number of the measures now being brought forward by the Government are ones that they resisted during the passage of the Deregulation Bill, Consumer Rights Bill and Enterprise and Regulatory Reform Bills in the previous Parliament. The Bill contains the product of a number of reviews, together with a curious mix of measures relating to the public sector and some well-intentioned but somewhat limited initiatives.
In this context, although we will always try to be as constructive as possible and seek to find ways in Grand Committee to convince the Government to improve some measures—and we will express our support for others—I cannot fail to say that our strongest disappointment concerns the Bill’s provisions relating to the Small Business Commissioner and late payments. No one is in any doubt of our support for the measures relating to those matters, but what has been proposed is, in our view and on the basis of available evidence, not just insufficient but highly likely to be negative.
The consultation on the Small Business Commissioner was limited. It reminded me of the quote attributed to Henry Ford, who said that if he had asked consumers what they wanted at the time, he would have invented a faster horse rather than the mass-produced motor car. The Government, resisting the arguments for a small business administration, have landed on the Australian model. This we warmly and enthusiastically welcome, but we do not believe that they have used the considerable experience and evidence base available to good effect. I know that the Minister recently met the Australian Small Business Commissioner, Mark Brennan, whose 15-year work in Victoria, Australia, has provided world-leading expertise in how to apply and develop that model. He has encouraged a massive evidence base to emerge with industry groups, academics and other institutions.
The Small Business Commissioner could be a great boon for our country, but its flaws as proposed are many. The first is its proposed scale. The Government anticipate that it will deal with only 500 cases a year. In fact, its staffing and resources compared to those in Australia, where there are small business commissioners in every state as well as at the federal level for a market and population considerably smaller than ours, will make it relatively smaller than the Australian federal and state commissioners.
Secondly, the Small Business Commissioner’s role and purpose is too limited. The origin of the Victorian Small Business Commissioner—the first one—was as a measure to improve the quality of the business environment. It was established with broad powers and functions in Victoria and developed from a review of the retail tenancy laws. When the original Bill fell due to the timetable, the next set of state Ministers considered that the advantages present in the Bill were likely to be highly beneficial to small businesses in general, rather than just the retail sector. The office of the Victorian Small Business Commissioner was established,
“to enhance a competitive and fair operating environment for small business in Victoria”.
That model has caught on. The specific provisions constituting the Victorian Act are not dissimilar to those found in the legislation of other states, which are essentially based on that model.
It is clear from the operation of all these models that there is a consensus and evidence base that a properly functioning small business commissioner covers: access to information and education; advocacy to government; investigation of small business complaints and business behaviour; facilitating the resolution of disputes, including and especially through mediation; and influencing a small business-conscious government and other key stakeholders including regulators, media, academia and the business community and trade organisations.
Fourthly, the decision not to provide the commissioner with a mediation role will inhibit it in establishing its place in the business community and takes little account of the evolution required to make the role truly effective. Universally, every small business commissioner in Australia will tell you that it is this role that led to the widespread support across the business community in large as well as small businesses for its work and established its credibility. The fact that it is underpinned by an important legislative power, namely that any company’s refusal to accept mediation must be taken into consideration over the question of who is responsible for costs of court action whatever the result, is fundamental to its effective operation.
I noted during the consultation that the Federation of Small Businesses did not support this role. On this, it is just plain wrong and I urge it to speak to its counterparts in Australia, who can brief it on the importance of this. The Government’s argument that there is no market failure is quite bizarre. Having listened to Ministers and read their documents in relation to the then Small Business, Enterprise and Employment Bill, their own conclusions on the asymmetries of power, information and resources are pretty clear that there is an entrenched market failure. The absence of mediation as a central function of the Small Business Commissioner is an error that requires correction.
Fifthly, the commissioner lacks the independence and long-term support to make it effective. Other similar agencies have been established, and beyond Australia, with greater independence so that they become the champions of small business rather than the potentially politicised tool of Ministers. Additionally, they have wide roles defined to make sure that they can evolve and design effective ways of working. It can hardly be credible that the Government have a serious, long-term commitment to these issues if they provide for the Secretary of State to be able to abolish it at the stroke of an administrative pen if they find it inconvenient.
Finally, and most extraordinarily, the Australian Small Business Commissioner model has very little to do with late payments at all. It has no specific powers or role there. It has little success and not one of the commissioners considers that an essential function. It has more to do with unacceptable payment terms, but there, too, it is limited. In fact, Australia’s record on late payments is probably worse than ours. On payment days, it has a significantly worse record than the UK. It is fiction to believe that it is either useful or effective in dealing with late payments. Given the 15 years or so of experience, it is sobering to observe that in Australia they are introducing a variety of legislative measures that we would do well to examine for how we deal with late payments. In fact, Australia’s recent introduction to deal with late payments in the public sector is to force the public sector to not just report any late payments but automatically pay interest on the costs to those it has not paid. We believe that that measure helps to materially and significantly address the problem of people not paying up by making them face consequences for late payments. We tried to introduce similar measures in the small business Bill, and we hope to re-examine this in Grand Committee.
I genuinely believe that the Government want to do something on this, and that they, too, are unconvinced that culture or a body that handles 500 cases a year can realistically address the ever increasing volume of late payments. We will lay amendments that we hope the Government will be inclined to work with. In the mean time, have the Government any plans to introduce, by amendment to this Bill or through administrative means, given the disproportionate disadvantage that small businesses have in funding cash flow, a requirement on all government departments and public agencies to pay additional compensation on small business invoices that are not paid within 30 days? Can we have an update on the Government’s experience on requiring contractors used by the public sector to pay their subcontractors within the same period as the main contractor is paid? Would they consider imposing a requirement for the main contractor to report on payment to the public sector body, including the payment of the interest on the late payment? Will they provide that all suppliers and bidders to the public sector and for public contracts must sign up to the Prompt Payment Code, and for suppliers to be able to make complaints about late-paying suppliers anonymously through their representative business organisations, as required under current EU legislation?
It feels a little early to be amending the small business Bill, but we are delighted to be doing so, as we made the point that the Government’s logic on regulation is that they should have introduced it then with regard to business impact targets. In addition, in Part 2, who could oppose anything to reduce the burden of regulation? That is, the burden, not the fact of regulation. I tried to find a single post-war Government that did not make this pledge. I believe the first to do so was when Harold Wilson, as the President of the Board of Trade, announced the “bonfire of controls” in 1948. The previous Government even suggested that they saved £2.2 billion through their “one in, two out” rule. I am pretty sceptical about that figure—a feeling that has grown stronger ever since I was given extremely unhelpful replies to my Written Questions on this matter. As an investor in and operator of small businesses, I have also been looking out for the couple of thousands of pounds by which I should feel better off as a result of this policy. However, a report issued by the independent Regulatory Policy Committee in March perhaps gives the reason why I am still waiting. It identifies that, during the last Parliament, the Government introduced regulatory costs of almost £2.7 billion. Overall, the cost of regulation increased by at least £460 million. To be fair, the last Government tried to be more thorough than most of their predecessors in trying to reduce the burden of regulation, but they have not done so. Regulation from the EU—or that which it defines as EU—is excluded, and the remarkably unscientific so-called “equivalent annual net cost to business” conveniently ignored the Government’s own accounting rules.
On the business impact targets, we believe that the Government are right to place a duty on regulators to see how they operate and to ensure that their impacts are properly measured, and we will support those sorts of notions. However, as I say, we are sceptical about the numbers, and we hope that the Government will be interested in supporting a more independent examination of the regulatory savings and how that can be strengthened. I must say that the last Government stated that they had saved £2.5 billion a year—£10 billion over four years, the Business Minister said at the time—and that this Government are looking to save £10 billion in five years. Perhaps they could be slightly more ambitious.
We have previously raised concerns about the growth duty and how it may affect particular regulators. While the intent is clear, the legislation and the impact assessment provide no comfort as to whether the operation of this duty is consistent with the effective operation of other regulatory functions. We are keen to support that, but we would be grateful for more clarity on it. We will of course also support the concerns of the Equality and Human Rights Commission that it should be exempt as a result of its particular circumstances. Perhaps the Minister could tell us whether these measures would apply to the EHRC.
We are strongly supportive of extending apprenticeships and of ensuring that they provide the right quality of opportunities and outcomes that we desire. I have also previously praised some of the initiatives the Government have undertaken on this. The wider concerns are how Ministers who are adding responsibilities and duties whilst cutting budgets to local authorities and requiring them to create new ways of working can realistically add centrally set targets and reduce the local capacity to design and develop training and reskilling of existing staff during restructurings. Does the Minister recognise that this might be a problem, and what measures or flexibilities have the Government examined to take this into account? In addition, will the Minister tell us whether the Government will now consider that if it is good enough for the public sector to have such targets, it might be under the Minister’s consideration for the private sector to have similar targets imposed in due course?
In relation to protecting the name “apprentice”, we are inclined to be positive. There are of course some major concerns about the operation of apprentices and a number of cases of abuse and of poor quality, which I am sure will be addressed by part of the debate on Thursday. However, I am also starting to worry about some of the noble Members of this House. Under this measure, would it be lawful to describe a 12-week training scheme, where an individual wins an investment in a business, as an apprenticeship? I suspect that we will see a start this Wednesday. However, I also suspect that those who might be threatened by this will appreciate that their salvation may be that the Government, which have presided over a 40% reduction in the budgets and size of trading standards, expect trading standards to be able to police this effectively; we are unconvinced that they have the resources to do so. I would be interested to see whether the Minister is providing some more resources, and if she will speak to that. Also, why has a consumer-facing body been charged with this duty, and what else did the Government consider before arriving at that conclusion?
This Bill has good intentions, carrying the conclusions of some impressive reviews but with some serious policy flaws and some measures whose vagueness raises questions over their efficacy. There are some things that we were expecting. In July, the Treasury briefed the media that the Bill would include provisions for the Government’s suggested changes to Sunday trading. Can the Minister confirm that that will be introduced in Grand Committee? There has been some speculation that the department has lost responsibility for this aspect of business policy and it has moved to the Department for Communities and Local Government. Which department holds primary responsibility for this measure, and is there an agreement that this should be introduced in a BIS-sponsored legislative measure?
I do not fault the Minister, who I recognise does a great job in dealing with some tricky government legislation, and we are always very keen to work with her. We on this side look forward to a long and detailed examination of these measures in Grand Committee, and have great expectations that the Government will be more forthcoming with details, data and evidence to support their positions. We will bring forward amendments that are consistent with the Government’s stated intentions and with the objectives of the Bill, covering areas that merit urgent consideration. But we will be resolute in trying to ensure that, for key measures in the Bill, this House provides a better piece of legislation to the Commons than that which came to this House, and we will be prepared to support others in this House, from whichever Bench, who share the same view.
Lord Stoneham of Droxford (LD)
My Lords, this is a deeply disappointing Bill, given the all-embracing nature of its title, and I am not sure that the Minister really answered her initial question as to why it was necessary to have this Bill now rather than doing more work on it. Only £25 million of net annual savings will come from these measures for business. That is what the impact assessment says. Many of us thought that the Government would reveal the principal items of their further push on red tape to cut the £10 billion of cost to business that they are projecting. I am never quite sure whether that is an annual target or whether it is £10 billion over the life of the Government. Perhaps the Minister could reassure us on that point. But it seems that this Bill is taking us back to new Labour targets; it will be used to extend the target for cutting red tape through the activities of the regulators, although it is unclear what impact that will actually have. I hope that the Minister can reassure us in her summing up that this is more than just a finger in the air by telling us how much detailed work has been done to reach these targets.
We welcome the promotion of an enterprise economy. We think that it has had a major role in job creation as we have moved out of recession, and it will have an even more critical role in job creation going forward. Frankly, with the great problems that Britain still faces in its balance of payments, financial deficit and low productivity, the small business sector is needed to make a massive contribution in all those areas. We need better managers; help with cash-flow problems for people setting up new businesses, with alternative sources of funding; more work and development by the British Business Bank; and we need to see small businesses directly encouraged to take on more apprenticeships and develop more skills. But the agenda of this Bill is very limited. Indeed, its appearance on the day we left for the conference recess suggested that the Government had spent the summer scratching around for things to put into it. Free of the shackles of the coalition, we were expecting the red meat of pro-business and pro-enterprise strategy pioneered by the free-market new Secretary of State to really get our teeth into—but we have been disappointed. Our worry is that it will provide a veneer of action before the public expenditure cuts nearer Christmas cut into the partnership activities of the industrial strategy, catapult centres, training budgets, adult education and research and development that are so vital to the country’s business renaissance.
We welcome in principle the concept of the Small Business Commissioner, but there are a number of issues. We are told that the running costs will be £1.3 million, with capacity to handle only 500 complaints a year. Voluntary mediation is apparently the way forward. There are no back-up powers and no ability to shame big business operators using bad practice or to enforce codes of practice—unless something is going to follow, and it is not clear that it will. As we know, complainants will be reluctant, as now, to come forward if they fear that business will be cut from them in future. That is the key problem. We know that small businesses do not complain for fear of losing future orders, so how will the commissioner be able to reassure people and encourage them to complain?
Apprenticeships were one of the great successes of the coalition. They built on the foundations of work started by the previous Labour Government. We are happy to see protection for the branding and quality of apprenticeships, but should the emphasis now be on the power to set targets in the public sector when the issue there should be largely one of the resources and will in that sector to do apprenticeships? The real problem is not there; it is getting the small business sector to take on new apprentices without weighing it down with the bureaucracy of government incentive schemes and costs. We would do better to oversee government resources going into this and, in particular, into adult education which can play such a big role in supporting local businesses in their area. There is a huge need.
With the Government desire for more homes, the big need is in the construction industry and sector, where the role of public sector infrastructure contracts could be so important in getting more apprenticeships. The Government should be addressing the annual shortage of 30,000 new engineers going into training. There are regional disparities and there is no mention of the fact that there are areas, such as the north-east, where the achievement in apprentices is much more disappointing than in other areas of the country. As providing resources is the key, can the Minister confirm that, in line with the devolution of local government, local authorities are not going to be included in the public sector targets at this stage?
On industrial development grants, the improvement of financial assistance in line with inflation has our support. There is a recognition that partnerships are helpful and that government funding can be essential, as we have seen in the motor industry in the past 15 years. Widening support to the electronic communications sector is welcome. This supports the view of the Minister before she was a Minister. In 2014, she said:
“Broadband and mobile coverage have become essential utilities, like water or power. Without coverage it is like living in the old world without a post box or hot water”.—[Official Report, 13/5/14; col. 1749.]
Over the past few months, I have been trying to get a specific figure from the Government on the number of households with super broadband. The skill of the Treasury in avoiding the question is remarkable, so I shall try again with BIS. What percentage of households currently have access to super broadband compared with the target of achieving 95% in 2017? Until I get that figure, I will be very suspicious that the Government are worried that they are not going to achieve their target. That may be one of the reasons they are putting this clause in the Bill: to put a bit more resource towards it, or at least to protect their backs. I would like to know what our progress is.
The importance of broadband for the small business operator needs emphasis. People can start businesses from home, which we encouraged in the previous Enterprise Bill, but it is no good if super broadband is pathetic or BT comes forward with completely unrealistic charges for putting in private lease lines, which I suspect it does as a way of getting more money, thereby holding up what it should be doing as part of public service.
On the day that it has been announced that Redcar is being not mothballed but closed down, will the Minister say whether there has been any consideration of industrial development grants in a situation which is devastating not only for the second-biggest steelworks in Europe but for all the small businesses in the north-east which have been dependent on it?
I find it strange that we have a public sector employment clause restricting exit payments in a Bill on a matter of enterprise. I am not sure why it is here. We on this side of the House accept that it is appropriate and reasonable that leaving payments should be limited, appropriate and not excessive. There are of course examples where they have been excessive but I fear that the Government are responding to Daily Mail headlines, and it is populism that results in poor government. “Give me 100 good managers rather than £1 billion in extra government spending”—I think that somebody said that recently. As somebody who has spent a lifetime in management, I could not agree with that more. We should be encouraging enterprise, good candidates, change and more appropriate commercial expertise in the public sector.
It is a hugely difficult job. I left the public sector in my 30s because I could not face dealing with some of the problems of a career in public sector management. Maybe the Minister did as well; she knows what it was like. I always admire the people who stuck it out, because I did not. Yet here we are, always looking to restrain salaries and cut back on perks and benefits. Sometimes, although there are instances where payments are excessive, you need to oil the wheels to get change and progress in the public sector, just as you do in the private sector. This legislation suggests that contractual terms are about to be broken, and it is extremely dangerous in terms of our objective of trying to get more change in the public sector that one of the mechanisms that is often needed is going to put a huge restraint on encouraging good people to come to work in this area.
I have one more point to make, which others have mentioned. I hope that we are not going to have some late amendments to the Bill on the Sunday opening issue, following the consultation. I hope that the Minister can confirm that to us in her summing-up.
This is a deeply disappointing Bill. There is little direct impact on the cost of regulation or direct help to small businesses. The Government’s agenda at this time needs to be to support small businesses. We should be giving ongoing attention to helping their cash flows and speeding payments, not least in the public sector and in the construction sector. We should be easing access to government schemes that support small businesses. We should be encouraging small businesses to take on new staff and apprentices, particularly with the use of grants. We should be looking particularly to local chambers of commerce to provide more help to the expert potential of small businesses. The Government need to be more convincing towards the enterprise economy if they really wish to address the nation’s need to compete globally.
The Lord Bishop of London
My Lords, as has been said, the Bill is modest in ambition but still very useful, especially the proposals in Part 4 setting targets for apprenticeships and containing measures for protecting the brand. I was fascinated by the Minister’s throwaway suggestion that there ought to be some ceremonies to symbolise the successful conclusion of apprenticeships. Speaking as a representative of “Rituals ‘R’ Us”, I could certainly offer a consultancy. We might even have apprenticeships in the Diaghilev industry that I can see growing today.
I was recently at the topping-out ceremony for the new Bloomberg building in the City of London. It covers three acres and will contain the largest quantity of stone of any building in the City since the construction of St Paul’s, so I dread to think what has happened to Derbyshire as a consequence. Five million hours of labour had already been put in before the ceremony, and there will be another 9 million before the centre is finished. The talk was all about a point that has already been made by other noble Lords: getting Britain building and, in that context, the vital importance of apprenticeships in securing the supply of properly qualified engineers and tradesmen. There was a special emphasis on the restoration of the dignity of making. That is obviously a very considerable cultural challenge and the direction has gone somewhat in another way, but presumably the measures to enhance the credibility and status of apprenticeships are partly aimed at addressing that. “The dignity of making” was one of Lord Foster’s phrases on the occasion of this extraordinary launch.
In the City of London, of course, regulations governing apprenticeships, to which the Bill contributes a 21st-century coda, go back to the 13th century. Then, the minimum was seven years and sometimes longer, and I hope that the Minister is aware of, and looks to, the 109 livery companies as allies. They are small businesses in themselves and, as part of their extensive involvement in education, they have also increased their involvement in craft-based apprenticeships. Companies such as the spectacle-makers are participating in advanced three-year apprenticeships and they have certainly acknowledged the support of BIS in getting their scheme off the ground. They are part of the Livery Companies Skills Council, which was set up in 2013 to support all manner of craft-related apprenticeships.
I declare an interest in representing 16,000 small businesses—parishes, church buildings and cathedrals—with a responsibility, among others, for maintaining 45% of all the grade 1 listed buildings in England, which are a vital part of our cultural inheritance. So we are also vitally interested and involved in the high-level training of stonemasons and other apprentices. The Cathedrals’ Workshop Fellowship is part of the effort. It was created in 2006 and nine cathedrals, including Canterbury and York, are currently involved in work-based programmes validated by the University of Gloucester. We very much welcome the emphasis on protecting the status of the brand. Measures to increase the supply and enhance the status of apprenticeships are very welcome. In life generally, apprenticeships are the way to success and mastery. The alternative is overnight stardom, but there is no legislating for that.
Lord Baker of Dorking (Con)
My Lords, this is something of a patchwork Bill, in which the Government have produced a variety of proposals which, they hope, collectively will make our society more enterprising. The dubiety of that has already been expressed by the Labour and Liberal spokesmen.
I should like to follow the right reverend Prelate the Bishop of London and talk about Clauses 18 and 19 on apprenticeships. The Government have set great store by transforming the whole apprenticeship movement and developing what has happened before, and they have set a target of 3 million by 2020. I think that that will be very challenging if we are to have high-quality apprenticeships, because the apprenticeship movement has been much abused in the past. I remember that about two years ago I went round an FE college and met two youngsters in the corridor. One was carrying a brush and the other a mop and bucket. I said, “Hello, what are you doing?”. They said, “We are apprentices”. I would not have thought that mastering a brush and a mop and bucket required a one-year or a two-year apprenticeship, and I doubt very much that they were doing the subjects which should be done when studying building maintenance via electronic engineering, making quite sure that computer systems and ventilation systems work. I do not think that they touched on those things at all; it was a racket. Some company—I do not know whether it was in the public or the private sector—was paying them a salary to do this. Maybe the FE college itself was paying them a salary because it would benefit from doing the training. However, I hope that the Minister will take this home to BIS and make sure that we do not have apprentices like that in the future.
There are four important levels of apprenticeships. Level 2 is taken at the age of 16, but industry and commerce look upon those as semi-skilled—they are not demanding enough. The next level is A-level or level 3, which is much more important and is a demanding level of achievement. For this, a two or three-year apprenticeship is needed. Then there is level 4, which is the old HNC and diploma level; and then the foundation degree level or level 5. We are now beginning to see, very slowly, some foundation degree apprenticeships—the noble Baroness is nodding, but I can assure her that it is only a tiny handful.
Last week, a report from the Sutton Trust on apprenticeships and their comparison with positions across the world shared a very interesting statistic. Someone who does a high-level apprenticeship—at levels 4 or 5, such as I have been talking about—will, over their working life, be likely to earn £50,000 more than a university undergraduate, apart from, of course, those attending the very best universities. We have to get it across to many young people that an apprenticeship is not a second-class pathway to success. It can, in fact, be infinitely better than a university degree, because the English education system is now cursed by only one target: three A-levels and a university. That has resulted in a very large increase in graduate unemployment at the moment.
We have to create new pathways to success. But how are we going to go about doing that? Take someone leaving an ordinary comprehensive school at the age of 16. Today, that student will have been doing mainly academic subjects—the famous three A-levels and a university. Technical subjects are being squeezed out in schools for those below the age of 16. Design and technology is a very good technical subject that I introduced into the curriculum in 1988. Already, in the last five years, the numbers taking it at GCSE and A-level have declined quite regularly because it does not appear in the league tables or get students to the magic three A-levels and a university. Someone aged 16 who has done only academic subjects and wants to be an apprentice will, quite frankly, be very hard pushed to find any company to employ him. Take those between the ages of 16 and 18. Again, fewer technical subjects are being taken at A-level. We then come to foundation degrees—the pinnacle of this pathway to success—and they also fell last year.
This is a really rather depressing position. We have a very substantial skills gap in our country. The Royal Academy of Engineering estimates that the skills gap in graduates in STEM subjects is 45,000 a year for each of the next five years. At the moment, it will be very difficult to get anywhere near filling that gap in the choice of students going into universities. When it comes to technicians, the figures are very much larger. At degree level, the gap is 830,000; at technician levels 3 and 4, we will need 450,000 over the next four or five years. I do not believe that the present education system in schools, FE colleges or universities will get anywhere near matching that gap.
The other thing I would say is that we should really have a look at how Germany has done it. In Germany, by the age of 18, almost 75% or 80% of students will have experienced a form of technical education. We are at 30%. Last year, over 500,000 apprentices in Germany finished their course, while we had about 200,000. This is a huge gap indeed.
I am now quite convinced that, if we are going to try to fill the skills gap, starting technical subjects at the age of 16 is too late and starting at the age of 11 is too early. I believe that students in our schools should start technical education at the age of 14. That is why, over the last six years, I have been promoting university technical colleges, because they take students from the ages of 14 to 18. The noble Lord, Lord Bhattacharyya, is in the House. He knows about this, because he supported a very successful one that opened in Coventry, supported by Jaguar—he is nodding. It is very popular and doing very well. It means that a student starts at the age of 14 and by 16 has a level 2 qualification. They are then just employable, and so it is much better for them to stay on and get a level 3 qualification and go on to a level 4 and level 5. That is why we need in our education system a clear and definite pathway for technical subjects for students between the ages of 14 and 18. The CBI has now called for the Government to establish this, as have the chambers of commerce. I hope that we will move towards it.
Certainly, the university technical colleges that are operating at the moment—we have 39 open and another 20 preparing to open—all very much subscribe to the phrase that the right reverend Prelate used: they all involve the dignity of making. For 40% of the curriculum below 16—that is, for two days of the week—the youngsters are making and designing things with their hands, in various types of metal, wood and other materials, and doing advanced computing. They are therefore very suited to providing apprentices. The JCB UTC in Uttoxeter in Staffordshire has 50 apprentices this term. They will be there for two years; they will be employed by companies in the area; and they will go to the college for two days a week to improve their basic education. That is very rare. An ordinary comprehensive could not possibly do that because no company would employ its students unless they had some technical skills.
Another UTC, at Reading, which was rated as outstanding by Ofsted this year—it is remarkable for a new school which has been open for only two years and is pioneering a new type of education to get such a rating—specialises in advanced computing. When I went to see Charlie Mayfield, the chief executive of John Lewis, I wanted to talk to him about food processing, because one of the UTCs wanted to do it and there is a shortage of hundreds of thousands of technicians in that industry, but he said, “No, I want to talk to you about the lack of computer scientists. I cannot get enough computer scientists of a sufficient quality to run what is a very difficult logistical operation of a large retail group”. So he has to employ from abroad. I then put him in touch with the Reading UTC, and I am glad to say that it is providing apprenticeships for Waitrose next year.
This is an entirely appropriate cause for the Government to be committed to. Huge sums of money are involved—the spending on apprentices this year will be £1.5 billion, or slightly more than that—but they must get it right. They must focus on the high quality of apprenticeships, because that is where we need it most. If you are going to have a really enterprising economy, you will have to have many more technicians in it, inventing and designing things. That should be our target in our apprenticeship policy.
Baroness Donaghy (Lab)
My Lords, with so many topics covered by the Bill, I will concentrate on public sector exit payments and then add brief references to cash retention and apprenticeships. I am concerned about the proposal to cap public sector exit payments. I have a fair amount of experience in this area and know that the measure will have unintended consequences which make reorganisation more difficult. It will mean less flexibility for redundancies and less certainty for staff—particularly those over 50—and, in the end, might cost the taxpayer more money not less.
In the Civil Service, the proposal cuts across a negotiated agreement. The then Minister for the Cabinet Office, now the noble Lord, Lord Maude of Horsham, described the agreement reached in 2010 as one which would be “lasting”; he said that it would,
“provide a fair balance between the interests of taxpayers and the interests of civil servants and protect those approaching retirement and the lowest paid”.—[Official Report, Commons, 14/12/10; col. 849.]
So what has changed?
The impact of the proposed cap will be on those with long service rather than on the highest paid. The Cabinet Office has confirmed that some civil servants earning less than £25,000 a year could be affected by the cap because they have worked for so long for the Civil Service. Conversely, some high earners with less service will not be affected, because the Civil Service Compensation Scheme is service-related and there is already a maximum pay limit. This maximum pay limit has meant that a number of employers have not been able to restructure their organisations or make the staff changes that they had planned. If the Civil Service had a viable redeployment process, it would provide better value for the taxpayer than an exit cap. It would also meet the ACAS guidelines for employers on redundancy handling.
In the health service, there is already an exit cap of £160,000. National Health Service trade unions have recently been in negotiations with employers and the Department of Health on further changes to the NHS redundancy scheme. The Department of Health has been keen to use this latest round of talks to introduce a staggered clawback of redundancy payments where staff were re-employed within 12 months, and a taper of redundancy calculations for staff approaching retirement age. The National Health Service trade unions have been keen to use the talks to limit the need for payments through establishing better scope for redeploying staff at risk of redundancy. While there are still issues to iron out, these talks have been productive. However, the announcement of the Government’s £95,000 cap has set this timetable back significantly and has the potential permanently to derail these talks—another unintended consequence, I am sure. If there has to be a cap, the figure must be increased and there must be a commitment to index-linking that amount.
The Local Government Association has indicated that the proposed cap may threaten essential future staffing restructuring in councils. The Bill also fails to provide certainty over when the cap will apply, which is unhelpful for staff and employers. A start date should be made clear. UNISON has also referred to necessary restructuring as a result of the dramatic cuts in local government budgets. UNISON described these reorganisations as,
“a staggered process over several years to maintain service delivery and to enable smooth transitions from old to new delivery models”.
The union made the point that,
“employers and employees may therefore have made dramatically different decisions in [the] initial stages of restructuring if they had been aware of the constraints proposed for future stages by this proposal”.
Under recently negotiated public sector pension changes, guaranteed not to be meddled with for 25 years, when a member of the local government pension scheme is made redundant over the age of 55 they are instantly entitled to draw their pension without the usual penalty for drawing it early. The employer makes a one-off lump sum payment known as a strain payment. The proposals in the Bill explicitly include payments made to a pension scheme. It would impact on those earning £35,000 a year and as pension age protections wither on the vine the pension strain payment will begin to affect staff on much lower incomes.
As UNISON pointed out,
“under these proposals, an individual staff member’s length of service and age could become the determining factors in employers seeking to avoid the complication of this arbitrary cap”.
That may be discriminatory. I hope that the Government will withdraw this clause altogether. If they are not minded to do that, I hope that there will be a protected period of two to five years where an employer can demonstrate that they are in the middle of an ongoing restructuring programme. The cap should be increased so as not to derail NHS joint negotiations. There must be a mechanism for index-linking, and pension strain payments should be excluded from the exit payment calculations. There should also be an exemption for low to moderate earners. My final point on this particular part of the Bill, particularly with the Trade Union Bill coming down the track, is that reneging on agreements reached after much agonising on both sides is a sure-fire method of creating havoc in employment relations and stoking up a lot of trouble for the future.
The Enterprise Bill provides an opportunity to return to the subject of cash retention, particularly in the construction sector. Some of us participated in a debate on the small business Bill but the previous Government were not minded to introduce some safeguards on this. The same Minister is presiding over this Bill and I hope that she will change her stance. I also hope that there will be support from across the House for a provision in the Bill that requires cash retentions to be placed in trust or that alternative security such as bank guarantees are provided. I am sure that the noble Lords, Lord Aberdare and Lord O’Neill of Clackmannan, are majoring on this important subject, so I will keep my contribution as brief as possible.
The Specialist Engineering Contractors’ Group has been calling for this provision for some time, and it is depressing to read about the companies that have gone under simply because of companies which owed money and did not pay up. As the SEC has stated, cash retentions are withheld from progress payments ostensibly as security against failure to remedy defects. In practice, they are deducted to support the cash flow of the paying party. Cash retention in the construction industry is a scourge which causes bankruptcies, loses jobs and reduces training. When I was preparing my report on construction fatalities six years ago it became clear to me that cash retention was part of the downside of the construction industry. Flexibility will always be a necessary ingredient for that industry’s success. While I was not able to prove a conclusive link between cash retention and safety in the industry, I feel sure that the uncertainty it causes, the cutting of corners, the massive strains put on subcontractors and those further down the supply chain make a negative contribution to safety. Cash retention is like an underground poker game. I urge the Minister to at least force these games into the fresh air.
I shall make a brief and final reference to Clauses 18 and 19 on apprenticeships. The commitment on paper is welcome, and I notice that the much-despised targets are back again. Unless the Minister has the powers of Prospero and can conjure up 3 million apprenticeships without any visible means of support for the public sector, I am very much afraid that this plan will be a Caliban. The levy could turn out to be a tax on training and could displace training budgets for existing workers. So I ask what plans there are for proper negotiation with employers and unions in its implementation. If the National Health Service is forced to take on more apprentices, where there is insufficient staffing capacity to provide supervision and mentoring, it could be very risky. The types of roles for which apprenticeships exist do not necessarily match up with the job vacancies. A healthcare assistant in the NHS wishing to become a nurse cannot currently do so through an apprenticeship and would require funding to support their progression. This could be a really important development if the Government were so minded and would provide real jobs at the end of the process.
Is it the Minister’s intention that the Skills Funding Agency continues to run and fund the National Apprenticeship Service, which co-supports the public sector? What information will be gathered on gender, age, ethnicity and disability in each region to ensure fairness? Will all apprenticeships receive the minimum wage and not just six out of seven as a recent BIS survey revealed? How will standards be streamlined? For instance, the level 2 healthcare support worker trailblazer apprenticeship does not require participants to achieve a level 2 qualification.
Finally, will the UK Commission for Employment and Skills report on the quality of apprenticeships being provided and produce a review of what social dialogue has taken place to help to ensure the success of these schemes? I look forward to exploring these issues further in Committee.
Baroness Brady (Con)
My Lords, as always it is an honour to speak in the House—especially on enterprise, a subject dear to my heart.
I will begin by describing the backdrop in front of which this Bill sits, and thereby illustrate just how important it is that we debate the issues it raises. With the party opposite having appointed a shadow Chancellor who does not believe in market capitalism, this Bill is a good opportunity for those of us who do and who believe that business is a force for good, to recognise the contribution that all businesses make to the life of our country and to begin to restore trust in business by creating new opportunities for small businesses to grow and for large businesses to help them do so.
As my party’s small business ambassador, I make no apology for championing the efforts of our nation’s start-ups, entrepreneurs, sole traders and growth companies. However, the Bill presents an opportunity to bring the whole of the business community together, large and small, as one economic and social ecosystem. Large businesses were once small and they can help our SMEs flourish as they have done.
I will begin with a few key benefits of the Bill to small companies. In a recent survey, 73% of scale-ups said that they would be able to grow faster if dealing with regulators were easier. The Bill will make that interaction easier. The Small Business, Enterprise and Employment Act already mandates that the Government publish the economic impact on business of legislative changes, but it currently covers only national legislation. It is to be welcomed that the Bill will bring any and all regulators in scope so that they, too, will need to be mindful of the economic impact of their output. It will also mandate that regulators report on how they are accounting for the impact on economic growth of the regulations that they are responsible for. This will help identify measures that are hampering growth and investment and therefore should be consigned to the legislative dustbin.
Further, amending the Industrial Development Act 1982 so that the Secretary of State can increase the number of grants or loans made in the name of spreading communications networks is a timely adjustment that should better enable the spread of broadband right across our country. Good, reliable connectivity is essential for businesses of all types, but its absence has a much bigger impact on small businesses. I also welcome the increase in the per project threshold in Clause 24 from £10 million to £30 million to reflect the effect of inflation since 1982.
I mentioned that the Bill presents an opportunity to bring all sections of the business community, large and small, into one ecosystem, because, of course, in reality they interact all the time. The creation of a Small Business Commissioner is symptomatic of this ecosystem and is an exciting attempt to improve it.
In January 2015, BACS reported that 59% of the UK’s small and medium-sized businesses were impacted negatively by late payments, with a total debt burden of £32.4 billion. In July, a BIS survey found that 75% of businesses agreed that the relative size and market power of small and larger businesses is the primary cause of unfair practices between businesses. The Small Business Commissioner will be there to level the playing field. The Bill will enable the commissioner to handle complaints, facilitate access to support when disputes arise and help small businesses take action while avoiding going to court.
I also mention that the inception of this new office is an opportunity for larger businesses, too. That is because of the last objective of the commissioner: promoting a change in culture on late payments. Larger companies should not wait to be told to pay up by the commissioner. Instead, on day one they should seek to demonstrate their responsible practices by paying promptly and engaging with the work of the commissioner to encourage others to do the same. In this way, larger companies can show that they are helping their smaller cousins flourish and grow as they have done, and not using their incumbency to protect their status.
The Bill is about being pro-market and pro-competition, not pro-vested interests and incumbency. If big businesses are seen only as entities looking to protect their status, doing the bare minimum to comply with the law while keeping smaller businesses down, we will not build trust in our system and our economy will grow more slowly and be less dynamic as a result. But if the Bill enables small businesses to grow and large businesses to play a part in that, then we can. Business is all about ideas, innovation, and investing in people and technology. This is business at its best and this is what this Bill is about, too.
NHS: Financial Performance
(8 years, 6 months ago)
Lords ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)
My Lords, I shall now repeat in the form of a Statement the Answer given by my honourable friend the Parliamentary Under-Secretary of State for Care Quality to an Urgent Question in another place. The Statement is as follows:
“Mr Speaker, I thank the honourable lady for giving me this opportunity to come to the House and make a Statement on the financial performance of the NHS. On 9 October, Monitor, the regulator of NHS foundation trusts, reported that foundation trusts ended the first three months of the financial year with an estimated net deficit of £445 million. Monitor’s publication noted that performance in the first quarter of the financial year is usually worse than the rest of the year.
The NHS Trust Development Authority also published that day the financial position of NHS trusts for the first quarter of 2015-16. This showed that the NHS trust sector ended the first quarter of the year £485 million in deficit. The financial position of the NHS is undoubtedly challenging but it is important to recognise that, despite the difficult decisions we have had to make because of the calamitous deficit we have inherited, this party has chosen to prioritise funding for the NHS. That is why we are committing an additional £10 billion over the lifetime of this Parliament, starting with £2 billion this year.
However, additional government spending is not the only answer to the challenges faced by the NHS. The Government have taken action with their arm’s-length bodies to support local organisations to make efficiency savings and reduce their deficits. In the first three months of this year, NHS trusts spent £380 million on agency staff, while foundation trusts spent £515 million. That is nearly £10 million a day across the NHS. We need to reduce this spending and challenge the agencies, which are charging, frankly, outrageous amounts for their staff. To that end, a package of measures, including a ceiling on the amount that each trust can spend on agency nurses and mandatory central framework agreements, was announced by my right honourable friend in June. These measures came into effect on 1 October. If further action is necessary, we will not hesitate to take it.
Furthermore, we have taken action through tough new controls on consultancy spending and executive pay, and in supporting organisations to dispose of surplus land among other initiatives. The impact of all these actions will not have been seen in the quarter 1 figures published last week.
The Government and NHS leaders have taken national action to support local leaders in managing down these deficits. I welcome very much a constructive discussion with the party opposite on where we may be able to go further in driving the efficiency savings that the NHS must find if it is to provide the exceptional standard of patient care that we all on both sides of this House wish to see”.
Lord Hunt of Kings Heath (Lab)
My Lords, the Minister is certainly having a busy day. I thank him for repeating the Statement. Obviously, these figures are very worrying. They relate to quarter 1. We are now well into quarter 3. What is the Minister’s latest assessment of hospital finances and his updated estimate of the year-end position? Clearly, there is not enough money in the budget to cover the existing costs of growing pressures, so how on earth is the service to fund seven-day services?
I noted the Minister’s comments about consultancy spend and agency staff. However, does he recognise that the reason so much money has been spent on agency staff, apart from through the actions of agencies themselves, is the fact that his Government cut the number of nurse training places in 2010? Does he also recognise that his Secretary of State’s attitude towards doctors is driving many of them away from this country? We should not be surprised if desperate NHS bodies, beset by criticism from the CQC about the numbers of doctors and nurses they need on the wards, resort to the use of agencies. As far as consultancy spend is concerned, does he accept that the Government’s own agencies—Monitor and the NHS Trust Development Authority—encourage NHS bodies to use consultancies? Will he ask them to try to reverse some of their actions themselves?
I quoted the Daily Telegraph to the Minister earlier. However, I want to say something about a story in the Mail yesterday concerning Sir Thomas Hughes-Hallett, chairman of Chelsea and Westminster Hospital in London. He has said that the NHS is in crisis and has referred to:
“A ‘worsening financial crisis’ leading to a ‘crisis in care provision’; An ‘environment of negativism’ triggered by endlessly critical missives from Ministers and officials; ‘Highly burdensome regulation’ leading to ‘abject confusion, fatigue and short-sightedness’; A ‘climate of fear’ ruling wards … ‘Continued emigration’ of doctors … The risk that these problems will cause an ‘inevitable reduction in quality and patient care’”.
You do not have to believe everything that Sir Thomas said without knowing that most people in the NHS share that view about tackling impossible pressures with limited resources. What are the Government going to do about it?
Lord Prior of Brampton
My Lords, I thank the noble Lord for those helpful comments. His first question was: what is the updated estimate for the full year? There is a general figure out there that the King’s Fund, the Health Foundation and others have come up with—£2.1 billion—as the underlying provider deficit for the year. That figure is largely based on the first quarter’s results because you cannot annualise the first quarter’s results; the first quarter is often much worse than the subsequent three quarters. We believe we can manage that £2.1 billion down quite significantly; interestingly, last year the underlying provider deficit was £1.2 billion. We have other ways of managing that deficit through the surpluses that may arise on the commissioning side and other sources of revenue.
The noble Lord talked about agency staff. I recognise some of what he says but there is no doubt that in the aftermath of the tragedy at Mid Staffordshire, the strengthening of the CQC when I was there has led to greater pressure to increase staffing numbers. I heard the noble Lord say, I think when he was chairman of the Heart of England trust, that if you are going to get shot it is better to get shot for not hitting your financial budgets than for not having enough staff on the wards. There has been a much greater emphasis on higher levels of staffing and that has put pressure on agency staffing. There are actually 8,000 more nurses and 9,000 more doctors in the NHS since 2010.
The noble Lord mentioned the cost of consultants. I recognise the strength of what he says—that it is a bit rich for us to complain about the cost of consultants when, through our arm’s-length bodies, we have been responsible for recruiting them. We expect much of the improvement methodology that has been provided by independent consultants to be provided by NHS Improvement; for example, the fact that we have now taken on Virginia Mason to help us spread best practice in running hospitals in the NHS is a model for things to come. I also hope that chains of hospitals will emerge and develop some of the best practice from hospitals such as Salford Royal, Frimley Park, the Royal Free and others, so that we can spread best practice without relying so heavily on external consultants.
Unfortunately, I have not read the article by Tom Hughes-Hallett. I would say to Tom, who I know, that he might spend more time focusing on his own hospital, which got a “requires improvement” notice from the CQC, than on spreading his views to all and sundry, although I recognise the strength of some of them. Sorry, I am running past my time. I had not realised that time was of the essence.
Baroness Walmsley (LD)
My Lords, quite clearly there is a crisis of funding in the NHS on an enormous scale and nothing I have heard from the Government indicates that the problem is going to be solved by any single party. This should be of cross-party concern. During the election, my right honourable friend Norman Lamb asked the Secretary of State for Health if he would co-operate with a cross-party commission to look at a cross-party solution to a new settlement for the NHS. He agreed, as did the Labour spokesman, yet five months later nothing has happened. Can the Minister tell me when it will?
In Scotland health and social care have been integrated and are already showing successes because of that. When will that happen in England? The situation in Scotland illustrates the fact that the challenges to the NHS are never going to be solved by the NHS alone. This is a whole-government issue. When will the Government beef up the Cabinet committee on health so that every department can be held to account for whether its policies contribute to the greater health of the nation or not? Until that is done, the NHS alone cannot be expected to solve the looming problems.
Lord Prior of Brampton
My Lords, it is worth reminding your Lordships that there was considerable consensus around the five-year forward view. I think that the noble Baroness’s party wholly signed up to it and, along with the Conservative Party, to committing £8 billion of extra money to the NHS over the lifetime of this Parliament. We stand by that. The NHS, in its turn, agreed to find £22 billion-worth of efficiency savings, which I think the noble Baroness accepted when she was part of the coalition Government. That is still the situation so I do not think that we need a new settlement. There is a settlement: it is called the five-year forward view and we are fully committed to it.
The noble Baroness raised the issue of integration. I agree 100% with her and it is an essential part of the five-year forward view—the vanguards are based on it. I remind noble Lords that the spending in the UK per capita on health is $3,200. In France it is $4,100 and in Germany it is $4,800. The NHS does a remarkable job in delivering world-class healthcare, which is rated by the Commonwealth commission and other independent agencies as among the best in the world, with considerably fewer resources than any other developed system in the world.
Lord Kakkar (CB)
My Lords, I declare my interest as chairman of University College London Partners. What assessment have Her Majesty’s Government made of the potential contribution of accountable care organisations to addressing the need to advance quality outcomes in the NHS and its financial performance?
Lord Prior of Brampton
I thank the noble Lord for that perceptive and interesting observation. The accountable care organisation is one whose time has come. A health organisation with a capitated budget is indeed the way forward. It will drive the integration that the noble Baroness was talking about earlier on. It is a key part of this Government’s health strategy to support accountable care organisations.
Baroness Wall of New Barnet (Lab)
My Lords, I too welcome the Statement, as did my noble friend. I have to admit that Milton Keynes Hospital, of which I am chairman, has contributed to the £550 million deficit referred to in the Statement. I want to focus on the issue around agency staff. I presume that the Minister has not seen the Evening Standard today—it has only just come out, so that is quite acceptable. In it, however, the chief nurse at Guy’s says very much what all chief nurses are saying: that hospitals are really performing with their hands tied behind their backs and that we have no staff to fill all our vacancies and have to recruit agency staff. We have just had an instruction, which the Minister referred to in the Statement, to reduce our agency staff by 1 October. I think it is from 22% to 17%. We have obviously gone back with some mitigation around that, which has been accepted. That has been very helpful but it does not solve the problem: we cannot get nurses through.
We went to Croatia and got 60 nurses. Five of them have had visas to get through and the rest cannot come, so we have to carry on with agency nurses to cover them. We have more 1:1 nurses than any other trust around London. I am going to wind up but as the chairman of a trust, I am talking about what really happens—the Minister knows that. Can he tell us how he is going to get this other money to reduce the deficit that he talked about and which is going to happen? I would be very interested in that. Also, when is the NHS going to make sure that the people who have that remit for nurses being admitted into our country will do something about it?
Lord Prior of Brampton
I will have to be very quick in replying. Maybe we could discuss this outside the Chamber. There are three ways in which we can find the resources for this. The first is partly through extra government money: there is another £10 billion coming to the NHS over these next five years. The second is driving through efficiency improvements. There are vast efficiency improvements that we must make over the next five years. I regard efficiency as a moral imperative because every £1 that we can save from waste is £1 that we can plough back into patient care. The third way is through new structures of organisations—accountable care organisations are one example; chains of hospitals are another. I think that the days of the independent DGH ploughing its own furrow, or of the foundation trusts structure around the DGH, are behind us.
Right to Buy: Housing Associations
The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)
My Lords, with the leave of the House, I will repeat as a Statement an Answer given earlier by my honourable friend the Minister for Housing and Planning. The Statement is as follows.
“As stated in our manifesto, this Government want to give housing association tenants the same home ownership opportunities as council tenants. Since the introduction of right to buy, nearly 2 million households have been helped to realise their aspirations to own their own homes—46,000 sales since April 2010, with nearly 40,000 of those under the reinvigorated scheme introduced in 2012 by the last Government.
This Government want to help families achieve their dream of home ownership, but about 1.3 million tenants of housing associations are not able to benefit from the discounts that the last Government introduced. That is why we want to give housing association tenants the same home ownership opportunities as council tenants.
At present, we have a situation where some housing association tenants have the preserved right to buy at full discount levels, some have the right to acquire at lower discount levels, and others have no rights at all. That cannot be right, and the Government want to end this inequity for tenants and extend the higher discount to housing associations.
On 7 October, the Prime Minister announced that a deal had been agreed with the National Housing Federation and its members which would give tenants of housing associations the opportunity to buy their home with an equivalent discount to the right to buy. This will deliver the manifesto commitment to extend the benefits of right to buy to 1.3 million tenants.
In summary, the deal will enable the following: 1.3 million families will be given the opportunity to purchase a home at right-to-buy-level discounts, subject to the overall availability of funding for the scheme and the eligibility requirements. The presumption is that housing associations will sell the tenant the property in which they live.
The Government will compensate the housing association for the discount offered to the tenant, and housing associations will retain the sales receipt to enable them to reinvest in the delivery of new homes. Housing associations will use the sales proceeds to deliver new supply and will have the flexibility, but not the obligation, to replace rented homes with other tenures such as shared ownership. The Government will continue to work with the National Housing Federation and its members to develop new and innovative products, so that every tenant can buy a stake in their home.
As part of the agreement, the Government will also implement deregulatory measures which will support housing associations in their objectives to help support tenants into home ownership and deliver the additional supply of new homes. Boosting the number of sales to tenants will generate an increase in receipts for housing associations, enabling them to reinvest in the delivery of new homes. Housing associations will be able to use sales proceeds to deliver new supply and will have flexibility to replace rented homes with other tenures such as shared ownership.
Housing associations have a strong record in delivering new homes, as evidenced by the way we have exceeded our affordable homes target, delivering nearly 186,000, which is 16,000 more than originally planned, between 2011 and 2015.
We want more people to be able to own a home of their own, and extending the right to buy is a key part of this, giving tenants aspiration and something to strive for. Extending the right to buy will enable tenants of housing associations to have the opportunity for the first time to purchase their home at the same discount level currently enjoyed by tenants of councils.
We will now be working closely with the sector on the implementation of the deal, and I will update honourable Members in due course on the next stage of the implementation”.
Lord Kennedy of Southwark (Lab)
My Lords, I thank the noble Baroness for repeating the Answer to the Urgent Question from the other place. I declare an interest as an elected member of Lewisham Borough Council. The extension of the right to buy to housing associations funded by the forced sale of council homes will mean fewer affordable homes, and we will oppose that. I am sure the noble Baroness will have seen the figures from Shelter estimating that up to 113,000 council homes could be sold to pay for this policy. Can she tell the House more about the guarantee of like-for-like replacement that she referred to? Is that both for housing association and council homes?
Baroness Williams of Trafford
My Lords, councils should effectively and efficiently use their resources. Where there is an increased need for housing across the country, it makes no sense for a local authority to keep high-value, vacant council houses when it could sell them to fund the building of new homes that will reflect its local housing need and increase overall housing supply. We want to work with both local authorities and local associations to ensure this one-for-one additional housing.
Lord Shipley (LD)
My Lords, I thank the Minister for her Answer. I am still unclear whether there is to be a requirement on local authorities to sell off their best housing to help pay for this policy. Will sheltered housing, which is protected under the right to buy for local authority sales, be treated similarly in the context of housing association right to buy? What is the Government’s target for net new homes for rent as a consequence of this policy?
Baroness Williams of Trafford
My Lords, as I just said, where there is a need for housing across the country, it makes no sense at all for local authorities to keep hold of their high-value, vacant council houses. Selling such properties will mean more money to fund the building of new homes. That will better meet their local needs and some of the money will go to support housing association tenants to buy their own property. This is part of our wider effort to help anyone who works hard and wants to get on the property ladder to achieve their dream. We are legislating to require local housing authorities, as the noble Lord said, to pay the Secretary of State a sum in line with the anticipated receipt from the sale of high-value council housing, and councils will be able to retain some of the sale funds to support new housebuilding locally to increase the overall housing numbers in their area. We will announce more detail in due course, obviously through the housing Bill. In terms of our aspiration on affordable housing, our aim is to deliver—
Baroness Williams of Trafford
I am sorry. On sheltered housing, all the exemptions that apply currently will continue to do so.
Baroness Gardner of Parkes (Con)
At what stage will we know details about such things as a sinking fund for those buying these housing association properties? That will definitely be an important feature as this has proved such a bugbear for those who bought their council flats and now find that they cannot afford the repairs.
Baroness Williams of Trafford
My Lords, I assume that such details will be in the housing Bill.
Baroness Masham of Ilton (CB)
My Lords, does the Minister agree that there is a shortage of special housing for disabled people? Many housing associations provide this. Will these houses be protected?
Baroness Williams of Trafford
My Lords, the Government will expect housing associations to abide by their obligations in terms of homes for disabled people, for homeless people and for sufferers of domestic violence.
Lord Best (CB)
My Lords, the Government are very wise to back off from giving a statutory right to buy to housing association tenants. I congratulate the Secretary of State for coming to this compromise with the National Housing Federation. However, 55% of housing associations voted in favour of this. The rest have yet to make up their minds or voted against it. What will happen to the housing associations that do not voluntarily sell to their existing tenants?
Baroness Williams of Trafford
My Lords, as I understand it, 94% of housing associations signed up to this but the federation confirmed that the offer—
Baroness Williams of Trafford
My Lords, I stand corrected by the noble Lord, who is far more expert than I am. However, the federation has confirmed that the offer is sector-wide and that it will encompass all housing association tenants. If necessary, the Homes and Communities Agency will be given additional powers to assess housing associations to a new homeownership standard. If necessary, we will take further steps to ensure that the right to buy is available to them, in line with our manifesto commitment.
Baroness Hollis of Heigham (Lab)
My Lords, housing associations have come from the charitable sector to build social housing for those unable either to rent or to buy. As a result, this policy is morally wrong, it distorts the charitable objectives of housing associations and it is financially illiterate. Will the Minister confirm that as a result of this policy, housing associations will lose a social home to rent on the waiting list, and local authorities will lose a second home available to rent for people on their waiting list, to fund, thirdly, a gift of up to £100,000 to a sitting tenant, which, if the statistics on RTB for council housing prevail, within five years will have been recycled into buy to let, into the private rented sector, at double the rent and double or treble the housing benefit bill, which the taxpayer will pick up? Therefore there will be two sales, a huge discount, funded in turn by going into buy to let at taxpayers’ expense, to do what? It will not add a single house to the stock but merely change the label over the door that says “tenure”.
Baroness Williams of Trafford
My Lords, I confirm to the noble Baroness that houses that have a specific charitable purpose will retain it. I also confirm that the Government make no bones about the fact that they support people’s aspiration to own their own home. Contrary to what the noble Baroness thinks, the building of extra homes on at least a one-for-one basis by housing associations will add significantly to the housing stock in this country.
Baroness Hollis of Heigham
One in nine of the houses sold under RTB has been replaced. Why does the Minister think that the housing associations sales will be any different?
Lord Patten (Con)
My Lords, it is indeed very good news that a majority of housing associations are in favour of this excellent opportunity afforded to them. Can my noble friend say when next there will be an opportunity to have an estimate by the Government of what individual tenants, many of whom wish to have this opportunity, are thinking, and when that will be published?
Baroness Williams of Trafford
My noble friend makes a very important point, because at the heart of this policy are the tenants and their aspiration to own their own home. I will segue into the previous point made by the noble Baroness, Lady Hollis, about right-to-buy properties not keeping pace; in fact, that programme has literally just started.
Lord McKenzie of Luton (Lab)
My Lords, has the ONS confirmed that it will re-examine the classification of housing associations in the national accounts? That followed a warning from the Office for Budget Responsibility that the extended right to buy and the planned cut in housing association rents could trigger that review. Of course, reclassification would mean that income and expenditure would be part of the public finances and, most importantly, it would add something like £63 billion to the Government’s borrowing requirement. Is it not the case, and is it not part of the government rationale for the voluntary deal, that if right to buy is volunteered, not imposed, that removes one of the key reasons for the ONS review?
Baroness Williams of Trafford
My Lords, whatever the ONS chooses to do in terms of classification, we are absolutely determined to deliver 275,000 affordable homes by the end of this Parliament. Noble Lords should not forget that the 2015-18 programme is still in its initial year, as I said to the noble Baroness, Lady Hollis. We saw housing associations—the providers—maximise outputs at the end of the 2011-15 programme, which has caused an inevitable lag in starts in the current programme.
Enterprise Bill [HL]
Lord Curry of Kirkharle (CB)
My Lords, I warmly welcome the Bill, and believe that it has the potential to create an even more favourable climate within which businesses can become established and grow. First, let me be clear about my own interests: not only am I in involved in small businesses, but I also declare an interest as the independent chair of the Better Regulation Executive. In the interests of transparency, let me state that the BRE has played a significant role in the formation of Part 2, Clauses 13 to 15, of the Bill. The Better Regulation Delivery Office, with which I also work closely, has been involved in Part 3.
This country has a long tradition of being an epicentre of business, but this Bill will ensure that there is an even more favourable climate in Britain for business to thrive. I hope that this Bill will help to position the UK as the lead country in Europe in which to do business, and build on progress to date. The Enterprise Bill will go further in helping to change the culture, in which small businesses will be able to start, uninhibited by mountains of red tape, and be given the help, support and encouragement that they need at every stage of their development to be able to grow, create employment and generate wealth.
The aim of Part 2, as the Minister said, is to extend the scope of the business impact target to include the regulatory activity of statutory regulators and to report publicly on the actions that they are taking in the fulfilment of their duties under the Regulators’ Code and the growth duty, and contribute towards the £10 billion target over the life of the Parliament. The result of the regulatory provisions will be to make regulators more transparent and accountable when performing their regulatory functions and, in particular, how they affect the activities of businesses. The transparency and accountability afforded by these provisions will ensure visibility of the impact of regulators’ activities on businesses, which will give further confidence to businesses that regulators are actively considering such impacts when making decisions.
The noble Lord, Lord Mendelsohn, has referred to the data published on regulatory savings during the previous Parliament. The RPC has been responsible for publishing those data, as he said, but he questioned their accuracy. The RPC is an independent body—I need to stress that—which jealously guards its independence. However, I have always had a concern that hard data alone are not a great indicator of success. The indicator of crucial importance is the attitude of business and business perceptions, and the most recent business perceptions survey shows that there has been a 10-point fall within the last five years in the number of businesses thinking that regulation is a barrier to progress. That for me is a much more important indicator than the hard data. However, the overall number of businesses that still consider regulation to be a problem means that the figure is still too high—so we still have more to do. I hope that we continue to drive this down further if we are to succeed in driving the change in culture that I mentioned earlier. That is why this Bill is important. Regulators need to appreciate the impacts of their actions on the bodies that they regulate. That is part of good policy-making, so I welcome its wider application to regulators now.
A key concern that has been expressed to me about these measures is the effect that they might have on the independence of regulators. I want to make it clear that this Bill does not constrain their independence and does not prevent them taking action in fulfilling their statutory duties. Regulators will be able to contribute to the Government’s overall business impact target, but they will not be required to meet any individual deregulation targets themselves. The responsibility for meeting the business impact target lies with the Government and government departments, not with specific regulators. Instead, it is all about transparency. The proposal will require regulators to report on any additional cost burdens or savings that their actions might impose on business, which they should be aware of in many cases.
I take this opportunity to welcome the regulators’ reporting requirements set out in Clauses 14 and 15. The Regulators’ Code and the growth duty are both positive measures designed to ensure that regulators consider the needs of business when exercising their functions. It is important that government and business are able effectively to appraise these important measures so that the impact they are having and the benefit they bring to business can be properly measured. To enable this to happen, regulators must be transparent about the action they have taken in respect of both measures.
I support Part 3 on the extension of the primary authority scheme. I hope this will not be a contentious part of the Bill. The primary authority scheme has been a huge success. It is highly valued by the business community. It has reduced bureaucracy and significant costs and improved efficiency, so this extension to the scheme is an important step forward in its evolution.
I shall now change course and comment on another key element of the Bill. A number of comments have already been made about the apprenticeship proposals in the Bill. I endorse the comments of the noble Lord, Lord Stoneham, on the disappointing figure for uptake in the north-east of England. The enrolment of apprentices is crucial to the establishment of a skilled workforce and the improvement of our productivity. I and others have a keen interest in the economy of the north-east of England. We need to focus on making sure that uptake increases and that we achieve the current targets within the scheme.
The Minister is aware that I have a serious interest in the agriculture, food and rural sectors. Apprenticeship figures in those sectors are also disappointing. They are crucial to improving our productivity within the agri-food industry. We need a concentrated effort to improve performance and uptake. I work very closely with the land-based colleges and their sector body, Landex. They are concerned about this and are keen to play a key role. I would be interested in briefing the Minister on this issue, if she would find that helpful.
I thank noble Lords for listening. I shall return to the subject of regulation and hope that noble Lords agree that these measures will be better for business and for Britain if we are able to introduce the more transparent, accountable and effective regulatory system which is proposed in the Bill.
Lord Patten (Con)
I dislike crumby, financially repressive and socially uncaring capitalism very much indeed—by which I mean the misuse of market mechanisms to meet malign and mindless corporate ends. I much admire the market when it is free and socially responsible, when it becomes a great force for human advance and happiness. Good capitalism is very good indeed, with competitive markets and innovations piled on innovations for the common good.
Crumby capitalism is not the fault of market mechanisms but of the corporations that misuse their power to repress suppliers, work in covert monopolies and delay payments to smaller companies, sometimes bringing them to their knees. I therefore applaud the last coalition Government for making a start on some of the worst excesses of the big supermarkets and others by introducing the Groceries Code Adjudicator Act, which came into force in June 2013 and has powers to ensure that big corporates treat their suppliers lawfully and fairly. I think that the adjudicator has made a good start, but Christine Tacon has a task on her hands even to persuade suppliers to come forward for fears of reprisals by the supermarkets into which they seek to sell. There will be a long march to bring about the vital corporate cultural change which, in the end, is needed so much more than even the best of codes. I entirely applaud what the noble Lord, Lord Curry of Kirkharle, has just said about cultural changes being as important as legislative changes.
The Bill, which I strongly support even though it looks a bit like a big legal pudding made up of all sorts of ingredients hauled off the shelf, contains two themes that I judge seek to carry on the good work in the Groceries Code Adjudicator Act 2013 that I referred to: the measures to introduce a Small Business Commissioner and powers to deal with the late payment of insurance claims. In the case of the first of those two themes, the Small Business Commissioner, with a role in assisting small businesses in disputes with bigger, bad businesses, will be in a position to guide and help those who feel repressed. These practices, as the Minister pointed out in her introductory speech, currently have an annual impact on small businesses of more than £25 billion. However, the commissioner is empowered only to advise and assist, not to become some kind of tsar to go out there with powers to direct and resolve disputes, thus empowering small businesses to resolve their issues.
Promoting fair treatment for all is the theory of the Bill, as politely put, but in coarse reality that is also a matter of the big behaving better to the small. We must not expect too much too soon from this body, which has the power not to provide legal advice but just to exhort. Although exhortation and the use of the bully pulpit can be very important, the body does not have the power to arbitrate; it can only signpost the options for business conflict resolution. It will be a slow process; I come back to that groceries adjudicator, slogging on after two years of existence but still having to hold her latest big seminar for suppliers, better to understand the workings of the code, as she did most recently on 29 September—only last month. Many did not come forward for fear of those reprisals.
To make both the groceries adjudicator and the new Small Business Commissioner redundant will be a matter not of a few months or a few years but probably of decades. It will also depend on major cultural changes by malign big corporates. That is my observation based on years of big corporate experience and involvement in the financial world and as a shareholder, all three of which are declared properly in my entry in the register of interests. There are well-documented cases of corporate malfeasance back in the 1970s that took the companies involved 20 or 30 years to lay totally to rest through the introduction of vigorous codes of practice, ethics checking, internal corporate housekeeping and the vital task of never-ending staff education, for just as one lot of staff go through a period of cultural training, another lot are recruited.
Sometimes it takes big-stick legislation to deal with the handful of big corporate repeat offenders. Perhaps the best example of this, and I pay tribute to both sides of the House, is the introduction of our excellent Bribery Act 2010, which has induced enormous corporate change, albeit at the threat of the use of a big stick. I well remember the noble and learned Lord, Lord Woolf, who is not in his place today, saying during the proceedings on the Bill, I think at Second Reading, that he felt that while there was an urgent need for legislative provision, there was an urgent need for corporate cultural change as well to parallel what was being brought forward. I can only say a respectful “Hear, hear” to him.
Secondly, there are the provisions, which I also applaud, to deal with the financially repressive late payment of insurance claims. I think that these will have a much more instantaneous effect through the proposed introduction of a new Section 13A in the Insurance Act 2015 with an obligation to big business, in particular, in the insurance world to pay within a reasonable time all contracts of insurance. The insurance industry does not have to wait for the introduction of the provisions of this Bill; it should start doing it today. It has it in its power to do it today and it knows that these measures are coming. It is bad business for the industry not to start straight away.
It is wrong for some companies in the insurance industry, most of which I greatly admire, to delay payments quite deliberately as a matter of policy, massaging their figures, particularly in the run-up to interim or final results, to make the reported figures look that tiny bit better because they have paid out that tiny bit less—delays that have ruined some tiny businesses. Any such activity can hinder, or at worst torpedo, the efforts of small businesses to get back on their feet after, for example, the catastrophic floods, which the Minister referred to recently, down on the Somerset levels near where we live and have our webbed feet, and in other areas on the River Thames that were hit. However, nothing will work as well as it should do until all big corporates recognise that looking after their suppliers or those that they insure is simply good for enterprise, good for business and therefore good business.
So there are three separate hares running: the groceries adjudicator, the Small Business Commissioner and the impact of trying to persuade corporates in the insurance world to pay their claims within a reasonable time. I think that these three are interlinked. We should see how they proceed but I would certainly say to my noble friend the Minister that by 2018—three years hence—we will have a very clear view of whether they are working. We will need a review in 2018 and I look to her to perhaps give a pledge to at least look at the possibility of bringing forward a debate in that year about how these three separate themes are working and, if they are found not to be working, to bring on a latter-day equivalent of the Bribery Act to deal with the continuing problem in these three areas.
Baroness Warwick of Undercliffe (Lab)
My Lords, in recognising the intention of the Bill to promote economic growth, I want to focus on just one part: Clause 18 and apprenticeships. I declare an interest as chair of the National Housing Federation, the body that represents housing associations.
There is a huge need to increase the number of apprenticeships and to ensure that they are of high quality. Looking in particular at the number of young people who are not in education, training or employment, I believe that there is an urgent need to focus on creating opportunities that will get them into employment. Work placements, traineeships and work experience opportunities can help some of the most disadvantaged in our society into a position where they can move into work and, for some, into apprenticeships. That is one of the key reasons why housing associations have become committed to building and developing both employment and skills support and apprenticeship programmes for their tenants and residents.
Many of those who are eligible for social or affordable housing are out of work or in low-skilled, low-paid jobs. The unique and regular contacts that housing associations have with their clients, together with their networks of local connections, provide an opportunity to offer innovative, tailored programmes to help those people into work and so provide the basis for stable tenancies. Both sides benefit, and the country benefits as well, as tenants become productive members of the labour force and no longer need to depend on welfare benefits.
I welcome the Government’s commitment to create 3 million apprenticeships by 2020, although I, too, acknowledge that that is a very challenging target. Housing associations want to play their part in creating those apprenticeships, but I am anxious that the Enterprise Bill will create obstacles and not opportunities for them to do that. Why do I say that? Clause 18 includes measures that would provide a power for the Secretary of State to set targets for public sector bodies in England in relation to the number of apprentices who work for them. They apply to most public sector organisations and require these bodies to have regard to any targets set on them and to report annually on progress against meeting those targets. The public bodies within the scope of the Bill will be set out in regulations, and a consultation is planned on exactly which bodies will be required to meet a target.
The Bill’s definition of a public body is:
“(a) a public authority, or
(b) a body or other person that is not a public authority but has functions of a public nature and is funded wholly or partly from public funds”.
It is paragraph (b) that concerns me. It would potentially apply a target to any body in receipt of public funds, which would certainly include housing associations, as well as many charitable bodies and many other recipients of public funding. I am anxious that the implications of this have not been carefully thought through. The consultation will, of course, allow concerns to be raised, but I want to flag this up now with the Minister in the hope of receiving reassurance on the issue.
I am concerned about two things. First, this is a broadly drawn definition of “public body” and could mean that larger housing associations, as well as many third sector and private sector bodies, will be brought into the scope of this legislation. Secondly, there is a risk that innovative approaches to apprenticeships, skills development and wider employment support may be stifled by the need to meet formal targets on apprenticeship numbers.
It is important to stress that housing associations are not public bodies. Housing associations are not-for-profit organisations, generating the majority of their funding from private sources. The ONS currently classifies them as private bodies. The independent status of housing associations underpins their ability to borrow billions on the private market to invest in housebuilding and to support programmes for the communities in which they work. To date, they have raised £76 billion. The ONS is currently conducting a review of the classification of housing associations and considering whether they should be reclassified as public bodies, as we heard only in the last debate. The federation that I chair is keen to avoid the reclassification of associations as public bodies. The accounting rule changes that would flow from a reclassification could carry harmful implications for associations’ ability to borrow and their use of cash flow and surpluses—all of which are important for funding the new supply of houses. There is growing concern in the sector about cumulative legislation and policy interventions that attempt to direct the corporate strategy of associations, because this is the central tenet of the test that the ONS will consider in its classification review. Any proposals that position housing associations as public sector bodies are likely to add to this cumulative risk to the sector’s independence.
My second concern is the stifling of innovation. Social housing tenants experience considerable disadvantages in the labour market and many require additional support to enable them to fulfil their potential. Around one-third of housing associations see supporting their residents into employment, education and training as a key priority. They provide employment support and training and skills development. Alongside all that, they provide many work placements, traineeships and work experience opportunities. In doing this, they are helping to support some of the most disadvantaged people in our society so that they are able to move into work and, for some, to undertake an apprenticeship. I would be very concerned if these innovative approaches were stifled because of a focus on in-house apprenticeship numbers. For example, many housing associations use their supply chains to deliver additional apprenticeship opportunities. I would be concerned if targets for in-house apprenticeships reduced capacity to support these externally provided apprenticeships. Many of these are in small and medium-sized enterprises in the construction and maintenance sectors. Increasing the number of skilled operatives in these sectors will be vital if the Government’s housebuilding and wider infrastructure ambitions are to be met.
Housing associations are committed to developing and supporting apprenticeship schemes. Over the last three years, they have directly employed around 12,000 apprenticeship starters. Annually, their contribution accounts for just under 1% of all apprenticeships across England. They are ambitious about helping even more people into work and they are good at doing it. I hope that the Minister can reassure me that the Enterprise Bill will not include housing associations in the definition of “public body” and that it will not jeopardise housing associations’ aim of increasing the number of apprenticeship schemes they can support.
Lord Cope of Berkeley (Con)
My Lords, any Bill called the Enterprise Bill starts with me prejudiced in its favour. I think that everyone who has spoken is in favour of enterprise in principle, but experience also makes one look at the detail. After all, many enterprising business men and women, when asked what the best thing the Government can do for them, say, “Keep out of our way”, and start from that point of view. Every change in legislation or regulations, even if it is in favour of the particular businesses concerned, needs to be looked at by them to see what it says and does.
As many have pointed out, this Bill is full of variety. It has eight quite different parts, not counting the general provisions at the end. I am not sure what dictated the logic of their order, but I notice that, broadly speaking, the odd-numbered parts help SMEs directly while the even-numbered parts are directed primarily at the public sector.
Part 1 sets up the Small Business Commissioner, charged with changing the culture of late payment of debts by large companies. This is a hoary problem, but it is still very much with us despite successive Governments’ efforts over many decades. The noble Baroness, Lady Donaghy, referred in some detail to the problems of the construction industry. If anybody doubts that such problems are serious, they should look at the business section of the Times today, where there is a very long and interesting article explaining exactly what they are.
The title “Small Business Commissioner” sounds wide, but, as has been pointed out, the role is limited. The Bill’s provisions ensure that they concentrate on this one matter of late payment. It will require a very special individual—as has already come out in the debate—to change the culture through the voluntary means that are at the disposal of the commissioner. They need, after all, to overcome the forces generated by the relentless pressures of cash flow which lie behind the problem. I think that the concentration of the commissioner on this one issue is right at this time, because it is a very important issue which we have failed to solve, but perhaps in time, if the commissioner succeeds with late payment, the remit might be extended by statute to cover other sources of concern to SMEs—but that is for the future.
However, one limitation on the commissioner’s role concerns me now. Under the Bill, the commissioner cannot deal with problems or complaints against local authorities and other public bodies over late payment. This can be a problem also for SMEs—I had several cases mentioned to me not so long ago. My noble friend Lord Patten referred to the Groceries Code Adjudicator, but I see that that office itself is being criticised for late payment. Whether the criticism is valid I cannot tell, but it is an example of where there seem to be problems.
Clause 3(1), read with the definition in Clause 3(11), limits the commissioner’s advice specifically to problems with larger businesses and excludes problems with public authorities that pay late. This limitation applies also to the complaints procedure. Clause 3(10) includes public authorities in the definition of “supply relationship”, but rules it out again in the next subsection—but that is a matter for Committee. I understand that the reason for excluding public authorities is that it is regarded as creating double jeopardy because of other mediation mechanisms that are available. However, given the limitations on direct action by the commissioner, I would like to see him or her at least able to give general advice and information under Clause 3: for example, about the mediation available in the case of public authorities and its efficacy, just as the commissioner can do in respect of larger companies.
The other odd-numbered parts of the Bill are welcome: Part 3 on the extension of the primary authorities scheme; Part 5 on the new implied terms for insurance contracts; and Part 7 on the extension of industrial development grants to electronic matters—we all know about broadband speeds in rural areas, for example.
The even-numbered parts are also welcome. The extension to regulators of the impact targets from last year’s small business Act in Part 2 seems an entirely positive development. One learns something every day in your Lordships’ House. I did not appreciate until just now that there are 70 national regulators. It is an enormous number which had not been borne in on me before.
I welcome also the extension in Part 4 of apprenticeship targets. The protection of the definition of “apprenticeships” may sit a little oddly in the Bill, but it is done by an insertion into the apprenticeships Act 2009, which itself built on John Major’s Government’s Act of 1994. The noble Lord, Lord Mendelsohn, referred obliquely to a television programme, but the Bill protects the word “apprenticeship” but specifically avoids protecting the word “apprentice”, so I do not think that there will be any trouble with the popular television show of that name, started by Donald Trump in America but obviously taken up by our colleague, the noble Lord, Lord Sugar. I strongly support apprenticeships as a method of training for work and, indeed, for life. I became a chartered accountant through an apprenticeship scheme—in England, we were called articled clerks, but in Scotland they were called apprentices, rather more accurately.
Part 6 permits the disclosure of HMRC information to local government on non- domestic rating valuations. Many of us who have served in the Treasury know how very closely HMRC guards all the personal tax information that it collects, even from Ministers. It is deeply embedded in its culture. We understand its reasons and respect it greatly for doing it, and it is a principle that we should uphold. Yet there is duplication at present, with the same or similar information being given by businesses to the Valuation Office Agency and to local authorities. The Bill states that the VOA can share its information with a local authority. I am not sure exactly what the extra information might include. The valuations, agreed for every property, are already fully public knowledge—the size in square metres and that sort of thing—but no doubt we shall hear more about that in Committee.
This is a useful Bill. It is necessarily technical and acceptably miscellaneous. In short, it is a kind of legislative herbaceous border full of interesting flowers, but no doubt some will detect some thorns or maybe even some weeds as we progress in our discussions.
The Earl of Lytton (CB)
My Lords, I, too, feel that there is much to commend in the principles behind the Bill and the reasons for introducing it. I particularly welcome the intentions towards small business and the general move towards proportionate regulation, no more so than in the business of the insurance payment provisions. However, in the time available it is necessary for me to focus on just two areas. The first is in Part 2—the proposal to bring the Equality and Human Rights Commission within the scope of the business impact target. I support the views of the commission expressed in its excellent briefing paper when it questions the reasons for that. It is not, after all, a regulatory body, but sets the framework for those bodies that are. First, as the briefing says, the proposals here could fetter the commission’s work. Secondly, they could impair its international status. That requires some explaining from the Minister. I pay tribute to the noble Baroness, Lady O’Neill of Bengarve. Had she been here at the beginning of the debate, she would doubtless have given chapter and verse much more eloquently than I am able to, but I press on.
My second area of interest is in Part 6 of the Bill. I declare my professional and other interests, not least as a payer of non-domestic rates. Back in 1975, I was an employee of the Board of Inland Revenue Valuation Office, so I come to the situation of non-domestic rating with some background knowledge. However, since that time, a once cheap and effective property tax was subsequently deemed unfair by the Thatcher Government, the residential part then became the community charge—of which probably the less said the better—and was subsequently changed again to the council tax, about which we have heard a lot recently due to the outdated nature of valuation bands. I will return to the question of things being out of date presently.
Business rates remained pretty much as they were, but ever more was demanded in terms of the product from that source of taxation. The year-on-year inflation-proofed increase through the national non-domestic multiplier, which is the figure applied to the rateable value to give tax due, remains the only certainty—a little like death and taxes. I have mentioned to the House before that one of my own business tenants, occupying about a thousand square feet of converted offices, pays three or four times in business rates what a residential occupier pays in council tax for the equivalent space, and for that he does not even get his dustbin emptied.
We now have about the highest annual business space tax anywhere in Europe, charged at nearly 50% of an assessment of rental value last fixed by reference to the market peak of 2008. The revaluation that would have come into force this year, based on what would have been the antecedent year of 2013, might have evened things up a bit, but the last Government deferred it. Other safeguards have been eroded too, such as those reflecting an uneconomic state of repair, the empty rate concession, access to adjudication within a reasonable timeframe, anomalies such as the relatively low level of rateable value on some hugely accessible retail superstores and, conversely, the way in which expenditure on costly but unremunerative environmental upgrades to premises such as steel works—adding to the rateable value, if you please—persist. The increased procedural requirements of the valuation tribunal for England now inevitably mean getting expert advice, so the costs of access to justice have risen.
There has been an inexorable move to shift the onus for substantiating the case on to the appellant ratepayer when in fact the Valuation Office Agency is the prime mover in setting the assessment in the first place. Businesses conclude that they are being treated unfairly, which is not least reflected in some 300,000 outstanding rating appeals of which admittedly maybe only a quarter will be truly justifiable. That is still a large number. The Valuation Office Agency staff are devoted mainly to dealing with the 2017 revaluation—the one that would have happened this year that was deferred—and do not have the resources to deal with the backlog. Meanwhile, the appellant businesses continue to pay the full amount until the reduced assessment is determined. All this is a blot on the enterprise landscape.
There is growing evidence, also, that standards within the Valuation Office Agency have been slipping for some time. I refer specifically to its rating functions: I make no comment on its other activities. I have been told of numerous cases where information that it offered about comparable property transactions—even in cases before the valuation tribunal and the Lands Chamber—has been misleading or inaccurate, never mind the badly prepared cases leading to unnecessary costs. I have experience of the valuation office claiming that it had “robust rental evidence” that turned out to be based on financial deals between lenders and borrowers in which the rent was governed by the repayment terms and was nothing to do with an arm’s-length transaction at all.
In the UK, property professionals share a lot of information and there is huge transparency, which greatly assists market fluidity. We should never forget that. In the rating context, the Valuation Office Agency is entitled to demand information on rents and, following revaluation, it has for some years posted details of every rating valuation and its breakdown on its website. The noble Lord, Lord Cope, commented earlier on some of the things that I will touch on. However, the agency does not always know the precise circumstances of any particular rental deal and, due to variables, most valuations produce a range of values rather than a precise figure. Nevertheless, it is an enormously advantageous position and indeed one of great trust. The property market is, after all, based on trust.
The professional bodies, particularly the Royal Institution of Chartered Surveyors and the Institute of Revenues Rating and Valuation, both of which I am a member of, make mandatory practice statements incumbent on surveyors acting as expert witnesses or advocates. These mirror the requirements of Rule 35 of the Civil Procedure Rules, which is the Ministry of Justice instruction to experts giving evidence. But these need to be observed by all, not just by those who are outside. Given all this, one would suppose that in responding to a business that has started the appeal process ultimately leading to appeal, the valuation office would be happy to discuss the basis of the valuation underlying a property tax at an early stage. However, I am informed that there has been an increasing reluctance by the agency to divulge anything until the matter is literally listed before the valuation tribunal. That is merely adding to the problem and the likelihood of sustained appeals.
The agency has long cited the confidentiality of data under the Commissioners for Revenue and Customs Act 2005, which is what the noble Lord, Lord Cope, referred to. But here we are concerned with evidence that it is bound to produce in any event at some stage in the context of an appeal. By the time an appeal gets to be processed, the information is likely to be several years old so I question how valid this protection of sources really is. I am also told that every time the agency has advanced such a premise in the Lands Chamber, it has been overruled. A legal opinion has been sent to me by Mr Holgate—now the honourable Mr Justice Holgate—which I will forward to the Minister, which gives a very different perspective on this point of controlled confidentiality. Furthermore, the whole thing is an untested assertion that rental information actually falls within the 2005 Act.
Across the rating valuation industry and business ratepayers, there is consensus that things have to change. However, it does not appear that the Government have been listening. From what I have seen, the business and professional interests are no more in favour of the proposals before us than they were a year or two ago when the Government stepped back from implementing them. That pause for reflection gave people some hope, but unfortunately that has not been demonstrated within the terms of this Bill. To say that Clause 22 is unwelcome is an understatement. Admittedly, it facilitates the sharing of revenue information with certain other bodies, but it also makes clear what it does not permit—in this case the sharing of information with the ratepayer and his professional valuer. This is an impediment to progress. I also have to point to the somewhat disingenuous manner in which—it is thought by the private sector—a department of state has gone about this whole process. That is regrettable. I also understand that this failure to share information according to Clause 22 would adversely affect business in improvement district schemes.
My questions to the Minister are these: how will Clause 22 be used in practice? Secondly, will its use extend to denying access to the evidential basis of an assessment in the valuation tribunal proceedings or in the higher courts? I think we should know that.
I now turn to Clause 23. Here it is proposed to insert a new subsection (4A)(c) into Section 55 of the Local Government Act 1988. Provision is made to bring in a power for the valuation office to impose financial sanctions on those who in its opinion provide false information. However, as I have pointed out, the private sector is far from the only manipulator of facts or the sole source of misinformation that might be described as being provided “knowingly, recklessly or carelessly”, to use the wording from the Bill. So the idea that the valuation office in its present state should be judge and jury in its own cause does not come naturally. What defence is available to those who might be so accused, and to whom might they have an independent right of appeal?
Noting that this clause would also introduce the facility of making a charge for an appeal prompts me to point out that the root cause of all this is successive Governments underresourcing this overworked tax and its administration. That is the core of the matter. If the Government just made it easier for ratepayers to check the basis of assessments from day one, most of the appeals would evaporate and huge costs would be saved. Will the Minister, even now, reconsider this?
I appreciate that the Local Government Association—I am an LGA vice-president—is in favour of this part of the Bill. I would be too if the current standards within the valuation office or its agents were the same as those demanded from others. I acknowledge the severe problems for billing authorities, but short-changing businesses on matters of fair treatment is not the way forward. Is this fair and just governance for people and businesses or is it protectionism for state institutions that lack a decent property tax? It looks to me rather like the latter.
I ask the Minister to look again at this part of the Bill and to cross-examine her officials very closely as to the background to what is proposed. For my part, I will forward to her and place in the Library a copy of a very succinct background paper I received from Mr Jerry Schurder, head of rating at surveyors Gerald Eve, with his full permission. The wider reform of business rates clearly lies outside the Bill, but I finally say this: if a cost-effective commercial property taxation system is what the Government are looking for, there are many eminent persons and bodies who would be more than willing to help. For my part, I will be returning to this subject as the Bill progresses.
Lord Leigh of Hurley (Con)
My Lords, it is with great pleasure that I speak on the Enterprise Bill, a subject close to my heart as well. Certainly, with the deficit down by half and projected to reach surplus by the end of the Parliament, the fastest-growing economy in western Europe and the best destination for foreign direct investment outside the US, we all have a lot to be proud of. The party opposite says, in effect, that that is enough now and that it is time to turn the page on boosting our competiveness, time to stop encouraging investment and time to put up taxes on families and businesses.
This Bill is to be welcomed since it does the opposite. It puts the pedal back to the metal and asks: what next to boost enterprise in the UK? No complacency, no sticking with what we have and definitely no reversal of what we have achieved. It contains many measures but I will focus on just a few of those that will help small businesses in particular. After all, there are some 5.2 million small businesses in the UK—more than in France, and more than in Germany.
The very welcome sight of the noble Duke, the Duke of Wellington, being introduced to the House today reminded me that someone once called us a nation of shopkeepers. Today, we are a nation of fast-growing businesses, businessmen and entrepreneurs. I accept, of course, that regulation is necessary to protect consumers, employees and the environment. As the Bill shows, it can be necessary to protect small businesses from large ones. However, we must make sure that it is proportionate and necessary. Specifically, we must make sure that it does not damage growth, employment and competitiveness—the engines of job creation.
In a recent survey, which pretty much every Peer seems to have quoted, 73% of scale-ups said that they would be able to grow faster if dealing with regulators was easier. It is amazing what Google can do. This means that regulators have to keep in mind the economic impact that they could be having on their stakeholders, especially small businesses. The Small Business, Enterprise and Employment Act, passed earlier this year, requires the publication of the business impact target, as we have heard. This sets out the economic impact of new legislation on business. However, it covers only regulation and legislation undertaken by Ministers. To increase transparency, the intention is to extend the scope of the target to include the regulatory activity of all statutory regulators—which, as my noble friend Lord Cope of Berkeley revealed to us, is some 70 organisations—not just in so far as they exercise powers on behalf of Ministers and departments, but in so far as they exercise their own statutory powers. The Minister will, when empowered in due course, specify the relevant statutory powers in secondary legislation.
It is to the last point that I will speak, focusing on the financial services in which, of course, I declare an interest as I earn a living from that industry. When drawing up this secondary legislation, it is essential that in respect of financial services, as well as regulatory organisations such as the FCA, the Financial Ombudsman Service—FOS—whose board is appointed by the FCA, is also included and made to report on business impact. There are, of course, seven other ombudsmen whose work I know less, although I have seen a little of the Pensions Ombudsman, and I think that my comments would apply to all the ombudsmen who operate under regulatory authorities, although, as I say, my focus has been interaction with FOS, the financial ombudsman.
Let me be clear that consumers, particularly in financial services, need proper protection. However, the situation we have now can be hugely damaging for firms being investigated by FOS or the FCA. FOS, which many people regard as a somewhat opaque organisation, can make rulings in an opaque manner itself, with no resource or recourse available to businesses so impacted. Extraordinarily, it seems that there is no right of appeal, even where decisions have a materially damaging effect on their own businesses. It must be the case then that FOS at least should be made to account for the impact of its decisions in the same way as other regulators.
I will cite just one recent example: that of retrospective regulation, which is, of course, hugely damaging for firms since it creates a climate of uncertainty where a firm never quite knows if it has fulfilled its compliance responsibilities. In a recent review, the FCA rejected all feedback it received, pointing to areas where regulation is being applied in this way. However, I looked at the example of SIPP operators, and there we have a case in point. The FCA has previously acknowledged, quite rightly, that SIPP operators are not responsible for the advice given to SIPP members by advisers. However, a recent decision by FOS has upheld a case suggesting that SIPP operators are responsible for investments that were made and have now gone bad. Clearly, this is palpable nonsense. It has highlighted how difficult it is for bona fide businesses to appeal against FOS’s decisions and threatens to cause huge disruption to an important sector of the financial services industry—the point being that FOS and similar organisations can make decisions that are very damaging to business without having any obligation to report on the growth and business impact.
As far as financial services are concerned, I therefore urge the Minister to ensure that the FCA is included within the regulators’ code so that when it holds its thematic reviews, as it calls them, it has regard to growth and economic impact, not just consumer protection, and has perhaps to consider which other organisations should be covered. Perhaps more importantly, I urge the Minister to consider including the ombudsmen services in the regulatory code. It seems strange, given their enormous powers, that they—and in particular FOS—are excluded from the list. Dare I say it, further steps need to be considered to ensure their transparency and accountability.
Next, I will mention the Bill’s approach to business rates. We have heard a lot about rates recently. The Bill contains important measures that mandate the sharing of business rates data across local governments and authorities, so that business does not have to share the same information twice. This is extremely helpful, but perhaps the most significant point is on appeals. A 2014 consultation identified that too many rating appeals are made without evidence, under a process that lacks transparency and takes too long. The very helpful Administration of Business Rates in England: Interim Findings makes the point that more than 70% of all challenges on the 2010 rating list resulted in no change.
How did we get here? I can do no more than share my experiences with noble Lords and declare an interest, in that I, too, sadly, pay business rates. When I started my business some 27 or 28 years ago, a man from the council came round to see me in the office and told me that he wanted to look around to determine the rateable value. I had no idea how the system worked and at the time had other worries on my mind, as most new entrepreneurs do. I asked him what would be the value and subsequent rate applied to me. “Well”, he replied, “I’ll give you a number, but it won’t really be relevant or matter as you will appeal against it and then we’ll find a number that works”. I was surprised to find that he was right. I had to take, and pay for, expensive professional advice. The thought occurred to me all those years ago that there must be a better way.
As luck would have it, this was in 1989. As my noble friend the Minister will recall, the previous Conservative Government had established a deregulation unit reporting to the DTI and the Cabinet Office, headed by an ambitious young adviser called Francis Maude—now my noble friend Lord Maude—with a keen and very bright civil servant advising him. I served on the tax division of the task force and seized my moment to look at business rates. I raised a number of issues at the time, not least that the Valuation Office required a business to resubmit the same information on every return, as opposed to keeping the information and simply asking whether it was still correct. Somewhat horrifyingly, I learned that the Valuation Office is still not digitised and still requires nearly all of its information to be submitted on paper. Sadly, in 1997 the Labour Party closed down the deregulation unit and my recommendations never progressed. That happened almost immediately, so once again it is up to the Conservatives to try to make life easier for businesses and entrepreneurs, as opposed to making life easier for civil servants.
The Bill provides for a revised system that is clear, sets out how long it should take and any and all action required. We should be clear that this process needs to be updated, because it is clearly not fit for purpose. However, I stop short of mandating annual reviews, which have been discussed. Yes, they would reduce the incentive to appeal, but they would cause annual chaos and be hugely expensive, costly and inconvenient for everyone—except, of course, chartered surveyors. Improving the current system to bring parties together earlier and with more transparency is a sensible step forward.
Other noble Lords have spoken about different but important measures in the Bill, such as apprentices, the Small Business Commissioner and public sector exit pay caps. All together, they add up to an attractive package of measures that would allow us to bolster our competitiveness further instead of standing still. Unsurprisingly, then, the Bill has been endorsed unanimously, as far as I can tell, by all the business groups.
The party opposite may say that we do too much for businesses and not enough for consumers and workers. That is because they may not have understood that to be on the side of business is to be on the side of workers. Entrepreneurs create jobs and businesses nurture employees. We do not set one against the other. This is one nation: we back investors, businesses and workers. The cause of all three is advanced by the Bill.
Lord O’Neill of Clackmannan (Lab)
My Lords, I will avoid the temptation of going down the rates road any further. Equally, I will not try to get into any international comparisons. I am reminded of the story of President George W Bush, who, when discussing French business acumen, said, “The French, they don’t even have a word for entrepreneur”. Therefore, we have to look at what we have here today.
It has to be said at the outset that BIS is not a legislating department. Therefore, by and large, when it gets the chance, its first reaction is, “Oh yes, this is wonderful”. Then it starts saying, “What do we put into it?”. We have a Bill that the generous might call a curate’s egg; others might think of it as a bit of a dog’s breakfast. I suppose that our task will be to make it into a reasonably acceptable curate’s egg at some stage. That is not to say that the Bill is a total basket case and there is nothing we can do about it, but I believe that, when we look at the establishment of a Small Business Commissioner, that position should be more than a kind of citizens advice bureau for 500 businesses per annum.
As the noble Lord, Lord Patten, said, we need to have an element of the big stick in the hand of the commissioner. Advice on payment disputes, frankly, is not enough. We have had discussions on payments matters in this House—I have been a Member for only 10 years—on innumerable occasions. Before coming here, I was chairman of the Trade and Industry Select Committee, which predated BIS as a department, and we engaged in a study on retentions. We got such a feeble response from the Ministers that we called the authors of the response, the civil servants, back in to see us again. That kind of thing does not happen very often with Select Committees. To say that the civil servants were not happy about it is something of an understatement. They had no substantial case to answer. The impression that we had was that the Ministers had been got at by the big building firms and they had told the civil servants to palm something off to the committee.
The fact is that retentions, which are only one element in the payment problems of British small businesses and in particular in the construction sector—I speak as the president of the Specialist Engineering Contractors’ Group—take various forms. Normally, when a building is being constructed, the first element, apart from the foundations, is the steel construction. There are numerous stories of steel construction firms that are not paid until the grass is laid around the car park at the end of the whole job, which might be two and a half to three years later—they have just kept a little bit back. In the intervening period, the steel structure will have been covered by concrete and will have had various other things done to it. The point I am making is that that is a cynical attempt by the major contractors in a lot of construction projects to hold back money that they then use for other purposes. I am not saying that there is anything criminal about what they use the money for. In fact, it might be argued that they are supporting other bits of their business empires. However, it is very inconvenient for the usually rather small businesses that depend on prompt payment.
The issue of retentions has been covered today in the business section of the Times, as has been mentioned. We cannot have a commissioner for small businesses who does not have any teeth or powers relating to payments and the scandals that happen here. Ultimately, most of the small businesses that have grounds for complaint do not take their complaint the whole way because they are frightened that they will never get any repeat business from customers who are late payers. It is therefore a difficult area, but one in which government needs to give leadership. Regulation should not be a source of fear for the good companies. It is a force to make recalcitrant companies implement good practice. Sadly, there are still a number of them. I do not wish to blacken whole sections of British industry, but we know the sums involved and the amounts of money that are written off annually. That requires us to look afresh at the terms of the Bill to see what amendments could be entered into.
As I said earlier, I am not completely negative about the Bill. I happen to think that the apprenticeship provisions are a source of encouragement. We have already had a very interesting discussion about the whole question of training, as the noble Lord, Lord Baker, mentioned. We have examples of good practice in one area, but perhaps we could look at an area that is a bit deficient in Committee—namely, in encouraging public bodies in this regard. Should not the contracts awarded to private companies by public bodies contain encouragement and, indeed, a requirement for those private companies to take on a number of apprentices in the course of the relevant project? I know there were examples of this in the Olympics programme and, I think, at Heathrow Terminal 5. It would not be a bad thing to include a measure of that nature in the Bill to give it a broader base for apprenticeship expansion.
I know from my own personal experience in the east of Scotland where we used to have the Rosyth dockyard and Ferranti, the major defence contractor, as then was, that in the 1950s, 1960s and 1970s they trained about 1,000 people every year—usually boys in those days. When we had for a brief period in Scotland what we called Silicon Glen, a lot of the employees had come out of the dockyards and the high-tech defence industries. There was an assumption that these companies could train more people than they required because they could afford to do so as they were given a financial incentive. That has been lost and it is one of the prices that we paid for privatisation. I will not get into the old argument, but the former public utilities and similar types of companies were extremely good at training people. They often gold-plated the whole process, but that meant that the rest of the industry was able to take up the slack.
I realise that there will be a substantial division between the Government and ourselves on the whole question of exit payments. I do not understand what this has to do with entrepreneurialism. It seems to have more to do with post-election triumphalism and hubris and putting the boot into a certain part of the system. The number of people who will be affected by this measure, but who will not receive massive payments, is very large. We will find that it will prejudice voluntary staff reduction agreements, result in acrimonious litigation, prevent much needed departmental reforms in the immediate short term and could well be grossly unfair as regards the severance and pension arrangements of low-paid, long-term local government workers. Many of us on this side of the House will need great reassurance from the Minister that something can be done about this in a way that will not prejudice the agreements which have been entered into by successive Ministers on how problems of this nature should be dealt with. It seems that a whole raft of undertakings have been thrown out of the window in pursuit of a cheap headline-chasing ploy.
To promote business success and enterprise we need to realise a raft of achievements, many of which are akin to motherhood and apple pie but nevertheless have to be pursued. We could make something of the Bill. As I say, it is a bit of a dog’s breakfast at the moment, but there is within it the grains and elements which could provide a basis for an understanding across the Chamber. We could achieve something which would assist small businesses, promote skills and reassure those people who are pretty certain that their jobs may well be lost as a consequence of government cuts and local government reforms that they will not lose out on what they assumed would be their pensions and final rewards. We are not talking here about the hundreds of thousands of pounds being given to chief executives and the like but about ordinary people who have committed themselves for very long periods of their lives to rates of pay which were considerably less than what they would have got in the private sector, but who stayed because of their commitment to their jobs and because they thought they would get some form of index-linked slightly better pension in their retirement years. In the name of cheap hubris after the election, it would be wrong of us to prejudice these people’s retirement and termination of employment opportunities.
Baroness Harding of Winscombe (Con)
My Lords, it is an enormous privilege, as ever, to address your Lordships, particularly on a subject so dear to my heart—supporting great British enterprise. I must declare my interest as the chief executive of TalkTalk Telecom Group.
As a business person, I am proud to support a Bill that will strengthen the UK’s position as the best place in Europe—perhaps even the world—to start and grow a business. The measures in this Bill will undoubtedly benefit all businesses, but I particularly welcome their focus on Britain’s SMEs. As many of your Lordships have already said, SMEs are the lifeblood our economy, employing over half our workforce and accounting for 99% of all British businesses, but, of course, they are also the seed-corn that creates big businesses. We want to encourage a vibrant and dynamic economy that drives growth from small businesses into big. Put simply, we will not fulfil our potential as a country without a thriving small business sector.
This Bill contains a number of elements, as many have said. In the interests of brevity, I want to focus on just two areas where I have personal specific experience: the role of regulation, and the importance of investing in a skilled workforce. The right, good regulatory framework is at the heart of how we ensure Britain is the best place in the world to run a business. As a passionate believer in free markets, I fundamentally think that consumers make better decisions than Governments do. Where markets are competitive and informed consumers are sovereign, companies are forced to constantly innovate, improve the quality of their services and put a downward pressure on prices. That may make life harder for established companies in the short term, but ultimately it benefits customers and ensures that our industries and our economy remain globally competitive.
The risk is that regulation, however well intentioned, becomes a barrier to that competitiveness. Where it becomes excessive or burdensome, it restricts innovation and risks forcing up prices for consumers while making lawyers richer. That hits the poorest hardest. I very much welcome the ambitions in the Bill to tackle red tape and bad regulation. However, regulation is not all bad. A much more successful entrepreneur than I am who comes from Silicon Valley once coined the phrase that monopolies are like children: if you do not have any, you do not really understand what the fuss is all about, but once you have a child of your own, you will fight to the end of your days to protect it. Monopolies are exactly the same, which is why, if you want to have strong competitive markets, strong regulators are equally important. I very much welcome the balance the Bill brings in making sure that we create a strong regulatory framework but focus also on hunting out red tape and bureaucracy, which hinder small businesses particularly. It is small businesses that are most hindered by having to deal with an army of regulators or lawyers, much more so than the big companies such as the ones I run.
Taking a couple of specifics, extending the business impact target to require regulators to consider the economic impact of their actions is a very good discipline. It is a welcome safeguard against the risk of overregulation becoming a barrier to our nation’s competitiveness and it will allow for deregulation wherever possible. That is to be welcomed. On the other hand, introducing regulation in the form of the Small Business Commissioner is also to be welcomed. That is exactly the sort of good regulation that we should encourage. I am sure that we will discuss in some detail in Grand Committee exactly how the Small Business Commissioner’s responsibilities should be set up but I encourage my noble friend the Minister to make sure that we keep that regulation as light as possible and do not fall into the trap of trying to define in so much detail that we err on the side of creating bad and complex regulation. Wherever possible, we want to create organisations that have a simple, clear brief to add to the role played by those 70 existing regulators.
Briefly, my second theme is apprenticeships. I really welcome the Bill’s commitment to ensuring that Britain has the high-skilled workforce we need to compete. As a chief executive, I know that the quality of my workforce—its skills—is absolutely the most important asset that any company can have, the most important ingredient in our success. Arguably, for far too long in this country we have been guilty of attaching disproportionate weight to academic qualifications—I say this as someone who is well overeducated. Of course we want to encourage people to apply for degrees and of course we want to aspire to having some of the best educational establishments in the world, but the Government are absolutely right to focus on expanding the range of vocational opportunities as well. Talent comes in many forms and we must ensure that we have the tools to help every young person fulfil their potential. That means a diverse mix of opportunities rather than career straitjackets.
Apprenticeships are undoubtedly an important part of this and I welcome the measures in the Bill to increase the number of apprenticeships in the public sector and to protect the quality of apprenticeships and the brand “apprenticeship” itself. But we must also remember that, just as degrees are not the only qualifications worth having, apprenticeships are only one form of vocational education. As well as delivering 3 million apprenticeships, I urge the Government to look at how we continue to support other activity that allows employers to invest in the training and recruitment of young people. That means encouraging long-term partnerships between companies and educational institutions; expanding the role of work experience and sandwich placements; encouraging flexible working arrangements that encourage and incentivise people to pursue new qualifications while still at work; and recognising that one size does not fit all. As we expand apprenticeships, it is crucial that we build the broadest range of opportunities for the broadest range of talents.
In summary, this is a very important Bill. I have touched on only two elements—regulation and vocational education—but I hope I have shown in a small way how the Bill will support businesses and customers and expand opportunities for our young people. That does not benefit just those directly affected, it helps to create the long-term growth our economy urgently needs to thrive and, with that, to make affordable the benefits that we would like to see cover all portions of society. I am proud to support the Bill.
Lord Aberdare (CB)
My Lords, I welcome the policy aims behind the Bill and its goal of promoting the growth of enterprise by reducing some of the burden of regulation, particularly on small businesses. As a former small business owner, I sincerely hope it will prove effective in achieving that goal. I shall comment on two areas relating to the Bill: first, the clauses relating to apprenticeships; and, secondly, the issue of cash retentions in the construction sector, which is not covered by the Bill as currently drafted, but in my view should be.
Turning to apprenticeships, Clause 18 allows the Secretary of State to set apprenticeship targets for prescribed public bodies. This should contribute to the promotion of good employment practices with regard to apprenticeships in the public sector, as well as help to meet the Government’s overall target of 3 million new apprenticeship starts in England during this Parliament—both of which I welcome. However, what really matters is not so much how many apprentices start as how many complete their apprenticeships, with real skills and opportunities to gain real and permanent jobs—outputs rather than inputs. How will the Bill ensure the quality of public sector apprenticeships, not just their quantity? As with so much about apprenticeships at the moment, it is still far from clear how funding and delivery processes will actually work in future, and I can imagine that some public sector bodies might be concerned at the prospect of having to pay the proposed new apprenticeship levy and meet a target for new apprenticeships while facing budget cuts.
Clause 19 seeks to raise the status of apprenticeships by making it an offence to describe a course or training programme as an apprenticeship if it is not a “statutory apprenticeship”. I wish that there was a good abbreviation for “apprenticeship”. The obvious one would be “app” but unfortunately that has already been taken. Again, I welcome the aims of protecting the reputation of apprenticeships and seeking to promote the growth of statutory apprenticeship schemes, but I have been struck by the number of emails I have received from organisations concerned that this provision may have a stifling rather than stimulating effect on the growth of apprenticeships. Concerns expressed to me include: whether the definition of acceptable apprenticeships might exclude some vulnerable groups, such as people with learning difficulties and disabilities, from the opportunity to undertake such apprenticeships; whether it will apply equally across all the devolved Administrations, which have their own apprenticeship regimes, and, if so, how; and whether local trading standards teams are best placed and adequately resourced to enforce it.
Apprentices whose training is provided directly by their employers are excluded from the terms of this clause. There seems to be some risk of confusion attached to having such a significant exception to the prohibition on using the term “apprenticeships” for anything other than statutory apprenticeships. In any case, the Government say:
“There is little evidence to suggest that the existing scale of misuse of the term ‘apprenticeship’ is widespread”,
so I wonder whether this is really the best way to enhance the status and attractiveness of apprenticeships. Having said that, I very much support the point made by the noble Baroness, Lady Harding, about promoting other forms of vocational education as well as apprenticeships. I look forward to hearing the Minister’s—I hope reassuring—comments on these points.
The other issue I wish to raise relates to an aspect of payment practice in the construction sector that is extremely damaging to productivity and investment in the sector, especially for small businesses, but is not addressed in the Bill at all. This is the issue we have already heard about of cash retentions, whereby a proportion—typically 5% but sometimes as much as 10%—of payments due to subcontractors at each stage of a construction project is routinely withheld. Notionally this is to provide a mechanism for remedying defects if the subcontractor does not do so itself. The noble Lord, Lord Cope, mentioned the timely report on this issue in today’s Times. It was also powerfully addressed by the noble Baroness, Lady Donaghy, and the noble Lord, Lord O’Neill.
According to research done by the Specialist Engineering Contractors’ Group, which represents more than 60,000 firms with over 300,000 employees, 99% of them small businesses, the total of such retentions at any time is some £3 billion. Subcontractors may have to wait up to three to five years, or even significantly longer, to receive the payments they are owed. In some cases they do not get paid at all, when the client business that has held back money owed to them goes bust. To add insult to injury, the cash retained is often used either as working capital or to fund investment by the debtor company, while the subcontractor to which it by right belongs, having completed the work involved, is unable to use it to enhance its own productivity through extra recruitment or investment. According to the SEC Group, the amount lost by small firms in this way just this year, because of insolvencies up the supply chain, is almost £30 million—enough to employ some 3,000 apprentices. Other construction sector bodies share this concern, including the Forum of Private Business, the Federation of Master Builders, the Finishes and Interiors Sector, and the National Federation of Roofing Contractors.
The Construction Supply Chain Payment Charter, issued in April 2014 by the Construction Leadership Council set up by BIS, included 11 commitments, one of which was to aim to move to zero retentions by 2025. More than 20% of public bodies, and some leading private sector businesses, have already abjured the use of retentions. Other jurisdictions around the world, including in France, Germany, Australia, New Zealand and the USA, have tackled or are tackling this issue to boost the productivity of their small businesses. A possible solution, along the lines of the existing tenancy deposit scheme which provides protection for landlords, would be to require all cash retentions to be held in a form of trust on behalf of the subcontractor to whom they really belong. This would have the beneficial effect of protecting a subcontractor from supply chain insolvencies, and perhaps of making it easier to seek loan funding against the value of cash retentions held in trust for it.
The Bill of course creates a Small Business Commissioner to assist small businesses in payment disputes with larger ones. But nothing in the proposed powers of the commissioner would address the specific issue of cash retentions and, as we have heard, experience shows that small construction firms are likely to be extremely nervous of using the commissioner to pursue disputes with their larger client businesses because of the possible impact on their own future business if they are seen as troublesome or difficult subcontractors. This is what the noble Lord, Lord Patten, described as the fear of reprisals.
I have a simple question for the Minister. Given that movement on this issue would have clear potential to galvanise the construction sector in terms of enhanced productivity and investment—especially those small businesses which the Government are quite rightly so keen to encourage and support through the Bill—why on earth should they have to wait until 2025 for any prospect of it being fixed? It is evident to me that given the choice between resolving the cash retentions issue and setting up the proposed Small Business Commissioner, welcome as that is, the vast majority of small construction firms would plump without hesitation for the first. So why not seize the excellent opportunity presented by the Bill and tackle both?
Lord Flight (Con)
My Lords, I think that no one champions more the huge and wonderful increase in entrepreneurship and small business in the UK. I have often done that here in your Lordships’ Chamber and the Bill contains a lot of useful micro-provisions that are helpful for small business. It has the excellent objective of supporting the UK’s position as the best place in Europe to start and grow a business. I hope very much that the Small Business Commissioner initiative will work. There is certainly the need for SMEs to save the time and costs of going to law to resolve disputes.
I am slightly sceptical about the success which will be achieved in cutting £10 billion of red tape. I am afraid my experience is that the regulatory and administrative requirements on SMEs and sole traders continue to grow inexorably, of which the most annoying to me are the never-ending and pointless AML requirements. By 2018, small businesses will also be faced with the cost and effort of providing pensions, even if they have only one employee. I will also repeat the points that I made in the September economy debate: the EU’s competition Commissioner is obliging the UK to change our very successful EIS and VCT schemes to qualify for EU state aid approval. The changes will limit severely the supply of equity risk capital for SMEs that are moving into a growth phase and, for reasons not yet explained—and contrary in this case to the accommodating facilities of the European Commission’s 2014 risk finance guidelines and the general block exemption regulation—exclude acquiring and sorting out SMEs with problems from qualifying for EIS and VCT status. I declare my interest as chairman of the EIS Association.
I support strongly the expansion of apprenticeships and congratulate my noble friend Lord Baker on the success achieved by university technical colleges in preparing young people for apprenticeships. I also wish the Government every success in stopping overgenerous taxpayer-funded six-figure pay-offs in the public sector.
I will talk about the specific requirements in the Bill for insurers to pay insurance claims within a reasonable period of time, as in Clauses 20 and 21. I suggest that all would agree with the objective of enhancing protection for SMEs and consumers but the provisions in the Bill are causing widespread concern in Lloyd’s and wholesale insurance markets. I should add that I have absolutely no involvement with Lloyd’s or the insurance industry. The CEOs of the Lloyd’s Market Association, Lloyd’s itself and the International Underwriting Association have written to the Economic Secretary, setting out their concerns in detail. I hope that the Government will come forward with their own amendments to disapply Clause 20 in respect of large insurance risks, where statutory protection is not appropriate or necessary for international business and commercial risks written in London.
The damages for late-payment provisions are the same as those ultimately removed from the Insurance Bill before it was introduced to Parliament in 2014, which was then on the advice of the Law Commissioner. I would like to quote David Hertzell, who was then the Law Commissioner. In his evidence to the Special Bill Committee of the House of Lords on that Bill, he said:
“It is absolutely impossible these days, and probably always was, to draft law that can cover both ends of this huge spectrum of different types of business. We have drafted something that we think fits the vast majority of businesses that sit within the middle of the bell curve. At the more sophisticated end, we expect businesses to take care of themselves, as they do now with their individual contracts, and at the less sophisticated end we have the Financial Ombudsman Service. This legislation”—
which became the Insurance Act 2015—
“is intended to be focused on the mainstream commercial marketplace. We expect the people who operate outside that marketplace to contract on different terms, as they do now. It is a default regime that essentially seeks to achieve as neutral an outcome as possible”.
The Insurance Act, if it is to be amended by Clause 20, will create a difficult framework for the London marketplace. Where Lloyd’s takes real issue with what the Law Commissioner said is that the Insurance Act has not created a neutral regime. Contracting out will be technically and commercially difficult and—the worry is—more so than switching to another legal destination such as Bermuda. The LMA and IUA put forward a proposal at the same time as the Insurance Bill in 2014 to create a remedy of damages for reckless or deliberate mishandling of claims, which seemed to go to the nub of the problem that the Law Commission wanted to cure but without exposing the market to bad faith or speculative litigation. It was a pity that Parliament chose then not to adopt the industry proposal.
There has been no consultation with the LMA or IUA regarding this Bill’s provisions, although HM Treasury said back in 2014 that the Government would continue to work with stakeholders to reach and agree solutions. The Government have not taken heed of what the Law Commission described as the “legitimate concerns” of the London market. Combined with other problems contained in the Insurance Act, the Government are not taking account of the balance required in English law if it is to remain the law of choice for different types of business and, in particular, international insurance business including reinsurance underwritten in the London markets.
The provisions would introduce a further significant element of uncertainty into insurance contracts written under English or other UK law. What would be a reasonable time for payment or reasonable grounds for dispute? Speculative claims for damages are likely to be made as a matter of course when a valuable or complex claim is disputed. Consequential damages claimed could be disproportionate to the cover purchased and the premium paid. Claims handling costs will increase significantly because of speculative, vexatious claims. There will be significant problems in the dispute resolution process, whereby insurers may have to disclose legally privileged advice to show that they are acting reasonably. Claims reserving will be problematic if large secondary claims for consequential losses are made. All this would lead to higher loss ratios, capital requirements and premiums. Unfortunately, the contracting out of the damages for late-payment provisions within the Bill will be a commercial non-starter, especially in soft market conditions. Wholesale insurers are already subject to FCA regulation in relation to claims handling, where the FCA has not found evidence of any systematic late payment of claims.
The Bill’s impact assessment also contains unrealistic underestimates of the damage for late-payment provisions, with continuing costs of investigating unmeritorious claims of just £375,000 per annum for the entire industry and increased litigation costs of £100,000 for five years for the entire industry. These sums could be absorbed by just one major speculative claim. The impact assessment is also inaccurate and incomplete in other major respects.
Applying enhanced statutory protection against late payment of claims is inappropriate and disproportionate for the wholesale life industry. The net effects and costs will damage the international competitiveness of the London insurance and reinsurance markets and are likely to lead to a rapid switch from English law to other jurisdictions such as Bermuda, with major implications for London. The wholesale insurance industry would therefore like to see Clause 20 disapplied in respect of large risks, as defined under the EU solvency II directive, and reinsurance claims, so avoiding the problems that I have spoken about.
Baroness Wheatcroft (Con)
My Lords, I applaud the aims of the Bill. In introducing it, my noble friend said that it was about making life easier for small businesses, and who would not want to do that? It will encourage smaller firms, deregulate and champion apprenticeships—all worthy aims. At this stage, I should declare my interests as listed in the register, including directorships of regulated companies.
We have a relatively successful economy, but not a perfect one by any means, and complacency would be misplaced. The persistent trade deficit—now a whopping 5.5% of GDP—is a real cause for concern. To deal with that, we need not just to support small business but to actively encourage those businesses that can grow into world-beaters. Britain is good at starting businesses. As we have heard, we have more than 5 million of them. The problem is that too few of them become big businesses. BIS published a survey in 2013 which found that 1.5 million businesses were not growing but, even more depressing, did not want to; 2.7 million were not growing but—slightly more encouraging—they wanted to, they just could not.
Trying to get to grips with this issue, last year, a serial entrepreneur, Sherry Coutu, produced the Scale-up Report for the Government. Her thesis was that competitive advantage for nations comes from focusing not on starting up but on scaling up businesses. Not every business is capable of scaling up—probably only about 6% of start-ups will ever get to national, let alone international scale—but, if it can be done, the rewards are huge. Deloitte’s has undertaken research that shows that if we succeeded in scaling up our businesses, by 2034 there could be an extra £225 billion added to our gross value.
Companies struggle to grow both domestically and internationally. The inventiveness, which is there to get them started, seems to fade at the problems of growing. What obstacles do they encounter? Finance is there, but it is nowhere near the top of the list. Obviously, late payments cause cash flow problems and cash flow is all-important; what the Bill proposes to deal with late payments will be very welcome, but that is not the main thing that is holding back our growth companies.
Top of the list is skills, so I welcome the move in the Bill to increase the number of apprenticeships. There is already a huge increase in that field but more to be done. This afternoon, we heard from my noble friend Lord Baker about the success of his technical colleges. We need people to go into such vocational education rather than getting just another university degree. We need to continue to improve literacy and numeracy—as we are—but getting those skills into the workplace where they are needed takes time.
If our growth companies are really going to get the motor that they need, some of them need to bring in those skills from overseas. One proposal that Sherry Coutu makes is that there should be a special scale-up visa that would allow growth companies to bring in the talent they need. I know that my noble friend the Minister is fearless; I wonder whether she would dare to broach that with the Home Secretary.
The other thing that holds back our potential growth companies and comes very high on their list of issues is leadership. They just do not have leadership skills, and struggle to break into new markets. Supportive relationships with big companies would really help in that area. There could be a symbiotic relationship between big and small companies; we have already heard reference to that this afternoon. My noble friend Lady Brady talked about the ecosystem which the Bill should be nourishing, improving relationships between big and small companies. We are not doing enough yet to improve the relationships along the supply chain and to foster the smaller companies that could benefit so much from the mentoring that big companies could give them, from the introductions to new markets that big companies could provide and from access to the infrastructure that many established companies have, which could open the door to those potential growth companies to really get going.
For the time being, our Small Business Commissioner will be very limited in what he does: just talking about late payments. I concur with my noble friend Lord Cope of Berkeley that, in the short term, that may well be the right thing to do—late payments are a big issue—but in the longer term, like him, I should like the Small Business Commissioner to take a much more proactive role in encouraging relations between small companies and big ones. In the mean time, the Department for Business has many different initiatives—some might say, still too many—to help small firms.
Elsewhere in the Bill, I welcome Parts 2 and 3, which are bringing about a sensible approach to regulation. Extending the duty of other regulators to take account of the need for growth is a positive step. Extending the primary authority scheme may not get the general public dancing in the streets, but it will bring sighs of relief from many smaller firms. To enable a business to have to deal only with the rules of one authority rather than many must make sense. As the Secretary of State himself put it:
“Thanks to Primary Authority, cheese makers don’t have to display their cheddar on wooden boards in one place and on steel platters in another”.
That must be a step in the right direction.
The Earl of Kinnoull (CB)
My Lords, I commend the thinking behind the Bill, seeking as it does to improve matters for business in our island nation. I shall concentrate on just three areas: late payment of insurance claims, gold-plating of EU directives and the attitude of regulators. I declare my interests as set out in the register, in particular as an employee of Hiscox insurance group for 25 years, much of it at a senior level.
First, on the late payment of claims provisions, I note that these are substantially the same draft clauses dropped due to time pressure from what is today the Insurance Act 2015, but with important additional wording that would prevent the ability to contract out of the new obligations. I have been in touch with the British Insurance Brokers’ Association—BIBA—which represents nearly 2,000 insurance intermediaries and has additionally as partners the bulk of British insurance carriers. It is, as am I, highly supportive of these provisions. I know well from long experience that those insurers which seek to pay valid claims rapidly look on with frustration at the small minority of competitors which make a business of not doing so. These provisions would be a great help for small businesses—the small and the brave—which are the bedrock of our nation’s prosperity today and a foundation for its prosperity tomorrow.
I spoke in this House in the debate on the gracious Speech about the problem of gold-plating older EU directives, something recognised by our EU neighbours who refer to it as “sauce anglaise”. I stress the word “older”. In 2011, the coalition Government brought in an admirable fresh approach to the bringing of EU directives into UK law. Not only were great efforts to be made to avoid gold-plating, but also things have become self-correcting through the use of review and sunset clauses in the regulations concerned. The previous Labour Administration latterly tried to prevent gold-plating, really in the wake of the excellent Davidson review of 2006. However, the absence of the default use of review and sunset clauses means that EU directives brought into UK law in the period from 2006 to 2011 generally have no mechanism to self-correct. The situation for directive-driven legislation prior to 2006 is that there is plenty of gold plate about, as the noble and learned Lord, Lord Davidson, found. Does the Minister agree that these older, pre-2006 bits of EU-inspired legislation represent potentially very rich pickings for the Government’s target to save £10 billion in red tape?
A particular case in point is the insurance mediation directive, or IMD, which dates from 2002 and was put into effect in the UK in January 2005. BIBA told me today that,“the UK is the most expensive regulatory regime on the planet, five times the cost of our major competitors and fourteen times the global average”. That is not so much gold-plating as lead-plating, which prevents our world-leading insurance intermediaries fulfilling their full potential. To put the size of this industry in context, BIBA also advises that its intermediary members employ 100,000 staff and account for 1% of UK GDP. UK insurance intermediaries are regulated by the Financial Conduct Authority, the FCA. Will the Minister confirm that the FCA is to be named as a specified regulator by the Secretary of State for the purposes of the Bill? For the older, gold-plated situations I described, the admirable regime envisaged by the Bill will apply only if the regulators concerned are specified by the Secretary of State, so I urge that he is very thorough here. I agree entirely with the words of the noble Lord, Lord Leigh.
Finally, I turn to the attitude of regulators. The best regulators in my experience over many years and in quite a few countries take a very helpful and collaborative approach. However, bad regulators can treat those that they regulate aggressively and as if assuming non-compliance, and/or use poor enforcement and/or excessive monitoring requirements, all of which can turn straightforward regulation into a costly and disruptive burden. I very much welcome Part 2 of the Bill, which in particular will allow those being regulated to feed back what it feels like, leading to a sort of reverse naming and shaming. That is likely to be a healthy step in driving a change in approach for those regulators that need to improve. However, it is important to patrol the fear that some have, well-founded or not, that if they complain about their regulator they could be subject to additional scrutiny from it, and thus be discouraged from giving useful feedback. I am not sure at this stage how that is best dealt with. Additionally, it is important to consider to whom the reports contemplated in the Bill are best addressed so that there is a clear potential for sanction where a regulator performs consistently badly. Again, I am grateful to the Minister for the opportunity to discuss this shortly. That said, this is an excellent Bill overall and I wish it well in its passage through Parliament.
Lord Sheikh (Con)
My Lords, I speak as a businessman and as somebody who has employed many people through several business ventures. My business interests have related to insurance, financial services and property. I have spoken many times in your Lordships’ House and elsewhere on the importance of supporting small businesses. I am a great supporter of SMEs and in my business life have rendered them support, with the result that my company has flourished and the SMEs too have done well. I used to own a company which provided facilities for the placement of businesses on insurance schemes to more than 1,200 intermediaries. We found our sub-agents to be innovative and made good use of opportunities we were able to provide. There were mutual financial benefits.
Five years ago, the Government inherited a substantial budget deficit. Much progress has been made and our economy is growing once again, but there is still some way to go. Business and enterprise have been and will continue to be at the heart of our recovery. Our economy will only grow if business is allowed to grow. The Government have a responsibility to assist businesses where they can. We must make it as easy as possible for businesses to establish themselves, to build and to flourish for the long term. Above all else, we must make the United Kingdom the best place to grow and run a business. Our country has an entrepreneurial spirit. We must foster and encourage this, not least with our small and medium-sized businesses.
Many of the measures in the Bill will offer greater support for small businesses in particular. We need to fully understand the contributions of small businesses to appreciate the importance of this Bill. It has long been said that small businesses are the backbone of our economy. Last year there were estimated to be around 5 million small businesses in the UK. They in fact constitute more than 99% of our total businesses. They are responsible for 48% of private sector employment and around a third of private sector turnover. They not only drive growth and provide jobs in the wider sense, but also bring fresh ideas and open new markets. They often innovate by challenging the status quo.
The Royal Society of Arts recently published a report into the health of small businesses. It found that when comparing like-for-like long-standing firms, micro-businesses actually have higher productivity levels than larger firms in many cases. Micro-businesses in particular are booming, but they are also struggling. The number of micro-businesses has increased by nearly 50% in the last 15 years, so that they now account for a third of all private sector employment. The report also found that small businesses are more efficient at innovation. They create more innovation for every unit of research and development expenditure and extract more financial value from these developments. The workplace employment relations study has also found that small business employees are the most satisfied in the labour market. They score highly on job control, influence on decision-making and loyalty to the business.
With this in mind, it is imperative that we do all we can to assist and nurture small and medium-sized businesses. It is in all our interests that they thrive. In many respects they must be empowered to compete on a fair and level playing field with larger companies, as some of them often suffer from an imbalance in bargaining power. They are most vulnerable to unfair practices and often do not have the resources to challenge them. Meanwhile, they are also under greater pressure to protect their commercial relationships. In particular, smaller cash flows also mean that many small businesses experience problems with late payments.
The Small Business Commissioner will provide the reassurance and capabilities that small businesses need to deal with such problems. Our SMEs need to know that relevant advice and information is available to them, and where to find it. Where they require dispute resolution or need to file official complaints, they will now have a central resource to which they can turn. A commissioner will also encourage a change in the culture of how businesses deal with each other. There must be fair treatment for all businesses, large and small. It is particularly welcome that a voluntary mediation service will be provided through the commissioner. Where disputes need to be taken further, avoiding the need to go to court will save much time and money.
We need only look at the success of the Victoria Small Business Commissioner in Australia. Over half of cases dealt with by the commissioner have been successfully resolved. They cost businesses 30% or less of the cost of going through litigation. Over half of the complaints received have also been resolved within one week, and 80% within 12 weeks. Can my noble friend say what specific lessons have been learned from this success in Australia? In summary, the new commissioner will provide SMEs with the support they need to thrive in an often volatile market.
One of the biggest barriers to businesses is red tape and bureaucracy. This affects large corporations too, but small businesses are often disproportionately affected. They identify compliance as one of their biggest inhibitors to growth. I am extremely proud that our Government have committed to cut red tape, and that commitment must be appreciated. The business impact target forms a key part of implementing this pledge. It is an innovative way of holding government to account for regulations it introduces. However, this deals with only half the problem. It is clear from businesses that the actions of regulators are just as impactful as the legislation itself. It therefore makes sense to extend the business impact target to include regulators, as they hold just as much responsibility as government Ministers.
We must look not just at the rules, but at the way they are enforced. If extra costs are imposed on businesses by the behaviour of regulators, we must know about it. This will mean even greater transparency of the real impact that specific regulations have. Ultimately, I hope that this will reduce regulatory burdens on businesses even further than previously forecast. That in turn will free resources, increasing productivity further still. More widely, I also hope that businesses will continue to come forward and report burdens through the Government’s Cutting Red Tape programme.
It is also extremely important that all regulators are properly engaging with the growth duty and the Regulators’ Code. They must be consistent and proportional with the policies on enforcing different regulations. It is also important for businesses to see that regulators are behaving with integrity. I welcome that measures in the Bill will give businesses a voice in declaring how they are affected through regulators’ regard to these duties. Making regulators more accountable and transparent will provide reassurance and clarity to businesses. It will also ensure a more stable system of regulation in the long term.
I commend the extension and simplification of the primary authority scheme. It has proved very popular and has doubled its membership in each of the last five years. Having a single point of contact for robust and reliable advice reduces time, risk and complexity. This is particularly valuable for small businesses, which often do not have in-house expertise on regulatory issues. As many businesses as possible should be able to access the benefits of the scheme. Extending it to other areas of legislation will also mean that more regulators can participate. Simplifying the formation of primary authority co-ordinated partnerships is also particularly welcome. I understand that the Government reviewed the operation of the scheme with hundreds of businesses and authorities that use it. Such extensive consultation is to be commended.
As someone who has been involved in business in the insurance and financial services sectors, I am glad that the Bill proposes for insurance claims to be settled within a reasonable period. I support this in principle, but it needs to be looked into further. However, this was my own practice when I was in business: I used to instruct my staff and loss adjusters to settle claims as quickly as possible. The questions of liability and quantum need to be established, and if the claim is valid the payment should be made as soon as possible. By doing so we will create good will and compensate the policyholder when they need our help the most. I feel that a satisfied customer is your best method of advertising.
I also welcome the provisions regarding apprenticeships and the drive to use the public sector as a model employer in this respect. This will indeed enable the Government to meet their target of establishing 3 million extra apprenticeships in England over the next five years. We must continue to develop our financial services sector but we also need to enhance our manufacturing base to enable us to expand our economy and create more jobs. This can be achieved by expanding our apprenticeship programme, which will provide us with more trained staff to fulfil the needs of the various sectors in the country.
The Bill will make life much easier for businesses to operate and innovate. It will provide extra support where it is needed and eliminate bureaucracy where it is not wanted. It will cement the United Kingdom's position as the best place in Europe to start and grow a business. The Bill will have my support in principle.
Viscount Eccles (Con)
My Lords, at this stage in a Second Reading debate, it is tempting to throw one’s speech away and reflect a bit on what has been said. I confess that I find it very difficult to pull out of what has been said things that I am certain about. The debate has been very much about people’s behaviour towards each other, asking why people pay late, or about cultural change, asking why people go on behaving in a way that you would think they would want to change. In pursuing those things, we have been taken to Australia by both sides of the House and, indeed, I shall also concentrate most on the proposal to have a commissioner for small businesses.
We also had my noble friend Lord Flight quoting the Law Commissioner, from some time ago, in saying that,
“we expect businesses to take care of themselves”.
But I do not think that we in Parliament—or a lot of us—do not believe that businesses or people can take care of themselves; we think that they need a lot of assistance. When it comes to this Bill and business practices, as my noble friend Lord Cope most elegantly said, we have even and uneven numbers.
We have heard some very powerful technical speeches relating to either one or another parts of the Bill, but I shall try to concentrate on the first part and try to deal with the argument that some people have made that it does not do enough, while others have suggested that it will not work. The conclusion from the second argument might be that it might be better not to try to do it that way in the first place. However, we all agree that there is a very serious problem—that many large and small businesses pay late and get paid late. So there is no doubt at all that there is a big problem, but there always has been. Is the law deficient in providing guidance and remedies for late payment? I am not sure that it is. Contract law is pretty thorough. The question of retentions is of course a completely different subject—it is different from being paid late. If you agree that you will have a retention in your contract, you have one. In my youth, with large construction contracts, you could always go to the bank and swap a cash retention for a bank guarantee. So I am not so sure that the present situation, in terms of technical, legal memories, is so short of what we would need or want.
If we agree that there should be further state intervention, we have a duty to decide whether it will be effective. In the case of Part 1 and the Small Business Commissioner, whose duty is going to be giving advice and information and trying to deal with complaints, my first impression is that it will engage him in a huge variety of problems. It would not be possible to describe how wide that variety could be. I go back to when I was running what I think was a small business—although, until we get the scope regulations, we do not actually know what a small business is; it could be that it is much more widely defined than simply one that employs fewer than 50 people, or one that is close to a start-up, or, as my noble friend Lady Wheatcroft, said, one that is not prepared or interested in scaling up. In the variety of circumstances, it would not be sensible to turn the description “small business” into some sort of fetish.
Indeed, in the days when I was responsible for collecting debts, I got rung up and told that so and so had not paid and asked to go and do something about it, and what I did was to get into a Hillman Minx van, DXG 813, and went to see the buyer. When you went to see the buyer, they would probably say, “It’s that wretched accounts department—they never keep up with paying the bills on time”, or they would say, “The inward goods reception said that you’d sent eight, but I can only see six”. So I would say, “Let’s go out into the yard and see whether we can find the eight”—and we usually did. And the buyer would then say, “Well of course those people never could count”. So at that time I was on the side of those who thought that the best thing to do was to sort out your own problems.
Nobody thanks you for bringing in a third party if, in fact, you could and should be solving your own problems. Two is company and three is a crowd. So I wonder where the idea came from for a Small Business Commissioner who would help to solve this amazing variety of problems by providing advice and information and concentrating on the question of the cash flows. Why would anybody believe that it would really make a difference? It is probably a follow-up—as was indicated in some depth and detail by my noble friend Lord Patten—to the Groceries Code Adjudicator. At some point in the passage of that Bill, I was heard to say that I was the only member of Her Majesty’s Opposition, because I confess that I never thought that the Groceries Code Adjudicator would have an easy job. I always thought that it would be very difficult. I think that the adjudicator is a very good public servant. I read everything that she says and that she has done, and I believe that she is as workmanlike, sensible and sophisticated an operator on behalf of the state as one could wish to see. She has been going at it now for two and a half years; she has the power to investigate and is making an investigation into Tesco. I suppose that Tesco opened itself to the thought that she should investigate it. She has the power to fine and the power to name and shame, but she has proceeded very cautiously—and she has not been able or wanted to implement those provisions of the Bill.
So this time, while probably thinking that that was the situation, we are faced with a much less draconian approach in the case of the Small Business Commissioner. But I still wonder whether it will actually have any real effect. Will a cultural change take place? Will everybody start to pay their bills in a different way because of the Small Business Commissioner? My answer to that is that it is not likely. Either the cultural change will come from within business itself, or it will not come at all. I do not believe that in this case this form of state intervention has anything to offer us, and therefore I say in conclusion that I am very glad to see that the Secretary of State will be given the power to evaluate and then to abolish.
Lord Borwick (Con)
My Lords, this Bill will help small businesses up and down the country get on with the task of making things and providing services. It will help to ensure that regulators are on the side of business, rather than in conflict with it, and it will help millions of young people develop skills and get good jobs. These are all wonderful things. I want to address the general themes of the Bill in turn and start by declaring my interests in business and enterprise as recorded in the register.
Given the problems that some small businesses have with late payments for services provided, it is good to see that a Small Business Commissioner will be introduced. The problem could possibly be solved with tighter contracts at the beginning of any deal, but small businesses by their very nature do not have the resources to deal with the hurdles that are sometimes put in front of them. It is important that any good work that the new commissioner does is taken seriously and promoted. That would hopefully have the knock-on effect of speeding up payments without the need for cases to be referred to the Small Business Commissioner. That means that it is important that we can see the tangible results that will be delivered by the commissioner and can measure his effectiveness.
Incidentally, are not slow payments the symptom of a problem, not the cause? I know that small businesses often complain about this subject, but my experience is that slow payments happen most often to boring businesses without anything that the customer regards as unique. Would it not be better for the supplier to spend his time improving his product or getting better capitalised? I am not sure how any small business proprietor will actually have the time to complain to the commissioner, and I am pretty certain that the customer who is the subject of the complaint will get himself a new supplier.
Trying to ensure that our regulators are pro-growth is a good thing, and I welcome this direction of travel. However, it is reasonable to expect that the growth duty should already be an implied duty for all regulators. The fact that this clause is needed at all shows that regulators are too often unhelpful and that they impede growth, possibly knowingly. Perhaps we do not need to change the legislation; we just need to change the regulator. I cannot but wonder whether, had this been enacted at the beginning, in the primary legislation that set up the regulator, it would have been harder for the regulators to come up with any excuses. I am pleased that the Bill finally settles the seemingly obvious matter that regulators should be pro-growth.
Extending primary authority powers will make life a lot easier for many small businesses. Dealing with one local authority has saved a lot of time for small businesses, and therefore saved them money. Bringing regulators within the scope of the scheme also demonstrates that the Government are on the side of small businesses by making their life a lot easier, but does the Bill allow for a regulated person to nominate an authority to be regulated by, with the Secretary of State accepting that unless there was a very good reason not to? It seems to me that this would put even more trust in businesses to make the right choices for themselves.
Apprenticeships are a wonderful thing. I have a background in manufacturing, so I fully appreciate what value they can bring to a company, not just in skills, but especially in loyalty and commitment, and I commend the Government’s drive to have more apprentices working in government and at Britain’s car makers, energy companies, pharmaceutical manufacturers and all the other wealth-generating businesses in our economy. If I have one concern about apprenticeships, it is how they may be vulnerable to being interfered with by educational institutions. Academic education happens in schools. Children who thrive in schools go on to university. The implication, therefore, may be that an apprentice did not thrive at school. It is not correct; I went from secondary school directly into business, missing out university. I have had the privilege of having great apprentices working in my businesses. One was so good that we promoted him to team leader within about a year of his start. I am not sure how such a promotion would fit into statutory apprenticeships. Apprenticeships and degrees are, of course, both things to be proud of, and pride is often the best driver of high standards. The Government are doing all they can to ensure that apprenticeships are valued and respected and that they are a viable path for millions of young people. That is wonderful.
The late payment of an insurance claim can be devastating for a business that is trying to get back on its feet. My only experience of a large insurance claim was a good one. There was a fire in my factory, and ACE paid out £500,000 in just seven working days. It provided a great service. I tell this story because I worry that the press will say that this section of the Bill carries with it an implication that insurers generally pay late. This is not true. As with every industry, there are good players and there are bad players. While we check the bad players, we should applaud the good ones.
It is entirely sensible to streamline the reporting of non-domestic rates. It is ludicrous that businesses have to report their information several times over. It highlights an important point on the valuation of rates. There are many consultancies in operation today that promise to reduce your business rates bill in exchange for a percentage of the saving. The fact is that they are usually right. It works. That shows that there is something more fundamentally wrong with the system if so many valuations are incorrect. There must be a good case for reform of the system if the majority of professional practitioners are working on a success fee. I am glad that the Government are working to improve the reporting processes and, hopefully, also the quality of information that is held, meaning that businesses are not paying over the odds.
Industrial development is a noble aim, but I am sure that most taxpayers and businesses do not agree that Ministers can pick winners better than the market, so while I commend the sentiment, because this Government back business, I am nervous about increasing the threshold for industrial development from £10 million to £30 million.
I again applaud the Government for their intention to end sky-high exit payments in the public sector. These deals do not really exist in the private sector to the same extent. That is not a universal rule—some very odd deals are handed out to those at the very top of the private sector—but I hope that shareholders are far more active in standing against this type of behaviour. Taxpayers are the shareholders in the public sector, so it is right that action is taken. However, I am concerned about the 28-day payment limit. Can the Minister assure me that there will be safeguards in place that mean public sector organisations cannot simply stagger these payments over two months rather than one? Is the limit in practice going to be £1,140,000 paid over a year, or would we be better to change the 28 days to one year?
In general, this is a great Bill, albeit over a bewildering variety of subjects.
The Earl of Lindsay (Con)
My Lords, I support the Bill and the measures it proposes for encouraging opportunity, productivity, enterprise, jobs and economic growth, and I particularly welcome Parts 2 and 3, as I have had a long and active interest in better regulation and deregulation and have been a member of the Better Regulation Commission, the Risk and Regulatory Advisory Council and the Better Regulation Strategy Group. All these bodies were established to give independent advice to successive Governments over the past 10 years on how to improve the quality, address the quantity and reduce the unnecessary burdens and unintended consequences of regulation.
I join other noble Lords in welcoming the extension of primary authority powers. Primary authority powers have to date made life easier for all sizes of business, including small businesses. On a broader scale, requiring all national regulators that oversee the business landscape to give greater consideration to reducing the compliance burden that they impose on firms is welcome, as is obliging all regulators to be brought within the scope of the deregulation target. In considering the impact of legislation, it is logical that the manner in which regulation is enforced is given the same level of scrutiny as the regulation itself. As the Minister said in opening, the business community sees the actions of regulators as being at least as important as the content of legislation in determining their experience of regulation.
A further important point is made in the impact assessments associated with this Bill—that,
“the costs imposed on business by regulators’ activity are not routinely measured or reported on. As a result there is a lack of transparency around the size and scale of these costs”.
I therefore welcome the proposal to include the actions of regulators within the business impact target, and that the reporting requirements attaching to that target, which will be subject to independent scrutiny by the Regulatory Policy Committee, will include the activities of regulators. This will encourage regulators to pay greater attention to the way that they operate and the effect they have on the businesses that they are regulating. It has to make sense for there to be greater incentives for regulators to design and deliver their responsibilities in a way that better meets the needs of business.
These measures comprise an important part of the Government’s headline commitment to cutting a further £10 billion of red tape. They lie at the heart of Part 2 of the Bill, and it is on Part 2 that I want to focus. In doing so, I declare an interest as chairman of the United Kingdom Accreditation Service, the national accreditation body. UKAS has a successful record of working with regulators, as its accreditation has proven itself to be one way in which the burden of regulation and its enforcement, or both, can be credibly and intelligently reduced.
In many regulated areas, such as environmental protection or food safety, the robust assurance provided by UKAS accreditation is used to good effect by regulators to target their enforcement activities where they are needed most, and to reduce them where they are needed least. For instance, businesses with accredited certification to ISO 14001 for their environmental management systems are visibly demonstrating, through UKAS-accredited third-party assessments, that they take their environmental obligations seriously. In such instances, the regulator can provide what is known as earned recognition to businesses with accredited certification. This enables reduced inspection requirements for the regulator, which can either make a net saving on inspection resources or redeploy those resources to focus on where the risk is greater. It also benefits the business, which saves on reduced levies charged by the regulator and avoids the business disruption of preparing for and undergoing a regulatory inspection.
I could cite many other areas beyond environmental protection and food safety where UKAS accreditation is enabling regulators to take advantage of earned recognition, or what is known as co-regulation, to improve the way in which they engage with those whom they are responsible for regulating. For instance, UKAS accreditation in the health sector is now recognised by the CQC as a source of information to support its hospital inspections regime. Other examples where UKAS accreditation is assisting regulatory regimes include drinking-water quality, emissions trading, microgeneration, energy efficiency, asbestos testing, gas safety, competent persons schemes under building regulations, farm assurance and animal feed, animal welfare and greyhound tracks.
I therefore hope that the extension of the business impact target will encourage regulators to make even greater use of UKAS accreditation, among other options. It is one tried and tested means by which regulators can sensibly reduce the burden of regulatory enforcement by allowing businesses to earn recognition through robust third-party assessments and manage their own activities in a responsible way.
Regulatory relief can contribute to reduced costs and greater investment, which in turn can drive economic growth. In this context, I note from analysis carried out by the National Audit Office and BIS that small and medium-sized businesses anticipate being among the biggest beneficiaries of regulatory relief. However, as I have already pointed out, businesses will not be the only beneficiaries. Regulators will be able to target their limited resources in a more informed and risk-based manner. This should help them to achieve their statutory objectives in a more efficient manner, which in turn will benefit society as a whole. Given the fundamental benefits that arise for both the regulator and the regulated, I would be interested to learn from the Minister whether a similar approach will be applied to the regulatory burden imposed on voluntary and community bodies, and indeed on those providing public services.
I welcome the new reporting duties that the Bill proposes placing on regulators. The Regulators’ Code sets out a good framework, based on the recognised components of better regulation, within which regulators should work. It is also right that regulators have a duty to consider the need to promote economic growth in the way that they carry out their duties. I therefore strongly support the requirement proposed in the Bill for regulators to publish information and produce an annual report on how they are performing in respect of the code and the growth duty. It will improve the transparency and accountability of the relationship between the regulators and the regulated. It will enable businesses and others to hold regulators to account in a more informed and intelligent manner, and it will enable good practice in the context of the implementation and enforcement of regulation to be understood and shared more easily. I support the Bill and look forward to its later stages.
Lord Haskel (Lab)
My Lords, owing to a mix-up my name was not on the speakers list, so, instead of my prepared speech, here are four bullet points for speaking in the gap.
First, regarding the commissioner, many attempts have been made to encourage prompt payments, and all have failed. In most companies, cash out requires cash in, and firms have their own carefully calculated cash flow. Without considerably more powers, a commissioner would not be able to do very much about that. Where I think a commissioner can be of value is in resolving disputes quickly and cheaply.
Secondly, on the Industrial Development Act and poor broadband, the Minister will be aware that BT says that money is not the problem. Others say that what is needed is competition for BT. The Bill should increase the powers of Ofcom so that it can deal with this. While I am on the question of broadband, the Bill ignores that rising form of work referred to as “the human cloud”. The Bill should find a form of arrangement that is suited to this type of work.
Thirdly, as apprenticeships have become more politicised, so they have become more complex. The Bill should provide a clear route of progression through all this.
Fourthly, on public sector redundancy pay, small businesses need good people in public services, particularly in the use of science and technology funded by the Government. This clause can be misinterpreted, it does not encourage that, and it should not be there.
Lord Stevenson of Balmacara (Lab)
My Lords, I thank all the speakers who have contributed to this debate. It has been extremely interesting, we have had had a lot of expertise on display and a number of points have been made. It was great on our side of the Chamber to feel that we were all in this together, and it was not until about halfway down the list that we had the first attack on our “anti-business” feelings, which of course I utterly refute. In any case, I am allowed to say what I like, and I say clearly that we support business. We support many of the measures in the Bill and will be pushing very hard for the Government to go further on a number of points, because we think that is the right thing to do.
However, as my noble friend Lord Mendelsohn said at the beginning of the debate, we have been slightly misled by the aspirations for the Bill. In pre-briefings it came out as something that would put red meat back into the whole question of enterprise, but I am afraid that it is much less than that. I think that it was described as another “pudding” Bill—I did not catch the exact words—and as a “legislative herbaceous border”, although perhaps a “rockery” might have been more appropriate because there are many rocks and hard places into which sensitive plants might fall if we are not careful as we take the Bill forward. But enough of such metaphors; we should go on to the reality of what we are about.
Although the Bill in itself is not something that one could argue against, the problem is that it lacks a lot of the ingredients that I think would have been expected of a measure labelled “Enterprise Bill”. Indeed, if the Government are not careful, they may well end up with one or two of these things being argued for in Committee. For instance, a couple of noble Lords have mentioned the need for more management, expertise and leadership in small businesses, in particular. There is not much, if anything, in the Bill about that. There is nothing here about support for exports—something that we have talked about in your Lordships’ House on a number of occasions. There are still problems with getting small businesses to aspire to export and getting medium-sized businesses ready to export more than they currently do. There is nothing here about lending or investment, which is still a major problem for small business if we want to see growth there. If we are talking about where the markets are, why is there nothing here about our approach to the EU, particularly, for instance, in the digital single market, which I know is occupying a lot of the Minister’s time? It would have been nice to see something there, perhaps leading where in the past this Government and their predecessor have held back a bit.
The noble Baroness, Lady Wheatcroft, was sharp on the question of immigration and the need to get more support for the expertise gaps that are sometimes found. I hope that the Minister will respond on that. However, it all points to a lack of anything in the Bill that could be described as an industrial policy. That perhaps does not feature so large in the thinking of the current Secretary of State, but it could well be reflected on as we go forward. Some other points were made and I shall touch on those as I go through.
I am struck that Parts 1 and 2 deal with issues that were raised extensively in the previous Session. There were two Bills that could easily have taken the materials now before us but they did not. We have come back to them not so much to amend but merely to extend points that were made in previous debates and discussions. Those points were not always made from this side, but we recognise them in some of the wording before us.
The introduction of the Small Business Commissioner, in Part 1, has been widely welcomed. In a sense, we do not need to go over this ground because it is common between us: poor contractual practices—for example, unfair payment terms and breaches of contract such as late payment—reduce the economic and financial resilience of small businesses. Indeed, recent data from the Federation of Small Businesses confirms that late payments alone are costing small and medium-sized businesses £26.8 billion per annum. Of course we must do something about that. However, what we have here seems to be an investigation and a register of issues rather than anything that might tackle the problem. We welcome the potential contribution that a Small Business Commissioner might make to help change, in particular, the culture of poor contractual practices within supply chains and to enable small businesses to resolve contractual disputes quickly and easily, but I think that this is a very pale imitation of what is needed. We have heard from all around the House that what is now available in the Bill will not provide “good capitalism”, as it was described by the noble Lord, Lord Patten, and it will not provide the rod of steel by which we think the practices currently in play need to be tested. As the noble Baroness, Lady Wheatcroft, said, this is something that we will have to return to, if not in Committee then perhaps in later years.
The problem seems to be that the Government recognise the issue but do not agree on its scale. There will be one commissioner dealing with perhaps 500 cases a year when we are talking about roughly 5.4 million small businesses in the country. As we heard, when the situation is compared with that in Australia, one finds that the gap is substantial.
With regard to the powers, why does the Small Business Commissioner not have the authority to deal with regulators, big business, government and local government when they do not perform according to the standards that we want? Why is its scope so limited? Why is it not given the powers of a mediator? At the moment we are seeing the introduction of alternative dispute resolution right across our economic field. Why is there not some thought of linking up what is proposed for the Small Business Commissioner with the ADR system? As I have already hinted, I suspect that primary legislation will be required, with automatic costs and interest being applied to those who do not pay small businesses in time, because the code of practice simply does not work.
That is the sort of thing that we would like to come back to in Committee, but we think that two further things that have been represented to us are important. There should be a power within the commissioner’s office to name offending companies. Without that, I do not think that the actions that it takes will stick. Naming should be mandatory if the respondent is found to be at fault. I also think that it would be reasonable for the commissioner to have powers to make referrals to the Competition and Markets Authority if there is clear evidence of significant market distortion across the economy as a result of late payments and poor supply chain practice. These are very minor areas in terms of what I have already sketched out as being important to us in Committee, but perhaps they are things that the Minister could think about.
We welcome the Government’s move to include the broad range of regulators within the business impact target. Alongside requiring regulators to publish both an annual report on their performance against the regulators’ code of practice and a report on the impact on economic growth, that will help to give a sense of the administrative and inspection burden that regulators places on businesses. In Committee, we would like to get further information and clarity from the Government on the fees, charges and levies that might be introduced within the annual economic growth impact report. Increasingly, regulators are imposing fees and charges for providing advice and services which are much needed in the small business sector, but we need to know more about that.
However, we are very disappointed that the Government have not stepped up to the plate on the EHRC, and we have already heard concern expressed about that. This was raised during the passage of the Small Business, Enterprise and Employment Bill, when the Minister was very firm that she felt it right that it should be excluded from primary legislation. Why has she not done that for this Bill? Perhaps she could answer that when she comes to respond.
We support the extension of the primary authority scheme. This was originally introduced by the Labour Government and we think that it has worked. It will help considerably if smaller businesses and other regulators are included in that. However, we have been told by those who have written to us that the Government are not consulting as widely as perhaps they could, and I hope that they will pick up on this point in the remaining stages of the Bill. Some key issues are affecting councils and I think they feel that they have not been able to make this point. In Committee, we will also probe whether it is possible for councils to charge for the work that they do on this scheme. They should be able to charge reasonable fees that would be negotiated and agreed by the primary authority, rather than being limited to charging on a cost-recovery basis. At a time when local authorities are being very badly hurt by cuts, this is something where value for money might prove valuable to them.
We spent a lot of time talking about apprenticeships in our discussions here. We like the proposal to protect the term “statutory apprenticeship”, and the offence that is being created of providing or offering a course as an apprenticeship if it is not a statutory apprenticeship is appropriate. In many ways it parallels what was required to safeguard the gold standard of a degree. Presumably the lessons will be learnt from that and we will certainly be probing that point. There have been difficulties in getting it right over the years and that has led to a number of concerns. However, I am sure that the Government will be able to get it right.
The noble Lord, Lord Baker of Dorking, who unfortunately is not in his place, talked about the challenging nature of the 3 million target, and that was picked up by a number of people. However, the point that he made was really the subject of a different debate. It is a debate that I regret is not prompted by the Bill and I wonder whether there will be room for it in Committee. The point here is that you cannot just bring in a statutory requirement for a particular type of apprenticeship without, as the noble Lord, Lord Baker, said, thinking harder about the split between vocational and non-vocational education in schools, about the role of the colleges and about the way in which the integration of work takes place. This is not a new debate; it has been around for many, many years. One would hope that, in building next to the structures and changes that the Government have introduced in the higher educational sector by bringing in the statutory apprenticeship route, they would also allow time to develop a properly rounded appreciation of what we are offering the children in our country who progress through primary and secondary school and then have a choice to make—in the view of many people it is currently made far too early—between a vocational and an academic course of study, to build in flexibility so that those who take one route are not excluded from the other, and to allow for linkages between the various types of training so that we have the possibility of reaching a level 5 comparison between the academic and the vocational courses which does not label people as being in one section all the way through.
These are words that everybody has heard, and we have all paid lip-service to them over many years. However, we do not ever seem to be able to get them right in Britain. Why is that the case? I say “in Britain”, but in fact it is not strictly true in Scotland. The system there is much more open in terms of the ability to move between various subjects and different types of educational skills acquisition. We should take a humble approach to this in England, and learn from the experience that works, to allow the proper and right thing being done here about apprenticeships to bite properly for the benefit of our economy as a whole.
I think also that, if we are going to do this, we have to think harder about what it is that apprenticeships do in relation to the wider context of employment. By that, I am thinking about trying to bring people out of poverty—although that is not the only reason for this—and find the most productive way forward. We have to build into anything that comes out of this Bill a monitoring process for what is happening on the ground. We will need demographics about who is applying for apprenticeships, what is happening to them and what the good and bad things about it are. We should be able to think of apprenticeships not just as something that happens in itself but as something that creates a job at the end of the training—something that sometimes does not happen.
We should focus harder on the 18 to 21-year olds who are leaving the secondary education system and joining the workforce, but also continuing in training. Although it is much resisted by government, it is true that the majority of apprenticeships currently go to those in the older 22 to 25-year old age group. Have we done enough to think about gender and apprenticeships? There seems to be a large gender inequality in where apprenticeships are going. Are vulnerable groups getting access to apprenticeships in the way that they should be, particularly those leaving care? What about those from a BME background? What about disabled people? These are all important things; although they will not necessarily drive the system, it would be fantastic to get it right if we can.
Finally, I hope that during the discussions we have in Committee we can think about the sort of reports, which I have mentioned, that will be very necessary if we are to take this forward. The statutory duty for apprenticeships is an important step forward in a long journey, and we want to get it right. We will also be probing the requirement that trading standards teams should enforce protection of the term “apprenticeship”. It is not at all clear that that is the best body to enforce this—it does not do employment; it does process. It is important that we get that right. We should also think harder about the way in which the requirement to make apprenticeships happen in the public sector has at least an implication for the private sector as well. It may not be appropriate to do this in a top-down way, but certainly it is setting up a difference between the approaches that would not be sensible in the long term.
We have talked a lot about the late payment of insurance claims. The provision seems an obvious adjustment of a long-standing difference between the systems that operate in the United Kingdom. The question of whether an insurer should be liable to compensate for losses caused by the failure to settle a claim within a reasonable time seems right. However, we have a long way to go on this, and I look forward to picking it up again in Committee.
On the non-domestic rating issue, we had a very helpful intervention from the noble Earl, Lord Lytton, which will repay a lot of reading. I do not think that answers will be readily forthcoming to all the points that were made this evening, but I am sure that they will be picked up. It is important that we get this right. At the moment, the system seems rigged to go wrong. We will certainly need to try to get the best out of the Bill, while taking on board the points that have been made.
We are all slightly confused by the industrial development provisions in the Bill. I had not realised that broadband in Wiltshire was so bad that the issue had to be picked up by the Minister herself and forced into the Bill—perhaps I am overstating the point. At a time when we are hearing that BIS is going through a bit of a contortion act around its budget and may not do quite as much funding or activity as before, it seems a little strange that the Bill contains a provision to increase funding for the Secretary of State. I look forward to hearing more details from the Minister when she responds.
The question of whether the problems we have will be solved by money was raised well by my noble friend Lord Haskel. I will not repeat the points that he made, but he raised the important issue that it is competition that is the problem, not money.
Finally, my noble friend Lady Rita Donaghy and others covered the ground on the public sector employment restriction of exit payments very well indeed. Rather than go through the issues again, let me say that there is something that can be done here, and probably there is a will to try to get this right. However, if the system that is being proposed catches the lower paid, impacts on pensions and destroys good industrial relations, we have to ask whether it is worth it.
The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills and Department for Culture, Media and Sport (Baroness Neville-Rolfe) (Con)
My Lords, we have had an interesting debate on the measures contained in the Enterprise Bill. I am grateful to the noble Lord, Lord Stevenson, for his comprehensive summary, and to my noble friend Lord Cope for his analogy with the herbaceous border. In an autumn when gardens have been flourishing, I hope that the sun will shine on this Bill, on our small businesses and on our plans for apprenticeships.
I am grateful for what seems to be virtually unanimous support for this Bill from the various business groups and this House; not necessarily for every detail, but I look forward to a constructive debate in Grand Committee.
Enterprise has been part of the British DNA since Elizabethan times—possibly before—and this Bill will provide a new range of opportunities. It is pro-market, pro-competition, pro-innovation and pro-investment in people and technology, and not pro-vested interests, as my noble friend, small business ambassador and judge on “The Apprentice”, Lady Brady said. My noble friend Lord Sheikh made similar points based on his own business experience.
I am pleased to note that a number of my noble colleagues, including my noble friends Lady Harding, Lady Wheatcroft and Lord Patten, and the noble Lord, Lord Curry, have expressed their support for the Small Business Commissioner. The Government are committed to helping small businesses, which unlike larger businesses do not always have the resource or expertise to fight their corner. By establishing a Small Business Commissioner we want to drive a cultural change to address late payment.
The noble Lord, Lord Mendelsohn, argued that the Small Business Commissioner should have a wider remit, referring to its Australian counterpart. The Small Business Commissioner is inspired by, but not the same as, the Australian Small Business Commissioner. That is deliberate. We want to adapt the Australian experience to our own circumstances. Here, the commissioner will focus on the key issue of late payment, which is of real concern to small businesses in the UK. I should advise my noble friend Lord Eccles that the definition of “small business” in Clause 2 is, in substance, consistent with the EU definition and that which we discussed during the passage of the Small Business, Enterprise and Employment Act.
I recently met the Australian Small Business Commissioner, Mark Brennan, to learn from his success. I concluded that finding a very good candidate for this job will be extremely important, as has been said. He told me that, in the last two years, he has had to use his power to name and shame an organisation only once. He is able to resolve most complaints informally and the threat of reputational damage encourages firms to work constructively with him.
Our consultation showed that the commissioner should not provide mediation directly. The real issue is awareness of mediation and of other forms of dispute resolution, which the noble Lord, Lord Stevenson, mentioned. We do not believe that yet more legislation, as he suggested, is needed, beyond the proposals that I outlined in my opening speech. What is needed is a change in culture. That means good, early decisions by the Small Business Commissioner.
The commissioner will seek to improve, rather than undermine, our business environment. He or she will complement existing dispute resolution services and lead a culture change in how businesses resolve and ultimately avoid commercial disputes, particularly around payment issues. It was good to hear of the positive experience that some had had of the Groceries Code Adjudicator.
Previous consultations showed that additional penalties would not solve the problem of late payment—that is what was felt—but stakeholders have demonstrated strong support for increased transparency. So we are also implementing a new reporting requirement. Our intention is for the Small Business Commissioner to be the custodian of the new reporting requirement. We will bring together this package of measures to drive a real change on the ground.
The public sector, a concern of the noble Lord, Lord Mendelsohn, is an area where we have been busy trying to lead in our own backyard. The Government have restated their long-standing commitment to pay 80% of invoices in five days and are required to report quarterly against this performance target. Where public sector invoices are not paid within 30 days and are not disputed, interest becomes payable. There are new reporting requirements for public sector contracting authorities over the next two years. The Government set out in their manifesto a commitment to strengthen the prompt payment code and ensure that all major government suppliers sign up to it. Sixteen of the 33 major suppliers to government have already signed up.
It is not just legislation which imposes costs on business; the actions of regulators do so as well. That is why we are extending the business impact target to regulators and introducing new annual reporting requirements for them. I welcome the support of the noble Lord, Lord Mendelsohn, for the principle of including regulators in the target and note his scepticism about the savings made under “one in, two out” in the last Parliament. The policies of the previous Administration saved businesses £2.2 billion a year, a £10 billion cumulative net saving over the course of the last Parliament. As the noble Lord, Lord Curry, said, these figures are validated by the independent Regulatory Policy Committee, whose strength is its independence. It is probably the best innovation in public administration that I found when I returned to government, and I would like to see one in Brussels. I am grateful to my noble friend Lord Lindsay for bringing his experience in the regulatory world to our debate today. The business impact target will cover the economic impact of new regulatory activity on business, including voluntary and community bodies—which I think answers my noble friend’s question—but it cannot apply to the public sector.
I stress that this Government are committed to matching that saving: another £10 billion of savings over the course of the Parliament. To help achieve this, we have just launched our first five reviews, in the energy, waste, agriculture, care and mineral extraction sectors. I welcome the support of the noble Lord, Lord Mendelsohn, for the growth duty. I want to clarify that this will not override or cut across regulators’ existing obligations but will sit alongside and complement them.
The noble Lord and the noble Earl, Lord Lytton, expressed concerns about the inclusion of the Equality and Human Rights Commission within the scope of the target. I assure noble Lords that the intention is to require regulators to measure and to report on the economic impact on business of the regulatory changes they make. We are certainly not seeking to fetter the independence of regulators, nor will we do so. While I understand the concern to protect the EHRC’s accreditation as a national human rights institution, I do not believe that being in scope of the target puts that accreditation at risk. I look forward to a meeting with the commission in November and I hope that it will agree that this is different.
Lord Stevenson of Balmacara
This is of such importance to the EHRC, but it is exactly the same argument as we had over the small business Bill. By implying any relationship to the governing authority, the list A status is jeopardised. If that turns out to be the case, does the Minister agree that it would be appropriate to put this on the front page of the Act?
Baroness Neville-Rolfe
I thank the noble Lord for his comment. As I have said, we will discuss this matter further. We will consult on the bodies that should be included, but I have stated the reasons why I see things differently in this case.
The noble Earl, Lord Kinnoull, asked whether the FCA would be in scope, and my noble friend Lord Leigh asked about the Financial Ombudsman Service. I intend to issue a Written Ministerial Statement before Committee in this House which will list the regulators that the Government currently intend to bring within the scope of the target. The necessary secondary legislation will also be subject to the affirmative procedure. I agree with the noble Earl on his point about historic gold-plating and would be delighted to find some rich pickings from 2005, as our ambitions are high. I would welcome any examples.
My noble friend Lord Flight talked about late payment of insurance, which I am sure we will return to in Committee, but Law Commission research suggests that late payment could occur in up to 10% of cases, which is not insignificant. Where late payment occurs, its impact on businesses can be devastating.
I am pleased to say that we all agree on the important role that apprenticeships play. I am most grateful to my noble friend Lord Baker of Dorking for sharing his compelling experience and to the right reverend Prelate the Bishop of London for sharing his experiences of apprenticeships in historic buildings—I speak as a Culture Minister and a lover of cathedrals. I especially liked his notion of the dignity of the makers, which I am sure we will return to.
On uptake, we are developing a comprehensive plan for growth including more work with large employers, more support for small business and a renewed emphasis on communications. On quality, I agree that it is crucial to improve the quality of apprenticeships. That is why we are pursuing reforms to content, assessment and funding. I also completely agree that higher levels of apprenticeships are important for both young people and employers. I look forward to the debate on apprenticeships in Committee and to talking about the various educational pathways that the noble Lord, Lord Stevenson, described, in different places.
On the question of the public sector target, we want the public sector to act as a model employer and lead by example by employing a significant proportion of apprentices. A number of noble Lords asked about the scope of the public sector duty. We will be consulting, but our current thinking is that public bodies with a workforce in England of more than 250 employees will be subject to the duty. This would be likely to include most local authorities, of course, and other organisations that are classified as public bodies. We do not believe that it is necessary to set targets for the private sector, but we are taking steps to promote apprenticeships and put employers at the heart of designing new apprenticeship standards, and of course the new levy. I also agree about the value of the growing number of university technical colleges, and as my noble friend Lady Harding said, in partnerships between employers and universities in offering sandwich courses and in work experience. These other areas are also very important.
The noble Lord, Lord Stoneham, suggested that we do more to increase the number of apprenticeships generated in businesses through public sector procurement. I am happy to say that all bids for government contracts worth more than £10 million and lasting more than 12 months must demonstrate a clear commitment to apprenticeships. Many public bodies in central and local government already build skill considerations into their procurement on a voluntary basis. We certainly want to see more. Heathrow, as the noble Lord, Lord O’Neill, said, and Crossrail have both played important roles in promoting apprenticeships, as have many others.
The noble Lord, Lord Mendelsohn, raised concerns about trading standards enforcing the measure to protect the term “apprenticeships” from misuse. We are in active discussion with the Department for Communities and Local Government and the Local Government Association about this issue to make sure that it works. As regards the level of business rates in the UK, a topic mentioned by the noble Earl, Lord Lytton, it is important to note that looking at one tax in isolation presents a skewed picture. We are cutting corporation tax further to 19% in 2017 and 18.5% in 2020, benefiting more than 1 million businesses, and the Chancellor has announced £1.4 billion-worth of support for business rates for the year 2015-16.
My noble friend Lord Cope asked whether the information shared by the VOA with local authorities would go beyond that already on the VOA website. The answer is yes. The information will include detailed information such as plans. I am seeing the VOA shortly and will explore some of the points raised in today’s debate.
I reassure the noble Lords, Lord Stoneham of Droxford and Lord O’Neill, and the noble Baroness Lady Donaghy, that the Government greatly value public sector workers and the important services that they deliver. We agree that it is essential that the public sector recruits, retains and motivates the highest-quality staff. The Government also recognise that exit payments are a valuable tool for employers, particularly when restructuring and modernising, as has been said. However, exit payments have cost around £2 billion a year in recent years and it is important these payments are fair and proportionate and provide value for money for the taxpayer. I assure the noble Lord, Lord O’Neill, that individuals will continue to receive their index-linked pension in full from their normal pension age. These reforms are not an attack on retirement benefits. They are a sensible curb on six-figure redundancy payments.
I also reassure my noble friend Lord Borwick that employers cannot get around the 28-day limit by staggering payments. The 28-day limit applies to the date that a person leaves public sector employment, no matter when they are paid.
The Industrial Development Act 1982 is over 30 years old and this Bill updates it to reflect current economic realities such as the need to be able to fund broadband infrastructure. I do not have time to go into the details that the noble Lord, Lord Stevenson, asked for, but I would like to reply to the question asked by the noble Lord, Lord Stoneham, on superfast broadband. Superfast broadband is available to over 83% of homes and businesses in the UK, up from 45% in 2010. Broadband deployment is progressing at pace, with the Government’s programme making available an additional 5,000 premises a day. We remain on track to provide 90% superfast coverage by early 2016 and we are aiming for 95% of UK premises to have access to superfast speeds by December 2017.
The noble Baroness, Lady Donaghy, raised the issue of cash retention in the construction industry. There are problems with the system, but this is a deeply embedded feature of the industry and we must act on the basis of evidence. This is why we will commission analysis on the costs and benefits of such practices to inform future action. I am sure that we will return to this subject.
On Sunday trading, the Government are currently considering the responses to the consultation and will publish our own response in due course. The consultation was signed by both the Secretary of State for Business, Innovation and Skills, and the Minister of State for Housing and Planning. The Government consulted on devolving powers to local areas—for example, to metro mayors through devolution deals, and devolving powers to local authorities more generally across England and Wales.
Finally, the noble Lord, Lord Stoneham, raised the important topic of SSI in Redcar. The Government are absolutely committed to helping the workforce and local economy. That is why we have announced a package of £80 million, which will include support for workers to retrain and help for local firms to grow and create jobs.
The Government are committed to supporting small businesses and have a much better track record than the noble Lord, Lord Mendelsohn, gives us credit for. There are 760,000 more businesses now than in 2010. Many measures exist to help small firms grow and innovate, such as the enterprise investment scheme, through which small businesses raised £1.46 billion in 2013-14. Micro-businesses and start-ups remain exempt from new regulations. The British Business Bank schemes currently support £2.4 billion of finance to more than 40,000 smaller businesses. Through the bank we aim to facilitate up to £10 billion of finance to business by 2019.
In the last 18 months alone, UK Export Finance products aimed at smaller exporters have helped to secure nearly £1.7 billion of export orders. That replies to the final point of the noble Lord, Lord Stevenson.
I thank noble Lords for their contributions today, and look forward to further debate and scrutiny when the Bill comes to Committee. The Enterprise Bill will support small firms. It will make life easier for businesses by furthering our deregulation agenda, and by investing in apprenticeships. We believe that it will help to cement the UK’s position as the best place in Europe to start and grow a business. I commend it to the House.