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Craig Williams (Cardiff North) (Con)
1. What progress he has made on his long-term economic plan.
The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
Britain is in a much stronger economic position than five years ago, with employment up and the deficit down. However, as I set out in my speech to business leaders in Cardiff, we face a dangerous cocktail of economic risks from around the world this year. That situation is reflected in the International Monetary Fund forecasts that were published one hour ago, in which world growth is revised down but the positive forecast for the UK is unchanged. That shows that the best thing that we can do is to continue to fix our public finances, back business and deliver our long-term economic plan.
Craig Williams
The Chancellor was very welcome when he visited Cardiff two weeks ago. He brought a sense of urgency to the Cardiff city deal process with the deadline of the Budget and a clear sense of direction with the compound semiconductor catapult. If we are to maximise the potential of Cardiff and the Welsh economy that our long-term economic plan presents, do we not need tangible partnership plans from the Labour Assembly Government? Is it not time that they came up with them, given that they have had 16 years to do so?
Mr Osborne
It was very good to meet my hon. Friend and business leaders in Cardiff; to back them and the brilliant work that is being done at the university there with the investment in the new semiconductor catapult; and to commit to additional capital investment. I hope that we can agree a Cardiff city deal with the Welsh Government and the authorities in Cardiff before the Budget. He poses the right question, which is if, after 16 years in power, the Labour party in Wales has not delivered a credible economic plan for Wales, is it not time for a change?
Chris Leslie (Nottingham East) (Lab/Co-op)
If the Chancellor keeps shrugging off the threat to the very existence of some of Britain’s core strategic industries, such as steel, is there not a danger that when our country really needs those resources and that extra capacity for our national security no less, they might not be there at all?
Mr Osborne
Of course the redundancies that have been announced at Tata Steel and elsewhere in the steel industry are a real matter of regret. We are providing all the support we can to the families who are affected and helping them to get into work. We are backing the steel industry by responding to its requests that we cut energy bill costs—that policy comes into effect today; that we change the rules around procurement so that companies and the Government buy British steel; and that we take action internationally against cheap imports from China. Not one of those things was done when there was a Labour Government, and during that period the number of steel jobs in this country fell by 50%. We will not take lectures from the Labour party, but we will back our steel industry.
Mr Andrew Tyrie (Chichester) (Con)
Does the Chancellor think that the stamp duty surcharge that was announced in the autumn statement for the buy-to-let market will inhibit or advance labour mobility?
Mr Osborne
I think that it will help to promote home ownership, because it will mean that there is a more level playing field between an owner-occupier who wants to buy a house, a first-time buying family and a buy-to-let landlord. There is nothing wrong with people investing in property, but there should be a level playing field so that we reverse the decline in home ownership in our country.
Rachel Reeves (Leeds West) (Lab)
A long-term economic plan means supporting small businesses across the country. On 26 December, 250 businesses in my constituency that employ 2,500 people were inundated by floodwater. Will the Chancellor take this opportunity to commit to a full flood defence scheme in Leeds so that this sort of disaster cannot happen to businesses in my constituency again?
Mr Osborne
I certainly commit to looking personally at what can be done to improve flood defences in Leeds. The Environment Agency and the Government are conducting a review after what was the highest level of rainfall in Yorkshire in modern history. Of course, having committed the additional £2 billion to flood investments, we are able to afford these things. We would not be able to afford any of this sort of thing if we had wrecked the economy like the last Government did.
Christopher Pincher (Tamworth) (Con)
17. Does my right hon. Friend agree that as part of his long-term economic plan, the Help to Buy ISA will help people in my constituency, where housing is priced at a premium, to own their own homes—a dream that the Labour party wishes to quash?
Mr Osborne
My hon. Friend is right, and the Help to Buy ISA has been a spectacular success. In the few weeks since its launch, 170,000 families have taken it up, and it is helping people to get on the property ladder and save for that deposit. We are doing everything that we can to support the aspirations of the families of Britain.
Stewart Hosie (Dundee East) (SNP)
The Government’s plan requires the doubling of exports by 2020 to £1 trillion —a promise repeated in “Fixing the Foundations”, which was published in this Parliament. Does the Chancellor still hold to the intention and promise to see UK exports rise by £100 billion a year every year for the next five years?
Mr Osborne
We hold to that target, but frankly it will be very challenging to meet. We have been improving exports, but many of our main export markets have been weak, and we would like further economic reform on the continent of Europe. Some of the big emerging markets are struggling at the moment, but a good economic dialogue is taking place today with India, and British exports to India are increasing. Only recently has the United States economy started to grow. There are many challenges, but I do not think we should duck those challenges or ditch the target. Increasing exports is a key priority for the UK.
Stewart Hosie
I agree that we should set ambitious targets, but they must be credible. Given that the British Chambers of Commerce states that the export target will be undershot, and the Office for Budget Responsibility states that it will fail to be met by some £350 billion, is it better to set a realistic and achievable target, rather than risk losing credibility as the Chancellor did when he failed on debt, deficit and borrowing targets in the previous Parliament?
Mr Osborne
It is right to set and to try to meet a stretching target, even if that will be challenging. The hon. Gentleman talks about realistic and credible numbers. If Scotland had listened to the Scottish nationalists, it would be separating from the United Kingdom in two months’ time. The Scottish Government based their claim for independence on an oil price of $115. Scotland would now be heading for economic catastrophe if it had listened to the hon. Gentleman and Scottish National party members. Before they talk about credible and realistic economic policies anywhere else in the United Kingdom, they should get one themselves.
Julian Knight (Solihull) (Con)
Motor manufacturing is crucial to our long-term economic plan and to exporting. The Land Rover Defender will soon stop production in Solihull. Will the Chancellor praise the workers of Solihull for producing that iconic brand and driving exports for the past 60 years?
Mr Osborne
My hon. Friend is right to pay tribute to workers at the Jaguar Land Rover plant in Solihull. The iconic Defender that they have produced over all those decades has been seen around the world and used in peacetime as well as during war. It is good news for Solihull, the west midlands and the whole country that Jaguar Land Rover will continue to produce brand-new models of great cars. It is one of the real success stories of the British economy. In general, while Conservatives have been in the Treasury and in Downing Street, car production in this country is up by 50%.
John McDonnell (Hayes and Harlington) (Lab)
Only eight weeks ago the Chancellor promised
“an economic recovery for all, felt in all parts of our nation”—[Official Report, 25 November 2015; Vol. 602, c. 1358.]
On the day that the International Monetary Fund warned about the global economy and called on Government to increase their investment spending—something that Labour Members have consistently called for—will he now reconsider his economic plan, and particularly his investment plans?
Mr Osborne
The economic plan has seen employment rise and unemployment fall, and it has meant that for the IMF forecasts that the hon. Gentleman mentions, the UK’s forecast has not been changed and remains one of the strongest among all advanced economies in the world. Perhaps I may gently suggest that the hon. Gentleman might want to change his own economic policy, since in the last week he has called for the return of flying pickets, and said that he wants to ban companies from paying dividends and spend billions of pounds on nuclear submarines without any nuclear missiles. Today he said that he is going to tour the country with the former Greek Finance Minister, Mr Varoufakis, to educate us all about economics—the one thing they have in common is that they have both lost their marbles.
John McDonnell
If the Chancellor will not reconsider his investment plans, can he at least appreciate how angry the families of steelworkers in south Wales are this morning? They know that when the bankers’ bonuses were threatened, he immediately shot across to Brussels with an army of lawyers to defend them and that he will jump into a helicopter for a Tory fundraiser. It has taken him four months to lift a finger to save steelworkers’ jobs. Does that not prove that he is actually the bankers’ Chancellor?
Mr Osborne
We want a successful financial services industry, because hundreds of thousands of people across the country work in it. We also want a successful manufacturing and steel industry, which is why we have taken action to reduce energy costs—something that had not happened previously and which comes into effect today—and why we are taking action to change procurement rules so that the British Government and others are encouraged to buy British steel. Again, that never happened when the Labour party was in office. We are acting internationally to deal with the dumping of Chinese steel. That is what we are doing. Of course it is an incredibly difficult situation, but as the hon. Gentleman knows, and everyone in this House knows, steel jobs are being lost in every single country in the world at the moment. The question is: what can we do nationally to defend and protect our steel industry? We are doing everything we can. If the hon. Gentleman has constructive suggestions, he should put them to me.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
2. What discussions he has had with the Financial Conduct Authority on its decision to end its review of banking culture.
Jo Stevens (Cardiff Central) (Lab)
13. What discussions he has had with the Financial Conduct Authority on its decision to end its review of banking culture.
The Economic Secretary to the Treasury (Harriett Baldwin)
The Financial Conduct Authority is an independent regulator. No Treasury Minister or official had any discussions with the FCA before it took the decision to discontinue the review.
Dr Huq
Given that the popular image of bankers right now is probably on a par with used car salesmen or MPs even, does the Minister not agree with the hon. Member for Wyre Forest (Mark Garnier) that to abort the review now, which could have looked at regulating challenger banks as well as historical mis-selling, is a missed opportunity?
Harriett Baldwin
I find it hard to take lectures from the Labour party on regulating the financial sector. In fact, since my right hon. Friend became Chancellor, we have set up the Financial Conduct Authority and moved on from the failed regulatory system under the Labour Government. We made it a criminal offence to manipulate the UK’s key benchmark, we brought in the toughest rules on bankers’ pay of any financial centre, and we are bringing in a new criminal offence so that senior managers whose reckless decisions bring down banks can face up to seven years in jail.
Jo Stevens
With the terrible impact of bad banking practices highlighted in the Tomlinson report, particularly in commercial lending to small businesses, still unresolved for one of my constituents, does the Minister agree that both the public and small businesses still have significant concerns about the behaviour of many individuals within the banking sector?
Harriett Baldwin
I completely agree with the hon. Lady that we need to see the highest levels of conduct from the banking sector. We also need to continue to take steps in terms of our long-term economic plan to secure access to funding for small businesses. That is why we have taken steps to back peer-to-peer lending and extended funding for lending for another two years. We continue to benefit from record low interest rates thanks to our prudent economic management.
Mark Garnier (Wyre Forest) (Con)
There has been speculation that the Treasury has influenced the decision by the Financial Conduct Authority. While I think that such speculation is certainly fanciful, it is important to remind the House that the FCA was set up in 2012 as an independent organisation. Does my hon. Friend agree that one way we could underpin the independence of the FCA would be to adopt a similar process to the one we have with the Office for Budget Responsibility, whereby the Treasury Committee can have power of veto over the appointment of the chief executive?
Harriett Baldwin
My hon. Friend, who is a very constructive and engaged member of the Treasury Committee, will have the opportunity to ask questions of the acting chief executive and the chair of the FCA on Wednesday. I agree that it is very useful for such a Committee to have pre-appointment hearings with any executive of the FCA.
Andrew Bridgen (North West Leicestershire) (Con)
The Symphony interbank communications software, which allows for the permanent deletion of emails, advertises itself as being able to save banks billions of pounds in fines. Will the Minister join my campaign, in conjunction with the Business Secretary, to ensure that the FCA retains the encryption codes for the Symphony software system for seven years, as happens in America?
Harriett Baldwin
My hon. Friend asks a salient question. The FCA is investigating this matter, and he will be aware that new rules—the markets in financial instruments directive II—will require firms to keep information for a considerable period, but this is the subject of ongoing discussions.
Tom Brake (Carshalton and Wallington) (LD)
23. Will the Minister agree that one of the biggest problems with the banking culture is that banks are too big to fail, and will she consider the issue of diversity in the sector, including, for instance, new lending platforms and market disruptors? In particular, will she consider new primary duties on the FCA to consider the issue of diversity?
Harriett Baldwin
I am sure the right hon. Gentleman will welcome the announcement we are expecting on Wednesday from the Bank of England, the FCA and the Prudential Regulation Authority about their working together to back innovation in the financial sector. A key part of our long-term economic plan is to back competition in the banking sector, which is why I am pleased there were eight new entrants to the banking sector in the last Parliament. In this Parliament, we are aiming for 15.
Richard Burgon (Leeds East) (Lab)
Mr Speaker,
“interventions by HM Treasury and other bodies have raised questions…regarding the board’s independence”—
not my words but those of an FCA-commissioned external report on the FCA board published last week. How will the Chancellor demonstrate that the appointment of the new chief executive will not be yet another example of an overreaching Chancellor trying to get his own way?
Harriett Baldwin
It was good of the hon. Gentleman to turn up for Treasury questions this time—I guess there was not a Stop the War march or a picket line to join today. I can assure him that the Treasury has the power to appoint both the board and the chief executive and to set its remit, but from then on it has operational independence.
James Heappey (Wells) (Con)
3. What comparative assessment he has made of the trends in the levels of wage growth and inflation.
The Exchequer Secretary to the Treasury (Damian Hinds)
The latest figures from the Office for National Statistics show that real average weekly earnings were up 2.4%, year on year, in the three months to October; wage growth has outstripped inflation for 13 consecutive months—the longest period of real wage growth since before the recession; and the Office for Budget Responsibility forecasts wages to grow faster than inflation over each of the next five years.
James Heappey
I welcome the Minister’s reply. Does he agree that the key to delivering further wage growth, particularly in rural areas such as Somerset, is improving productivity, infrastructure and the skills base, all of which underpin the Chancellor’s long-term economic plan for the south-west?
Damian Hinds
My hon. Friend is quite right. Last year, the hourly pay of the average Somerset employee grew well in excess of CPI inflation, and of course the south-west has a particularly strong employment rate. To keep on driving real wage growth, however, we must have productivity gains, hence the focus on the “Fixing the Foundations” strategy for skills and infrastructure and on making sure we have an attractive tax regime that encourages investment and brings jobs to that region and the country as a whole.
Geraint Davies (Swansea West) (Lab/Co-op)
Some 400,000 fewer people earn more than £20,000 than did in 2010, because the Chancellor has been cutting full-time jobs and replacing them with more part-time, low-paid jobs. What is he doing to lift productivity and research and development to raise average and median wages?
Damian Hinds
The lowest earners experienced the fastest growth in median earnings last year, and recent growth in employment has been dominated by full-time workers, contary to what the hon. Gentleman says. We have a comprehensive plan for driving productivity in the “Fixing the Foundations” strategy, and the national living wage is a dramatic, long-term structural change.
John Stevenson (Carlisle) (Con)
4. What progress he has made on the establishment of the northern powerhouse.
The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
Our long-term plan is to turn around the decades-old economic divide between the north and south by building a northern powerhouse. We said we would create powerful new elected Mayors, and that is happening; we said we would speed up transport connections across the north, and we have committed £13 billion of investment; and for my hon. Friend’s Cumbria, there is a new enterprise zone, new air routes and nuclear research. The north is growing under this Government, and, with our plan, we will do everything we can to keep it growing strongly.
John Stevenson
I, like many of my constituents, want Carlisle and Cumbria to be part of the northern powerhouse. This is partly about ensuring the private sector invests and grows and partly about skills and infrastructure, but then there is the proposed Cumbrian deal. Will the Chancellor assure me that everything is being done, from the Government’s perspective, to achieve this deal, and will an elected Mayor be part of it?
Mr Osborne
As my hon. Friend knows—he is a real champion not just of Carlisle, but of Cumbria and the Cumbrian economy—we are working with local authority leaders and other elected representatives on whether we can have a new governance arrangement in Cumbria, which might include an elected Mayor. This is a decision for Cumbria, of course, but it has come to us with this proposal, and we are working hard with the people of Cumbria to see whether we can get an arrangement that boosts jobs, boosts investment and makes sure that decisions that affect Cumbria are taken in Cumbria.
Mr Dennis Skinner (Bolsover) (Lab)
Does the northern powerhouse occur in Redcar where the steel industry has been closed because of the Chancellor allowing the Chinese to dump steel? Are they talking about the northern powerhouse at Scunthorpe, where they have lost more than a thousand jobs? Are they talking about it at Port Talbot, where they are going to lose a lot more jobs? The truth is that they do not talk about the northern powerhouse in the coalfields where the Tories have shut the last three pits. They call it the northern poorhouse. That is its real name.
Mr Osborne
The hon. Gentleman seems to forget that the Redcar works first closed under the Labour Government that he supported. It is also the case that during that Government, which he supported from the Government Benches, the number of steel jobs lost in this country was 30,000. We are doing everything we can to preserve the steel jobs that remain. We are working with the steel industry. We have acceded to almost all its requests, and we are looking at the last remaining one, which is changes to business rates—again, something that never happened under a Labour Government. We will report on that at the Budget. We are working to make this the competitive place to do business, and if we adopted the policies of the Opposition, where dividends are not paid to investors and flying pickets are reintroduced, do they really think that a single overseas investor, such as Tata Steel, would be expanding their business in the United Kingdom?
Emma Reynolds (Wolverhampton North East) (Lab)
5. What assessment his Department has made of the potential effect of leaving the EU on UK GDP.
The Financial Secretary to the Treasury (Mr David Gauke)
The Government are fighting hard to fix aspects of our EU membership that cause so much frustration in the United Kingdom, so that we get a better deal for our country and secure our future. We are confident that the right agreement can be reached.
Emma Reynolds
Jaguar Land Rover recently announced that it will double investment in the brand-new engine plant on the outskirts of my constituency, creating hundreds and hundreds of additional jobs on top of the 1,400 already announced. Does the Minister agree that unfettered access to the single market drives this sort of investment and that if we were to walk away or sacrifice that access, those jobs and that investment could well be put at risk?
Mr Gauke
I too welcome the new jobs being created in and near the hon. Lady’s constituency by Jaguar Land Rover. Indeed, my right hon. Friend the Chancellor visited that site recently. On our relationship with the European Union, the Government’s position is very clear: we want the benefits of access to the single market, but there are aspects of our relationship with the EU that can be improved. That is what we are seeking to do in our renegotiation.
Philip Davies (Shipley) (Con)
Given that we had a £62 billion trade deficit with the European Union last year, and given that if we left the EU the UK would be the EU’s single biggest export market, does the Minister think we could have a free trade agreement with the EU from outside it, without handing over £19 billion a year in membership fees?
Kelvin Hopkins (Luton North) (Lab)
Britain has been a significant and, in recent years, a substantial net contributor to the EU budget. For over 40 years, this has had a negative impact on UK economic growth and GDP, the cumulative effect of which has been very large. Would leaving the EU not take that particular brake off UK GDP growth?
Alison Thewliss (Glasgow Central) (SNP)
6. How many staff in his Department earn less than £7.85 per hour.
Alison Thewliss
I thank the Minister for that answer, but does she not agree that it is important to pay the real living wage, which is £9.40 an hour in London and £8.25 in the rest of the United Kingdom? It is paid by the Scottish Government and by more than 400 employers in Scotland, so it is fair to all employees, particularly those under 25.
Harriett Baldwin
I am glad the hon. Lady welcomes the fact that, from April this year, all employees in the United Kingdom who are over 25 will receive a significant pay rise. That is thanks to the strength of employment throughout the United Kingdom, which in turn is thanks to our long-term economic plan.
Rishi Sunak (Richmond (Yorks)) (Con)
According to my calculations, someone who earns £7.85 an hour today will benefit from rises in the personal tax allowance and the national living wage, and, by the end of this Parliament, will be more than £1,500 better off. Does my hon. Friend agree that that proves that this Government are committed to making work pay?
Harriett Baldwin
My hon. Friend makes an excellent point. In fact, it has been stated that not only will 2.5 million people benefit directly from the change in the national living wage in April, but up to 6 million whose salaries are very close to that hourly rate will benefit as well.
Mr Jim Cunningham (Coventry South) (Lab)
When will the Chancellor, and in particular the Minister, give public sector workers a decent pay rise that reflects some of the jobs that they do for us?
Harriett Baldwin
We believe that every worker in the country will benefit from the change in the national living wage, which is an important part of the long-term economic plan, but, as the hon. Gentleman will know, this year public sector workers received pay rises that were above inflation.
Mr Ranil Jayawardena (North East Hampshire) (Con)
The Minister has made important comments about the principle of making work pay. Will she give further consideration to extending the married couples’ tax allowance, so that more families can keep more of what they earn?
Mr Alan Mak (Havant) (Con)
7. What fiscal steps he is taking to support businesses.
Andrew Rosindell (Romford) (Con)
11. What fiscal steps he is taking to support small business owners.
The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
The Government are backing businesses by cutting their taxes. We have given Britain the lowest corporate tax rate in the G20, and we are cutting it further. To support small businesses, the employment allowance will rise by 50% in April, and we are doubling small business rate relief. This Government understand that we create jobs and raise money for public services by backing companies, not by punishing them with the kind of anti-business, anti-enterprise nonsense that we hear from the Labour party.
Mr Mak
Manufacturers in my constituency, such as Innova Design, are growing, thanks to the rise in investment allowance tax relief which takes effect this month. Will the Chancellor join me in congratulating Innova Design on its growth and success, and will he also continue to support the British manufacturing sector, an industry that was neglected by Labour for 13 years?
Mr Osborne
Absolutely. I join my hon. Friend in congratulating Innova Design on the work that it is doing. We are investing in transport infrastructure on the south coast, and we are also backing companies—not just there, but around the country—with a permanent annual allowance of £200,000, which is the highest that it has ever been.
Andrew Rosindell
What steps does the Chancellor intend to take to ensure that the quarterly tax returns that are made in 2020 will not harm small businesses in constituencies such as mine by affecting their productivity and their ability to make profits?
Mr Osborne
My hon. Friend is right. Our objective is to make it easier for businesses, and indeed individuals, to complete their tax returns by making use of modern digital technology, and we are introducing a simple and secure personalised digital tax account. We estimate that that will reduce the administrative cost to businesses by £400 million.
Ian Austin (Dudley North) (Lab)
The best way to support manufacturing businesses in the midlands would be to free the region from London’s control, because it has been stifled by Whitehall for far too long. If the Chancellor gives us the powers and the funds that we need to strengthen the economy, develop brownfield sites and tackle congestion, we will deliver more jobs, better skills, quicker transport and new homes.
Mr Osborne
We have a deal, because that is exactly what we are doing with the west midlands. We have worked with different political parties: I have met both Labour and Conservative authority leaders and Members of Parliament in the region, and we have collectively agreed to have an elected Mayor and to hand significant powers from this place and the Government to the people of the west midlands. I think that that is one of the most exciting steps that have been taken in the devolution of power in this country.
Ms Margaret Ritchie (South Down) (SDLP)
What further discussions have taken place with the devolved Administrations about the introduction of fiscal incentives to pump-prime apprenticeships and economic growth?
Mr Osborne
We are in discussions with the Northern Ireland Executive about what we can do to support the economy, and it is great news that we are now moving forward with the additional resources for capital investment there. Of course, one of the things that we would really like to see is the devolution of corporation tax rates, for which we have legislated, and provided that we can reach agreement on the budget implications of that measure, it would provide a massive boost for Northern Irish businesses.
Mims Davies (Eastleigh) (Con)
21. I welcome the Chancellor’s reduction in corporation tax, which has helped to create many jobs. Does he agree that some businesses cannot grow, despite that measure, because of local infrastructure constraints such as the one that needs addressing in my constituency at the Chickenhall Lane link road?
Mr Osborne
My hon. Friend is absolutely right. We are investing in transport infrastructure in the Southampton area and along the south coast, as I was just saying to my hon. Friend the Member for Havant (Mr Mak). We understand that all parts of the country can benefit from additional investment in transport infrastructure, and that is why we are increasing the transport budget even at a time when public budgets are tight. None of these things would be affordable if we crashed the economy.
Bill Esterson (Sefton Central) (Lab)
The introduction of quarterly reporting and tax returns has been described by the Institute of Chartered Accountants as an additional burden for business. Does the Chancellor understand the very real anger among businesses in my constituency and around the country that they are being penalised while many of the largest corporations are allowed to avoid tax altogether?
Mr Osborne
We have increased our action against large-scale corporate tax avoidance and evasion, and the new diverted profits tax is designed to deal with the very real anger that people feel, particularly in the small business community, when they see large businesses not paying tax. We are also dealing with the burdens of tax administration, and we are consulting small businesses. I would just make the point that we would be crazy as a country not to make use of new digital technology and the internet to update and modernise our tax collection system, and we would regret not taking those steps today and letting other countries power ahead in reducing the burdens on business.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
8. What fiscal steps he is taking to reduce the trade deficit in order to reduce the reliance of the economy on domestic spending.
The Chief Secretary to the Treasury (Greg Hands)
The Government have taken a range of steps to reduce the trade deficit. Since 2010, UK Trade & Investment has more than doubled the number of businesses supported, and UK Export Finance has provided more than £15 billion of support. Earlier this month, I saw some of the results of that support when I met entrepreneurs at ESpark’s new hatchery in Edinburgh. Many start-ups and exporters in Scotland greatly appreciate UKTI’s assistance. I welcome the Government’s announcement this morning of an improved UKTI approach to exporters across the whole of the UK.
Dr Cameron
It is incredible for the Minister to continue with a policy that has failed and that resulted last year in a horrendous £123 billion deficit in the trade of goods. We all want to see reduced dependence on consumer debt, but is it not time for him to admit that the UK Government’s policy has failed? I gently suggest revision.
Greg Hands
The trade deficit is actually improving as a share of GDP, and it is projected to continue to do so in the Office for Budget Responsibility’s forecast. What would be an absolute disaster is the Scottish National party’s policy of full fiscal independence, which would cost Scotland £10 billion a year, added to which the collapse in the oil price would, according to the OBR, result in revenues this year being down by a staggering 94%. That would be a disaster for Scotland.
David Rutley (Macclesfield) (Con)
I welcome the Chancellor’s earlier comments about export initiatives to India. Will my right hon. Friend join me in welcoming the excellent work that is being done by businesses in the north-west and the northern powerhouse to boost exports?
Greg Hands
I join my hon. Friend in very much welcoming that, particularly with reference to exports to China and India, which have been a great success. UKTI is doing what it can to support that, with a doubling of funds in China over the spending review period and providing tailored support for first-time exporters, with an additional £20 million in 2015-16. It is supporting northern powerhouse trade missions on that specific basis, on the terms mentioned by my hon. Friend.
Peter Grant (Glenrothes) (SNP)
22. The British Chambers of Commerce is forecasting that the much heralded doubling of UK exports will take not another four years, as the Chancellor had promised, but another 18 years—it will happen in 2034. Does the Chancellor accept that this is clear evidence that his efforts to reduce the UK trade deficit are failing and will continue to fail?
Greg Hands
As I mentioned earlier, the UK has a good future in terms of the trade deficit and improving statistics. UKTI will also be playing an important role here. On the announcements we made today on trade policy, one of the most important things we can do is adopt a whole-of-government approach to improving the approach we take to trade and boosting our exports.
Craig Mackinlay (South Thanet) (Con)
My constituency contains a niche amusement machine manufacturer, Harry Levy Amusement Contractor Ltd, which supplies global export markets. What help and support can my right hon. Friend offer to exporters so that we can really achieve the new, cross-government approach to exports launched today by the Business Secretary and the Trade Minister Lord Maude?
Greg Hands
I have been to my hon. Friend’s constituency quite a few times over the past year and a half, but I do not think I have had the particular pleasure of meeting the company he mentions. I am very happy to meet him and that company, or perhaps to meet Lord Maude, if that is more appropriate, to see what could be done to help exporters in South Thanet.
Sammy Wilson (East Antrim) (DUP)
The concrete products industry used to have a surplus on the balance of payments but it now has a deficit of hundreds of millions of pounds. That is due to the imposition of the aggregates levy on products made in the UK but not on imported products, which has put thousands of jobs in jeopardy. Will the Minister consider imposing the same tax on goods produced abroad as is imposed on goods produced here in the UK?
Greg Hands
I am happy to look in detail at the points the hon. Gentleman raises. My understanding is that there have been legal challenges to aspects of the aggregates levy and that has prevented us from addressing some of these issues, but I am happy to engage with him on an ongoing basis to see what could be done better.
Catherine West (Hornsey and Wood Green) (Lab)
9. What fiscal steps the Government are taking to support manufacturing exports.
The Exchequer Secretary to the Treasury (Damian Hinds)
Since 2010, we have cut corporation tax from 28% to 20%, which is the joint lowest rate in the G20—we will cut it further to 18% by 2020; we have set the annual investment allowance at its highest ever permanent level, at £200,000; and we have made research and development credits more generous and above the line, available in the early loss-making phase for the first time. In addition, UKTI has announced today enhanced support for exporters.
Catherine West
Is the Minister concerned about recent figures showing that the manufacturing sector is back in recession? What does he intend to do about that?
Damian Hinds
We have to get behind the manufacturing sector. That is at the heart of this Government’s approach, of the long-term economic plan and of the productivity plan, through giving enhanced access to leading technologies in the catapult centres; the apprenticeships levy; making sure that we build up our skills base by attracting more teachers into the STEM subjects—science, technology, engineering and maths; and a range of other initiatives.
Amanda Solloway (Derby North) (Con)
With Derby being named as one of the No. 1 places to start a small business, may I ask the Minister what steps are being taken to assist and encourage small businesses to become expanding, exporting businesses?
Damian Hinds
UKTI has an ambition to increase the number of exporting businesses by 100,000. There are a number of aspects to that: moving to more direct support as well as advice; learning from some of the leading export promotion agencies in the world; and, as my right hon. Friend the Chief Secretary was saying just now, making sure that we leverage existing Government relationships with firms and sectors through a whole-of-government approach to supporting exports.
Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op)
19. The slump in manufacturing exports at the end of last year has to be proof that the UK economy is still too dependent on consumer spending to drive growth, and the Government must stop being so complacent and so self-congratulatory in sessions such as this. With the risk of Brexit this year only making things worse, what are they going to do to expand manufacturing exports?
Damian Hinds
Exports are a challenge; there has been a long-term change in the UK’s share of world trade, the majority of it coming before 2010. On the hon. Gentleman’s point about investment expenditure and consumption expenditure, business investment has grown by two and a half times that of consumption since 2010.
Michelle Donelan (Chippenham) (Con)
Does the Minister agree that supporting engineering and manufacturing is absolutely essential to our economy and productivity, and that we must do all we can to address the skills gap that is threatening local jobs and businesses in my constituency and around the country?
Damian Hinds
I absolutely agree with my hon. Friend about the importance of engineering. The evidence of that was shown in the spending review and the autumn statement, with enhanced support for science as well as the apprenticeship levy, which is an important structural change in the way we invest in our skills base.
Seema Malhotra (Feltham and Heston) (Lab/Co-op)
Five years ago, the Chancellor said that he would rebalance the economy towards manufacturing, exports and the regions. The director-general of the British Chambers of Commerce recently said:
“None of those things have actually transpired in practice yet.”
Will the Minister tell me why not?
Damian Hinds
We are rebalancing the economy, but it is a long-term and sustained programme—indeed, it is our long-term economic plan. We have talked already today about some of the enhanced support for science, technology, engineering and mathematics and the skills base, the apprenticeship levy, and the catapult centres, which give British business access to the best in leading- edge technologies. Of course there are some things in international trade that we cannot control; for example, there was bad news again today from China. Nor can we control the world exchange rates. However, we are absolutely doing the things that we can when it comes to supporting British exporters.
Seema Malhotra
There we go again—it is everybody’s fault but this Government’s. Here is the truth: the Chancellor promised to boost manufacturing, but instead it is in recession. Manufacturing output is now 6.1% below its pre-crisis peak and falling. The British Chamber of Commerce’s survey of firms found manufacturing close to stagnation, with export sales and orders falling. Instead of helping the sector, the Chancellor closed the Manufacturing Advisory Service in November without so much as a mention. Is it not true that British businesses and families are now paying a heavy price for this Chancellor’s failures?
Damian Hinds
That is not true. The enhancement of manufacturing is absolutely at the heart of this Government’s approach, but we should not forget that services are also a very large part—in fact a bigger part—of the economy. The overall performance of the British economy is such that we had the highest growth rate in the G7 countries in 2014 and the joint highest in 2015. We have rising real wages and more people in jobs than ever before.
Lucy Allan (Telford) (Con)
10. What assessment he has made of recent trends in the level of employment.
The Exchequer Secretary to the Treasury (Damian Hinds)
Employment stands at 31.3 million, which means, as I have just said, that more people are in work than ever before. In the past year, growth has been driven by full-time employees in high and medium-skilled jobs, showing that we are now moving to the next phase of our recovery, with high-quality employment, and a boost in productivity and living standards nationwide.
Lucy Allan
I thank the Minister for his reply. In my constituency, youth unemployment has halved in the past year and it is now lower than for the whole of the west midlands and the country. Does he agree that this excellent news for Telford shows that the economic plan is working?
Damian Hinds
I am delighted with that news from my hon. Friend’s constituency, and I do indeed agree with her. Across the west midlands, youth unemployment has fallen by almost a quarter on the year, with the rate now returning to pre-recession levels. The west midlands saw the fastest growth in full-time average earnings among all the English regions, and there are some 140,000 more people in work since 2010.
Tristram Hunt (Stoke-on-Trent Central) (Lab)
One of the leading employers in Stoke-on-Trent is the ceramic industry, and part of the growth in recent years has been due to the anti-dumping ruling by the EU on subsidised Chinese imports. Shamefully, the British Government opposed that. Will the Minister now commit the Government to supporting the renewal of that anti-dumping ruling when it comes up?
Damian Hinds
The Government do of course raise all issues to do with dumping and unfair trade practices as and when they come up. I will be happy to look in further detail at what the hon. Gentleman says about ceramics in Stoke-on-Trent.
Sir David Amess (Southend West) (Con)
12. What recent representations he has received on proposed changes to Her Majesty’s Revenue and Customs’ regional centres.
The Financial Secretary to the Treasury (Mr David Gauke)
HMRC announced its future location strategy on 12 November. As I have previously stated, delivering that strategy will help HMRC to deliver more for less and reduce its estate costs by £100 million per year by 2025. Both HMRC and I have received a number of representations from interested parties, most recently from my hon. Friends the Members for Rochford and Southend East (James Duddridge) and for Southend West (Sir David Amess).
Sir David Amess
Following my hon. Friend’s meeting with me and my hon. Friend the Member for Rochford and Southend East (James Duddridge), will he reflect further on the points made about Southend becoming a regional centre? Whatever changes are made in the future, will he ensure that the hard-working, dedicated and loyal staff of Alexander House are treated well?
Mr Gauke
Of course, my hon. Friend made his representations in a robust and forthright way in our meeting yesterday. I am sure that HMRC will be reflecting on that. Assuming that staff are relocated from Southend to Stratford, they will be compensated for their additional transport costs for up to three years and will benefit from London weighting, given that they will have moved to Stratford.
John Pugh (Southport) (LD)
How exactly is any of this reorganisation going to do anything about the depressing call handling statistics of HMRC? Will the Minister guarantee an improvement?
Mr Gauke
At the moment, call handling is at a higher level than it has been for many years. It was certainly the case that in spring of last year call handling standards were not at an acceptable level, but HMRC has made significant improvements and I hope it will continue to make progress.
Nick Smith (Blaenau Gwent) (Lab)
14. What his plans are for future funding of illegal money lending teams.
The Economic Secretary to the Treasury (Harriett Baldwin)
The Government are exploring options to ensure that the England and Wales illegal money lending teams have the funding they need to ensure that consumers continue to be protected from illegal loan sharks, and are confident of transitional arrangements being agreed.
Nick Smith
Too many of my constituents are victims of loan sharks. The illegal money lending team has helped nearly 24,000 victims across the country, yet the Government have treated the service with disdain. Will the cuts to this vital team and to local employment standards not make the poorest more vulnerable?
Harriett Baldwin
Far from agreeing with the hon. Gentleman, I must say that the Government are finding ways to put the team on a sustainable basis to continue the valuable work it does to protect people from illegal money lending.
Gareth Johnson (Dartford) (Con)
T1. If he will make a statement on his departmental responsibilities.
The First Secretary of State and Chancellor of the Exchequer (Mr George Osborne)
The core purpose of the Treasury is to ensure the stability and prosperity of the economy.
Gareth Johnson
High exit fees act as a disincentive for people to take advantage of flexible pensions, so does the Chancellor agree that tackling these high fees is essential to give people freedom over their own pensions?
Mr Osborne
My hon. Friend raises an important issue. The pension freedoms we have introduced have been widely welcomed, but we know that 700,000 people who are eligible face some form of early exit charge. The Government are not prepared to stand by and see people being either ripped off or blocked from accessing their own money by excessive charges. We have listened to the concerns and the newspaper campaigns that have been run. Today, we are announcing that we will change the law to place a duty on the Financial Conduct Authority to cap excessive early exit charges for pension savers. We are determined that people who have done the right thing and saved responsibly should be able to access their pensions fairly.
Rebecca Long Bailey (Salford and Eccles) (Lab)
Recent statistics show that household debt is now at a record high, but back in 2010 the Chancellor promised to move from an economy built on debt to one that saves. Will he tell us today why the figures contradict his original promise?
Mr Osborne
Household debt as a proportion of household income was 168% in 2008 and today it is 142%, so it has fallen.
Johnny Mercer (Plymouth, Moor View) (Con)
T3. This Chancellor has given more than any before him to the cause of looking after our armed forces veterans in this country, and for that I thank him wholeheartedly. Does he agree that although the charity sector has a key role to play, ultimately veterans’ care is a state responsibility and we must ensure that the money coming from Government is used for evidence-based, empirically measured professional treatments for our veterans and their families?
Mr Osborne
My hon. Friend obviously has huge experience in this area, personally and because he represents a constituency that has given much to the defence of our nation. He is right: as well as the LIBOR fines, which we use for specific one-off causes to help military charities, we have the armed forces covenant and the annual commitment to support our veterans. I am always happy to look at either specific projects in which we can invest or ongoing concerns we can deal with.
Deidre Brock (Edinburgh North and Leith) (SNP)
T2. The collapse of UK manufacturing has in fact been going on for some 50 years—it has gone from 30% of the economy in the 1970s to less than 10% today, and from more than 20% of all jobs in the 1980s to only 8% today. Given the scale and length of this decline, why have the Government not made manufacturing and exports one of their top priorities?
Mr Osborne
We have backed our manufacturers and exporters. We have cut corporation tax and other taxes that affect those businesses, and we have reformed UK Trade & Investment. As a result, the manufacturing sector accounts for a larger share of our economy than when I became Chancellor, but there is still a huge amount more to do. One thing I would say to the hon. Lady and the Scottish Government is that we want to work more closely with the Scottish Government on overseas trade missions, where we can promote Scottish businesses. We do not always get that co-operation, but we hope it will be forthcoming in the future.
Kelly Tolhurst (Rochester and Strood) (Con)
T4. Although I welcome the Government’s move towards digitisation of tax, a number of self-employed people and small businesses across my constituency, approximately 74% of which employ fewer than four people, have voiced concern about how quarterly tax reporting might have a negative effect on their human and financial resources, depending on their reliance on an accountant. What support will be provided to our small businesses to help them to adapt to the proposed changes?
The Financial Secretary to the Treasury (Mr David Gauke)
First, may I reassure the House that there are no plans for quarterly tax returns, as has been reported? What HMRC is considering is making greater use of digital technology and ensuring that information is provided to HMRC more frequently. My hon. Friend raises an important point about ensuring that businesses are supported as they adapt to new ways of record keeping, and HMRC is determined to do that.
Amanda Milling (Cannock Chase) (Con)
T9. The midlands engine has been turbo-charged, with recent figures showing four Staffordshire constituencies in the top seven ranked by the extent of the fall in the claimant count between May 2010 and November 2015, with Cannock Chase ranked fourth. What measures is my right hon. Friend taking to make sure that we maintain the positive momentum?
Mr Osborne
There has been good news in Cannock and across the midlands. Employment is up by 6% in my hon. Friend’s constituency. Since entering Parliament, she has been a great champion of the businesses in her area. We are working together to give more power to people in the west midlands to take control of the decisions that affect them, and I welcome her support for that; and we are investing in major transport infrastructure and backing science in the west midlands as well. We are introducing a whole set of measures, but if my hon. Friend has specific ideas to help businesses in Cannock, my door is open.
Steven Paterson (Stirling) (SNP)
T5. How on earth will a £42 million cut over the next four years to the UK Trade & Investment budget enable it to become “a world class export and investment promotion agency”?
Mr Osborne
We set out today the strategy to give more direct help to our exporters across the United Kingdom, and Lord Maude presented to the Cabinet the proposals to do that. On getting lectures on public finances from Scottish nationalists, I have to say that we would be heading towards the break-up of our country in two months’ time if the people of Scotland had listened to the arguments of the Scottish nationalists, whose calculations were based on an oil price of $115, which at the time the right hon. Member for Gordon (Alex Salmond) described as “quite a conservative estimate”. The oil price is now less than $30. It would have been an absolute catastrophe for the people of Scotland if they had listened to the figures and economic advice given by the Scottish National party.
Nigel Huddleston (Mid Worcestershire) (Con)
What efforts are the Government making to widen access to basic bank accounts?
The Economic Secretary to the Treasury (Harriett Baldwin)
I am delighted to tell my constituency neighbour that at the end of last year we announced that all the major banks are now able to offer a basic bank account to customers who require one.
Margaret Greenwood (Wirral West) (Lab)
T6. Many of my constituents who watch “Coronation Street” will be following the story of Tyrone Dobbs’ struggle with debt with keen interest. Unsecured lending reached a record high last year, with more than 3 million people in problem debt. The Government promised a review of what breathing space creditors should give to people who are engaged with a debt charity or agency, so that their debts do not continue to spiral out of control while they are working to resolve them. The review was due by the end of 2015. When do the Government now plan to announce it?
Harriett Baldwin
In answer to earlier questions I referred to the importance that we place on the team that will tackle illegal money lending. We have continued to support funding for debt advice, including through excellent organisations such as Christians Against Poverty, StepChange and Citizens Advice, to help individuals such as those mentioned by the hon. Lady.
James Berry (Kingston and Surbiton) (Con)
On Friday I visited Barclays bank in Kingston to hear about the fantastic Barclays life skills course, which teaches young people financial literacy, among other things. I can see some candidates for the course here today. Does the Minister agree that by making financial education more accessible, we can ensure that the financial sector itself supports young people and people throughout every stage of their lives?
Harriett Baldwin
I am delighted that my hon. Friend found his visit to Barclays in his constituency to be so helpful. I know that he, too, will welcome the fact that since 2014 financial education has been part of the national curriculum.
Barbara Keeley (Worsley and Eccles South) (Lab)
T7. The Conservative leader of Essex county council has told the Prime Minister that the 2% social care precept will cover only half the council’s increased costs. He has suggested bringing better care funding forward to 2017 and asked for a fairer redistribution of funds. Even Conservative councils cannot wait till 2019 for the funding that the Chancellor has allocated, so will he act now to avoid a further crisis in social care?
The Chief Secretary to the Treasury (Greg Hands)
In advance of the spending review, the Conservative leaders of the Local Government Association came to see me. One of their specific proposals was to introduce the social care precept to help address the shortfall there may otherwise have been. We have also put a lot more money into the better care fund to make sure that local authorities and the NHS working together are able to meet the challenges of social care over the next years.
Mark Spencer (Sherwood) (Con)
One of the key tools that the Chancellor has deployed to boost the economy has been the creation of enterprise zones. Will he lend his support to the creation of an enterprise zone at Thoresby colliery in the northern part of Nottinghamshire?
Mr Osborne
I know Thoresby colliery and have been to the site with my hon. Friend. We were not able to give the go-ahead to the enterprise zone because the business case did not quite stack up, but I have committed to work with him and the local community to try to get that over the line and get an enterprise zone in place in Thoresby colliery.
Alex Cunningham (Stockton North) (Lab)
T8. I have just chaired a packed meeting of the all-party parliamentary group on carbon capture and storage with the Minister of State, Department of Energy and Climate Change. There was a lot of anger in the room over the Chancellor’s decision to axe the funding for the CCS competition projects. What funding will the Chancellor provide when DECC comes up with its new CCS strategy in the autumn?
Mr Osborne
We have set out our capital budget and our energy policy, which will see a doubling of the investment in renewable energy over the next five years.
Robert Jenrick (Newark) (Con)
Thank you, Mr Speaker. You are very kind. My superb hon. Friend and neighbour the Member for Sherwood (Mark Spencer) had already asked the question, but I will ask it again as that is not unusual in this place. My parents formed their small business in the first enterprise zone created by Margaret Thatcher in Telford in 1984. My right hon. Friend the Chancellor has carried on in that great Conservative tradition. Will he afford the same opportunities to get on in life and create jobs to my constituents and those of my hon. Friend the Member for Sherwood by backing Thoresby colliery as the next and best enterprise zone?
Mr Osborne
My hon. Friend has just demonstrated that he is a very smart thinker on his feet. He is always ready to stand up for the interests of his Newark constituents. As I said to our hon. Friend and his neighbour the Member for Sherwood (Mark Spencer), I would love to get the Thoresby colliery enterprise zone into a condition where we can give it the go-ahead, and I give him and my hon. Friend his neighbour my personal commitment that we will try to do that over the next year or two.
Mr Speaker
Of course, as colleagues know, the fact that a question has been asked does not stop others asking the same question. Repetition is not a novel phenomenon in the House of Commons.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
Will the Chancellor ponder the fact that we still have not tackled productivity? May I guide him and ask him and his Department to look at the way in which we further invest in manufacturing skills? Surely he will agree that what we want in this country are high skilled, high paid jobs, which are to be found in manufacturing.
Mr Osborne
The hon. Gentleman is right to draw attention to the fact that the UK has had a productivity challenge for many decades, and the financial crisis caused a significant impairment that had an impact as well. Productivity is improving, but the key weakness in the British economy, consistently identified by everyone who looks at it, is the weakness of our skills. I hope that the apprenticeship levy and the expansion of the apprenticeship programme will go some way towards addressing that historical weakness for Britain.
Mr Robin Walker (Worcester) (Con)
Credit unions can play a vital role in improving financial inclusion and creating a stronger savings culture. As I know from my work with the all-party credit unions group, they have support in all parts of this House. With the opportunity of the World Council of Credit Unions coming to the UK—to Northern Ireland—later this year, will the Chancellor commit to making sure that we continue to build on the work of the credit union expansion programme and back this vital group?
Harriett Baldwin
My other constituency neighbour is a fine advocate for the excellent credit unions industry. As he will know, we have backed the industry with £38 million of investment through the credit union expansion project, and we will continue to seek ways to back credit unions.
Shabana Mahmood (Birmingham, Ladywood) (Lab)
Given that manufacturing remains at 6.1% below pre-crisis levels, with worrying trends in the manufacture of plant and machinery and of pharmaceuticals, will the Chancellor accept that his domestic policy agenda has just as much impact on our performance as the global factors that he is so very keen to blame, and that if the march of the makers is now going backwards, he must bear a measure of responsibility and come forward with proposals to halt the decline?
Mr Osborne
As I said, manufacturing makes up a larger sector of the economy than when I became Chancellor, but there is a huge amount more to do to make the UK more competitive, to make our businesses more competitive, and to improve skills for our manufacturers and the like. I have to say, and I suspect the hon. Lady agrees with me, that the idea of banning manufacturers from paying dividends would not be a particularly sensible way forward. Unfortunately, that is now the policy of the Labour party.
Chris Philp (Croydon South) (Con)
Is the Chancellor aware that since he took office in May 2010, the claimant count in my constituency has fallen by 62% and the youth unemployment count has fallen by 67%? Does he agree that reducing corporation tax, increasing the personal allowance and reforming welfare has caused these fantastic figures, and will he confirm that his long-term economic plan will continue?
Mr Osborne
We will absolutely deliver the plan in these more difficult economic conditions. As I say, the IMF has not revised down the UK’s growth forecast even though it has today revised down the global economic forecast. In Croydon and south London, we will continue with important transport infrastructure, and, indeed, do everything we can to back homeowners in my hon. Friend’s constituency—a group of people he particularly champions.
Alison McGovern (Wirral South) (Lab)
May I return the City Minister to the issue of the cancelled FCA inquiry into banking culture? The Parliamentary Commission on Banking Standards chaired by the right hon. Member for Chichester (Mr Tyrie) pointed to the “Murder on the Orient Express” excuse where everyone was partly responsible but no one was really to blame. The Minister said before that Ministers had no role in the cancellation of that inquiry. Will she say, yes or no, whether any civil servants did?
Several hon. Members rose—
Mr Speaker
Points of order come after urgent questions, so I will await the hon. Lady’s inquiry with interest.
Ebola: Sierra Leone
(8 years, 11 months ago)
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Stephen Phillips (Sleaford and North Hykeham) (Con)
(Urgent Question): To ask the Secretary of State for International Development if she will make a statement on the death from Ebola virus disease of a 22-year-old student in Sierra Leone on 12 January 2016.
May I wish you a very happy birthday, Mr Speaker?
The Secretary of State for International Development (Justine Greening)
Many happy returns to you, Mr Speaker.
The House will be aware that, as my hon. and learned Friend said, a new case of Ebola has been confirmed in Sierra Leone. A 22-year-old female student from the Tonkolili district sadly died on 12 January. This latest case of Ebola in Sierra Leone demonstrates that we need to stay vigilant. Indeed, the news came just as the World Health Organisation formally declared the Ebola outbreak in west Africa over, following Liberia’s reaching 42 days without a new case, but it is not unexpected given the context of this unprecedented outbreak.
The new case was identified from a swab taken after death and is currently being investigated. The Government of Sierra Leone have activated their national Ebola response plan, and rapid work is under way to identify and quarantine people who have had contact with the young woman and to establish her movements in the final few days and weeks before her death. Teams in five districts are acting on that information. No other cases have been confirmed to date.
The speed of the process reflects the work that the UK has undertaken with the Government of Sierra Leone to develop their national response plan. As today’s International Development Committee’s report says, the UK has been at the forefront of the global response to the Ebola outbreak in west Africa and has from the very start led in Sierra Leone, working hand in hand with the Government of Sierra Leone. We took on this deadly disease at source by rapidly deploying the best of British military personnel and NHS and Public Health England staff, building treatment centres in a matter of weeks and mobilising the international response more broadly. We have worked with the Government of Sierra Leone to build up their health systems and strengthen all aspects of society, including civil society, to allow them to be prepared.
We continue to stand by Sierra Leone because, as we have always made clear, there is the potential for further cases. That is precisely why our response now is focused on assisting Sierra Leone in isolating and treating any new cases of Ebola before they spread.
Stephen Phillips
I am grateful to my right hon. Friend for that answer and, indeed, for coming to the House urgently today to answer questions on this subject. I am also grateful to her for the leadership she demonstrated during the Ebola outbreak of 2014-15, as I am to the brave military and civilian personnel who travelled to Sierra Leone to help west Africa during that period.
On 7 November 2015, the World Health Organisation declared Sierra Leone free of Ebola following a period of 42 days during which no new cases had been reported. Just last week, as my right hon. Friend has said, the WHO made a further declaration to the effect that, all reported transmissions having ended, the outbreak of Ebola in west Africa was over.
My right hon. Friend and the whole House will therefore have been dismayed at yesterday’s reports of the death from Ebola of a young woman in the northern Tonkolili district last week, particularly given that she appears to have travelled in three other provinces during the infectious stages of the disease.
What steps is my right hon. Friend taking, together with her colleagues in the Foreign and Commonwealth Office and the staff of our high commission in Freetown, to determine the source of this latest outbreak? Is she confident that the outbreak can be contained, given that the burial customs observed do not appear to have followed the procedures necessary to prevent further contamination? Are the quarantine measures adopted by the Government of Sierra Leone sufficient to ensure that widespread transmission of the virus is unlikely?
The assistance provided by the UK during the last outbreak cost the British taxpayer £427 million. My right hon. Friend will remember that I first asked about that outbreak in the House on 18 June 2014, at a stage when the number of cases was in the tens, rather than the thousands. None of us wishes to see a further significant outbreak, but is she working with her officials, the Government of Sierra Leone and the WHO to ensure that we get on top of the problem at a stage when relatively few individuals are likely to have been exposed?
It is fair to say that the worst epidemiological predictions during the previous outbreak did not materialise, but across west Africa more than 11,300 people died of Ebola in 2014-15. Many more died of preventable disease, which an overburdened and fragile health care system was incapable of addressing at the same time as dealing with Ebola.
What funding will my right hon. Friend make available to the Government of Sierra Leone and non-governmental organisations working in the region to deal with this latest outbreak and to establish long-term resilience in healthcare systems for dealing with a disease that may well now be endemic in the region? Has she held discussions with her colleagues in the Ministry of Defence about the potential for assistance to be given to ensure that the disease does not spread further? Does she have confidence that the failings demonstrated by the WHO in the past will not be repeated? To what extent is she confident that there are no further cases of Ebola present in Liberia and Guinea?
Retesting of samples taken from individuals who died in the 10 years prior to the 2014-15 outbreak indicated that Ebola may well have been present in west Africa for more than a decade. To the extent that Ebola is now endemic, what measures will my right hon. Friend and the Government support leading to the development of an effective vaccine for the virus? When does she expect that vaccine to be available?
The previous outbreak of Ebola and its spread across an interconnected world indicated the threat faced by the United Kingdom from the spread of hitherto unheard- of diseases. Direct flights have recently recommenced from Sierra Leone to London, but my right hon. Friend will know that the previous ban on such flights was unnecessary and, indeed, counterproductive. Will she assure the House and the Sierra Leonean diaspora in this country that the mistake of banning direct flights in the past will not be repeated?
Finally, the long-term prognosis for those previously infected with Ebola is not well understood by the medical profession. From cases such as that of Pauline Cafferkey, we now know that the virus can hide in the body for lengthy periods. Is the NHS aware of the risks of Ebola re-emerging in patients who have previously survived the disease? What assistance are the Government giving to non-governmental organisations and Governments in west Africa to ensure the long-term health of those who have survived Ebola and may still be able to pass it on to others? Specifically, what, if any, monitoring project does her Department intend to fund so that the disease is stamped out both for individuals in the region and to secure the biosecurity of the United Kingdom and those of us who live here?
Mr Speaker
Order. Before the Secretary of State responds, let me say to the hon. and learned Gentleman that his erudition, which is never in doubt, has been equalled today only by his length. He is a very sophisticated denizen of the House, and he has treated of a very serious matter. I am aware, and the House will also be conscious, that on top of that he is an illustrious Queen’s counsel. Perhaps I can express the hope that he does not charge his clients by the word, for if he does he will be a great deal richer and they, I fear, will be a great deal poorer. From now on, we must try to stick to the time limits allocated for this purpose. I say that in a good spirit, because he has raised a very important issue and done so in an extremely intelligent way. If we operated within the time limits from now on, the House would greatly appreciate it.
Justine Greening
I must say, however, that my hon. and learned Friend achieved amazing value for money in the number of questions asked during the time spoken, for which I commend him.
To respond to the very serious issues that my hon. and learned Friend raises, from the very beginning this has been an unprecedented outbreak. We are seeing that even now, given the length of time that the virus appears to stay in the bodies of survivors after they have fully recovered. That is one reason—as we are still learning, frankly, about the implications of the virus’s persistence in survivors—why part of the work we are doing in Sierra Leone is to mitigate the risks of its being passed on. We are doing so through verifying survivor registers so that we know who should be on the list to be tested; offering safe sex counselling; establishing semen testing; ensuring access to free healthcare; and combating survivor stigma. It is critical to working with the people who may be most at risk of passing on a disease that they have themselves have survived. There is now a national semen-testing programme for male survivors aged 15 and above. Indeed, DFID and Public Health England are working with the Government in Sierra Leone to make sure that it works effectively.
We saw the same in Liberia, a country that also passed its 42-day Ebola-free point, but subsequently had other cases. That is precisely why we have been so vigilant. Indeed, it was the processes, systems and testing that we put in place with the Government in Sierra Leone that have picked up this particular case and enabled us to go through the processes of contact tracing and quarantine. As my hon. and learned Friend pointed out, it is known that this student had travelled extensively, which makes our task all the harder. We are therefore working at district level. One thing we have set up is a mobile field hospital that can rapidly get to a particular district if an outbreak takes place. He asked about the quarantine measures. They are indeed being put in place, and the contact tracing is happening.
My hon. and learned Friend asked about funding in relation to the latest outbreak and about how we are working more broadly to help get to what I call “resilient zero”. Having got past the maximum period of the main outbreak, which was incredibly difficult, we all expected that sporadic cases would continue to appear. We are now in that phase. As he says, getting on top of such cases is the way we will reach “resilient zero”, when we can be more confident that there will not be any future cases. There is funding for the latest outbreak, to cover some of the things I have mentioned and for work in schools to make sure that issues of water and sanitation are understood and that the basic steps that can be taken at community level are put in place to minimise the risk of passing on diseases, including Ebola. The district-level response mechanism that we used so successfully to get over the major outbreak when it was at its peak is still there. The London School of Hygiene and Tropical Medicine estimated that we saved more than 56,000 lives through the work that we put in place with the Government of Sierra Leone to get on top of the outbreak.
My hon. and learned Friend asked about the vaccination process. Prior to the crisis, DFID was involved in the development of early stage vaccines, which can now tackle Ebola. He will know that there are some promising candidates, which give us the prospect of being able more readily to clamp down on future outbreaks.
My hon. and learned Friend spoke about health system strengthening. One of the key messages that came out of the Ebola outbreak was that countries such as Sierra Leone and Liberia that, in the scheme of their histories, were newly emergent from civil war, were less able to cope, simply because their health systems were at an earlier stage of development due to those conflicts. Other countries in the region, such as Nigeria, were better able to clamp down on the outbreak simply because they had stronger health systems, although there is some way for even that country to go.
To reassure the House, it is not a surprise to see these sporadic additional cases, but the people, processes and systems are in place on the ground in Sierra Leone to identify them and respond rapidly.
The final thing that my hon. and learned Friend mentioned was flights. We felt that the decision that we took on direct flights was in the interests of our national security. I think that it was the right decision to take.
Critically, the way in which we got on top of the outbreak in the end was by working with our fantastic Foreign Office as one team to bring the best of British—our military, our doctors and nurses, Public Health England—and working hand in hand in partnership with the Government of Sierra Leone to provide a platform that the rest of the international community could work on to combat the disease. I again put on the record my huge thanks not only to the many DFID staff I am privileged to lead, but to all the other people across Government and all the public sector workers who in many cases put their lives on the line to help Sierra Leone get to grips with this terrible crisis.
Ms Diane Abbott (Hackney North and Stoke Newington) (Lab)
I am sure that the whole House will join me in paying tribute not just to the British health workers and military who went to help the people of west Africa in the last Ebola outbreak, but to all the local health workers who bore the brunt of the campaign against Ebola and the brunt of the deaths.
The Secretary of State will be aware that the International Development Committee report says that the Government were too reliant on the World Health Organisation, which eventually declared an emergency in August 2014, and should have listened to other groups, such as Médecins sans Frontières, which had been warning about Ebola months earlier. Does she agree with the Committee’s Chairman that
“The international community relied on WHO to sound the alarm for an international emergency on the scale of Ebola. The organisation’s failure to respond quickly enough is now well documented”?
Does the Secretary of State agree that Ebola cannot be seen in isolation and that we have to look at the general issue of access to healthcare in the region and building a resilient health system?
Justine Greening
I am grateful to the hon. Lady for those questions. As she clearly sets out, the key to success in tackling Ebola was, of course, the response of the Sierra Leonean people and their willingness to run towards tackling a disease which, instinctively, many people would have wanted to run away from. Many Red Cross volunteers from across Africa also went into the region to help tackle it. They very much led the effort. The UK’s role was to work hand in hand with them and to ensure that our resources and know-how could be brought to bear to finally get on top of the disease.
Everybody recognises that there are serious lessons to be learned by the international system from the response to the crisis. Indeed, WHO reform is taking place. The Secretary of State for Health and I have talked directly to Margaret Chan about that. It is vital that we learn lessons from the crisis so that we understand how the international system can mobilise far more speedily when a crisis hits. This outbreak spread rapidly, but it started in a part of the world that was one of the least able to respond to it initially.
The UK actioned the Ebola response much earlier than the official declaration of the outbreak by the WHO. As early as June and July, we were supporting MSF, which played a key role alongside many other non-governmental organisations.
There are lessons to be learned. Today’s International Development Committee report goes through the initial response and what happened subsequently in a systematic way. It is important that the WHO be reformed. It must not only look at its processes and how it responds, but ensure that the emergency response fund that it is setting up, which the UK helped to fund initially, is adequately resourced so that it has the means to respond, as well as the strategy.
Fiona Bruce (Congleton) (Con)
The International Development Committee report, which was issued today, commends the strong leadership of DFID and the UK Government in co-ordinating the response to Ebola in Sierra Leone, but is very critical of the WHO’s delay in designating the outbreak as a public health emergency of international concern. Will the Secretary of State give us more of an insight into her discussions with Margaret Chan and confirm that the Department is ensuring that the WHO treats this matter as a priority among its radical reform needs?
Justine Greening
There are various aspects, but one that is particularly key is the regional response of the WHO. It is important to ensure, at that level, that emerging outbreaks be clearly identified in a depoliticised way. They must be identified as outbreaks simply from the facts on the ground, as Governments are sometimes understandably reticent about declaring a health emergency. Those are the key changes that we will steadily see in the WHO over time.
Critically, we need to be able to mobilise people. One aspect of the WHO reform is the setting up of an international register of healthcare responders, much like the one the UK has, which we were able to draw on to tackle Ebola. That will enable us to ensure that we rapidly have the right people in the right places the next time that a crisis hits. Having said all that, this was an unprecedented outbreak. It was the first time that an Ebola outbreak spread across borders. Nevertheless, we clearly need the WHO to reform and to respond far more quickly and effectively in future.
Patrick Grady (Glasgow North) (SNP)
We echo the dismay at the new case and the tributes that have been paid to those involved in the response.
Bearing in mind the International Development Committee report, what more can the Secretary of State say about the steps DFID is taking to monitor the situation in the wider region? What contact does she currently have with service providers such as MSF on the ground to pick up early warnings? What consideration will she give to the recent report from the US National Academy of Medicine’s commission on creating a global health risk framework for the future, which called for WHO reform, including a permanent emergency centre and global investment of £3 billion a year in pandemic response?
Justine Greening
The work that is under way on the ground aims to ensure that the whole framework that we put in place to tackle the major outbreak swings into action again at the local level. That means the isolation of potential Ebola sufferers. It sits alongside ongoing surveillance work, which was how we picked up this case in the first place. We must continue to emphasise the need for safe burials so that this case does not spread more broadly, and work with communities to deliver that.
I mentioned the hospital and treatment centres that provide the isolation units we need to treat Ebola sufferers effectively, and the lab testing. Those things are legacies of the UK’s work with Sierra Leone, which means that it is now better placed to deal with this case. I emphasise that as we go through the contact tracing period and the quarantine period for high-risk contact, it is inevitable that further cases may emerge. That is all part of the steady eradication of Ebola, and getting to what is called “resilient zero”. Unfortunately, we do not expect it suddenly to switch off overnight, which is why we were keen to ensure that some of the underlying processes remained, as well as having the right people and surveillance in place to deal with such situations.
The hon. Gentleman asked about WHO reform and the emergency response, and he is right about that. We must ensure that resourcing is funded internationally, to enable the WHO to put into practice the new strategies it is now developing. The UK was one of the initial contributors to a fund that was set up to do that within the WHO, and we are strongly lobbying other countries to join us.
Jeremy Lefroy (Stafford) (Con)
Our thoughts are very much with the people of Sierra Leone. The Secretary of State said last July that the United Kingdom will stay the course until Ebola is defeated. Will she confirm that the UK will stay the course until Sierra Leone, in partnership with its Government, has health systems that are as strong as they need to be to tackle such outbreaks—and indeed all other diseases—in future?
Justine Greening
We will certainly stay the course, and my hon. Friend will be aware that part of our work with Sierra Leone over a number of years has been to strengthen healthcare systems. That has been vital for Sierra Leone and in the context of this outbreak, because there was a point at which people were extremely concerned about the potential of the disease to arrive here in the UK. It is not just in Sierra Leone’s interest that we do this work; it is in our interest to have a WHO that is able to respond effectively to international health emergencies.
Stephen Twigg (Liverpool, West Derby) (Lab/Co-op)
I congratulate the hon. and learned Member for Sleaford and North Hykeham (Stephen Phillips) on securing this important urgent question, and I particularly welcome the emphasis on reform of the WHO. One of the central recommendations of the International Development Committee report published today is that the UK and DFID take the lead in reform efforts. Will the Secretary of State say more about the timescale for reform, so that we do not lose that opportunity this year?
Justine Greening
Reform is under way, and comparatively recently I met Margaret Chan, who heads up the WHO, to speak about that. Changes are already being made across the board, and the key thing that remains to be worked on is bottoming out the overall strategy for improving an emergency response from the WHO, and ensuring resourcing. We must work with the countries that are most at risk if a health emergency occurs, so that they are able to deal with it more effectively. This is not about having better systems and resourcing in place; it is about targeting what we know are potentially the greatest holes in an international response.
James Cleverly (Braintree) (Con)
The Department, our medical professionals and armed forces can be proud of the assistance they gave to Sierra Leone during the Ebola outbreak of 2014-15. I am a Member of the House with a Sierra Leonean mother, so will the Secretary of State assure the House, my family and the wider Sierra Leonean diaspora that support for Sierra Leone will continue until local facilities are able to withstand further health difficulties such as this? Will she also assure the House that our future economic and diplomatic relationship with Sierra Leone will not be defined by this darkest period in the history of such a wonderful country?
Justine Greening
My hon. Friend makes his points extremely well, and the role of the diaspora and the links that people naturally have with Sierra Leone are critical. I remember meetings that I held with the diaspora in this country to ensure open lines of communication between the work being done by DFID and the Foreign Office, and that done by people on the ground. He speaks about the need and hope that Sierra Leone will bounce back from what it has been through. It was a terrible, terrible outbreak, and I visited three times in a short period. Only on my third visit did I feel that I got to see some of the country and its spirit, because the first two times were so embedded in crisis that it was really a different place.
Before this crisis hit, Sierra Leone was one of the fastest growing economies in the world, and our hope and ambition must be that it will now bounce back. The challenge is to bring the same urgency as we saw in the response to Ebola to the rest of that country’s development. We saw in that response that when we work together and there is a country-owned strategy, and when all different stakeholders pull in the same direction—when there is the political will—we can cover a lot of ground quickly. That has much broader lessons for development progress internationally, and we will try to ensure that that momentum is kept up in Sierra Leone, even though the outbreak is steadily being eradicated.
Mark Durkan (Foyle) (SDLP)
Further to that welcome point, will the Secretary of State ensure that support for resilience will involve not just support for the infrastructure of a fragile healthcare system that clearly needs such support but support for village development committees in Sierra Leone? They have proved themselves to be an effective and important network of mobilisation, and their capacity will be relevant to other challenges, including those diseases that lost priority during the Ebola crisis.
Justine Greening
The hon. Gentleman mentions a number of different but related points, and the work that happened at community level proved pivotal in enabling us to tackle Ebola, both by steadily ensuring that victims of Ebola were buried safely and did not pass the virus on, and by improving surveillance. Surveillance is now a key plank of ensuring that no other case of Ebola romps away in the way it did when it took hold in 2014. There is a lot more work to be done, and improving district and community level healthcare is vital. Indeed, the lack of a strong district and community level healthcare system enabled the virus to take hold—I spoke about the legacy of Ebola, and if we were able to put one thing in place, it was good command and control that went from the Ministry of Health and the President right down to the most remote communities. That was put in place to deal with the crisis, but as a structure it can help us to drive improvements in community healthcare, and to build on the back of that framework to improve health more generally in Sierra Leone.
Mr Philip Hollobone (Kettering) (Con)
I thank my hon. and learned Friend the Member for Sleaford and North Hykeham (Stephen Phillips) for asking this urgent question, and I congratulate the Secretary of State on the way she has responded. My constituents in Kettering are hugely proud of the fantastic deployment of armed forces and civilian NHS personnel to tackle this crisis, but I do not think that the full extent of the good news about this country’s involvement in the crisis is out there—most people do not know that this country saved 56,000 lives as a result of our intervention. Will she share with the House some more good news about the involvement of this country as the world’s leading responder to this huge crisis?
Justine Greening
The number of lives directly saved because of work that the UK was able to do is staggering —we can actually see the epidemic curve bending upwards, and then our steadily working with the Government to wrestle it down over a period of months. It was extremely difficult work that required a huge effort.
As part of our response, we had 1,500 military personnel. We provided six UK treatment centres in a matter of weeks. We trained over 4,000 Sierra Leonean healthcare workers. We deployed 150 NHS volunteers, who worked on supporting over 1,500 treatment and isolation beds. That was more than half of the beds available to treat Sierra Leoneans. As I said, we now have a 36-bed mobile field hospital. One hundred Public Health England staff helped to set up three laboratories. We delivered 28,000 tonnes of aid. We delivered more than 1 million protective equipment suits for people working in the red zone and dealing directly with people who had Ebola. We supported over 140 burial teams. We had RFA Argus, the Royal Navy support ship and Merlin helicopters out there. It was a phenomenal response across government and I am very proud to have been part of it.
I thank my hon. Friend for his question. After a crisis has been responded to, it is easy to move on and lose sight of the important and valuable role we played.
Andrew Gwynne (Denton and Reddish) (Lab)
I very much support the Secretary of State’s efforts so far and I agree with her comments about the need for economic reconstruction in Sierra Leone. She will have heard the comments of the chief medical officer of Sierra Leone, who is reported as saying that in the case in Magburaka, the patient showed
“no signs or symptoms that fitted the case definition of Ebola”.
Given that very disturbing fact, what are the wider public health implications for us in the United Kingdom, and what discussions has she had about this specific issue with Public Health England, the Department of Health and the Foreign and Commonwealth Office?
Justine Greening
We continue to have a substantial team in Sierra Leone working directly on the ground as part of the response to this latest case. That response is, of course, led by the Government of Sierra Leone. The real test of whether we have worked effectively is if, in time, we can step back and see its health system strengthened and able to take care of these sorts of outbreaks. We are investigating this particular case right now. The hon. Gentleman talks about some of the challenges of identification. This is why surveillance is so important. Indeed, it was the following of some procedures on taking swabs of all deaths that picked up that this was Ebola. At each stage of the response, we have had steadily to work out the most effective route forward. We continue to do that as we confront new challenges, such as the one seen in recent days. The House can be assured that we are working hand in hand and have resources in place. We have fantastic medical experts to help us ground any new strategy in terms of the science and of how we take the facts on the ground and respond to them effectively.
Wendy Morton (Aldridge-Brownhills) (Con)
We should be very proud of the role played by the British military, health workers and volunteers, under the leadership of DFID, in tackling Ebola in Sierra Leone. This latest incident, which sadly led to the death of someone in Freetown, highlights the fact that we must remain vigilant in the face of this terrible disease. Will my right hon. Friend assure the House that DFID will continue to press the World Health Organisation and the international community to continue to play a part not just in monitoring but in strengthening and further developing the public health system in Sierra Leone?
Justine Greening
I strongly agree with my hon. Friend. We are playing that role already and will continue to do so. Much of it is pushed forward by our Department of Health and its very close working relationship with the WHO. It is vital we fix some of the underlying problems that led to Ebola taking hold in the first place. Essentially, this means strengthening the health system on the ground and having a better international responder system to deal with crises when they inevitably emerge around the world.
Diana Johnson (Kingston upon Hull North) (Lab)
Further to the Secretary of State’s comments about supporting Sierra Leone, Hull is very proud to have been twinned with Freetown for over 35 years. There have been many reciprocal visits, especially by teachers. In the light of what has happened recently, is the Department considering what more it can do to strengthen such reciprocal visits to ensure that support, especially for education, is given to that country?
Justine Greening
I will take the hon. Lady’s ideas and thoughts away and respond to her following the urgent question today. She is right to highlight education. One of the key issues we now face and are working on is getting children, in particular girls who may have been out of school, back into school. We have to ensure they go back to school, and that is not always easy. There are a number of orphans as a result of the Ebola crisis, too. Education matters not just in terms of broader public health but of schooling for children, many of whom were out of school for a year. I will reflect on the point she makes about the important links between her local community and Freetown.
Andrew Stephenson (Pendle) (Con)
The Secretary of State’s actions have undoubtedly saved thousands of lives. I pay tribute to the efforts of the UK Government. Kids in Kailahun, a small Pendle-based charity, does fantastic work in the Kailahun district of Sierra Leone and did so throughout the Ebola crisis. It describes the in-country response to Ebola orphans as too patchy across the country. What more can the Secretary of State do to make it easier for small sums of aid funding to be provided directly to charities such as Kids in Kailahun, which can make such a difference on the ground?
Justine Greening
We had a particular fund to enable us to provide funding to some of the smaller charities. As my hon. Friend will probably be aware, at the beginning the main challenge was putting in place the key planks of a successful strategy, which we were able to do. Smaller NGOs played a key role and I pay tribute to the charity he highlights. DFID worked to support orphans, many of whom would have otherwise been in an incredibly vulnerable position throughout the crisis. We continue that work because, as he will be aware, many survivors of Ebola suffer stigma as a result of having had the virus, and some of them are children. Work is under way to try to ensure we reintegrate people into their family. Wherever possible, we help orphans to get back in touch with their extended family.
Mr Barry Sheerman (Huddersfield) (Lab/Co-op)
I warm to the Secretary of State’s words about the broad, holistic approach to reconstruction in Sierra Leone. Ebola knows no boundaries, however, and affects the whole of west Africa. That is why reconstruction in that part of west Africa is so important. She paid tribute to our troops and all the efforts they made, but many individuals were involved, too. We all remember the wonderful and moving diary on Radio 4 by the doctor from Huddersfield. The voluntary work of aid agencies, such as Save the Children, Médecins sans Frontières and the International Rescue Committee, where my own daughter works, was tremendous. We have to learn the lessons, however. I used to work for the World Bank. On many occasions, I had deep reservations about the effectiveness of the WHO. This is a time to reflect on whether the WHO is fit for purpose. If it is not, the UK should try to do something about it.
Justine Greening
A number of NGOs, many British-based, played a vital role in helping to respond successfully to Ebola in Sierra Leone and in other affected countries and communities. In particular, Save the Children was pivotal in enabling us to open Kerry Town, the first treatment hospital we were able to put in place, and save lives. For many NGOs, it was a step into the dark to have their volunteers working in such a dangerous environment, with all the training that needed to go alongside that. I pay tribute to the volunteers who went out, not just from our own public sector, as I set out, but from all walks of life. They did an amazing job and saved lives. The hon. Gentleman said that the international response and system needed improving, as we have heard in other questions today, and he is absolutely right. We must learn lessons from this crisis. There were some positive lessons about what it took to confront Ebola, but there were also some negative lessons about how a better job could have been done.
Finally, looking forward to reconstruction and recovery, I represented the UK at a UN conference midway through last year, hosted by the Secretary-General, that was all about mobilising resources and the effort around country-owned plans in Liberia, Sierra Leone and Guinea so that we can get behind one strategy that helps them get back on their feet. DFID’s bilateral programme in Sierra Leone is part of delivering that on the ground.
Kevin Foster (Torbay) (Con)
I welcome the Secretary of State’s responses so far. As touched on several times, the work of our armed forces in Operation Gritrock is not just about saving lives in west Africa but about protecting and saving lives in this country, and demonstrates that maintaining military capability and delivering on our international development objectives are complementary, not exclusive, to each other. Given the re-emergence of Ebola, what discussions has she had with the MOD about the potential for further support, if it proves necessary?
Justine Greening
We hope that the procedures and framework we have left on the ground will be the most effective way of responding to this latest incident, but we can also learn from Liberia’s experience—it was Ebola-free and then saw fresh cases. I hope we can use the existing structures to respond. If we have learnt one thing over the past one or two years, it is that our fantastic MOD stands ready to be part of the UK humanitarian response, as we have seen in relation not just to Ebola, but to Typhoon Haiyan and Nepal. It plays a unique role in enabling this country to mobilise as effectively as any in the world and to play its part in helping save lives when disaster hits.
Dr Lisa Cameron (East Kilbride, Strathaven and Lesmahagow) (SNP)
I commend the work of everyone involved in tackling Ebola. Given the key issues highlighted in the Select Committee report, will the Secretary of State outline what lessons have been learnt about engaging cultural leaders and working with cultural norms to provide a cohesive and fully implemented response?
Justine Greening
The hon. Lady’s constituency is home, of course, to our Scottish DFID headquarters, whose staff played a key role in helping us to shape our response. I would like to say a huge thank you to them.
The issue of social norms and working with communities is vital. We had to work with the cultures already there —we cannot impose on people—and the leadership from the top down, from the President down to district-level community and religious leaders, made a real difference, particularly on safe burials. Only when we got the percentage of safe burials up towards 100% did the number of cases peak and did we stop the onward spread, and only after we got treatment beds in place did we start to improve survival rates. By working with communities, with the assistance of community leaders, we helped people to understand how to stay safe and not catch the virus and how quarantining was in their interest—if difficult—in saving their families. Bringing communities with us and the role of community leaders and mobilisers—often young people going into communities to talk about these issues—were a key plank in helping us turn the corner on Ebola. But it took time.
Tom Brake (Carshalton and Wallington) (LD)
Does the Secretary of State agree that had it not been for the commitment, initiated under a Labour Government and delivered under the coalition, to the 0.7% GNI target, it might have been more difficult, at the very least, to deliver on the scale and at the speed with which the Government responded to Ebola in Sierra Leone, and that it would have restricted their ability to negotiate with the WHO had we not been able to stand up in front of other countries and say, “We have delivered on our 0.7% commitment”?
Justine Greening
There is no doubt that our having finally delivered on the promise we made many years ago to meet the 0.7% commitment gives us huge credibility, but our influence goes beyond that. We consistently help, constructively and positively, to shape the response. Ours is not just a significant but a thoughtful response that helps to shape strategy and ensure that the money, wherever it is from in the world, has the biggest impact on the ground. Whether that is leading on Ebola, our work on women and girls and tackling female genital mutilation, or our work on protracted crises-—most recently, in Syria, shaping job creation, employment and education, which refugees need if staying in the region is to be a viable option—the UK’s work goes far beyond simply doing a lot; what we are doing is also smart and helping to ensure that the international community’s response more broadly is also smart.
Points of Order
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Kate Osamor (Edmonton) (Lab/Co-op)
On a point of order, Mr Speaker. During Treasury questions, the Chancellor said that the shadow Chancellor had lost his marbles, which I feel was unparliamentary. This comment comes in the week when the Government have been exposed as leaving mental health services underfunded. I just wanted to put it on the record that this comment goes to the heart of their callous attitude towards vulnerable people.
Mr Speaker
I am grateful to the hon. Lady for her point of order. I did not make the immediate judgment that the Chancellor’s remark was unparliamentary. I think it was intended in a jocular spirit, although, of course, we all have to weigh our words carefully in this place and think of the possible implications of the language chosen. I stand by the judgment I made, but equally she has taken the opportunity to make her own point and to make a wider point about an important public policy issue in the process. I thank her for putting her comments on the record.
Hywel Williams (Arfon) (PC)
On a point of order, Mr Speaker. You have certified that the Education (Student Support) (Amendment) Regulations 2015 relate to England only and are subject to double-majority voting. Thousands of English students study at Bangor University and are constituents of mine. Can you advise me on how I might fully represent their views in the Lobbies?
Mr Speaker
I am grateful to the hon. Gentleman for his point of order and his characteristic courtesy in notifying me in advance of its thrust. He asks how he can represent the interests of his constituents in relation to the education regulations before the House. This gives me the opportunity to explain the situation. Although I have certified the instrument as relating exclusively to England, the prayer to annul it requires a majority both of all Members and of Members representing English constituencies, so he is perfectly entitled to vote on it. The test that the Standing Order sets is that every provision of the instrument relates exclusively to England and is within devolved legislative competence. I am satisfied that the instrument meets that test. In forming my judgment, I am guided by advice from Speaker’s Counsel and from the Public Bill Office. Our exchange is now on the record and will, I hope, be useful to him in such exchanges or communications as take place.
Mr Speaker
I am not sure whether this will be further to that point of order, but I shall discover whether that is so, courtesy of the right hon. Member for Delyn (Mr Hanson).
Mr Hanson
Further to that point of order, Mr Speaker. I fully accept your interpretation of this matter, Mr Speaker, which is right and proper. My further point of order is about the opportunities available to Members who believe that they have an interest in Wales to make representations to you prior to your certification. As my hon. Friend the Member for Wrexham (Ian C. Lucas) will point out, there are implications concerning the impact of budgets on communities such as ours. For example, I have only just learned in the last few moments, prior to entering the Chamber this morning, of your certification on this particular matter, and I am interested for future reference in what process is in place for us to make those representations. Self-evidently, we Members with Welsh seats believe that we have a constituency interest in this matter.
Mr Speaker
I am grateful to the right hon. Gentleman for his point of order, but if my memory serves me correctly, I announced my decision on this matter on 6 January. There has therefore been a period of no fewer than 12 days in which it was open to right hon. and hon. Members to make representations. Moreover, in relation not, I concede, to instruments, but to Bills, the House will be conscious or will start to become conscious that it is my frequent practice to make a provisional certification, which is subject to review during the passage of the piece of legislation, depending on the sequence of events. If, during such periods, Members feel that their point of view has not been heard and that if I heard it I might reach a different judgment, they should take the opportunity to make that known.
The right hon. Gentleman looked rather sceptical when I said that a judgment had been made about this matter several days ago, but I emphasise that there is no intention at all to deny Members the opportunity to make representations. Indeed, it is rather the contrary. I would also very politely point out to the right hon. Gentleman and the House that this procedure is one that the House has decided I should operate. I am seeking to operate it to the best of my ability and extremely fairly. It is not, however, the Speaker’s procedure; it is a judgment that the House has made, and I am making the best job of it that I can. [Interruption.] The right hon. Gentleman is intimating from a sedentary position that his facial expressions were those not of scepticism, but of gratitude. I am grateful to him for that helpful clarification—as an expectant nation will also be, I am sure.
Ian C. Lucas (Wrexham) (Lab)
Further to that point of order, Mr Speaker. I am particularly grateful that you pointed out that this appalling procedure is not your procedure, but one that, unfortunately, the House authorised you to implement, and one subject to Standing Orders, which you are, of course, acting upon.
I think the difficulty is that the notification and notice are very late for those of us, such as me, who have constituents in Glyndwr University who are directly affected by this measure. In a spirit of being helpful, I would like to point out that the Procedure Committee, of which I am a member, is undertaking an inquiry into this appalling procedure and will be reporting on it. May I suggest that those who are motivated, such as my very good hon. Friend the Member for Denton and Reddish (Andrew Gwynne), who actually attended Glyndwr university and can vote today in a way that other MPs from Wales cannot, should make representations to the Procedure Committee?
Mr Speaker
First, I must emphasise that all Members can vote on this matter today. The hon. Gentleman can vote on it; I do not want him to develop—it would be sad and worrying if he did—a persecution complex. I would not want him to feel that he is excluded. The hon. Gentleman says that he is making his point of order by way of being helpful, and I cannot think I would doubt that for a moment; I do not think he ever intends anything other than to be helpful to me, to the House, to the nation and, of course, to his constituents. He certainly can vote on the matter.
The House will have been struck by the hon. Gentleman’s use of his adjective in relation to the procedure. I, of course, did not make any evaluation of the procedure. I simply made the factual point that it is not something introduced by the Speaker; it is something that the House has said the Speaker shall do. I am the servant of the House, and I am doing it to the best of my ability. The hon. Gentleman has made his own assessment of the procedure and he is, of course, as he has pointed out using other words, a distinguished ornament of the Procedure Committee. Members who wish to make representations to that Committee and to its illustrious Chairman, the hon. Member for Broxbourne (Mr Walker), should, of course, do so. That opportunity has been helpfully advertised.
Greg Mulholland (Leeds North West) (LD)
On a point of order, Mr Speaker. On a separate matter, I was astonished on Friday lunchtime to be told by a constituent that the Prime Minister was visiting the wonderful Makkah mosque in my constituency on Monday morning. Having followed that up, I received an e-mail at 4.57 saying that that was the case, but those sending it refused to tell me where the visit was—even though I had already told them that I knew! Only on Monday morning was I finally told where the visit was going to be, given that I was not told in the first place.
Apart from the “Keystone Cops” attitude to national security, given that a sitting Member of Parliament was not told about a visit that constituents did find out about, I ask your advice on parliamentary protocol, Mr Speaker. On this occasion, I did not have the opportunity either to liaise with the wonderful Makkah mosque, which does marvellous work on integration, or to speak to the Prime Minister’s Office to give him my thoughts and advice on the work the mosque does before his visit.
Mr Speaker
I rather imagine that the Prime Minister thinks of little else in the course of planning his day than of the merits of receiving, in such terms as the hon. Gentleman thinks fit and at such length as is necessary, the hon. Gentleman’s advice. It occurs to me off the top of my head that it would have been open to representatives of the mosque to notify the hon. Gentleman in a timely way.
On the matter of the protocol whereby Members should be notified of visits, I would say that it is best for colleagues to interpret their responsibility in this matter broadly. That is to say—I do not refer to any particular case—that rather than taking a narrow view and thinking that notification would take place at a very late stage, it is better to notify a colleague well in advance of an intention to visit his or her constituency. My own personal view is that where we are dealing with colleagues who are right hon. and hon. Members, it is a courtesy to give more information rather than less. I hope that is helpful to the hon. Gentleman and to the House. These sorts of matters tend to arise from time to time.
Freedom of Information (Public Interest and Transparency)
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Tom Brake (Carshalton and Wallington) (LD)
I beg to move,
That leave be given for me to bring in a Bill to amend the Freedom of Information Act 2000 to remove provisions permitting Ministers to overrule decisions of the Information Commissioner and Information Tribunal; to limit the time allowed for public authorities to respond to requests involving consideration of the public interest; to extend the Freedom of Information Act 2000 to cover private companies, social enterprises and charities contracted to carry out work for public authorities; and the Royal Household; and for connected purposes.
I am no stranger to freedom of information ten-minute rule Bills: this is the third Bill on this subject that I have promoted in Parliament. I am hoping—without any real justification, I confess—that today will be a case of three times lucky. A country’s commitment to FOI is a clear indicator of the strength of its democracy. For that reason, I totally reject what one of Tony Blair’s former advisers in Downing Street said to the BBC’s Martin Rosenbaum, namely that
“FOI was the worst thing the Labour government did”.
I also think Tony Blair was far too hard on himself when he said about FOI:
“You idiot. You naive, foolish, irresponsible nincompoop. There is really no description of stupidity, no matter how vivid, that is adequate. I quake at the imbecility of it.”
Instead, he should have saved those words to describe his decision, on the flimsiest of evidence, to drag the UK to war in Iraq.
Tony Blair’s views on the imbecility, or the alleged imbecility, of FOI legislation are well known, as indeed are those of Jack Straw, who used the ministerial FOI veto twice—once to block Cabinet minutes from the run-up to the Iraq war—and has condemned FOI legislation in the following terms:
“We’ve ended up with a freedom of information act with more access to documents than any comparable jurisdiction.”
Personally, I consider that to be something to celebrate, not denigrate. I welcome the current more enlightened view on the subject in the Labour party, and I hope that, once completed, its review will disregard the views of its dinosaur tendency and back FOI to the hilt.
Just as strong FOI legislation is a good barometer for the health of any democracy, any attempt to dilute FOI legislation represents a threat to it. With the number of MPs falling, hundreds of thousands of voters dropping off the electoral register, Short money being slashed and the Trade Union Bill being rammed through—all of which hurt the Opposition parties much more than the Conservatives—the Opposition parties’ ability to challenge the present Government is being severely curtailed. I therefore contend that we are more dependent on FOI and the Freedom of Information Act than ever before when it comes to holding the Government to account.
What, though, are the present Government’s views on FOI? In July, they established an independent commission to review the Freedom of Information Act. That “independent” commission includes Jack Straw. There is no need to submit an FOI request to Lord Burns to demonstrate that there is nothing independent about it. The Justice Secretary claims that the review is necessary because the Government needed to revisit FOI to ensure that officials could speak “candidly” to Ministers in the “interests of good government”. He spoke of a
“worrying tendency in our courts and elsewhere to erode the protections for that safe space”.—[Official Report, 23 June 2015; Vol. 597, c. 753.]
Some of those officials, including Sir Gus O’Donnell—as recently as this weekend—and the Cabinet Secretary, Sir Jeremy Heywood, dubbed “Sir Cover-up”, have made their positions known too. Sir Gus suggests that civil servants will not be writing down Brexit plans, but is that because senior mandarins have scared them into thinking that they cannot write things down because they will be exposed through FOI—when there is no such risk—or because it serves the Chancellor’s interests to require them not to? I know from my involvement with the Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Act 2014 that a “chilling” effect can be achieved because someone repeats the fact that a law or measure is “chilling” often enough for people’s actions to be curtailed. In effect, people self-censor, rather than their actions being curtailed because the measure is actually chilling.
Sir Jeremy has spoken of the “chilling” effect of the Freedom of Information Act. In the interests of fairness, I should point out that now Sir Jeremy simply wants to make the FOI rules clearer, without making any substantial changes. If I can paraphrase Vince Cable, in the last few weeks we have witnessed his transformation from “Sir Cover-up” to the “Sir Lancelot du Lac” of FOI. Which incarnation is likely to have the longer shelf-life? I know where my money is.
Many legal experts point out—and the statistics confirm this very convincingly—that information tribunals that hear challenges against disclosure allow policy discussions to be revealed only in very limited circumstances, or when the arguments for disclosure are overwhelmingly in the public interest. It should also be borne in mind that the Justice Committee has already conducted a much wider post-legislative scrutiny, stating that FOI
“has contributed to a culture of greater openness across public authorities, particularly at central Government level”,
and that it
“is a significant enhancement of our democracy”.
I am disappointed by the commission’s limited scope. Its remit does not cover which types of body should be covered by the Act, which is, in my view, a major failing. As we have seen with the activities of companies such as G4S and Serco, Southern and Thameslink, and charities such as Kids Company, a growing proportion of work that was previously undertaken by the public sector, which is subject to FOI, is now undertaken by other organisations, which are not. How many Medway Secure Training Centre scandals could be prevented if FOI applied to private sector companies doing public sector work? We need to act on the Public Accounts Committee’s 2014 recommendation, and include those private contractors in its scope.
The commission should have considered the question of bringing the Royal Household into the scope of the Freedom of Information Act. It is difficult to understand why it should not be within the scope of the Act, and why FOI requests to it should not be treated like any other—subject, of course, to the public interest test. The Royal Household is surely the most public of our public authorities.
The ministerial veto must be scrapped. In the words of Maurice Frankel of the Campaign for Freedom of Information,
“The veto allows ministers for reasons of political embarrassment to overturn considered decisions of the commissioner or a tribunal. It allows them for bad reasons to overturn good decisions.”
Nor does the commission seek to consult on some of the tricks of the trade that are used to delay FOI responses, such as the absence of any time limits on internal FOI reviews. The News Media Association is pressing for such limits, and I am backing its efforts. A total of 40 days for all stages seems reasonable. Currently, the absence of time limits provides Departments with a convenient delaying mechanism, and they are already adept enough at kicking into the long grass. Andrew Lansley’s diaries from the period in the run-up to the Health and Social Care Act 2012 are a case in point. They are of interest because of what they might reveal about the number of meetings with private health companies. Their release was fought on the grounds that there might be gaps in Andrew Lansley’s diary that would have to be filled by spurious meetings to ensure that he could not be accused of laziness. That was rightly dismissed by the tribunal as “incredible”.
On the other hand, the commission does float the idea of upfront charges for FOI requests. No precise figure is given, but it could be at least £20 to recoup the cost of invoicing. The introduction in Ireland of a €15 fee in 2003 resulted in a 75% collapse in the number of FOI requests from the public, although I am pleased that the Irish Government subsequently scrapped the fee. The introduction of fees will not save money; indeed, I would argue the contrary.
FOI requests often ferret out abuse, inefficiency and waste, which can then be addressed. The most famous example was, of course, our own expenses scandal, but other examples include Network Rail, which spent £7.2 million on car allowances for senior staff last year, bringing its total expenditure on the perks over the past five years to £32 million. Incidentally, bringing Network Rail into the scope of FOI, with effect from March last year, was a welcome step, for which Norman Baker and I pressed when he was a Transport Minister. If a £20 fee were in place, investigating all 43 police forces in England and Wales would cost £860. There are more than 260 NHS trusts, which would push the cost of “FOI-ing” their performance to over £5,000.
I am also disappointed by the phrasing of the commission’s questions, all of which start from the premise that FOI is a constraint rather than a benefit.
Finally, let me bring this matter much closer to home, and mention Parliament. Parliament should always set an example when it comes to transparency, and I therefore support the Press Association’s bid to ensure that the Commons authorities disclose evidence or reports relating to alcohol consumption in Parliament—or, at least, are compelled to defend their decisions not to do so. The PA’s request was rejected on the grounds that such action would breach confidentiality, and would prejudice the effective conduct of public affairs. However, Parliament has a duty to lead on matters of transparency. It should, in all circumstances—except those involving matters relating to parliamentary privilege, to prevent the courts from trespassing on Parliament’s turf—be treated like any other public authority, and should be subject to the public interest test. That would have enabled the question of whether the release of those documents was in the public interest to be properly assessed.
Our democracy is healthier, more resilient and less vulnerable to ambush with tough and challenging FOI laws in place. The Bill would strengthen FOI to ensure that no one was above the scrutiny of FOI—not Ministers, the private sector, charities, Parliament, or the Royal Household. I urge the House to support it.
Question put and agreed to.
Ordered,
That Tom Brake, Mr Graham Allen, Mr Alistair Carmichael, Mr David Davis, Mark Durkan, Tim Farron, Norman Lamb, Caroline Lucas, Greg Mulholland, Liz Saville Roberts, Mr Mark Williams and Mr David Winnick present the Bill.
Tom Brake accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 11 March and to be printed (Bill 119).
Opposition Day
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Student Maintenance Grants
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
16:24 - The House divided: - Ayes: 292 / Noes: 306 - Question accordingly negatived.
16:40 - The House divided: - Ayes: 292 / Noes: 303 - Question accordingly negatived.
Mr Gordon Marsden (Blackpool South) (Lab)
I beg to move,
That this House calls upon the Government to abandon its policy on replacing maintenance grants with loans for lower income students.
The Government’s proposal to scrap maintenance grant support for disadvantaged students and replace it with a loan system is not an isolated proposal. It is part of a pattern that can be seen in other areas of government. It mirrors, for example, changes that were debated eight days ago, which removed NHS bursaries for nurses and other staff, and it has been foreshadowed by changes that the Government have made in support and protection for further education over the past three or four years. The truth of the matter is that the Government have ducked and dived to avoid further debate on their direction of travel on the grants issue, and on freezing the payment threshold for five years, which is not specifically part of the regulations although it is referred to in the assessment that comes with them. That is also likely to hit disadvantaged students.
We have called this debate today to hold the Government to account over this major issue. They have refused to bring these changes to the Floor of the House themselves, and preferred instead to sneak them through in delegated legislation, which can be debated and voted on by only a handful of MPs.
Ian C. Lucas (Wrexham) (Lab)
Does my hon. Friend agree that it is particularly shameful that this proposal did not appear in the Conservative party manifesto? It is being sneaked into the House of Commons and without the knowledge of the people of this country.
Mr Marsden
My hon. Friend makes a striking point. That is only one of a series of delinquencies that I want to move on to.
The Conservatives have shied away from the light of debate, challenge and scrutiny on this issue, preferring instead to use a legislative sleight of hand to ensure that the sweeping changes were made in Committee in the hope that no one would notice. All the way through this process, they have been defensive. They have been less than candid and they have systematically resisted the path of openness. There was little detail to be had when the Chancellor first mooted this change in the summer, and not much more in the autumn statement. It was only when the National Union of Students raised the alarm about the impact of the process and threatened a judicial review over the lack of consultation and the failure to publish the interim equality assessment—which the Government have still not done—that a separate equality impact assessment was slipped out.
My hon. Friend the Member for Wallasey (Ms Eagle), the shadow Secretary of State of State for Business, Innovation and Skills, wrote to the Business Secretary explaining our concerns and asking for a full debate on this matter. This was reflected in early-day motion 829, which attracted a number of cross-party signatures. However, the Business Secretary’s reply largely ignored the issues. The issue of failing to bring the matter to the Floor of the Commons was raised by the shadow Leader of the House in December, and at that time the Leader of the House intimated that there should be a debate on the Floor of the House, but no such debate has taken place. A question from my hon. Friend the Member for Sheffield Central (Paul Blomfield) was ducked by the Prime Minister last Wednesday. Colleagues raised the issue again in last week’s business questions, and I put a series of detailed questions to the Minister in the Delegated Legislation Committee. I and the other members of the Committee would like to see the responses to those questions in due course.
It is perhaps no surprise that The Independent led today on the way in which this Government have been using statutory instruments systematically to force through profound and controversial changes to the law without proper debate and scrutiny. Nor is it surprising that my hon. Friend the Member for Wallasey told the newspaper:
“This is arbitrary rule that massively decreases the power of the Commons to effectively scrutinise the Government.”
The equality impact assessment was slipped out with a relative lack of ceremony at the end of November. As I said last week, this is the document that almost dare not speak its name, not least because the detailed evidence of the negative impact was tucked away in its central pages, to which I will refer later, and was rather belied by the bland conclusions appended to the front of the document. What is driving these panic measures from the Government—the £1.5 billion raid on grants and the threshold fees—is their belated recognition that the whole set of financial assumptions about repayment that underpinned their trebling of fees in 2012 is producing a black hole for them and for future taxpayers.
Steve McCabe (Birmingham, Selly Oak) (Lab)
Did not a Tory Minister stand at the Dispatch Box in 2012 and assure us, on the question of tripling the fees, that increased maintenance grants and the national scholarship programme would protect students from the poorest backgrounds? Now the Government are scrapping both and trying to sneak the measures through. Is this not an absolute betrayal?
Mr Marsden
My hon. Friend is absolutely right, and he obviously has the power of telepathy, because I intend to refer to that later.
Mr David Lammy (Tottenham) (Lab)
My hon. Friend refers to the impact statement. Does he agree that, in 2016, it is a scandal that the impact statement, which the NUS had to drag out of the Government and which confirms that the measures will disproportionately affect black and minority ethnic students, women and disabled people, does not merit a proper debate and vote in this House?
Mr Marsden
I entirely agree with my right hon. Friend, who was a distinguished Schools Minister. His points are absolutely valid, and I shall deal with them in more detail in due course. These measures are not simply incidental tinkering with existing financial regulations.
Mr Geoffrey Robinson (Coventry North West) (Lab)
Can my hon. Friend confirm that 45% of the student loan book, amounting to some £5 billion, is suspected to be delinquent in some way or other? These measures would add a further £1.6 billion to that amount. Are not the Government building up a huge unfunded liability in their national accounts?
Mr Marsden
I am grateful to my hon. Friend, who has great experience in these matters. The Institute for Fiscal Studies and other organisations have commented on that matter.
James Cartlidge (South Suffolk) (Con)
It is wonderful to hear Labour Members talking about unfunded liabilities. The hon. Gentleman mentioned the £1.5 billion cost of this measure, which is the money that will be saved. Is it his party’s policy to reverse the measure, and if so, where would it get the money from?
Mr Marsden
I am delighted that the hon. Gentleman is so looking forward to the arrival of a Labour Government that he is already asking us detailed questions on this matter. I would remind him, however, that today is a day for the Government to be held to account for their failures.
Helen Whately (Faversham and Mid Kent) (Con)
Will the hon. Gentleman give way?
Mr Marsden
I am sorry, but I must try to make some progress. I will take more interventions later.
These measures are typical of the ideology-driven but evidence-lite approach that this Government have too often employed. This is a major reversal of policy only four years after they hailed those maintenance grants for students from disadvantaged backgrounds. The statistics from the House of Commons Library tell me that the measures will affect around 500,000 of England’s most disadvantaged students. This amounts to a Domesday book listing the numbers of students who will lose their grants under the new rules. Universities across England, old and new, will be affected, as well as other higher education institutions. Further education colleges will also be affected, because they make an increasingly valuable contribution—10% and rising—to higher education, and a disproportionate number of their students will be affected.
Mr Marsden
I will give way to my hon. Friend the Member for Denton and Reddish (Andrew Gwynne) and then briefly to my hon. Friend the Member for Bolton South East (Yasmin Qureshi).
Andrew Gwynne
I commend my hon. Friend for bringing this debate to the House of Commons so that we can have a vote on this important issue. He has talked about the impact on universities and colleges. Perhaps he has seen the information released by UCAS in December that shows that, even today, twice as many young people from advantaged backgrounds as from disadvantaged backgrounds go to university. How does he think removing £3,500-worth of grant a year is going to assist social mobility?
Mr Marsden
The reality is that it will not. I will have more to say about social mobility later.
Several hon. Members rose—
Mr Marsden
No, I will not give way again, as I have already indicated. A large number of people wish to speak, and I need to give them a chance to do so.
Yasmin Qureshi
Does my hon. Friend remember that, in the last Parliament, the Government abolished the education maintenance allowance for 16 to 18-year-olds going into further education? They are now abolishing the maintenance grant for poorer people going into higher education, yet they managed to find tax cuts for millionaires in the last Parliament. Does this not show that this Tory Government are really not concerned about the poor and disadvantaged people in this country, whether in relation to housing, to universal credit, to disability or to education? They just don’t care.
James Morris (Halesowen and Rowley Regis) (Con)
Will the hon. Gentleman give way?
Mr Marsden
No, I am sorry, I will not give way. I have already said that.
The EMA is not the subject of our debate today, but that point illustrates the problems affecting further education colleges. There can be a cumulative effect for the future of such colleges because these measures can result in people no longer applying to them. That is why the Association of Colleges said in a specific response to these regulations:
“We have real concerns about the proposed change as many of the students may never earn enough to pay back the money and the policy does appear to penalise poorer students.”
Several hon. Members rose—
Mr Marsden
I have already indicated that I will not give way at the moment, but I will do so in a little while.
The expansion of higher education opportunities in further education colleges after 1997 was one of the most significant advances made under the Labour Government in this area, and it was a crucial part of beginning to address the lack of balance for higher education in the English regions outside the areas of the traditional clusters of long-established universities. It was part of a joined-up strategy to embed higher education and skills in our local economies and via the regional development agencies at that time. My local Blackpool and The Fylde College gained an excellent new higher education block in that period, where more than 2,800 students are now in higher education. We know that many further education students come from precisely the non-traditional backgrounds for participation in higher education.
James Morris
The hon. Gentleman is deploying the same argument that was deployed against the introduction of tuition fees, which was carried out by the previous Labour Government and developed by the coalition, but we have actually seen an increase in the number of students from disadvantaged backgrounds going to university. His argument, therefore, just does not stack up.
Mr Marsden
Perhaps if the hon. Gentleman listens as I talk further about the way in which these things have changed, he will understand that what was introduced in 2012 and the explanations—I will not call them apologies—that his Government gave for tripling tuition fees were based on a series of quid pro quos, all of which they have now abandoned. The pattern I have talked about is also seen in the number of people doing higher education in the so-called “post-92” universities and receiving the maintenance grant. That is why million+, whose membership contains a significant number of those post-92 universities, has expressed its alarm in the briefing it prepared for today’s debate. It said that
“by virtue of nothing more than household income, some students will be saddled with debts far in excess of their fellow students.”
It continued:
“the freezing of the earning repayment threshold for five years will also exacerbate this problem and will hit lower earning graduates the hardest.”
My former colleague Bill Rammell, who was a higher education Minister and is now vice-chancellor of the University of Bedfordshire, made precisely those points in an excellent piece for Politics Home today.
Jack Dromey (Birmingham, Erdington) (Lab)
Erdington is one of the poorest constituencies in England, but it is rich in talent, and maintenance grants mean a great deal to students who want to get on—42% are dependent on them. Does my hon. Friend agree that the Government are both breaking a promise, and dashing the hopes and dreams of a generation of strivers?
Mr Marsden
I absolutely agree with my hon. Friend. Of course, he comes from and speaks for a distinguished part of the west midlands, which is in the process of trying to gain control over areas of activity in their local economies. What the Government are doing for people in Birmingham and elsewhere is confounding their own devolution prospects.
Mr Marsden
No, I will not give way at this stage, but I might a little later.
We know now, thanks to a question I tabled to the Minister for Universities and Science to establish the extent of this issue, how many people will be directly affected by the withdrawal of the maintenance grant in further education. The statistics show that some 33,700 English applicants were awarded maintenance grants for higher education courses at further education colleges. Within that 33,700 figure, we have a roll call of the English regions, where it is not just the individuals but the local economies, through the growth of skills there, that have benefited from this expansion of higher education and further education.
Let me cite some of the statistics that the Student Loans Company has produced: in the north-west, Blackburn College has 1,842 students on maintenance grant; in the north-east, Newcastle College Group has 1,669; and in the south-west and Cornwall, Cornwall College has 931. The list goes on, but a crucial subset comprises the numbers in those areas where, as I just mentioned to my hon. Friend the Member for Birmingham, Erdington (Jack Dromey), the Government are encouraging combined authorities and local enterprise partnerships to take up their devolution offers and, therefore, potentially to have control of or take a role in higher skills initiatives. Greater Manchester has 410 on maintenance grants at Stockport College and 1,060 on grants across The Manchester College network. In Merseyside, 542 in total are on grants at The City of Liverpool College and the Liverpool Institute for the Performing Arts. In Leeds, 1,604 are on these grants, spread between Leeds City College, Leeds College of Music and Leeds College of Art. London has a huge further education sector, which caters to so many of the groups identified in the equalities assessment, as my right hon. Friend the Member for Tottenham (Mr Lammy) said. At a time of pressure already, from area reviews and cuts to ESOL—English for speakers of other languages—this new proposal could be toxic. If the effect of these changes, introduced without consultation, is to blunt those skills and that empowerment, this Government will be cutting off at the knees the very strategies for English devolution, for skills and for social mobility that they claim to be promoting.
Rushanara Ali (Bethnal Green and Bow) (Lab)
Last week, the Prime Minister said that his Government’s mission was
“to look each…child in the eye, and say, ‘Your dreams are our dreams. We’ll support you with everything we’ve got.’”
Does my hon. Friend agree that scrapping grants to half a million people, including more than 5,000 young people in Tower Hamlets in my constituency, is a cap on aspiration and that it stinks of hypocrisy?
Mr Marsden
I certainly agree with the point about the potential threat to my hon. Friend’s constituents, and it underlines what I said about London.
Several hon. Members rose—
Mr Marsden
No, I will not give way until I have finished dealing with the intervention. On my hon. Friend’s point about hypocrisy, it is not for me to judge, but I would recall that fine old English proverb, “Fine words butter no parsnips.”
Michael Tomlinson (Mid Dorset and North Poole) (Con)
On social mobility, will the hon. Gentleman welcome the fact that more and more people from disadvantaged backgrounds are accessing higher education? That has increased from 13.6% when the Labour Government were in power to more than 18% this year.
Mr Marsden
Of course I welcome that fact. The point I am trying to establish today, which I hope the hon. Gentleman and his colleagues will accept, as I am actually trying to help them, is that these are fine words about an increase in social mobility and all the rest of it, but things will go in the opposite direction if they do not reconsider this measure.
Several hon. Members rose—
Mr Marsden
I am sorry but a great number of people wish to speak. I have taken a number of interventions already and I really must make progress.
Mr Speaker
Order. Just so that the House is aware, on present trends there will be only about an hour in total for Back-Bench speeches and 18 people are wanting to speak. I am underlining the potency of the point that the hon. Gentleman has just made from the Front Bench.
Mr Marsden
Thank you, Mr Speaker. There is a nudge factor here; it is a nudge away from progress, from that regional growth and from those opportunities for groups and individuals who traditionally have been debt averse. Asking people on higher education courses at further education colleges to take on up to £50,000-worth of debt in areas such as the north-east, where in some parts that sum could equate to the price of a small house or flat, concerns colleges such as New College Durham. Its principal, John Widdowson, has said that
“nudge can work both ways—especially for people who’ve signed up for foundation courses and are considering going for honours—the more complex you make the funding process the more it can seem a barrier.”
Those sorts of concerns were recently echoed by the Office for Fair Access. But it is the individual life chances that may be blighted or disrupted by these changes that should weigh heavily on all of us, which is why the NUS and its student bodies have been so passionate in campaigning against this change. For me, all those individual cases in FE are summed up by the email I received only yesterday from a student in Blackpool, who said that she would like to thank me
“for defending the students who will be affected by the loss of grants. I am from Blackpool and in my second year of my degree with UCLan, and a married mature student with two children.”
She said that she had been plagued by illness as a child, which is why she was having to study in her late 30s, and stated:
“The complete U-turn by the Government who said education should not just be for the privileged and should not exclude the poor has now done exactly that.”
The changes will also affect significant numbers of students in the traditional university sector, including 14,000 at Manchester Metropolitan University, 8,000-plus at the University of Manchester, nearly 11,000 at Nottingham Trent and 3,738 at King’s College London. As I have said, it is a potential list of lost opportunities.
We can only speculate on what impact the regulations will have on future cohorts of students. The National Education Opportunities Network and the University and College Union are currently undertaking research with more than 2,000 final year A-level and level 3 students to look at how costs influence the higher education choices that those students make. The interim findings from that research show that more than half the students who are deciding not to go into HE are taking that decision because of the lack of direct financial maintenance grant support that they had envisaged for the year ahead.
The equality assessment states:
“At an aggregate level there is no evidence that the 2012 reforms, which saw a significant increase in HE fees and associated student debt levels, has had a significant impact in deterring the participation of young students from low income backgrounds.”
That is now debateable, because the safety net of maintenance grants, which was introduced in 2012 with that tripling of fees, is now being removed. That is why, in her letter praying against the regulations, the shadow Secretary of State wrote:
“Labour is concerned this change won’t improve Government finances in the long term.”
That echoes the view of the Institute for Fiscal Studies, which said:
“The replacement of maintenance grants by loans from 2016–17 will raise debt for the poorest students, but do little to improve government finances in the long run.”
The IFS states that, in the short term, Government borrowing will drop by around £2 billion a year, because current spending on grants counts towards current borrowing, while current spending on loans does not. In the long run, savings could well be less than that. The amount of money lent to students will rise by about £2.3 billion for each cohort, but the IFS says that only around a quarter of those additional loans are likely to be repaid. In the long run, therefore, the net effect is a reduction in Government borrowing by around £270 million per cohort, and a 3% decline in the Government’s estimated contribution to higher education. In a fair and balanced way, the IFS said:
“Students from households with pre-tax incomes of up to £25,000 (those currently eligible for a full maintenance grant) will have a little more ‘cash in pocket’…But they will also graduate with around £12,500 more debt, on average, from a three-year course. This means that students from the poorest backgrounds are now likely to leave university owing substantially more to the government than their better-off peers.”
It also states:
“The poorest 40% of students going to university in England will now graduate with debts of up to £53,000 from a three-year course, rather than up to £40,500. This will result from the replacement of maintenance grants”.
As I have already said, when the Government tripled tuition fees in 2012, they tried to sweeten the pill, by talking up the centrality of the maintenance grant to ensure that the most disadvantaged could still access higher education. They promised three things: a national scholarship programme; the maintenance grants for the disadvantaged programme; and the earnings-related threshold that would be uprated with inflation. The then Minister of State for Universities and Science, David Willetts, said:
“The increase in maintenance grant for students from households with the lowest incomes, the National Scholarship Programme, and additional fair access requirements…should ensure that the reforms do not affect individuals from lower socio-economic backgrounds disproportionately.”
That is what the Minister’s predecessor in the Conservative-led Government said in 2011-12, but the regulations that the Government passed in Committee last week will disadvantage the same groups of students that the Government promised to protect two years ago. David Willetts previously lauded the measures as a quid pro quo for the trebling of tuition fees, saying:
“Our proposals are progressive, because they help to encourage people from poorer backgrounds to go to university, because of the higher education maintenance grant, and because of the higher repayment threshold.”——[Official Report, 3 November 2010; Vol. 517, c. 940.]
Now all three elements of those promises have been broken by this Government. The Minister’s colleague, now Lord Willetts, must be revolving in his ermine at the way in which his promises have been so lightly regarded by the Government.
The Government and their predecessors set great store by the principle of “nudge”—actions that persuade people to change their behaviour for the better. Let me remind the Minister that it is possible to nudge people away from desirable outcomes rather than towards them. A new Department for Business Innovation and Skills study shows that more than half the applicants said that they had been put off university by the costs. That is backed up by the Sutton Trust, which said:
“Shifting grants to loans may move them off the balance sheet, but it could also put off many low and middle income students and tip the balance against their going to university. Since grants were reintroduced, there have been significant improvements”—
and we welcome that, but those will be—
put at risk by today’s Budget plans.”
Research from the National Union of Students, which was published last week by Populus, shows that parents are concerned that the Government’s plans to scrap the maintenance grant will discourage their children from applying to university. Two fifths of those with a combined income of £25,000 or less believe that to be the case. The range of the groups affected by the changes is daunting. The assessment concedes that black and minority ethnic students in particular will be disproportionately worse off. On older learners, it says:
“Mature students will be disproportionately impacted by the policy proposals to remove the full maintenance grant and replace with additional loan as well as the freezing of targeted grants.”
The Government have also conceded that disabled people will be disproportionately affected by the decision not to protect the real-terms value of disabled students allowances. The assessment spells out the potential for discrimination because of religious beliefs, stating that there is evidence to suggest that there are groups of Muslim students whose religion prohibits them from taking out an interest-bearing loan. Finally, the impact assessment also states that female students will be particularly affected by the freezing of childcare grants, parents’ learning allowances and employment and support allowances, given their significant over-representation in these populations.
Further to that, the scrapping of 24+ loans in further education is particularly relevant to the case before us today, because it is indicative of what has happened in previous circumstances when the Government have gone down this road. As the Minister knows, the Government released figures in October 2015 that showed clear evidence of the deterrent impact on learners that I and others warned about when these loans were introduced as replacements for grants in January 2013. The figures showed that in 2014-15 only £149 million of the £397 million allocated for the process had been taken up. It is no wonder that people in the FE community have lamented the lost opportunity of £250 million that could have helped some of our most disadvantaged learners. The very group of people who benefited from the concessions given in 2013 by the Minister’s predecessor, the right hon. Member for South Holland and The Deepings (Mr Hayes)—that those who went on access to HE courses would have the outstanding amount written off in their access course loan—face another knock back. The damning details from the Government’s own impact assessment should surely give Ministers pause for thought, given that they threaten to affect the most debt-averse groups.
Worryingly, it appears that the Government have yet to produce an up-to-date estimate of the impact that the shift from grants to loans will have on the resource accounting and budgeting charge, which calculates the cost to the Government of the higher education funding system, based on how much students are ultimately expected to repay. Having heard the evidence that we have presented so far and the comments from around the Chamber, will the Government tell us why, if they were so confident about these policies, they did not bring them to the Floor of the House? More to the point, why did they not consult independent experts and various representative organisations? Why did they not commission research from any of the reputable independent policy bodies?
Last month, along with a number of other MPs, I sat in the corridor of this place listening to hundreds of students who had come to lobby us. Their message was consistent: scrapping maintenance grants will leave people struggling to go to university. People in the Chamber today have talked about consequences and people will talk about their own experiences. I was a tutor for the Open University for 20 years and I know that many of the students whom I taught had been put off higher education at an earlier age by the costs. Such things do not alter just because we are now in the digital world of the 21st century, and the impact of the changes, particularly on mature students, cannot be divorced from the precarious position of so many of those who study part time in HE.
Statistics published by the Higher Education Statistics Agency have shown that the number of first-year part-time students in 2014-15 is down 6% on previous years. The number of part-time higher education students since the Conservatives came into office has fallen by nearly 40%. No wonder the NUS is exasperated about that, and it relates it to the trebling of student fees since 2012 for England and English students in HE in Wales and Scotland. No wonder also that the president of Universities UK and the vice-chancellor of the University of Kent, Dame Julia Goodfellow, said that the decline in part-time numbers was a serious concern. I acknowledge, as they do, that the introduction of maintenance loans to some part-time students from 2018-19 announced by the Government is welcome, but in the meantime the nudge factors are very strong against such study. No wonder the Open University has also expressed its alarm, commenting on the Minister’s higher education Green Paper that flexible learning provision is also at the heart of Government policy development. Are not those concerns precisely why we need a proper discussion and are they not reasons why we need a commitment to bring a Bill to this House? I invite the Minister to give that in his response.
There is a lack of balance, as well as a nudging towards negative outcomes, and the issue will not go away. It is not surprising that connections have been made between the specific ways the Government have tried to dodge scrutiny in this matter. No wonder the Minister appeared relatively ill at ease in Committee, but to tell the truth perhaps the blame lies elsewhere. The article in The Independent reminds us that it was the Chancellor who tried to use a statutory instrument to smuggle through his tax credit changes, and we all know what happened to them. The Chancellor is proud of promoting himself as the Government’s master builder—all his rhetoric is shot through with the image. He preens as he boasts of the march of the makers and of how the Government, on his watch, is fixing the roof while the sun is shining, but the truth is that the Chancellor is a man with whom we always need to read the small print. He has consistently missed many of his debt and other targets, and as far as building a secure future for Britain’s learners is concerned, he is Mr Dodgy, whose actions are unlikely to get a certificate from the Federation of Master Builders. While the sun is shining, he has dislodged slates on the way down and has disguised cuts to adult skills as efficiencies, as his Newspeak officials call them.
He is pushing those students off the ladder of social mobility. It is time for him to get real in the real world, where the elasticity of demand eventually snaps and where stretching the envelope can finally break it. The direction of travel is threatening to deliver not a northern powerhouse but a northern poorhouse, undermining his regional strategy. We want no part of the narrative of failure, nor should this House, and that is why this afternoon we are calling again for Ministers to think again, to support the motion, and to annul the misguided regulation that this Government tried to hide away.
Several hon. Members rose—
Mr Speaker
Order. Before I call the Minister for Universities and Science, from whom the House will want to hear and who will need to treat of these matters in proper detail, may I gently express the hope that the combined effect of the intellectual powerhouses on the two Front Benches and their enthusiasm for communication will not succeed in crowding out Back Benchers? We have also to hear from other distinguished intellects later in summing up the debate, and I hope that the product of their grey cells will be meaty but not too big.
The Minister for Universities and Science (Joseph Johnson)
I welcome the opportunity to explain, I hope briefly, why it would be a mistake to vote for the Opposition motions that attempt to annul the statutory instrument agreed by the Delegated Legislation Committee last Thursday. The instrument delivers the Government’s policy of offering increased financial support for living costs for new students in the 2016-17 academic year in the form of loans rather than grants. The policy is part of the Government’s plan to ensure that our world-class higher education sector remains sustainably financed and open to more students from all backgrounds. The Government are extending the benefits of higher education to more people than ever before. We have lifted the artificial cap on student numbers, allowing record numbers to secure places last year.
A higher education sector that is not properly and sustainably funded cannot deliver the life-changing education that students expect.
Joseph Johnson
I will when I finish my introductory remarks.
In the context of fiscal restraint, ensuring that we have a sustainable model for our higher education system is crucial. In this respect, the measure builds on successive reforms since 2010 which have delivered a higher education system that safeguards social mobility and delivers for students and taxpayers. Indeed, the OECD has commended the reforms in aggregate for the sensible balance they strike between the interests of taxpayers and students. Its director of higher education has said that England is
“one of the very few countries that has figured out a sustainable approach to higher education financing.”
Very recently, on a trip to London, he added that England
“has made a wise choice. It works for individuals, it works for government.”
Joseph Johnson
I am grateful to the right hon. Gentleman for making that point. If he reads page 35 of the Conservative party manifesto, he will see a clear commitment to continuing the funding reforms that I have just described and ensuring a fair balance between the interests of taxpayers and students. There are also many other references in the Conservative manifesto to the need to achieve budget deficit savings.
Let me start by beginning to address the questions about the scrutiny of the regulations that were raised by the hon. Member for Blackpool South (Mr Marsden). The regulations were not sneaked in, as he suggested. In fact, the policy was first announced in principle in the 2015 summer Budget, nearly six months ago. It was in fact included in the Chancellor’s summer Budget speech, one of the most closely scrutinised events in the parliamentary calendar. The decision finally to proceed was made as part of the spending review in November 2015 and the instrument was laid before the House on 2 December. A comprehensive 80-page equality analysis was published the next day, in line with an earlier commitment I made voluntarily to the House. I shall say more about that later.
The regulations were made under powers granted to the Secretary of State by the previous Labour Government, under the Teaching and Higher Education Act 1998. Rather than using some obscure and arcane procedure, as hon. Members have suggested, we are following the very parliamentary processes that the previous Labour Government created for this purpose. Labour asked for a debate on the regulations on 9 December and the Government tabled a motion that appeared on the Order Paper on 5 January, referring the regulations to a Delegated Legislation Committee. Labour did not object, and the regulations went to such a Committee on 14 January. To put it simply, the processes were put in place by Labour when they were last in government and they did not object on 5 January, when they had the chance. I now welcome the opportunity to debate the issue further in this Opposition day debate and I note that the other place will also have a chance to consider the instrument following the tabling of a motion by the noble Lord Stevenson of Balmacara on 13 January.
Catherine McKinnell (Newcastle upon Tyne North) (Lab)
I have been contacted by a large number of people, including students from Walbottle Campus, Gosforth Academy and Newcastle and Northumbria Universities. They would like to know from the Minister when they will have the opportunity to feed into the public consultation on this issue.
Joseph Johnson
The House debated the matter in the Delegated Legislation Committee. There was a thorough 80-page equality analysis. The Department for Business, Innovation and Skills maintains an ongoing and regular dialogue with all stakeholders on matters relating to higher education.
We welcome the scrutiny, because this Government are rightly proud of our record on higher education. Since 2010 we have delivered a bold reform of higher education, putting in place a funding model that has ensured that our universities are properly funded and properly able to deliver world-class, life-changing education. At a time of significant fiscal consolidation, total income for the higher education sector has risen in real terms; it has increased from £24 billion in 2012-13 to £26 billion in 2013-14 and is forecast to rise to £31 billion by 2017-18.
Let us not forget the difficult fiscal context in which this has been achieved. Against the background of a record budget deficit, providing universities with that level of financial security could only be achieved by asking students to meet a greater part of the cost of their education, paid not upfront but out of their future earnings. That recognises the principle that if someone benefits from higher education and secures higher lifetime earnings than taxpayers who do not go to university, they should contribute to the cost of their education.
Rushanara Ali
The Minister is aware that students from disadvantaged backgrounds are already less likely to go to university; those from more advantaged backgrounds are two and a half times more likely to do so. This change will make that much worse. Will the Minister please face up to the facts and do something to respond to this question? If his Government are serious about social mobility, these cuts would not be made and he should be honest about that.
Joseph Johnson
This Government are committed to social mobility and we are delighted that we now have more students from disadvantaged backgrounds going into higher education than ever before, at a record level of 18.5%. Those from a disadvantaged background are now 36% more likely to go to university than when we took office in 2010. The Prime Minister has committed to doubling the proportion of students from disadvantaged backgrounds in our universities from 2009 levels by 2020, and we are going to be doing everything in our power to ensure that happens.
It is this sustainable model of funding that has allowed more people to benefit from higher education, which in turn promotes social mobility. Removing the cap on student numbers has allowed more people to benefit from higher education than ever before. We are now in a position in which almost 50% of young people are likely to undertake some form of higher education during their lifetime. This would simply not have been possible in an unsustainably funded higher education system.
Peter Kyle (Hove) (Lab)
Brighton and Hove City Council has set up a fairness commission to make sure that it delivers fairness and social mobility in its public policy making. With 3,700 students out of 10,000 at Sussex University and 6,700 out of 16,000 at Brighton University on maintenance grants, has not their job just got an awful lot more difficult because of the Government’s policy?
Joseph Johnson
The hon. Gentleman can tell his constituents that university and going into higher education remain transformational experiences, especially for people from disadvantaged backgrounds. They are likely on average to go on to earn £100,000 more over their lifetimes as a result. Owing to the instrument that we are debating today, they will have access to more financial support while they are at university than ever before.
Let us acknowledge the success of these reforms. As a consequence, we today have a higher education system with record numbers going to university, record numbers of disadvantaged students, the highest ever rates of black and minority ethnic participation, and more women in higher education than ever before. The principles underpinning these reforms flow from a clear manifesto commitment to
“control spending, eliminate the deficit, and start to run a surplus.”
I have already referred to the other commitments in the manifesto, on page 35, relating specifically to higher education funding.
Those Opposition Members who oppose our policy and want to reintroduce more direct taxpayer support must think about whether they would also have to reintroduce the student number controls we abolished and prevent thousands of young people from attending university.
Joseph Johnson
Does the hon. Gentleman wish to reintroduce student number controls?
Neil Coyle
The point I want to make is that applications to the most selective universities from students from the lowest income households has fallen since 2010, from 16.2% in 2010 to 15.3% in 2014. What impact, in terms of the number dropping further, will this policy have?
Joseph Johnson
We want people from disadvantaged backgrounds to go to the very best universities in this country in as high a proportion as possible. We want to see that increase, which is why we asked in our guidance letters to the director of the Office for Fair Access that he pay particular attention to institutions that are not pulling their weight in getting people in from disadvantaged backgrounds. We will continue that in our next letter to the director of the OFA.
Rebecca Harris (Castle Point) (Con)
On paying for university, does the Minister agree that it is difficult for me to explain to residents in my constituency on low or moderately low incomes who have not had the benefit of a university education that the alternative is for them to pay more in their taxes for people who will have the opportunity to earn considerably more in their lifetimes?
Joseph Johnson
I thank my hon. Friend for her intervention, and that is precisely the point: it is unfair on people who do not go to university to pay for the educations of those who in their lifetimes will go on to earn considerably more. On average, men who go to university will earn £170,000 more in their working lifetimes than someone with two A-levels who does not go to university, and women who go to university will earn £250,000 more over their working lifetimes. It is entirely fair that we ensure that they contribute towards the cost of their higher education.
Let me turn now to specific changes to student finance for the coming academic year. We should first note that the instrument delivers more money for students from some of the most disadvantaged backgrounds. Evidence suggests students are primarily concerned about the level of maintenance support they receive while studying. They understand that student loans are not like commercial debt, in that they are progressive and only repaid in line with future incomes.
As a result of these regulations, an eligible student whose family income is £25,000 or less and who is living away from home and studying outside London will qualify for up to 10.3% more living-costs support in 2016-17 than they would under current arrangements, which is an additional £766 of support. Those who vote for the motion to annul this instrument will be denying poorer students this extra cash.
Studies show that graduates will, on average, earn £100,000 more than non-graduates over their lifetime. BIS research suggests that this premium could be as high as £250,000 for female graduates compared with those who hold two A-levels or fewer. This is our progressive A-level system and our progressive repayment system in action, and those who do not benefit from increased earnings as a result of undertaking higher education will not pay any more as a result of this policy.
The system we have put in place ensures that higher education is open to everyone with the potential to benefit from it, irrespective of background. Opposition scaremongering only risks deterring students from attending university. While the data available so far on this application cycle are provisional, early data from UCAS indicate applications in 2016-17 are broadly in line with last year. The BIS-funded student finance tour sends out recent graduates to schools to bust the myths about student finance. Let us not undo the good work they do in undertaking this tour; they are passionate advocates of the benefits of university, and speculating and scaremongering about the effects of this instrument will undermine their good work.
Patrick Grady (Glasgow North) (SNP)
More than 45,000 students from England each year choose to study elsewhere in the UK, including at Glasgow University in my constituency. How does scrapping maintenance grants incentivise them to travel further from their home to get the benefit of education at universities outside England?
Joseph Johnson
We are making a record amount of financial support available to those students—more than has been provided by any previous Government. That will enable them to travel further away from home than they have in the past.
Let me turn to the significant savings achieved by these changes. The switch from maintenance grants to loans will, in a steady state, save around £2.5 billion per year from the fiscal deficit—not the £1.5 billion mentioned. We acknowledge that a proportion of the loans will not be repaid. This is a conscious decision to invest in the skills base of our country, and protect those who go on to lower-paying graduate jobs. We forecast that the long-term annual economic savings will be around £800 million per year.
Mr Geoffrey Robinson
The Minister said earlier that this is a deficit-reducing policy and we take that, and of course I entirely agree with all the points that have been made on the grounds of social mobility and denial of educational opportunity that this policy implies, but is not the point the Minister really has to answer that 45% of his loan books at the moment have been declared delinquent for one reason or another? How much of this so-called saving does he think he is going to get back? Is he not really just pretending he is making this saving, while in fact building up unfunded liabilities?
Joseph Johnson
There is an immediate grant saving of £2.5 billion, which comes directly off the budget deficit. As I just mentioned, there is of course the prospect down the line of some loans not being repaid, as a result of a conscious decision by the Government to invest in the skills base of the country and to allow people to pursue incomes that do not enable them to pay off the full value of the loan. The economic value of the savings, as I just said, is £800 million a year in a steady state.
I challenge the Opposition to explain how they would fund their alternatives. I note that the Labour party has in the past year put forward competing higher education funding policies, although they share one significant feature: their huge cost to the taxpayer. Labour’s leader, the right hon. Member for Islington North (Jeremy Corbyn), said in July that fees should be removed completely, with grants retained in full. The policy was costed by Labour itself at £10 billion. Such policies move us backward. They are unsustainable and, at a conservative estimate, would add more than £40 billion to the deficit over a five-year Parliament. We should be clear about what the results would be: more reckless borrowing, more taxes on hard-working people, and the reintroduction, inevitably, of student number controls. We have lifted student number controls and we will not allow the Labour party to reimpose a cap on young people’s aspirations.
I will deal with the risks associated with this policy as set out in the equality analysis, but let me first quickly respond to the false accusation that we refused to publish the assessment until prompted to do so by the National Union of Students. That is simply not true. Every year, when the Education (Student Support) Regulations 2011 are amended, an equality analysis covering the changes is published on gov.uk. This is standard practice. On 14 September, in a written response to a parliamentary question asked by my hon. Friend the Member for Totnes (Dr Wollaston), I said:
“The Government expects to lay amendments to the Education (Student Support) Regulations 2011 later this year and publish an Equality Analysis when the Regulations are laid. The Equality Analysis will include an assessment of potential impacts of the changes.”
Only on 22 September 2015, more than a week after that answer was given, did the NUS give notice that it would seek legally to challenge our policy. There has been no evasiveness in the presentation of the policy or its potential impacts.
I will deal now with some of the issues identified in the equality analysis and how they will be mitigated. Let it be remembered that similar issues were identified as a result of the 2012 reforms, but did not crystallise. Indeed, we now have a world-class higher education system, with record numbers of disadvantaged students in higher education, the highest rates of BME participation in higher education and more women in higher education than ever before. Our impact assessment explains that the risks will be mitigated by at least three factors, including the 10.3% increase in the maximum loan for living costs, the repayment protection for low-earning students and the high average returns on higher education.
More funding is also being provided through access agreements: in 2016-17, £745 million is expected to be spent by universities through access agreements, up from £404 million in 2009-10. That is money that makes a real difference to disadvantaged students, and we will of course monitor the progress of the policy through the data available from the Higher Education Statistics Authority and the Student Loans Company.
Rachael Maskell (York Central) (Lab/Co-op)
At the University of York, 40% of students get a maintenance grant. What assessment has been made of the impact on universities of not attracting students because they simply cannot afford to attend?
Joseph Johnson
As I have already said, we are making a record amount of financial support available to students, and students from the poorest backgrounds will benefit from a 10.3% increase in financial support. They will have more cash in their pockets than ever before.
I hope that I have been able to clarify some of the misconceptions about our policy, the steps we are taking to increase living costs support and the process surrounding it. I will finish by directing Labour Members’ attention to the interview with Ed Balls in Times Higher Education this week, which should be of interest to them. He said that the
“blot on Labour’s copybook”
was that
“we clearly didn’t find a sustainable way forward for the financing of higher education”.
He went on to say:
“If they”—
the electorate—
“think you’ve got the answers for the future, they’ll support you”.
We have a plan for the future. In a time of fiscal restraint, we are taking action to ensure that university finances are sustainable, so that more people than ever before can benefit from higher education.
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. Before I call the Scottish National party Front-Bench spokesperson, I remind Members that there are 18 people who want to catch my eye and the winding-up speeches will start in just over an hour, so we will have a time limit of three or four minutes by the time we reach the Back-Bench speeches. If everyone is as concise as possible, we will hopefully be able to get everyone in.
Carol Monaghan (Glasgow North West) (SNP)
Education has been a priority in Scotland for more than 300 years. The established Church in Scotland decided in the mid-16th century to set up a school in every parish to enable children to read the Bible and access its teachings. By the early 18th century, Scottish children led the world in literacy and fuelled the Scottish enlightenment.
That is important because it highlights the differences in how education is viewed across these isles. The focus in Scotland remains the student; there is not only a commitment to the young person’s education but an acknowledgement that that same young person will develop skills through their university career that make them an asset to the country.
Carol Monaghan
No, because I have been urged to be brief.
By contrast, we see from this Tory Government an ideological attack on the most disadvantaged students. While still at school, talented pupils in England have had their education maintenance allowance scrapped, forcing some youngsters to leave before they have reached their potential. In England and Wales, fees of £9,000 a year are being imposed on students, and now grants for the poorest are to be scrapped, with the Chancellor describing them as “unaffordable”. In using such language, does the Chancellor consider those young people to be an asset?
In my previous profession as a secondary school teacher, I often came across extremely able pupils from difficult backgrounds. It was important early in their school career to plant a seed of possible career aspirations, because even with academic success getting them to university was not a certainty. A lot of work had to be done both with the young people and with their parents to encourage that progression.
Tom Tugendhat
The hon. Lady speaks with eloquence and knowledge from her great experience in secondary education and I very much welcome her contribution, but I challenge her description of the differences between Scottish and English education. In England, we have seen a greater ability of children from all backgrounds to achieve access to tertiary education. In Scotland, that is increasingly not the case. Does she not agree that one of the Scottish National party’s achievements of the past five years has been a fall, not a rise, in social mobility in tertiary education?
Carol Monaghan
Once again, we hear that myth here in this House. There is work to be done on the numbers of young people going directly from school to university; none of us would deny that. However, in Scotland young people have many more pathways to access university. If we look at children coming through further education colleges, we see that the number of young people from disadvantaged backgrounds is significantly higher in Scotland than in the rest of the UK.
May I return to those young people and their parents? Eventually the chat turns to logistics and how they will be able to afford higher education. We have to go into the detail. Parents are usually full of pride—often the child is the first in the family even to think about going to university. Explaining that in Scotland tuition is free makes a huge difference, but the parents still have to weigh things up. They have been expecting a new breadwinner, contributing to the household. They have been expecting their daughter or son’s Saturday job to become their full-time career. Instead, the financial burden on the family stretches on.
Hywel Williams (Arfon) (PC)
My constituent Nathan Haley is an English student studying in Wales. He already faces debts of £36,000 in tuition fees and expects that to rise to £65,000 if the proposal goes through. Does the hon. Lady think that will encourage him to pursue a career path into teaching?
Carol Monaghan
I thank my hon. Friend for his intervention. The barrier becomes insurmountable for such young people. I was one of five who all managed to go to university and got grants throughout that time. For my family it would have been impossible for us to access a university education.
Being able to say to worried parents, “Yes, there is some support available. Yes, you will be able to apply for financial help” makes a massive difference to the decisions the family will make. When there is less family support, the financial support offered by a grant becomes a lifeline. Students can of course apply for loans to support them through their course, and many do, but we have to understand that loans are not viewed the same by children from different backgrounds. For families living under the constant threat of debt, for whom life is a continual battle to survive between meagre wage packets, the decision to take out a loan, incurring further debt, is extremely difficult, and often it is one that they just cannot take.
Clive Lewis (Norwich South) (Lab)
I could not agree more with the hon. Lady on that point. The Institute for Fiscal Studies has said that the debt of the poorest 40% of students will increase by £12,500 to £53,500. I do not know where Government Members are coming from, but from my point of view, as someone who came from a working-class background, that would have put me off going to university and it will put off many thousands of other students. The policy is not about social mobility. There is no social justice in it. It is about social cleansing and keeping such students out of university, and it is wrong.
Carol Monaghan
I agree wholeheartedly with the hon. Gentleman.
There has been some success in widening access, which must be applauded, but there is a danger that the excellent work that has been done will be brutally undone if these grants are scrapped. Last week in a different context I heard a Member on the Government Benches refer to grants as “free money”. Let me be clear: grants are not free money. Grants are paid back. The grant that I received when I was a student was paid back by more than 20 years as a physics teacher. The bursaries provided to student nurses are paid back when they provide vital care in our NHS. The grants paid to students across these isles will be paid back when they take their place as educated contributors to our workforce and to our nations.
In Scotland education has been a key national priority for over 300 years and the Scottish Government’s commitment to our young people is clear. The UK Government have to ask themselves whether they value education and the benefits to society that it brings. Do they value the skills gained by our young people, or is this simply another attack on the most vulnerable?
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. I am putting a time limit of four minutes on Back-Bench contributions. If we keep to four minutes, we might get through everybody who wishes to speak.
Alec Shelbrooke (Elmet and Rothwell) (Con)
The problem with today’s debate is simple: no alternative is offered to the measure that has been laid before the House. For all the huffing and puffing from the Opposition, their idea of social mobility is, “We’ll just give lots of money and let lots of people go. We’ll worry about paying it back later, even though the economy will crash like it did before.” Social mobility went down 13% over 13 years of Labour government.
The game was given away last week at Prime Minister’s questions when the Leader of the Opposition made it clear that he thought it was a bad policy for this Government to try to improve social housing and get rid of some of the sink estates. The policy of the Labour party now seems to be, “Where you’re born is where you should stay because we will look after you by printing money.” It is nonsense.
I worked in the higher education sector for many years. I once asked what would happen if we did not increase tuition fees. The answer was that we would limit the numbers of people who could go to university. That is abysmal. The hon. Member for Norwich South (Clive Lewis) says he was from a working-class background. Guess what? So were lots of Members on the Government Benches. The Opposition are trying to bring class warfare into the argument, which is nonsense.
James Cartlidge
Does my hon. Friend agree that it is not just about the number of students? If we had not increased the funding, the quality of the degree that each student receives would have suffered.
Alec Shelbrooke
I entirely agree with my hon. Friend. That is why such efforts have been made to address the A-level and exam system. As someone who was outward-facing in my career at the University of Leeds, I was shocked to go to countries in Europe such as Germany and be told of worries about the standard of UK degrees because of the A-levels that were done to get on those courses. As a prime example, we had to lay on two extra modules of basic maths in year 1 of our engineering degree because we had students who could not cope with the mathematics used in engineering, although they had good grades at A-level.
That is part of a bigger picture, and the point of today’s debate—opportunity for everybody to go to university. It is all very well to say that grants should not be cut without proposing an alternative way of raising the money, but the system would become unaffordable as a consequence, limiting the numbers of people going to university. I went to a comprehensive school. My parents were teachers. I became a professional engineer and then a Conservative MP. My sister qualified two months ago as a fellow of the Royal College of Surgeons. No money was spent sending us to private school. We went out and got our own part-time jobs to fund our way to university. I took on a private job at WH Smith when I was still at school.
Simon Hoare (North Dorset) (Con)
My hon. Friend is telling the House in clear terms an explicit Conservative story of hard work, opportunity and meritocracy, in sharp contradistinction to the narrative from the Opposition, who were too busy thinking about their reshuffle to pray against the order and are far too busy plotting and planning to keep people in their places, rather than busting the glass ceilings.
Alec Shelbrooke
My hon. Friend makes an excellent point. This is what today’s Opposition debate is about. It is not about how we best move this country forward. That is why, under 13 years of Labour government, social mobility decreased. The statistics and the facts cannot be argued with. The fact that there has been a 36% increase in those from the poorest backgrounds going to university, the fact that we raised the income at which a student loan had to be paid back to £21,000, the fact that we reduced the amount to be paid back each day, the fact that people do not start paying interest on it until they leave university, the fact that it is time limited so that it is written off after a specified time—all these are key aspects of making sure that we get people to university and reap the best of their potential.
Rebecca Harris
Does my hon. Friend agree that the way to encourage more social mobility and get more young people from disadvantaged backgrounds into university is, first, to improve their chances in education, and then to show them what they can achieve and raise their expectations and their confidence, not to frighten them with fears of debt for the future?
Alec Shelbrooke
My hon. Friend is right. We have heard time and again from Labour, “You cannot afford to go to university. You are going to have huge debts. You are from a poor background—don’t go because you’ll be worried about debt. Don’t increase your life chances.” It is a disgrace of modern politics that the Opposition peddle such rubbish.
We have a generation who believe they can go on to “The X Factor”, win it and become rich. Why did we not see that in relation to the possibilities in academic education and professional careers? It was because we had a Labour Government who wanted to keep people where they were, and who said, “You may be lucky enough to pull yourself up out of that situation, but, if not, don’t worry—we’ll keep borrowing money. We’ll still rack up huge debts that hard-working people will have to pay for so that you can stay where you are.” That is not what we on the Government Benches believe. We believe in an “X Factor” generation of people who go out, pull themselves up, get the education they are capable of getting, and become the people who drive this country. The idea we have heard in this debate—“Here is the working class on the Labour Benches and there is the upper class on the Conservative Benches”—is so outdated and misguided that it is laughable.
That has been the problem with the Opposition since the start of this Parliament: they have been laughable. It is laughable that they bring forward a motion saying, “We don’t agree with the legislative process that we laid down back in 1998.” We say, “You didn’t do anything about this when the time was right”—when it was laid before the House.
This is Labour Members trying to start the old class wars once again, because that is all they have to fall back on now. They have no coherent economic policy and no coherent plan for higher education. They have heard the words of the former shadow Chancellor of the Exchequer, yet they give no response.
Conservative Members specifically questioned the shadow Minister about Labour’s alternative. The response was, “It’s an Opposition day debate and we don’t have to answer that.” It is not a debate: it is a bunch of people stamping on the floor and not suggesting anything sensible. A debate is an exchange of policies whereby we come up with something that might take us in a better direction. Simply standing there and saying, “We don’t like it,” is pathetic. It is the politics of the sixth form, but frankly that is what we have come to expect from this ridiculous Opposition.
Dr Roberta Blackman-Woods (City of Durham) (Lab)
I begin by thanking my hon. Friends the Members for Wallasey (Ms Eagle) and for Blackpool South (Mr Marsden) for the fact that this debate is taking place. The Government would have been more than happy for these sweeping changes to higher education to pass through Parliament unnoticed, hidden away in delegated legislation—worst of all, a negative SI—with no public scrutiny. I am therefore pleased that at least we are able to call the Minister to account. However, it is extremely disappointing that he showed no contrition whatever for introducing policies that are likely to limit the aspirations of many young people in this country, or at the very least make it more difficult for them to achieve them.
Dr Blackman-Woods
I will not give way to the hon. Gentleman because we are very short of time.
We know that these changes will affect many students. The House of Commons Library states that in 2014-15, 395,000 students received a full grant, with 135,000 getting a partial grant. That amounts to over half a million students. Currently, students who go into higher education from families with an annual income of £25,000 or less are eligible for the full grant of £3,387, and students from households with an annual income of between £25,000 and £42,620 are eligible for a partial grant. However, in the summer Budget of July, plans were announced to remove the student maintenance grant, arguing that the grants had become “unaffordable”. This, in itself, is an assertion that needs to be deconstructed. Politics is about priorities, and this Government have chosen not to prioritise the needs of students from low-income families and, astoundingly, to make them a target for cuts.
The Government have talked endlessly about the importance of hard work and rewarding those who want to achieve, yet now they are undoubtedly making it more difficult for a number of our young people to have the opportunity to access higher education. The move to £9,000 fees in 2012 has meant that students and graduates now contribute 75% towards the overall costs of their higher education. The replacement of grants with loans will further increase the contribution of individuals compared with that of Government. Yet no conversation has taken place with students, their parents or across the country as to what the balance should be.
These changes will lead to a substantial increase in debt for poor students. Assuming that students take out the maximum loans to which they are entitled, the IFS estimates that average debt from a three-year course will rise from about £40,500 under the old system to £53,000 under the new system. This is not just a fear of debt—it is an actual increase in debt. We also know from the impact statement that these changes will particularly affect women, older students and students from ethnic minorities—reason enough to stop these policies in their tracks.
I stand here as someone who is passionate about supporting students from all backgrounds who can to get to university in accessing higher education. These changes are likely to make that more difficult for them. As a country, we need to ensure that our young people have the skills to enable them to compete in a global labour market, and I am concerned that these changes will prevent them from doing so.
James Cartlidge (South Suffolk) (Con)
It is an honour to follow the hon. Member for City of Durham (Dr Blackman-Woods) and, in particular, my hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke), whose speech combined expertise and passion.
I am going to follow in the footsteps of the Leader of the Opposition and his new style of reading out emails from constituents. I am well aware that students are concerned about this measure. I have had an email from Jack Lay, who lives in Glemsford in my constituency and is vice-president of the Kent student union. He is worried about
“making sure young people from South Suffolk are able to access higher education”
and fears that
“if grants are removed young people from poorer backgrounds will accrue more debt from no fault of their own.”
My answer to Jack and to all hon. Members concerned about this is that it will not hinder access to higher education for those from poorer backgrounds, and for five key reasons. First, we are increasing the cash that they will have in their hand to sustain university life and deal with the day-to-day costs they will face. Secondly, we have increased the level at which they will repay their student debt from £15,000 under the previous Government to £21,000—if they do not earn that, they do not repay. Thirdly, the statistics show that this is not having the impact that Opposition Members are warning about. As we have heard, there has been a 35% increase in the access rate of people from disadvantaged backgrounds to university. The figure has risen from 13.6% in 2009-10 to 18.5% last year—an incredible increase. If the Opposition’s alarmism were based on fact, that would not be happening.
The fourth key reason is that, under this policy, the beneficiary pays. That is a key principle.
Alec Shelbrooke
Is this debate not taking place basically because it sticks in the gullet of Labour Members that we have increased social mobility? Does not that echo the words of the Prime Minister, who said, “If you want a lecture on poverty, talk to the Labour party; if you want action on poverty, speak to the Conservative party”?
James Cartlidge
That is absolutely right.
The principle that the beneficiary pays is about not getting the poorer working-class people who have chosen not to go to university to pay for the education of others who will go on to earn significantly more than them. That is a fair principle, and that is why this is about fairness.
The key reason why I support the measure is that it is about the quality of the education. What really matters to the student from a disadvantaged background is that they achieve an excellent degree that enables them to earn a good salary and get on in life. That is the single most important thing. If universities are well funded, students will have more chance of a good-quality degree. I also believe profoundly that when people pay for something—when they contribute—they take it more seriously and therefore get more out of it. [Interruption.] SNP Members are laughing. I am delighted to see so many of them, because only two or three of them were here yesterday when we were discussing the crisis in North sea oil. I was quite surprised about that.
My hon. Friend the Member for Elmet and Rothwell talked about his experience. Before I came to this House, I ran a small business as a mortgage broker. For many years, we were very fortunate to have an exclusive arrangement with Britannia building society for a range of graduate mortgages called Graduate Network. Having seen thousands upon thousands of applications from graduates—many of whom, I am pleased to say, went on to buy a home—I never failed to be astonished that the more debt they had, the higher their earnings were. That was often because they had undertaken professional studies. Those who had had professional studies loans from the banks and gone on, for example, to do law and study at the Bar had the highest earnings.
Of course we do not want people to have ridiculously high debts. That is why, as my hon. Friend said, the debts would be cancelled after 30 years if not repaid. However, we have to get our heads around the key point that what really matters is the quality of the education that our students have.
Mike Wood (Dudley South) (Con)
Does my hon. Friend agree that extending the system of finance so that more part-time and postgraduate students can receive funding is helping social mobility and providing greater opportunities for people who would otherwise not be able to have access to higher or postgraduate education?
James Cartlidge
My hon. Friend makes an excellent point. The Minister is introducing for the first time masters loans, and that is incredibly important. In my experience, those who had borrowed eye-watering sums to do professional studies and courses that led to the biggest salaries, such as a masters of business administration, often had very high earnings indeed. That is a reality of life. It is about the quality of degree someone gets.
I am pleased to see that the time remaining to me has frozen at three minutes and 13 seconds, but I will wrap up because lots of hon. Members want to get in. On the broader economic issue, the number of graduate jobs has increased by 7.5%. The most important contribution the Government can make to higher education is to have a strong economy offering lots of opportunities for our graduates to ensure that they can earn salaries and therefore repay the cost of the education that they have benefited from.
Mr David Lammy (Tottenham) (Lab)
The Minister prays in aid and relies on the increase in university participation and the record number of students going to university; I did his job once and I remember standing at the Dispatch Box and saying the very same thing. However, today’s debate is not about widening participation or student numbers. It is about the cohort of students whose parents are from poor or working-class backgrounds, including dinner ladies, people who run minicabs, security guards, receptionists, people on zero-hours contracts and others who are unemployed. This debate is about their children, who aspire to go to university, and the state of our nation in relation to that cohort. That is why it is outrageous that, as a former Minister with responsibility for universities, I am allowed just four minutes to make a contribution to this debate.
When we made changes to maintenance grants back in 2009, we increased the amount we gave to students whose parents earned less than £25,000, and we increased partial grants for students whose parents were on incomes of between just over £18,500 and £57,000. It is that settlement, on the back of increased tuition fees, that we are debating today. Frankly, it is an outrage that this scrutiny has had to be dragged out of the Minister because of the work of the National Union of Students and Labour Front Benchers. It should have been a point of debate.
The issue is not about widening participation, but about fair access. There has been a 50% increase in the number of students choosing to stay at home rather than go to universities to which they would love to go. What does that mean? It is likely that the university attended by students who stay at home in a deprived constituency is a modern university, even though those students may have got the three As they needed to do medicine at a more teaching and research-intensive university. That is what this debate is about and that is how it will affect students. The Minister’s own impact assessment says that there will be a disproportionate effect on students from a black and minority ethnic background. Does he think that matters?
The Minister cannot in one breath rightly make statements about unconscious bias and the need for name-blind admissions, but then change the context for those students from poorer backgrounds in a way that disproportionately affects them. The situation is the same for disabled students, and there will also be a great impact on mature students. That is why this debate was required and why I am surprised that the Government are making the changes in this way.
A few years ago there was consensus in the House that the state, the universities and the student would make a contribution to their education, but this settlement withdraws the state even further from where it was after the 2010 Parliament and lands the debt entirely on the student. The Minister says there is no alternative, but the alternative was to go to the universities themselves, whose funding per student has gone up from £22,000 to £28,000. There were alternatives available to the Government, who have made this decision despite the fact that the Minister’s own figures show that 45% of students will not be able to repay their loans.
This does not hang together. It will have a disproportionate effect on poorer students. I have to say that, despite the fact that the Minister is not a bad guy, this is a mistake he will regret.
Huw Merriman (Bexhill and Battle) (Con)
I speak as a member of the Delegated Legislation Committee that discussed this issue last week. I draw Members’ attention to the remarks I made at the time and I welcome the fact that this debate is being held in this Chamber.
I want to refer to my own situation. I feel strongly that it is right for Conservative Members to dispel the myth coming from the Opposition that students from a background similar to mine will not be able to go to university as a result of the changes. I say that as someone who took out loans to get through my professional training.
To further illustrate my argument, I went to a secondary modern school and failed my 12-plus. I was advised by my teachers not to waste my time doing A-levels, but I am glad that I ignored that advice. I went to a sixth-form college and was then fortunate enough to study at university. Although my parents’ background was by no means one where money was readily available to us, I just missed out on a maintenance grant, so I understood straightaway how important it was to work during my time at university in order to fund myself and, therefore, to study hard. As a result, I worked through Christmas, Easter and the summer, and during term time at Durham.
When studying for the Bar in London, I had to take out loans and work outside my course to cover not just my maintenance but my fees. I therefore took out tens of thousands of pounds in debt, with no earnings threshold for repayment. That was incredibly daunting, but it made me determined to succeed in order to be able to pay those loans back.
Working around my studies was hard, but it gave me invaluable experience of the world of work. Most students do that as a matter of course now, so it is incredible to be told that working outside a degree makes it impossible to do a degree. That certainly was not the case for me.
Twenty years on, I regard the loans I took out to have been the best investment I have ever made in myself. I visit schools in my constituency and tell students to chase their dreams and not be put off going to university because they may not be able to afford it. It is the most incredible investment an individual can make for themselves, including in the form of a loan, which can, of course, be paid back.
Although Labour Members’ comments are well meaning, I find it patronising in the extreme to be told that the loans system will put off students in a similar situation to mine and stop young people chasing their dreams, and that it is not possible to work and study at the same time. Those who have aspiration and self-belief will make it a target to repay loans, and then they will use their degree to enjoy the successful careers afforded to them by university.
In an ideal situation, this country could afford to fund university students for their maintenance, but successive Governments have moved towards a model whereby we allow everyone who wants to go to university to go to university. Record numbers of students are studying at university, including record numbers from disadvantaged backgrounds. Students from backgrounds similar to mine are now going to university.
Huw Merriman
I will not give way, because of the time. Most students understand that we are moving towards a loans system. They are comfortable with that concept and do not want bleeding hearts. What they want is a job at the end of their university degree. By balancing the books, we are making it more likely that they will have a job, security and success, and that they will be able to pay their loans back and to enjoy the fruits of their labour.
It is important that this House sends a message that university is available to all, no matter their background, and that is something that has carried me through so far.
Paul Blomfield (Sheffield Central) (Lab)
I have the privilege to represent more students than any other Member of the House. I am pleased to have the chance to raise their concerns, and more importantly, the concerns of those who hope to take their place in the future but will, I fear, be deterred from doing so by the Government’s proposals. Such a decision is one of huge significance for 500,000 students.
It is a major reversal of Government policy, and it is being taken without any mandate. The Minister for Universities and Science tried to bluster his way out of that by referring to page 35 of the Conservative manifesto. I challenge his colleague, the Minister for Skills, to read out the precise section of the manifesto that gives the Government the mandate to remove maintenance grants from the poorest students. I will happily give way now if the Minister for Universities and Science wishes to read it out.
Paul Blomfield
I urge Conservative Members to think carefully about the policy. [Interruption.] Their party—it is a shame none of them is listening—has consistently supported maintenance grants. In November 2009, the then Conservative shadow Minister told the House that it
“is students from the poorest backgrounds who are most desperate when they cannot get their maintenance grant”.—[Official Report, 3 November 2009; Vol. 498, c. 737.]
When we debated the Government’s changes to student funding in November 2010, a Conservative Minister said:
“Our proposals…help to encourage people from poorer backgrounds…because of the higher education maintenance grant… That crucial commitment…is one of the reasons we commend these proposals to the House.”—[Official Report, 3 November 2010; Vol. 517, c. 940.]
Reflecting on their approach, in September 2012 a Conservative Minister said:
“The maintenance grant and support for bursaries are going up. That is why we…have record rates of application to university”.—[Official Report, 11 September 2012; Vol. 550, c. 216.]
In opposition and in government, Conservative shadow Ministers and Ministers have rightly made the case for maintenance grants year after year.
That was, however, suddenly thrown into reverse by the Chancellor in the July Budget, without any proper consideration of its impact. Such a consideration is important because we are talking about the poorest students. We still have not seen the original assessment behind the July decision, but even the massaged assessment that the Government were prepared to publish in November, four months after the decision was made, is extremely worrying.
Conservative Members should pay heed to it, because it is the Government’s own assessment. On participation by low-income households, it warns of the evidence from past reforms on which the Government are relying that
“there are limits to its direct applicability”.
On gender, it expects a “decrease in female participation”. On age, it says that there is a
“risk for the participation of older students”.
On ethnicity, it says that there is a
“risk to the participation of students from ethnic minority backgrounds”.
On religion, it talks about
“a decline in the participation of some Muslim students”.
That is the real impact on real people.
That impact has been confirmed by those affected. A survey of students in receipt of maintenance grants found that 35% said that, because of their circumstances, they would not have gone to university without a grant. A new survey by Populus says that 40% of parents from low-income households believe their children will be discouraged from going to university without a grant. Evidence from the Institute of Education shows that for every £l,000 increase in the grant, there is a 4% increase in participation from lower-income families. No doubt the reverse is true, so with the level of cuts being made, there will be a significant decrease on the basis of that assessment.
The irony is that the Government have set ambitious objectives for widening participation. The problem is that this policy will prevent that. I urge Conservative Members to vote with us to annul it.
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. I am sorry to say that, before I call the next speaker, I must drop the limit down to three minutes.
Seema Kennedy (South Ribble) (Con)
There can be absolutely no doubt about the Government’s commitment to building a highly educated, highly skilled society. That is part of our challenge—the challenge of the 21st century—to improve productivity. It was set out in the report “Fixing the foundations”, by my right hon. Friends the Chancellor and the Business Secretary, and it is essential to our competitiveness in the world.
I remember the discussions 20 years ago, when I was an undergraduate, about how, with the introduction of tuition fees, admissions from all sections of society would tumble. That did not happen, and the change we are discussing will not happen either, as is borne out by the figures. Record numbers of students were admitted to university last year, and record numbers of disadvantaged students secured places last year: up from 13.6% in 2010 to a record high of 18.5% in 2015. The arguments made by Labour Members are simply not borne out by the statistics.
My hon. Friend the Member for Castle Point (Rebecca Harris) set this out, but I repeat that the system needs changing. The needs of people from my constituency who leave the excellent Runshaw College—I invite the Minister to visit it—with A-levels and who start to pay tax straightaway need to be balanced with the needs of those who go to university. We must face the fact that university graduates benefit from such an investment—to the tune of £170,000 for men over a lifetime and of £250,000 for women over a lifetime.
We should consider very carefully the fact that we need more and more people to have a tertiary education. We must absolutely face the fact that as many people leave university in China with doctorates as leave university in the UK with degrees. It is therefore absolutely essential to increase the number of people going to university. We should bear in mind the words of the Robbins report, which stated that university education
“should be available for all those who are qualified by ability and attainment”.
If the next motion is passed, I fear that there will be a cap on university numbers, which is not what we want. By limiting student numbers, it would be a cap on aspiration, and it would be bad for social mobility and bad for our economy. I ask Labour Members what they are offering—are they offering cuts or taxes elsewhere, or are they offering caps? I listened very carefully to them, but once again, answers came there none.
Mr Geoffrey Robinson (Coventry North West) (Lab)
This is a very timely debate. I am pleased that the Opposition will divide the House on an important issue.
I was struck by two remarkable statements by Conservative Members. The first was made by the Minister, who said that the policy was an important deficit-reduction exercise or measure. The other was made by the hon. Member for Bexhill and Battle (Huw Merriman), who said that all the students he knows are very comfortable with the present level of borrowing with which they will leave university. I do not know where he meets such students, but I have not met anybody who feels anything other than that they are, at the moment, at the utter limit of what is bearable.
The Government want to promote a shareholding democracy, to increase social mobility and all the other things they praise, but they do not realise that no one—ordinary people graduating in the normal course of events from the bulk of our universities—will ever be able to afford a mortgage in the foreseeable future when carrying £53,000 of debt. The Minister has done nothing to contradict the figures produced by the Institute for Fiscal Studies, which has the unhappy knack of being right about such things.
We would like to hear the Government’s argument, because it seems to me to be a very strange sort of accounting. A student loan book of £5 billion is currently sitting on the balance sheet. We know that 45% of it should be written off, although it will not of course be written off. We know that loans are defective for one reason or another—the interest is not paid, or there is no likelihood of the interest being repaid, let alone the capital—but no action is taken to write them off. Similarly, the loan book will now be increased by £2 billion a year. I think the Minister said £2.5 billion, but the figure I have is nearer £2 billion. We will increase the loan book by that amount and we will effectively write off 45%, because we know that that will not be repaid, but this is somehow still a great deficit-reduction exercise. It is nothing more than a great exercise in voodoo accounting, probably promoted by the Treasury for some reason or other. The Department just seems to accept it, and the Minister for Universities and Science accepts it when he knows full well that there is no real case for it.
I endorse everything that has been said by my hon. Friends. This measure is bad for social mobility, bad for access and bad for fairness. It will leave students with an enormous burden of debt—£53,000. How can anybody think that that is a sensible proposition to put to youngsters today? We need not do it and the Government will not get the money back anyway. It beggars belief. I urge the Government to think again and am very pleased that we will divide the House on this matter.
James Morris (Halesowen and Rowley Regis) (Con)
I recently visited Ormiston Forge Academy, which is an improving school in my constituency, and took part in an aspiration day. What struck me when I talked to the year 8 pupils was that the barriers to their thinking about going on to higher education were only partly to do with money. Primarily, they were to do with their background, whether their parents had been to university and whether their friends aspired to go to university. That was an important part of the conversation that I had with them.
The arguments that we hear from the Opposition about loans are like a recycled debate from a few years ago. Young people and students are becoming much more attuned to and understand the progressive nature of the loans system that we have introduced. Low-income graduates will not have to pay back the loans until they get over a certain income threshold.
As the Minister rightly pointed out, putting our higher education system on a sustainable footing was a choice that the Government made. They chose to design a progressive loans system to enable students of whatever background to aspire to go to university. As hon. Members have pointed out, the system that has been designed by the Government introduces maintenance loans for part-time students for the first time, which will have a considerable positive impact on social mobility. It also introduces maintenance loans for MAs and other post-graduate courses, which will provide different ways of accessing higher education.
Hearing the arguments from the Opposition feels a bit like groundhog day. As my hon. Friends have pointed out, no alternatives have been posited.
Simon Hoare
I think that the answer to this will be yes, but I wonder whether my hon. Friend shares my irritation with this debate because all of us in this House should be committed to improving social inclusion. He is stating very clearly the narrative that we deploy to explain these policies. The narrative from the Opposition, in my judgment, is tailored specifically to preclude people from applying to go on to further education. Is it not time that we all explained to students precisely what my hon. Friend is saying?
James Morris
My hon. Friend makes a powerful point. When I spoke to the students, it struck me that we needed to educate them about the realities of going into higher education, whether by providing better information about courses that they might be able to take or explaining what it means to take out a student loan. As he says, there is a lot of propaganda about being saddled with debt. There needs to be more education about what it means in practice.
Rebecca Harris
Does my hon. Friend agree that young people these days are getting much more savvy about the types of courses they want to take, whether courses will lead to a productive career and whether universities have good engagement, employability guidance and that kind of thing?
James Morris
Yes, I agree with my hon. Friend. Among the core benefits of the reforms that were introduced in the last Parliament and that are being developed now is that they encourage universities to raise the quality of higher education courses, make students much more discriminating about what they want to get out of higher education, and provide a greater understanding, as the Minister pointed out, of what economists rather dryly call the returns of higher education, which are tangible. We are seeing huge new opportunities in the graduate employment market. More graduates are getting high-quality jobs and more people are taking the opportunities that are out there.
The system that has been devised is progressive. The evidence is that the loans system has not had the detrimental impact on access that Opposition Members warned about three or four years ago. This is another one of those groundhog day, recycled scare stories. It simply is not happening. More people from disadvantaged backgrounds are going to university.
It would be very much a backwards step to accept the Opposition motion because it provides no credible alternative to the Government’s plan and runs away from the difficult choices that the Government have made to put our higher education system on a sustainable footing. I urge the House to reject it.
Jo Stevens (Cardiff Central) (Lab)
I am privileged to represent a university constituency. Cardiff Central has one of the highest proportions, although not quite the highest proportion, of students of any constituency in the UK. Tens of thousands of students live and study in Cardiff Central. Many of them are from Wales, but many are from England. They, unlike their Welsh peers, will be badly affected by the proposal to scrap student maintenance grants.
The Labour Government in Wales believe in aspiration and in protecting students from crippling levels of debt, and they put their money where their mouth is. Today in my constituency, Welsh students are sitting next to English students in the same lecture on the same course at the same university and living in the same accommodation, but thanks to Conservative Members, and to the Liberal Democrats—oh, sorry, they are not there anymore—a Welsh student is paying a third of the annual tuition fees paid by an English student.
It is not just with tuition fees that the Labour Government in Wales have supported students. The coalition Government abolished the education maintenance allowance, and the Welsh Labour Government kept it. The Labour Government in Wales are not abolishing student maintenance grants either, or NHS bursaries for nurses and midwives studying in Wales. Unlike the Conservative party, we believe in investing in future generations.
The Government claim that scrapping grants will not prevent access to university for the most disadvantaged students, but how do they know? They have not even asked them. There has been no consultation with students, parents or higher education. What have Conservative Members got against young people? They have trebled tuition fees and abolished the EMA. They will not allow 16 and 17-year-olds to vote, and they are happy lecturing everyone on balancing the books and reducing debt, while at the same time their policies inflict crippling levels of debt on students. We can add to that the Chancellor’s plans to end housing benefit for anyone under 21.
Last week I heard speeches in Committee, and again today, about how various Conservative MPs have worked their way through university, and if they managed it, why should today’s students not do that? However, they already do, and now the Government will not even let them earn the increased national minimum wage, because they have excluded anyone under 25 from that. The impact of this policy will prevent young people from going to university, from learning, from gaining independence, and from equipping themselves with the knowledge and skills needed to be successful in the job market.
Jo Stevens
No, I will not. Those young people will be prevented from fulling their true potential. I will conclude by mentioning Kate Delaney, vice-president of Welfare at Cardiff University. She had her EMA abolished. It paid for her bus fare to get to sixth-form college. She qualified for a maintenance grant, and she would not have been able to go to university without it. She told me that that maintenance grant gave her a voice, and also the ability to represent 30,000 students at Cardiff University, and Conservative Members are taking that away.
Emma Reynolds (Wolverhampton North East) (Lab)
I received a full maintenance grant when I was at university, and its impact was not just money in my bank account, but the feeling of confidence and freedom that I could choose the degree that I wanted at my first choice of university—that important point has not really been covered by the debate. When I graduated, I did not have £53,000 of debt, which is what the poorest 40% of students will graduate with. I remind Conservative Members that we are talking about the poorest students from the poorest backgrounds in our country. As my right hon. Friend the Member for Tottenham (Mr Lammy) said, these are the sons and daughters of dinner ladies, bus drivers, and care workers on zero-hours contracts, and we should not forget the reality and background of those students. Let me say to the Minister, and to other hon. Members—particularly those who are chuntering from a sedentary position—that this is not scaremongering. This is a serious debate—
Graham Stuart (Beverley and Holderness) (Con)
The debate was five years ago.
Emma Reynolds
There he goes again. This is a serious debate about the impact of the proposals on our poorest constituents. That debate should be taken seriously by the Minister and by Conservative Members. This is not just about participation; this is about fair access and about which university someone chooses to go to, if they have that first choice. Some of my constituents in Wolverhampton might not choose to apply to Oxford, Cambridge or even perhaps the University of Sussex, because it is too far away and will be too expensive. This is about the choices that the poorest children must now make, given the level of indebtedness that they will face.
Huw Merriman
The hon. Lady talks about the sons and daughters of those in poorer professions, such as dinner ladies and so on. Why can those people not take out loans, make a great success of themselves and pay them back? Why are they different? They should not be different because they are special people.
Emma Reynolds
The people we represent have the same ambitions and aspirations, and Government Members should not cast aspersions on what Labour Members think about that. They will be graduating with £53,000 of student debt. I hope they still will go to university. I hope that will not affect participation. However, I fear it will and I fear it will affect the choices they make. We will all be poorer for it, because the talent will not come through.
I say to the hon. Gentleman that this is part of a wider pattern under this Government: the problem of intergenerational inequality is worsening. I came into politics precisely because I want to live in a country where the background and income of someone’s parents should not determine how well they do in life and whether they fulfil their potential, but inequality is increasing. The Intergenerational Foundation calls this younger generation the packhorse generation, because the Government are burdening them with more and more debt. Yet they face more insecurity in the workplace and higher housing costs. Some have given up hope of ever owning their own home, because we are not building enough homes. To be fair, that is true of preceding Governments, too. The packhorse generation is taking on huge levels of debt and faces a much more insecure future. That is why I hope the Government will think again. Intergenerational unfairness and intergenerational inequality are growing problems.
Rebecca Harris
I understand there is an increasing burden on the current generation largely because of the enormous, overweening burden of debt the Government inherited. Does the hon. Lady agree that the young people of this generation who are not going to university would otherwise be expected to pay for those who have the benefit of doing so?
Emma Reynolds
We had that debate in the previous Parliament and in Parliaments before that. We are talking about the very, very poorest students. Their parents do not have a penny to give to them in support and they will graduate with a huge level of debt.
I say this again to the Government: since the election of the Tory majority Government and the previous coalition Government, the younger generation have been hit with the removal of the education maintenance allowance, the trebling of tuition fees and now, for the poorest students, the removal of grants. The Government need to think really carefully about intergenerational inequality and the social contract between young people and the state. If the state no longer supports the aspirations and opportunities of the poorest students, the social contract will break down and we will all be poorer for it.
Mr Jim Cunningham (Coventry South) (Lab)
Much of what I want to say has already been covered by Labour Members, but taking an overview it strikes me that we are going back to the 1980s. This Government, like all Conservative Governments, have picked up where they left off. There is an agenda here. They are using the deficit as an excuse, not a reason, to take the country backwards.
Much has been made of the 3 million apprenticeships the Government talk about creating, but not much has been said about cuts to further education. Some further education colleges may close, so those 3 million apprenticeships will be under threat because students will not be able to get the facilities they want.
I want to pick the Minister up on the point about his manifesto. He said this was part of the manifesto. We will give him the benefit of the doubt, but it did not say there would be cuts to university grants and it did not say there would be cuts to bursaries. That was the point the Minister seemed to skate over in his speech.
Paul Farrelly (Newcastle-under-Lyme) (Lab)
Casting our minds back to over 10 years ago, the Labour Government capped fees at £3,000 and reintroduced maintenance grants. The third element was bursaries from universities. Does my hon. Friend agree that we should look very carefully at this direction of travel and ask the Minister to make it clear that bursaries are not the next target?
Mr Cunningham
I agree wholeheartedly with my hon. Friend. On the subject of bursaries, we had a debate last week about nurses. We have a shortage of nurses in the NHS, yet we are not doing much to encourage young people to enter the nursing profession. We are in danger of creating what was called the Thatcher generation—the lost generation—of the ’80s, because young people always seem to be at the butt end of the Government’s policies.
The regulations will affect the west midlands economy, whether the Government accept it or not. They have talked about the west midlands powerhouse, but that relies on highly skilled labour. They have boasted about Jaguar Land Rover being one of their successes, but it was the Labour Government who encouraged Tata to invest in Jaguar Land Rover. The latter is now short of highly skilled labour. The impact of the Government’s measures will result in a lost generation and, in the longer term, affect the British economy. We are going back to the rationing of education, which we put right when we entered office in 1997.
I have the privilege, along with my hon. Friend the Member for Coventry North West (Mr Robinson), to represent two of finest universities in this country, if not the world; they are world-renowned. That can have an impact locally and around the country in encouraging students to study different disciplines. However, the measure before us will have a major impact on higher education and affect Coventry’s economy, the west midland’s economy and the national economy.
Wes Streeting (Ilford North) (Lab)
It says it all about the Government policy that we are debating that so few of their Back Benchers have turned up to read the poor script they have been given by the Whips, and it says everything about how they conduct themselves that instead of having a proper debate on the Floor of the House, with a full vote involving all Members, they sought to have a debate down the corridor and up the stairs, hoping that nobody would notice, in a Committee that nobody has ever heard of.
Chris Stephens (Glasgow South West) (SNP)
The hon. Gentleman made a similar point during his Adjournment debate a few weeks ago on student nurses and bursaries. Is he as concerned as me, first, that the Government are increasingly using this device to sneak through their most controversial legislative proposals without debate and, secondly, that it is contrary to the comments by the Leader of the House on 10 December 2015, on this very issue, when he indicated we would have a debate on the Floor of the House?
Wes Streeting
I agree wholeheartedly. In their cowardice the Government are treating with disdain the House and the students we are all sent here to represent. In spite of what the Minister says, there is absolutely no mention in the manifesto of cutting student grants. In fact, we would find Lord Lucan before we found any reference to cutting student grants, so they cannot hide behind a democratic mandate. As a student union president and president of the National Union of Students, I used to have arguments with previous Labour Governments—
Wes Streeting
That included arguments with my right hon. Friend the Member for Tottenham (Mr Lammy). But even with landslide majorities there was always a full debate and a vote in the House, whether they were abolishing student grants or, more wisely, reintroducing grants following the introduction of top-up fees.
This afternoon, these proposals will impact on 500,000 students from the poorest backgrounds. In my local university, the University of East London, that equates to about £30 million of financial support for students—gone. At my alma mater, the University of Cambridge, the figure is more like £9 million. If there is one thing we know about the higher education sector, it is that not only opportunity but financial support is unevenly distributed. It is completely unfair that students from the poorest backgrounds will now face a postcode lottery when it comes to determining how much non-repayable support they receive.
The very existence of student grants was won as a result of hard-fought negotiations. Student leaders argued that, if we were going to ask people to make a greater contribution, it was only fair that the poorest students received a non-repayable contribution. How must Conservative Members and the few remaining Liberal Democrats feel about the fact that when, under the coalition Government, the then higher education Minister justified the trebling of fees, they were told, “Don’t worry. We’ve got the national scholarship programme, student grants and the £21,000 threshold going up by inflation.” What has happened since? The national scholarship programme has been abandoned; the threshold frozen at £21,000; and now we see the abolition of student grants. We cannot trust a word that these people say, particularly when it comes to fair access to higher education and support for the most disadvantaged. It is an absolute disgrace.
I am proud of what the last Labour Government did to widen access and opportunity to people from working-class backgrounds. I was one of the beneficiaries, from the excellence in cities work that was done in schools right through to the opportunities provided through expanded places.
Graham Stuart
The hon. Gentleman is doubtless equally proud of the fact that the Labour Government said that they would not introduce tuition fees, and then did; and said that they would not introduce top-up fees, and then did. Does he accept that he and others who said five years ago that the introduction of increased fees would lead to a reduction in those from poorer backgrounds going to university were wrong? They were wrong then, and we believe that they are wrong today.
Wes Streeting
I remember the debate here in 2003, and I think it was to the credit of the Government of the day that the introduction of higher fees did not come in until after a general election, when at least the voters could make their judgment on whether they wanted to re-elect a Labour Government, which they duly did.
So much has been said about participation numbers this afternoon. I am certainly not going to make prophecies of doom about participation, but we should bear in mind a few facts. First, there is the issue of equity. How can it possibly be justified that students from the poorest backgrounds graduate with the largest amount of debt? How can it possibly be fair that under these repayment mechanisms, the wealthiest graduates who go on to the most successful jobs will end up paying less over the course of their working career than people from middle and lower incomes? That cannot possibly be justified as fair. We should take seriously the evidence from the Institute for Fiscal Studies published in 2014 showing that a £1,000 increase in the maintenance grant led to a 3.95% increase in participation. Removing the grant does not necessarily mean that participation will plummet, but I think there is a risk that it could suffer.
There is a huge amount of complacency from this Government about the impact of higher tuition fees on applications to part-time routes and for mature students. It does not have to be that way; other choices are possible. We should look at what the Labour Government in Wales have done. They have not chosen to abolish student grants; they have kept those grants in place.
If the Tories want to talk about hard choices, how are they going to look the poorest students from the poorest backgrounds in the eye and explain why this Government continue to alleviate the tax burden on the wealthiest, while making the poorest pay the cost of their higher education? A 75% contribution to the cost of higher education is, by anyone’s estimation, too much, and there is not a single item in the Conservative manifesto that Government Members can point to in order to justify this outrageous attack on the poorest students.
Several hon. Members rose—
Madam Deputy Speaker (Natascha Engel)
Order. Five Members are seeking to catch my eye. If no interventions are taken, we should be able to get everybody in, but if interventions are taken, I am afraid that people will have to be dropped off the list.
Alison Thewliss (Glasgow Central) (SNP)
I thank Labour Members for securing this debate. We in the SNP believe in the principle of free education, and we stand in solidarity with students in England against the principle of scrapping grants. I did have a lot more to say in the debate, but I shall be as brief as I can.
Other Members have referred to their own circumstances, and I shall do so, too. I moved from home in 2000 to go the University of Aberdeen. I graduated in 2004, having taken out a student loan. I started paying it back to a significant extent only on coming to this place in May. I pay back £400 a month. That is my obligation, so I pay it. If, however, I had left university with a debt of £53,000, and assuming I could start to pay it back right away at £400 a month, it would take me 11 years to do so—11 years in a very well paid job. The expectation that some people may not pay their loan debt back at all makes a mockery of the whole process. If a loan is not expected to be paid back, what is the point of giving people loans in the first place? It seems ludicrous. We are bringing up a generation that expects to be in debt, and society should guard against that.
In Scotland, we will try our hardest to make sure that education remains free and that grants are available, but this Government are putting our budget under increasing pressure by their actions. We do not know—they have not told us—what the impact of these decisions taken today will be on the Scottish budget. This has been designated as EVEL, but it clearly has an impact on students from England, Wales and Northern Ireland who are studying at Scottish universities. What will the impact on those institutions be? What consultation has the Minister had with universities in my constituency, such as the University of Strathclyde, the Royal Conservatoire of Scotland, the Glasgow School of Art and Glasgow Caledonian University? He is not even paying attention; he is chewing his pen.
What conversations has the Minister had with my colleagues in Scotland about this measure? What impact will it have on members of larger families, and what impact will it have on Muslim students? The hon. Member for Ealing Central and Acton (Dr Huq) has raised that issue before. Some Muslim students cannot take out loans, and other students may not wish to do so either, for different reasons. My hon. Friend the Member for Banff and Buchan (Dr Whiteford) mentioned cuts in the disabled students allowance. What impact will the added loan burden have on them?
Conservative Members have asked, “What about people who do not go to university? How do they benefit?” They benefit from the common good. Glasgow Caledonian University is a university for the common good. People in Scotland know that university graduates will become the doctors who treat them in hospitals, and the lawyers who represent them. They will become the well-qualified people who pay us back through taxation to help the common good of our country.
Liz McInnes (Heywood and Middleton) (Lab)
I am grateful for the opportunity to speak in the debate, because I have been urged to do so by many students in my constituency. This is a matter of great interest to the general public, and the Government’s behaviour has been noticed by them, even if the Government themselves are still in denial.
The fact remains that the Chancellor’s replacement of maintenance grants with loans may dissuade many students from modest backgrounds from going to university, while none the less resulting in large sums never being paid back to the Treasury because graduates will go into what the Prime Minister described last week as “menial labour jobs”. That point has not been addressed, although a number of Members have raised it.
Even with maintenance grants, which support students from the poorest backgrounds through university, the system remains stacked against working-class students. According to the education charity The Sutton Trust, students from wealthy backgrounds are 10 times more likely to secure a place at university than those from poorer backgrounds.
The Government have consulted about freezing the current student loan repayment threshold at £21,000 for five years. Martin Lewis, of moneysavingexpert.com, has pointed out that only 5% of the responses to the consultation were in favour of the proposal, while 84% were against it. He has written to the Prime Minister to ask why the Government have pressed ahead regardless with increasing the amount that our students must pay for their current student loans. In 2011, Martin Lewis was appointed head of the Independent Taskforce on Student Finance Information. Ministers told him unambiguously that, from April 2017, the £21,000 repayment threshold would start to rise annually with average earnings. The decision to backtrack on that is hugely damaging. It means that many lower and middle-earning graduates will repay thousands more over the life of their loans.
Martin Lewis says that this issue is just as much moral as legal. The retrospective change destroys trust in the student finance system, and perhaps even more widely in the political system as a whole. The Government seem remarkably relaxed about the fact that our poorest students will graduate with £53,000 worth of debt before they have even started work. What guarantee will the Government give that they will not move the goalposts for repayment of this loan as well?
There is a huge body of evidence to support student maintenance grants. I do not have time to go into all of them, but they are opposed by the University and College Union, which says:
“Maintenance grants are crucial for engaging students from disadvantaged backgrounds who are already daunted by cripplingly high tuition fee debt. Increasing the debt burden…will act as a disincentive to participation”.
Greg Mulholland (Leeds North West) (LD)
I, too, represent one of the constituencies containing the largest number of students in the country. In 2011 there were just over 19,000 in the three fantastic universities, Leeds University, Leeds Beckett University and Leeds Trinity University. However, I have just three minutes in which to speak, which I believe equates to 0.0095 of a second per student in what is a hugely important debate. Given the importance of these measures, the fact that the Government have proceeded with them through secondary legislation without a full and proper debate is an absolute disgrace.
Why has there been no public consultation on these major changes? They were announced last summer, but there has been no consultation with the higher education sector in the six months since. There has been no consultation with the universities or with the student unions. It is also a matter of huge concern that the Government conducted an equality impact assessment only after the National Union of Students instigated legal proceedings. If that does not suggest that the Government know they are doing something unacceptable and have something to hide, I do not know what does.
The equality impact assessment explicitly states that the changes present a risk to the participation of students from poorer backgrounds, mature students, BME students, disabled students and Muslim students. So, having being forced to accept that all those groups will be affected, has the Minister done anything to deal with it or to suggest ways of mitigating the impacts? I am afraid that the answer is no.
I do not have time to go through all the facts, some of which have been put forward today, but these changes will clearly have a detrimental and unfair impact on students from poorer backgrounds—the students we clearly want to encourage to go to university. At the same time, the Government are also freezing the repayment threshold at £21,000. The House of Commons Library states that this will have
“a proportionately larger impact on repayments by graduates with lower lifetime earnings”.
Martin Lewis has already been mentioned. He was tasked with selling the new system to the public, but he is now looking into a judicial review of the freezing of the repayment threshold. You could scarcely make this up. Whether the Government wish to accept it or not, the evidence shows that these measures will hit students on lower incomes and discourage people from going to university. The Government must today announce a proper debate with a proper vote on this matter in the House. We will settle for nothing less.
Tommy Sheppard (Edinburgh East) (SNP)
I went to Aberdeen University in 1977. I was the first member of my extended family to go to university, and I was able to do so because the tuition was free and I got a full maintenance grant. If it had not been for the Wilson Governments of the 1960s, I would not have had the opportunities I have had in my life. I can understand people from privileged backgrounds protecting privilege, but what really sticks in my throat is that those who have climbed that ladder of opportunity themselves are now determined to kick it away from other students. That is a disgrace.
We should be in no doubt that these decisions will have layers of consequences. On an individual level, they will result in lives less fulfilled and opportunities forgone. On a community level, people will see this pathway out of poverty being barricaded before their eyes. Most of all, the effects will be felt on a national level. How many surgeons, architects, doctors and writers will not emerge because of the denial of this opportunity?
Let us make no mistake: this is an attack on the poor. The hon. Member for Bexhill and Battle (Huw Merriman), who is no longer in his place, asked whether poor people could not simply take out loans. Well of course they can, and, by the way, they are more used to doing so than many Conservative Members are. But the real question is this: is it fair that people from the poorest backgrounds should have to take on more debt to get the same opportunities as their counterparts in well-off families? That is iniquitous, and we should not tolerate it.
The Government seem to be labouring under the misapprehension that students are all rich, and that they benefit from their education so much that it is okay to charge them whatever they want to. That is not the case. A small minority do extremely well and become rich—
Tommy Sheppard
I have been told not to take an intervention.
A small minority do become rich, and if the Government want them to pay, they should introduce a progressive taxation system whereby people pay more when they start to earn those high wages. Instead, of course, they are cutting taxes for the highest earners in our communities. Nowhere is this thrown into sharper relief than in the situation of nurses and midwives. The abolition of grants for nurses and midwives will not only penalise the people who want to contribute to our national health service but undermine our NHS itself. Not for the first time, I am so pleased that in Scotland we have a Scottish Government who stand between the young people in that country and the mal intent of this Government here. We will not abolish grants for nurses or midwives. We will maintain maintenance grants. Most of all, we will keep tuition free and we will make sure that people are not saddled with the debts they are saddled with in this country. If ever there was a case for a measure not applying and not being certified, it is this, because I have more than 2,000 constituents directly affected and it is unfair that my vote will be disregarded.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
Until my election in May, I had spent all my adult life in universities, from being the recipient of a full grant, with my fees entirely paid, in 1990 at Cambridge University to teaching at Kingston University until my election. I have also taught at a red-brick university. I contend that at all these categories of university—all seats of learning in this country—the student bodies will be poorer as a result of the abolition of grants, both socio-culturally and financially. The kind of students we are talking about in respect of this measure are not the “Brideshead Revisited” ones, they are not Neil from “The Young Ones” and they are not even Student Grant from Viz; they are people such as my constituents at the University of West London. They are people such as Josh Goddard, its student union president, who has been here since 1 o’clock today and who has told me that he is the first person in his family to go to university and he would not have done it without a maintenance grant. He said that he represents the students of the present but he also wants the students of the future all to have the chance to go to university. As well as the NUS, the Sutton Trust has condemned these changes, as they narrow the talent pool of who will be able to participate in higher education in the future.
I think of the students I taught at Kingston University—this was before the changes—who seemed often to be coming in between the burger-flipping shifts. The Conservative party puts great store by being the party of fiscal responsibility, but how does it reconcile that with saddling young people with £53,000 of debt? We have heard about the words of Martin Lewis, who was tasked with leading the taskforce in 2011. He is normally a financial man, and he is not a politician. He says:
“The regulator would not allow any commercial lender to make a change to its terms this way.”
It is surely bad governance. We are dealing with a case of double standards here. These people signed up to one experience and even after they have signed their loan agreements they are seeing the goalposts moved.
The Minister has a lot of explaining to do. Where was this on page 35 of the Conservative manifesto? None of us has seen it in the small print. What will the transitional arrangements be? What happened to the review promised in 2014 for Muslim students who want sharia-compliant student finance, given that this measure is coming in now? As we know, this has been done with no proper debate. It is only because Labour Members have forced this debate today that we are discussing it at all. The Government want to shunt it through using their new favourite toy, the statutory instrument. If their sums are wrong, the books should not be balanced on the backs of students. We have seen that the NHS bursary for nurses has gone and the education maintenance allowance has been removed. If the Government have a shortfall, it should not be students who are taking on that burden.
Kevin Brennan (Cardiff West) (Lab)
We have had a lively and extremely interesting debate, with contributions from 17 Back-Bench speakers, by my calculation. I will not mention them, because time is short as a result of the interest in the debate.
I have some sympathy for the Minister for Universities and Science, the hon. Member for Orpington (Joseph Johnson), because we all know that the decision to scrap maintenance grants for the less well-off students in favour of loans was really made by the Chancellor and not by him. I know that he and the Chancellor are old friends—this goes back to the days when they were penniless students together, having to scrape by on their student grants and meagre Bullingdon club dinners—but I find it hard to believe that he went to his old friend the Chancellor and said, “Having been appointed as Universities Minister, I have suddenly decided that we were wrong to have maintenance grants for the less well-off students and it would be a great idea for the worse-off students to have the most debt after they have been to university.”
I might be wrong about the Minister, but he does not strike me—he has not until today—as the kind of person who would think it right to change the system so that, as the British Medical Association points out in its briefing for this debate, medical students from the poorest backgrounds could graduate with £100,000 of debt. Nor does he strike me as the kind of person who thinks that it is all right to go back on promises made by Tory Ministers when the new system was introduced. It was David Willetts after all who said that the tuition fees increase was progressive precisely because of the higher education maintenance grant. That was the argument made. The Minister does not strike me as the kind of politician who would cynically pursue policies that penalise younger people who are less likely to vote Tory, or even to vote at all, than others.
Despite what was said today about page 35 of the Tory party manifesto, I do not think that the Minister for Universities and Science would think it was really okay to carry out this kind of major change of policy direction without explicitly putting it into the party’s manifesto, so that the public, including young people, could see what they were voting for or against. Is he really the kind of politician who, having done all this, would then slink away from debating such a major change openly and properly on the Floor of the House in Government time? I may be wrong, but I never thought that he was that kind of politician, or that he was that cynical.
Kevin Brennan
However, I think we know someone who is that cynical. I give way to the hon. Gentleman.
Simon Hoare
I do not know whether the hon. Gentleman was referring to me. Will he flick back through his archives and find where, in the 1997 manifesto, the Labour party had the introduction of student loans in the first place, because I cannot remember seeing it?
Kevin Brennan
The hon. Gentleman told us in his speech how hard he has worked. Given that he is from Cardiff and that he has such an accent, I can absolutely acknowledge that he is a very hard-working individual. He will know that a general election was fought following that decision being taken and before they were introduced.
We all know that the Chancellor prefers governing from the shadows, and this shameless betrayal of previous promises and the shabby manner in which this has been handled in Parliament bear all the hallmarks of the current Chancellor of the Exchequer. Being young in Britain should be a time of opportunity—a time when opportunity knocks. Instead, we have the Chancellor introducing an opportunity tax. His proposals are an assault on aspiration, on opportunity and on those who want to get on in life. That is why we oppose them and also why the Welsh Government, under Labour First Minister, Carwyn Jones, is keeping maintenance grants. By the way, those who say that these proposals affect only England should think again—I say this to Welsh Conservative MPs as well: of the 30,000 students studying at Cardiff University, nearly 9,000 are from England.
Graham Stuart
On a point of order, Madam Deputy Speaker. I am sure that the shadow Minister would not wish to mislead the House, but he has just said that tuition fees were introduced not after the 1997 election, but after the following general election. That is not true. They were introduced in 1998. Having said that they would not introduce them, the Government started the process 12 weeks later.
Madam Deputy Speaker (Mrs Eleanor Laing)
The hon. Gentleman is making a point of debate, not a point of order for the Chair. We have very little time.
Kevin Brennan
I would have been happy for the hon. Gentleman to intervene. Actually, I was asked about student loans, not tuition fees.
Students in constituencies such as Cardiff North are registered to vote in Wales, but, subject to the decisions that will be taken after this debate, local Welsh MPs can have their votes nullified under the constitutional monstrosity that is the English votes for English laws procedure, which the Government have foisted on this House.
Who will be affected by these measures today? This is what the IFS says:
“The poorest 40% of students going to university in England will now graduate with debts of up to £53,000 from a three-year course, rather than up to £40,500. This will result from the replacement of maintenance grants”.
Of course, as I just pointed out, it is about not just students going to university in England but students who are attending university and who are registered to vote in Wales, a thought that will not be lost on students in Cardiff North during next May’s Assembly elections.
Lady Hermon (North Down) (Ind)
I would be very encouraged if the hon. Gentleman would also note that as universities in Northern Ireland have had the number of students they can take capped, hundreds and hundreds of very able students from Northern Ireland take up places in English universities, and are happy to do so. It is an absolute disgrace that this measure should be deemed exclusively English because it affects my constituents and many parents and students from Northern Ireland.
Kevin Brennan
I am happy to acknowledge that.
It is not as if this policy will save that much for the public finances in the long run, despite the claims made by the Government. The IFS says that the replacement of maintenance grants by loans from 2016-17 will raise debt for the poorer students but do little to improve the Government’s finances in the long run. The truth is that the Chancellor is fixing the figures, not the roof.
I am pretty sure that I would never have gone to university had no maintenance grant been available, let alone have been the first from my family and from my comprehensive school to go to university and to go to Oxford. There are many others in this place for whom something similar is also true. The Government must accept that that is still the case for many thousands of young people. Indeed, that is why, as David Willetts said, maintenance grants were part of the structure when fees were tripled to £9,000 per annum under the previous Tory-led Government.
The decision is mean in spirit and underhand in execution. It will be tragic in its consequences for many young people, and I urge the House to reject it by supporting our motion.
The Minister for Skills (Nick Boles)
A middle-aged man like me needs to approach the subject of student finance with a degree of humility, for I was one of the lucky few who did not have to pay tuition fees and although I did not qualify for anything more than the minimum grant, many of my contemporaries did. The key fact about university when I was growing up was that it was just that: the exclusive preserve of the lucky few. Universities were bastions of privilege and the nation was poorer for it, as were millions of people whose lives would have been enriched in every sense by a university course.
It was Tony Blair, of course—remember him?—who first recognised that many more people could benefit from university education and started us down the road of reforming student finance so that we could widen participation. It was Gordon Brown—remember him?—who asked the noble Lord Browne to suggest further reforms of student finance. And it was Vince Cable and the right hon. Member for Sheffield, Hallam (Mr Clegg) who bravely impaled themselves and their party on an irresponsible campaign pledge and introduced the system of tuition fees we have today.
At every stage in this journey towards a student finance system that allows anyone with the necessary grades to be offered a university place, we have heard the same howls of outrage and the same predictions of disaster from the same sources. “Participation will plummet,” they intone, “The poorest will be put off,” and just as predictably at each and every stage these shroud wavers and doom mongers have been proven wrong, as my hon. Friend the Member for South Ribble (Seema Kennedy) reminded us. Why have they been proven wrong? Because, as my hon. Friend the Member for South Suffolk (James Cartlidge) pointed out, individual students observe the benefits that flow to university graduates, look at the repayment terms for student loans and calculate, quite correctly, that they will have to repay their student loans only if they themselves are benefiting from higher wages.
My hon. Friend the Member for Bexhill and Battle (Huw Merriman) said that the loans he took out were the best investment he has ever made, and my hon. Friend the Member for Halesowen and Rowley Regis (James Morris) talked about the returns on higher education, which in terms of lifetime earnings, interestingly, are even higher for women than for men. The truth is that student loans are not like ordinary commercial loans and it is frankly a disgrace that Opposition Members are willing to mislead would-be students by pretending that they are.
A commercial loan is often secured against specific assets, which can be seized if the individual cannot make the repayments. With a student loan, no bailiff is going to knock on a door and take a television if a low income means people cannot afford to repay it. A commercial loan will charge a rate of interest from the very first day and the poorer the person is, the higher the interest rate is likely to be. With a student loan, the interest rate is held at a lower rate until the student starts earning over £25,000 a year, and the amount they have to repay in any year is limited to 9% of their income over £21,000. A commercial loan and all the accumulated interest will still be hanging around someone’s neck in 40 years’ time if they have not managed to pay it off. The balance of a student loan is written off after 30 years.
There are two ways to fund university students. We can limit access, undermine the quality of university teaching and get the general population, most of whom have not benefited from a university education, to foot the bill; we could call that the SNP approach. The alternative is to offer anyone who has the capacity to benefit from a university course the opportunity to do so, and to put in place a system of subsidised student finance which asks those who do go on to benefit to contribute while protecting those who do not from the need to repay the loans. That is the Conservative approach; it was also the approach of the Liberal Democrats when they were a party of government and of the Labour Government under Tony Blair and Gordon Brown.
One thing is clear at the end of this debate: a party’s attitude towards student finance is a leading indicator of its fitness to govern. In opposition, a party will take the irresponsible route in an attempt to curry favour with the National Union of Shroud-wavers—sorry, I mean Students. In government, it will suddenly discover the merits of a sustainable system of student finance that is fair to students and taxpayers alike.
If we are ever to see another Labour Government—and on the basis of the party’s current performance, that may be a very long time in coming—I confidently predict that they will quietly drop their opposition to the system of student finance put in place by Governments of all parties over 20 years, and that is why—
Martin John Docherty (West Dunbartonshire) (SNP)
On a point of order, Madam Deputy Speaker. The Minister has called into disrepute a national organisation voted by, and elected for, the students of this country. Should he not withdraw his comments immediately? It is a disgrace to his position.
Madam Deputy Speaker (Mrs Eleanor Laing)
The Minister’s language was perhaps not exactly what I would have chosen myself as a matter of taste, but it is not for me to tell the Minister exactly which words to use. He was not strictly outwith the rules of the House, but I am sure he will now very positively return to more tasteful and moderate language.
Nick Boles
Madam Deputy Speaker, I feel that that reproof was perhaps a little more stinging than I deserved, but I will, of course, do exactly as you require.
If I may briefly reprise, a party’s attitude towards student finance is a leading indicator of its fitness to govern. If we are ever to see another Labour Government, I confidently predict that they will drop their opposition to the system of student finance put in place by Labour Governments, coalition Governments and this Conservative Government, and that is why I urge the House to reject the motion.
Question put.
Madam Deputy Speaker (Mrs Eleanor Laing)
We come now to the motion praying against the Education (Student Support) (Amendment) Regulations (S.I. 2015, No. 1951), which will be taken without debate. I remind the House that because, as Mr Speaker has certified, this instrument relates exclusively to England and is within devolved legislative competence, it is subject to double majority. If a Division is called, all Members of the House are able to vote in the Division. Under Standing Order No. 83Q, the prayer to annul the SI will be agreed only if, of those voting, both a majority of all Members and a majority of Members representing constituencies in England vote in support of the motion. At the end the Tellers will report the results, first, for all Members and, secondly, for those representing constituencies in England. I think that is clear. [Interruption.] The instruction is clear. Members do not really have to do any thinking except to decide whether to vote Aye or No, and then everyone can pass through the Lobbies.
Education (Student Support) (Amendment) Regulations 2015
Motion made, and Question put forthwith (Standing Order No. 118(6)),
That an humble Address be presented to Her Majesty, praying that the Education (Student Support) (Amendment) Regulations 2015 (S.I., 2015, No. 1951), dated 29 November 2015, a copy of which was laid before this House on 2 December 2015, be annulled.—(Mr Marsden.)
Alex Salmond (Gordon) (SNP)
On a point of order, Madam Deputy Speaker. You will recall the debates that were held in the House on this double majority measure, when the Leader of the House made several totally unavailing attempts to explain it to Members. The Government said that nothing could pass against the will of the House and that the procedure was about ensuring that nothing was imposed on English Members against their will.
We have just had an illustration of a vote that could have enacted an order against the will of the House. The majority was only 11; if the majority had been won in the other direction and the House had voted as a whole to annul the order, and English Members had voted against it, the matter would still have stood. Students would still have been deprived of their vital maintenance grant, against the will of the House and contrary to what the Leader of the House and others on the Tory Benches told us. That will be of no satisfaction to English students who are suffering under this Government in the knowledge that they have been knowingly deprived of their maintenance grant. Will the Chair reflect on that procedure? It is totally contrary and illustrates the complete swamp into which these people have led the House.
Madam Deputy Speaker (Mrs Eleanor Laing)
I understand the point the right hon. Gentleman is making. Indeed, he has made the same point in different ways at various times. However, this is the first time we have had a double majority vote and this is different procedure. The right hon. Gentleman will of course appreciate that the procedure we have undertaken this afternoon was approved by the whole House and put into Standing Orders just a few months ago. Therefore, the procedure under which we have operated this afternoon has been approved by the whole House—possibly not by the right hon. Gentleman, but by a majority of the whole House.
The right hon. Gentleman very reasonably asks me—this is what I can deal with from the Chair—whether this matter will be reviewed. I am happy to tell him that of course it will be. Mr Speaker has made it clear that he will be keeping the new arrangements under review. I also understand that the Procedure Committee will be keeping the arrangements under review. I am sure the point the right hon. Gentleman has just so eloquently made will be taken into consideration by both Mr Speaker and the Procedure Committee as they consider the matter.
Andrew Rosindell (Romford) (Con)
On a point of order, Madam Deputy Speaker. This is the first time in 15 years that I have attempted to vote in the Lobby and been denied the right to do so. My name was not on the tablet used. This is a denial of the rights of my constituents to be represented in a vote in the House of Commons. I seek assurance from you, Madam Deputy Speaker, that my vote will be recorded in the Government Lobby and that this kind of error will never be allowed to happen again.
Madam Deputy Speaker
I can well understand the hon. Gentleman’s understandable consternation. I am absolutely certain that his constituency is in England, because it is right next to mine. He has a perfectly good reason to complain. It is quite wrong that his name did not appear and I am certain that that will be rectified. I am assured that although his name did not appear on the list and his vote was not recorded in the way all the others votes were, his vote has been recorded both by the Tellers and the Clerks this afternoon. He need have no fear that his opinion has been overlooked, nor should it ever be.
Jim McMahon (Oldham West and Royton) (Lab)
Further to that point of order, Madam Deputy Speaker. If it is any consolation to the hon. Member for Romford (Andrew Rosindell), my name was not on the list either. However, I have been assured by the Teller that the vote was recorded.
Madam Deputy Speaker
I am particularly concerned for the hon. Gentleman, because he is very new to this House. Indeed, I hope he will be making his maiden speech later this afternoon. We are all looking forward to that. Of course his name ought to have been there. We will do everything to make sure it is there in future.
Pete Wishart (Perth and North Perthshire) (SNP)
On a point of order, Madam Deputy Speaker. I wonder whether you could help me with this. This is very serious. The fact that one of our Members—one of the most English of all English Members—has been denied the opportunity to vote in the first double majority vote in this House is something that has to be properly investigated. Can you suggest, Madam Deputy Speaker, whether it is now worth having a recount, given that hon. Members have obviously been left out of this very important first vote?
Madam Deputy Speaker
I can assure the hon. Gentleman that the vote of the hon. Member for Romford (Andrew Rosindell) has most definitely been counted. There is no need for a recount.
Lady Hermon (North Down) (Ind)
On a point of order, Madam Deputy Speaker. As part of the review of the House’s adoption of this appalling procedure, which excludes the votes of MPs like me who represent Northern Ireland constituencies—because certification has indicated a matter is exclusively English, despite its undoubtedly affecting my constituents—may I invite Ministers to Northern Ireland, with the promise of a warm welcome, to meet students affected by this vote or those affected by last week’s vote on the Housing and Planning Bill and explain to them why the rights of their representatives have not been honoured equally with those of other MPs?
Madam Deputy Speaker
As I said to the right hon. Member for Gordon (Alex Salmond), the whole House decided on these new Standing Orders, but of course the hon. Lady’s vote has been registered and counted and her constituents will know how she has voted. It has not been counted twice, but it has, very definitely, been counted once. She has, however, made her point properly.
Michael Fabricant (Lichfield) (Con)
On a point of order, Madam Deputy Speaker. First, may I assure the House that “Fabricant” was indeed on the tablet and that my vote was recorded? May I also take this opportunity to praise the Clerks, the Parliamentary Digital Service and you, ma’am, for taking us through, relatively smoothly, this innovative and creative bit of legislating, despite the travails of my hon. Friend the Member for Romford (Andrew Rosindell)?
Madam Deputy Speaker
I thank the hon. Gentleman for his point of order. The Clerks, the Officers of the House and those working behind the scenes have worked hard to put this new procedure into operation. This is the first time we have had a double majority vote. It has not gone perfectly smoothly, but we all learn from our mistakes, and I am quite certain it will go more smoothly in the future. I assure the House, especially hon. Members with concerns, that both Mr Speaker and the Procedure Committee are keeping a careful eye on these matters, as, I think, is the Leader of the House, and everything that hon. Members have said will be taken into consideration.
Cost of Public Transport
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
18:59 - The House divided: - Ayes: 213 / Noes: 305 - Question accordingly negatived.
Madam Deputy Speaker (Mrs Eleanor Laing)
I inform the House that Mr Speaker has not selected the amendment.
Lilian Greenwood (Nottingham South) (Lab)
I beg to move,
That this House believes that the rising cost of public transport is adding to the financial pressures facing many households; notes that over 2,400 local authority-supported bus routes have been cut or downgraded since 2010; regrets that bus fares have risen by 26 per cent on average and regulated rail fares have risen by up to 38 per cent since 2010; further regrets delays to rail infrastructure projects including the electrification of the Great Western Main Line, the North TransPennine route and the Midland Main Line; notes with regret the decision by the Scottish Government to award the ScotRail franchise to a private operator, rather than exploring alternative options; calls on the Government to bring forward a buses bill as announced in the Queen’s Speech to enable the regulation of local bus networks; and further calls on the Government to rule out the privatisation of Network Rail and instead extend to franchised services the model of rail public ownership that delivered record passenger satisfaction scores on the East Coast Main Line.
I start by wishing the Secretary of State a happy new year, although that will not have been the sentiment that came to most commuters’ minds when they returned to work a fortnight ago. I am afraid it will have been cold comfort to be told by the Under-Secretary of State for Transport, the hon. Member for Devizes (Claire Perry), on the day that fares rose again, that the Government’s plan for passengers was to improve journeys for everyone. The chief executive of Transport Focus gave a more accurate assessment:
“In some parts of the country, given rail performance has been so dire, passengers will be amazed there are any fare rises at all.”
Hon. Members who attended the Southern Railway summit in this place yesterday, and most travellers, would not be able to reconcile the Minister’s statement with their own experience of increasingly overcrowded and unreliable carriages.
Mr Chuka Umunna (Streatham) (Lab)
Does my hon. Friend agree that Members on both sides of the House are fed up with excuse after excuse and broken promise after broken promise from Southern rail, and that what we now want to see is action taken against this operator?
Lilian Greenwood
My hon. Friend is exactly right. I know that he and my other hon. Friends are holding Southern rail to account for its poor punctuality and poor passenger satisfaction. That underlines the need for reform of the railways.
Let us look at the facts. In 2010, the Conservative party said that it would
“relieve the pressure off both the fare-payer and the taxpayer”.
But what happened? Regulated fares rose by 25%. As a consequence, commuters from Birmingham to London are paying more than £10,000 for a season ticket for the first time. Worse still, Ministers bowed to lobbying from the train operating companies and restored “flex”—their right to vary prices by up to 5%, meaning that some season tickets have gone up by 38% since 2010, and a new Northern evening peak restriction hiked prices by up to an eye-watering 162%.
Mr Jim Cunningham (Coventry South) (Lab)
I am sure my hon. Friend will be aware that senior citizens, who might have business in London working for charities, are finding it very difficult to afford to come here unless it is outside peak times, and they are often unable to arrange meetings at times that would suit the off-peak periods. Does she understand that and have a view on it?
Lilian Greenwood
My hon. Friend is quite right that it is indeed a concern that people who need to travel at peak times find it almost impossible to find an affordable ticket.
Bus fares have continued to rise, too—up by 26% on average, which is more than three times faster than wages. Some areas have seen much higher rises still. In the north-east, bus fares have consistently risen by 3% above inflation, and it is the non-metropolitan areas that have seen some of the steepest bus fare increases, including in the constituencies of many Conservative Members, with fares increasing by 27% on average.
Christian Matheson (City of Chester) (Lab)
The problem with buses is not just bus fares; it is the fact that in rural areas, such as in Saughall or Guilden Sutton in my constituency, the privatised bus companies are simply withdrawing services because their profit margins are not big enough.
Lilian Greenwood
My hon. Friend makes an important point. In many cases, it is hard-pressed local authorities that are trying to fill the gap, but of course with cuts it is increasingly difficult to do so.
The Secretary of State may remember when Ministers said at the start of the last Parliament that their cuts to bus funding would not impact on fares or service levels. Perhaps it was before the Secretary of State’s time. Almost six years on, however, the impact of the reductions to bus subsidy and local authority budgets is clear: more than 2,400 supported bus services have been altered, downgraded or withdrawn altogether. Supported, socially necessary bus services accounted for 24% of overall mileage in 2010. Last year, that had shrunk to 17%. The overall mileage of socially necessary services is down by 10% in the last year alone, and the number of transport authorities funding a young person’s concessionary travel scheme has fallen by 24%.
Bus services are used by every section of society, and we need a growing bus industry that can provide new routes to areas that are not currently served and provide people with as many options as possible for travel. We know that buses are particularly important to disabled people, older passengers, those on low incomes, young people and jobseekers. I am proud of the support that Labour introduced, including the concessionary bus pass, which provides a lifeline for pensioners and has kept many networks viable. Six years ago, the Prime Minister said that he would keep Labour’s free bus pass. Indeed, a year ago the Transport Secretary told this House that
“we have kept, and will keep, concessionary bus fares for older people.”—[Official Report, 22 January 2015; Vol. 591, c. 357.]
But what is the point of a free bus pass when there are no bus services left?
Craig Williams (Cardiff North) (Con)
Before I entered the House, I sat on the board as a non-executive director of Cardiff Bus. Is the hon. Lady aware that we had to get together as Welsh bus companies and threaten legal action against the Labour Welsh Government on the concessionary fare funding because it was a breach of contract?
Lilian Greenwood
You do not want to talk about your own Government’s record on concessionary fares. [Interruption.]
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. The hon. Lady does not mean “you”, does she? She means “he”.
Lilian Greenwood
The hon. Gentleman does not want to talk about the point at issue. He does not want to talk about what has happened to bus services here in England.
Anyone who searches the speeches and the statements of Conservative Ministers for references to fare rises on buses or cuts in routes will spend their time in vain.
Several hon. Members rose—
Lilian Greenwood
I will make some progress, and then I will give way.
Bus passengers account for two thirds of public transport journeys, but the Transport Secretary mentioned them only once, in passing, in his speech at the Conservative party conference a few months ago. No doubt he will say that funds have been provided for local authorities to bid for support, and of course investment in cleaner, more efficient buses is welcome, but taxpayers will not realise value for money without reform. Fares have outstripped inflation and wage growth, and savings from the falling cost of fuel are not being passed on to passengers. Throughout the country, bus services are trapped in a vicious cycle in which fare rises dampen down demand and routes are then cut, triggering another round of cost increases.
There was a time when Ministers insisted that
“there have not been the cuts that the Opposition are so keen to talk up.”—[Official Report, 19 April 2012; Vol. 543, c. 485.]
However, when Transport Focus, the official watchdog, surveyed people who had been affected by the cuts, one person responded:
“I have one daughter who is disabled. They have cut her bus on a Sunday and in the evenings, so I can’t go and see her on a Sunday now.”
Another said that they
“Can’t see elderly parents in the evening and care for them as much when they probably need it the most. Can’t afford a taxi because not working at the moment and relied on the bus.”
One respondent simply said:
“I can’t see dad”
in a nursing home
“on a Sunday because there is no bus.”
Conservative Members may say that the Government cannot be held accountable for the operation of a deregulated market, and it is true that London was the only part of Britain that was excluded from the provisions of the Transport Act 1985, but the fact is that, across the country, buses continue to receive very high levels of public support. Of the industry’s costs, 41% are met by subsidy, and the Competition Commission found that genuine competition between bus companies, beyond occasional and disruptive bus wars, was rare. In too many areas the market does not provide comprehensive networks, forcing councils to fund additional services where they can still afford to do so, and placing an additional cost of more than £300 million a year on our hard-pressed local authorities. Nexus, the north-east transport authority, has only been able to maintain local services by drawing on its reserves, while also pursuing reforms that would allow it to deliver better services at a lower cost to taxpayers.
Andrew Percy (Brigg and Goole) (Con)
Not everything that the hon. Lady is saying is incorrect, and obviously the position with bus services is very difficult, but it is a question of choices. The hon. Lady should consider what has been done by North Lincolnshire’s Conservative-controlled council. When we took control, it was able to reinstate the No. 37 bus, which had been cut by the previous Labour authority, and extend its services to Wroot and to Crowle. Labour-run Goole Town Council decided to cut the workers’ bus services so that it could pay for a bonfire once a year. So it is about choices. When local authorities are innovative, they can do what we have done in North Lincolnshire, and expand services.
Lilian Greenwood
The hon. Gentleman should think about the powers that local authorities have to enable them to make effective choices on behalf of passengers, and that is what I intend to talk about.
While fares continue to rise and routes are cut, some of the biggest bus operators report profit margins of 13% or more on their operations outside London. What was the response of Conservative Ministers? For four years they ignored the calls for reform from Labour Members. I am proud of the fact that Labour has consistently championed the case for bus tendering, but Ministers rigged funding awards to exclude local authorities that pursued regulation, and, shamefully, they remained silent when councillors were subjected to appalling abuse and called “unreconstructed Stalinists” just because they were trying to deliver better services.
While the Treasury’s decision to accept the case for bus tendering is welcome in principle, as is the Transport Secretary’s Damascene conversion, we must question the sincerity of that commitment, and the test will come in the forthcoming buses Bill. Will the Bill make those powers available to all areas that want them, not just to authorities that have reached a devolution agreement? Will it contain measures to protect rural bus services, which are particularly important to those communities, and which have been hit by some of the highest fare rises in the country? Will it protect transport authorities from crippling compensation claims?
The Nexus quality contract scheme boards said that the authorities should have set aside up to £226 million to compensate existing operators for the potential loss of business. If those payments were replicated in Greater Manchester, the Sheffield city region and the north-east, a key northern powerhouse commitment would never get on the road—not to mention the effects on Cornwall and other areas that have sought bus-tendering powers.
The bus market is costing too much and is not delivering for passengers, and we have seen the same trend on our railways. Commuters’ fares have gone up by a quarter since 2010, with season tickets costing up to £2,000 more. Ministers restored the loophole known as flex, which gave the train companies the right to vary prices by up to 5% a year, meaning that the cost of some season tickets has risen by up to 38%, and evening fares in the north have been hiked by up to 162% at the direct insistence of the Department for Transport.
The Secretary of State for Transport (Mr Patrick McLoughlin)
Will the hon. Lady remind the House how many years flex was not available for when the last Labour Government were in office? Am I correct in thinking that it was just one year—the year of the election?
Lilian Greenwood
The Labour party scrapped flex permanently, and it was the Secretary of State’s Department that chose to reinstate it, as well he knows. It was only as a result of concerted pressure by Labour Members that this Government dropped it over the past two years.
As I was saying, evening fares in the north have been hiked by up to 162% at the Secretary of State’s direct insistence. The Department’s own McNulty review has warned that our fragmented railways have a ticketing system that
“is complex, often appears illogical and is hard for the uninitiated (and even the initiated) to understand.”
There is also an efficiency gap of up to 40% compared with the best performing European operators, which is wasting money that should be used to address the rising cost of travel and to fund investment.
At the last election we were promised part-time season tickets, and a pilot by Southern Railway found that they could save some commuters 50% of the cost of their travel. However, the smart ticketing programme that underpins the system is 78% over budget and delayed by three years, and there are rumours that it could be cancelled. Will the Secretary of State tell us today whether the south-east flexible ticketing programme is being dropped?
Ministers might claim that services are getting better for everyone, but I urge them to mind the gap between their rhetoric and reality. We all remember the Under-Secretary of State for Transport, the hon. Member for Devizes (Claire Perry), saying that rail passengers had to realise that they were paying
“fair fares for a comfortable commute”.
Stephen Hammond (Wimbledon) (Con)
In the Corbyn land of rhetoric, the hon. Lady seems to have forgotten that fares went up by 11% in the last year of the Labour Government alone. It is this Government who have frozen regulated fares for three years. Will she acknowledge that fact and make sure that she puts the truth on the record?
Lilian Greenwood
If the hon. Gentleman looks at our record, he will see that rail fares increased only by the level of inflation or were actually cut in six of the 13 years that Labour was in power. Fares rose in some years, and that helped to fund investment. Under Labour, there was more investment in rail in real terms than under any previous Government. Under this Government, that link has been broken.
The Transport Secretary said that only commuters were paying regulated fares, and that unregulated fares could be “quite cheap”. Those comments are a world away from the frustrations endured by passengers every day on Southern and Thameslink, some of which were described in the House today by my hon. Friend the Member for Streatham (Mr Umunna). They reflect an increasingly overcrowded and unreliable network.
In 2009, the Conservative party’s rail policy review stated:
“Fare rises come with tacit Government approval and are often the direct result of the franchise process”.
Will the Secretary of State therefore explain why he intends above-inflation rises to resume after 2020, as his Department’s recent consultation on the East Anglian franchise makes clear? Passengers were always told that higher fares were necessary to pay for improvements, but under this Government that link has been broken. The electrification of key lines was first paused and then shambolically “unpaused” one week before the Conservative party conference, and those projects are now delayed by years.
That goes to the heart of public trust in the railways. Ministers and Conservative Back Benchers went into the last election on a manifesto that said that key improvements would be delivered in this Parliament, but information about the true state of those programmes was kept concealed within the Department. The Transport Secretary has said that he was not informed about the state of the electrification programme until after May, but why did he not pose searching questions within the Department in October 2014, when my predecessor, my hon. Friend the Member for Wakefield (Mary Creagh), challenged him to say
“which electrification projects will be delayed or cancelled”—[Official Report, 23 October 2014; Vol. 586, c. 1030.]
due to cost overruns on the great western main line?
Oliver Colvile (Plymouth, Sutton and Devonport) (Con)
I have one curious question for the hon. Lady: how is this all going to be paid for? Is it going to be borrowed or are we going to put prices up?
Lilian Greenwood
I shall deal with that very question later on in my speech, so the hon. Gentleman should listen attentively.
Why did the Transport Secretary not raise the alarm in the last Parliament when the estimated cost of electrifying the midland main line rose from £250 million to £540 million, and then to £1.3 billion? Why did he not do so when the cost estimates for great western electrification rose from £548 million to £930 million, and then to £1.7 billion? Of course, the estimate has now risen further still, to £2.8 billion. Why did he not act when the Transport Committee warned in January 2015:
“Key rail enhancement projects...have been announced by Ministers without Network Rail having a clear estimate of what the projects will cost, leading to uncertainty about whether the projects will be delivered on time, or at all”?
Will the Transport Secretary confirm that he commissioned a report on the state of the electrification programme, which was given to him in September 2014? This report has never been published, and a Freedom of Information Act request for a copy has been personally refused by a Minister in his Department. What did that report say, and what has he got to hide?
The truth is that the Department was clearly warned by Network Rail about the impending northern power cut. The company’s board discussed last March
“the decisions required jointly with the DFT”
regarding
“enhancement deferrals from June”.
Network Rail’s chief executive has confirmed to me:
“In mid-March 2015, Network Rail informed DfT that decisions may need to be made in the coming months about the deferral of certain schemes.”
If the Secretary of State really was not aware of what his own Department and Network Rail were doing, there is only one possible explanation: he made it clear that he did not want to know. He failed to take responsibility, and passengers are now paying the price.
We were told that 850 miles of track would be electrified before 2019, but now the Department is refusing to say how many miles of track will be electrified in this Parliament. Is it half the original target? Is it a quarter? Will the Transport Secretary confirm that by 2019 this Government would do well to realise the plans for electrification set out by a Labour Secretary of State, the noble Lord Adonis, a decade earlier?
Let me return to the cost of tickets.
Lilian Greenwood
I am not going to give way at the moment, because I want to make some progress. The Government claim they will not increase regulated fares above inflation, and we will hold them to that promise, but may I remind the Transport Secretary of his comments from two years ago, when he said that Labour’s fares freeze
“would cost £1.8 billion over the lifetime of the next parliament and be paid for by more borrowing and higher taxes.”
Given that the black hole in Network Rail's finances will be plugged by £1.8 billion-worth of asset sales and £700 million of additional borrowing, has not this Government’s ostrich-like approach to the railways resulted in what the Transport Secretary’s own party might call more spending, more borrowing, and more debt?
We need investment in our rail network, both in HS2 and in the existing railways. I am proud of the fact that we saw record investment between 1997 and 2010. Our Government invested more in the railways, in real terms, than any previous Government, addressing the chronic maintenance backlog, replacing thousands of unsafe, slam-door Mark 1 coaches and ending the appalling safety crisis created by the disaster that was Railtrack. I am concerned that the Government’s programme has come to resemble not the much heralded “biggest investment since the Victorian era” that we have heard so much about, but the ill-prepared 1950s modernisation plan that did so much damage to support for the railways.
As we come to make the case for additional investment, we need Ministers to own up to the challenges that the programme continues to face, but again and again, the message is the same: they did not know; they were not responsible; and they were not there. We could ask what exactly Ministers were doing instead of keeping improvements on track, because they were not keeping an eye on the franchising programme, which collapsed in 2012 costing taxpayers more than £50 million, or on the allocation of trains in the north, as the Secretary of State approved the transfer of new rolling stock from TransPennine to the south, triggering a capacity crisis that cost taxpayers another £20 million to resolve. It seems that their focus was solely on privatising East Coast, a successful public sector rail operator, which delivered record passenger satisfaction and punctuality scores—
Lilian Greenwood
No, I have already given way to the hon. Gentleman.
East Coast cut its fares in real terms in 2014 and reinvested all its profits in the service. As reported last week, it was delivering the best-ever service on the line in the weeks before it was sold. Instead of extending that successful model of public ownership to the other franchise services, the route was prioritised to be sold off. Worse, we now learn that Directly Operated Railways, East Coast’s parent company, has effectively been mothballed and its functions outsourced to companies with no experience of operating passenger services.
We are left in the absurd position of divesting our in-house railway expertise at precisely the moment that several franchises and contracting competitions appear to be in doubt. Now, on top of the damage already done, the Government are seriously considering privatising Network Rail. They have already tested the theory to destruction with Railtrack. A sell-off of Network Rail will put profit before passengers and risk dragging us back to the worst excesses of privatisation. I say to the Transport Secretary: do not go down this road. We know how it ends and we on the Labour Benches will oppose it all the way.
May I say how disappointing it was that the Scottish National party in government not only issued a conventional franchise for ScotRail, but passed up the opportunity to invite a public sector bidder for the contract? The franchise was awarded a full month after Gordon Brown, the former right hon. Member for Kirkcaldy and Cowdenbeath, made it clear that, on the forthcoming Smith agreement, enforced rail privatisation will be no more and the right to include a public sector option is currently before Parliament in the Scotland Bill. Labour urged the Scottish Government at the time to postpone the competition, but that call was rejected.
Callum McCaig (Aberdeen South) (SNP)
I thank the hon. Lady for so kindly giving way. I am pleased that she is addressing this part of the motion. I feel that the request is particularly ironic given that she talked about the powers that local government in England should have. The Scottish Parliament, and indeed the Scottish Government, do not have such powers. What she and her party are encouraging is the Scottish Government to break the law. Will she explain why that is the case?
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. Before the hon. Lady answers the intervention, may I say that she has been very courteous in taking a lot of interventions—and it is indeed good to have a lively debate—but this debate has less than an hour and a half to run? The hon. Lady has spoken for some 25 minutes, and I am sure that she will be aware that there are many other people who wish to speak.
Lilian Greenwood
I will move towards finishing my speech, Madam Deputy Speaker.
It is a pity that the hon. Gentleman did not refer to the fact that the Labour Government fully devolved the ScotRail franchise, or that it was Labour that secured the change to the Railways Act 1993 through the Smith commission. The invitation to tender for the ScotRail franchise, issued by the SNP Government, said:
“Transport Scotland reserves the right to alter the timetable or the process, or to terminate this process at its sole discretion.”
There we have it. It was entirely in the Scottish Government’s power to wait until the 1993 Act could be amended, but they chose not to do so. There is nothing in the 1993 Act or in the ScotRail invitation to tender that prevented them from delaying the competition until section 25 of that Act was amended. It is regrettable to see the inaccurate amendment tabled by SNP Members.
It falls to Labour to set out the case for reforming our transport services and addressing the rising cost of public transport. It is what Labour is doing in local government, winning concessions from Whitehall. It is what my right hon. Friend the Member for Tooting (Sadiq Khan) will do as Labour’s Mayor of London by putting bus and rail passengers first. We must play our part in Parliament too, and I urge Members to support the motion today.
The Secretary of State for Transport (Mr Patrick McLoughlin)
I welcome the debate and I know that the hon. Member for Nottingham South (Lilian Greenwood) cares very much about the subject. She has worked with us on the Bill for HS2, which is making good progress, and I thank the Opposition for their support on that vital project.
I also thank everyone in all parts of the transport industry who has been out this winter responding to the floods. It has not been easy, but good progress is being made. I was in Cumbria for the second time last week to see it at first hand. Over the Christmas period, Network Rail also successfully carried out its biggest ever works as part of the railway upgrade plan that is so essential to the future of the British rail industry. I pay tribute to the thousands of staff who gave up their Christmas to improve our railways.
Today, the hon. Lady asks about transport costs, and I am pleased she does. After all, the Opposition should know all about them, because when they were in office rail fares soared. In their last full year, regulated fares increased by up to 11% and between 2004 and 2010 they went up by about 4% a year—a total increase of some 26.4%. We have kept increases down. They have dropped steadily over the past five years and we have frozen increases at inflation for the whole of this Parliament, a promise made in our manifesto and kept in government, saving more than a quarter of a million season ticket holders an average of £425 over the next five years.
The Opposition should also know about the cost of driving. Fuel prices are down by almost 16% in real terms since 2010 and we abolished a number of the increases that were going to take place under the Labour Government.
Alec Shelbrooke (Elmet and Rothwell) (Con)
Despite all the howling we have just heard from Opposition Members about oil prices, was it not the Opposition who wanted to freeze energy prices?
Mr McLoughlin
I am going to say a bit more about their record in government; I am not sure that I want to say too much about their record in opposition.
Mr McLoughlin
Three Members are trying to get me to give way, Mr Deputy Speaker, but I am mindful of the short time for this debate, and I am very sorry about that. I will take an intervention from the hon. Member for Streatham (Mr Umunna), but then I will make progress.
Mr Umunna
Does the Secretary of State think that the cost of £964 for a season ticket from Streatham Common to London Victoria is good value for money in the light of the recent service that my constituents have been subjected to by Southern Railway? Will he give serious consideration to the breakup of the Govia Thameslink Railway franchise, which is clearly too big and too complex?
Mr McLoughlin
I will want to say something about the works on the rail network. The amount of work that is taking place will lead to some disruption but eventually will lead to a much better service for the hon. Gentleman’s constituents. The huge investment in London Bridge, for example, will cause disruption while it is taking place. I wish that that was not necessary, but people will get a much better service than they had before those improvements.
Mr McLoughlin
I want to make some progress.
Fuel prices are down by nearly 16% since 2010. The cost of driving licences has been reduced, the cost of the theory test is being cut and we have taken action to bring down the cost of car insurance as well.
There is another thing that the Opposition do not like talking about—the cost to our country of lost investment when they were in office, and the cost to jobs, businesses and growth. Britain slipped from 7th to 33rd in the World Economic Forum’s infrastructure league table when they were in government. They cancelled more than 100 major road improvement projects and did not invest when they had the chance. They electrified just 10 miles of railways, less than one mile a year. I was going to say that it was a snail’s pace electrification, but I have checked, and that would be unfair to snails. They go faster than the previous Labour Government went on electrification. No Conservative Member will take lectures from the Opposition about electrification. They did not invest, and they made the task of rectifying their mistakes much more of a challenge. The real benefit cannot be felt until all this vital but disruptive work is completed. No wonder Labour has been so reluctant to debate transport in this House. The shadow Secretary of State’s immediate predecessor did not even have a debate on transport. In fact there have been only three debates on transport since 2010. That is obviously because the Opposition are so embarrassed by their own record, and so impressed by our record.
The shadow Secretary of State has served on the Opposition Front Bench on transport since 2011. She is the fourth shadow Secretary of State I have faced across the Dispatch Box, and in that time there have been about as many changes in opposition transport policy as there have been shadow Secretaries of State.
Mr Cunningham
I thank the right hon. Gentleman for giving way; I notice he has been avoiding me for the last five minutes. Will he have a look at the use of senior citizens cards, particularly in respect of certain rail companies? As I said in an intervention on my hon. Friend the Member for Nottingham South (Lilian Greenwood), some people badly need them; they do charity work and they need to come to London, but not at the times when senior citizens cards can be used. Will he have a look at that, and the different franchises and different uses?
Mr McLoughlin
I know the hon. Gentleman will want to support me wholeheartedly on creating more capacity. One way we are going to do that is by building HS2, which in the past he has not been quite so supportive of. It is very important that we look at these things, however, and of course I will look at the points he makes.
Mr McLoughlin
I really do need to make progress.
The shadow Secretary of State used to be in favour of rail franchising, but now she seems to be against it, although it is interesting to note that her party’s candidate for Mayor of London is apparently so keen on it that he wants Transport for London to bid for contracts in the private sector. In 2014, the shadow Secretary of State got one of our great private companies, Stagecoach, to sponsor her Christmas cards. I did not get one in 2015. Maybe this time it was sponsored by the RMT instead, because these days Labour has only one policy on transport: turn all the signals bright red—a policy that is going nowhere from a party that is getting nowhere.
Now of course the Labour party wants to impose yet another cost on hard-working people: the cost of strikes. We heard not a single word from the hon. Lady in her speech about the planned strikes next week on the underground—a party that will not even stand up for Londoners when the unions carry out a selfish and irresponsible strike. Well, this Government clearly stand on the side of Londoners and those who work in London. Will the hon. Lady condemn the planned strike on the underground? I will give way to her if she will. Will she condemn it? Silence. She is probably under orders from the shadow Chancellor to join the picket line, or does she agree with the Labour peer Lord Mendelsohn? My hon. Friends may not have heard this: Labour peer Lord Mendelsohn said strikes would be “economically efficient” because some travellers would discover better ways into work. That is Labour’s new policy: a strike that aims to stop Londoners getting new and better services.
Transport is central to Britain’s economy, and because we are dealing with the decline and deficit the Labour party left behind, we can afford to invest for growth. That means more jobs, more homes, and more businesses using our transport system, and more people too. Last year it carried more people than ever in its history: there were 1.65 billion journeys on the railway network, 316 billion vehicle miles on our roads, and over 1.3 billion journeys on the tube. This year, it will break that record again. That is why we are widening roads, building railways, opening up opportunities: a massive programme is under way now that means building Crossrail, completing Thameslink, electrifying the northern hub, starting HS2, record investment in local roads, setting up an independent National Infrastructure Commission under Lord Adonis, and getting on with the £15 billion road investment strategy, including the A358 and A27 that Labour pledged in its manifesto to cancel. There is £38.5 billion of investment in our railways, and 30% more on enhancements than Labour spent previously.
Oliver Colvile
May I remind my right hon. Friend that, during the election, the Labour party said it would cancel the A359 work? I did not hear how this would all be paid for, which I was told clearly to listen out for.
Mr McLoughlin
Indeed, the Opposition said they would take those roads out of the roads investment strategy.
Through our careful custodianship of the economy, we can afford to invest in the future. That is why some 4,000 new rail carriages for the national network are now on order, with most being built in Britain.
The hon. Member for Nottingham South talked about the need to help people up and down the country with transport costs, and I agree with her. That is why we are investing. In Nottingham, we have spent £150 million widening the A453, speeded up trains and rebuilt the station at a cost of more than £100 million, and extended the tram with a contribution of more than £370 million. That is more in six years for the people of Nottingham than in the previous 13 years of Labour government.
I welcome the hon. Member for Middlesbrough (Andy McDonald) to the Opposition Front Bench. I hope he lasts longer in the job than his predecessor, which will let him see the benefits of our investment in his constituency, including new intercity express programme trains, direct services from London on Virgin Trains East Coast, the removal of Pacer trains from the network and an upgrade to the A19 close by. I could go on. Other members of the Front-Bench team will benefit, too, with a £1.5 billion investment for the A14 and new Thameslink trains serving Cambridge, while Birmingham already has the upgrade to New Street station, services on Sunday from Longbridge and the M5 smart motorway programme.
That is the choice: under Labour, the cost of travel goes up and the cost of lost investment goes up too; under us, rail fares are capped, fuel prices go down and investment goes in.
Andrew Percy
My right hon. Friend knows that we in the Humber got the fluffy end of the lollipop under the last Government. The Humber bridge toll has been halved and we have got rail electrification and a number of road projects. On the subject of the cost of bus passes, will he acknowledge the incredible work done by Conservative North Lincolnshire Council, which reversed the 500% increase in the price of post-16 bus passes, cutting the cost from £180 under the Labour party to £30 under the Conservatives?
Mr McLoughlin
My hon. Friend clearly shows that Conservative councils choose priorities to help local people and make sure the investment goes straight to the frontline. I congratulate the council in his area on doing that.
Mr McLoughlin
If my hon. Friend will forgive me, I am mindful of the time. I know other hon. Members wish to speak, and I understand that there is to be a very important maiden speech.
On the east coast line, Virgin is bringing 23 new services a day from London, with more than 70 extra stops at stations. The hon. Member for Nottingham South is against that. There are plans for new direct services to Huddersfield, Sunderland, Middlesbrough, Dewsbury and Thornaby, and more trains to London from Bradford, Edinburgh, Harrogate, Leeds, Lincoln, Newcastle, Shipley, Stirling and York. That is our plan to build for the future and support our great cities, too. Under this Government, that means city deals, new mayors, growth, a northern powerhouse and a transformation of the railways in the north.
In 2004, when Labour was in charge, it let the franchise for Northern rail on a zero-growth basis. That meant no investment, while fares were allowed to rise. It was a disgrace. Perhaps the hon. Lady would like to apologise for the consequences. The cost was no new trains and massive overcrowding, with people expected to travel on worn-out Pacers. Just before Christmas, the Government let new franchises for Northern and TransPennine that will result in a £1.2 billion boost to rail services, 500 new carriages, 40,000 extra spaces for passengers and free wi-fi on trains and in stations. No wonder local Labour politicians in the north were lining up to praise the move. Liam Robinson, chairman of Merseytravel, said it was a “big step forward” and would “drive up standards”. Labour councillors including Peter Box, Richard Leese, Keith Wakefield and Nick Forbes praised the impact of devolution to Rail North. The RMT commented too, describing it as a “bitter blow”. Who does the hon. Lady agree with? Would she have signed that franchise contract—yes or no? Would the Opposition have walked away, leaving the north with nothing, just like they did last time? We bring the private and public sectors together in partnership, backing better services and growth.
The hon. Lady mentions buses. I am not clear what she wants. Does she want to nationalise them too? We are going to legislate so that cities can help shape their bus networks, working with the private sector. While her party was in office, bus use outside of London fell by 8%. In 2010 only 25% of buses outside London could take smart cards; now 89% can. Compared with 2010, buses are safer, with more CCTV, and they are busier and more accessible. The Government are supporting the vital work done by community transport organisations with a scheme to help them buy new minibuses. We have taken tough decisions on the economy, but protected concessionary travel across the country.
On road travel, we have reformed Highways England and set out the first-ever long- term investment programme. We are investing in local roads, with a record £6 billion of funding to tackle the menace of potholes, and a further £475 million for the larger road schemes that some towns so desperately need. On cycling, which the Opposition did not even mention in today’s motion, we have increased spending from the £2 a head that we inherited in 2010 to £6 a head today, and we will go further still.
That is the investment we need to help cut the cost of transport. We are getting on with Crossrail, which is on course to open two years from now. We are getting on with HS2, with construction starting in less than two years from now. A new National Infrastructure Commission has been established. Record investment is taking place and rail fare increases have been frozen in line with inflation. Transport is transforming our country, whereas Labour wants to go back to an age when train use fell, fares went up and investment was cut. This Government are optimistic about rail, roads, buses, cycling, and more importantly the British people. We are going to be trusting. We are going to see investment at a record level, which will be good for our cities and for our country right across the transport network. I urge the House to reject the motion.
Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)
I echo the sentiments of the Secretary of State regarding the staff who worked in the floods and the inclement weather over the Christmas and new year period on all networks to keep us moving and to help passengers as they travelled.
A debate on public transport is welcome. People need effective, regular and affordable public transport. In a debate such as this, they would expect the issue to be moved forward, although I am not sure they would have had that impression from the opening exchanges. Public transport is close to my heart and that of many of my hon. Friends. My constituency, in common with many of theirs, is mostly a rural community. Scotland has diverse public transport needs. Some places in Scotland and in other nations of the UK have no public transport—people can only use their cars, so it is not just the cost of public transport that matters to them, but the cost to the public of transport.
The motion could have benefited from the inclusion of other forms of transport that people need—and, indeed, rely on—in Scotland. For example, we do not see aviation as anything other than public transport. That is what it is. Marine transport is very important to us, and ferries are public transport too. As the Secretary of State said, the motion could have included public cycling schemes and public costs in relation to roads—tolls, for example. The need for major UK infrastructure projects to give proper consideration to Scotland could be debated. The debate could have been more inclusive and served a common purpose. It could have been more positive, seeking to benefit people.
Many local bus services in Scotland receive subsidies to ensure that uncommercial services can continue to operate as a public service. Figures from the House of Commons Library show that from 1995 to 2015, Scottish bus fares went from being 10% higher than those in England to being lower. Since 2007, bus fares in Scotland have risen by 5% less than in England. Since 2010, bus fares in Scotland have risen by 4.6%; in England over the same period, they have risen by 7.0%. The Scottish Government have invested a quarter of a million pounds every year through the bus service operators grant and concessionary travel scheme. That has helped 1.3 million older and disabled people to live more connected, healthier lives.
In aviation, there are direct flights to over 32 countries, and we have the successful ongoing work to improve long-haul connections to Scotland and connectivity through world hubs. We plan to use changes to air passenger duty to improve the situation for the travelling public by reducing their costs, and to help businesses, including in tourism and food and drink, by growing key sectors of our economy and giving better choice to our people. This is all for the people of Scotland. We are working to achieve guaranteed levels of access between Scotland and London. The Scottish Government acquired Glasgow Prestwick airport to safeguard 3,200 jobs and to secure vital infrastructure as an asset that contributes more than £61 million annually to the Scottish economy.
We have invested in roads to ensure that Scotland has a modern transport infrastructure for the 21st century. The SNP Scottish Government have a clear policy against the use of road pricing and tolls, now and at any time in future, and we have abolished all road tolls on bridges in Scotland. We are delivering the £1.4 billion new Forth crossing at Queensferry, which is on track to be completed by the end of 2016—again, with no tolls for the public.
In marine transport, Ministers in the Scottish Government have invested more than £145 million in piers and harbours, with £8.6 million going to Stornoway harbour to accommodate the new Ullapool-Stornoway vessel, MV Loch Seaforth. Since 2007, we have invested almost £1 billion in ferry services, including the road equivalent tariff and six new ferries. That is investment of over £100 million. We have introduced into the network of services operated by CalMac a third hybrid—MV Catriona, which was launched at Ferguson marine shipyard in Port Glasgow in December 2015. On 16 October 2015, Ferguson Marine Engineering Ltd was awarded contracts worth £97 million to build two £100 million ferries with a delivery date in 2017-18. The First Minister of Scotland confirmed just yesterday that Dundee’s central waterfront infrastructure would be the latest Scottish Government project to be delivered on budget and ahead of schedule. This includes a re-rationalised road layout and is part of the £1 billion, 8 km Dundee waterfront project, which will create 7,000 new jobs.
Let me come to the interesting one: rail franchising. On this important issue—the public outside this Chamber will not understand this—Labour Members have chosen to attack the Scottish Government, not the UK Government whom they are supposed to be opposing. Every time they take a wee excursion up the branch line, they end up embarrassing themselves and the branch office in Scotland. Frankly, they are embarrassing everyone. The purpose of opposition, surely, is to build alliances to hold the Government to account. What a missed opportunity! The SNP is the effective Opposition in this Chamber. The Government realise that, which is why they are going at us day after day, every day—they spend more time on us now. Labour Members have deliberately inserted a line in this motion—a complete falsehood, by the way—that makes it impossible for us to support them in the Lobby tonight. Imagine that! People are looking on, and they see this shambles for what it is. They are switched on like never before, and they are continuing to lose respect for Labour, given stunts like these.
Let me tell the House about the Scottish Government and rail policy. The UK Government oversee a perverse system that forbids publicly owned UK bodies to bid on rail franchises while having overseas nationalised services such as Deutsche Bahn or France’s SNCF running franchises in the UK. We believe that public sector organisations should be able to bid to operate rail services, as allowed in EU law but currently prevented by UK legislation. That is a lesson for Labour Members. That approach would enable us to ensure the delivery of all rail services in Scotland and to deliver maximum economic and social benefit for our people.
Labour has used this motion to attack the SNP Government for awarding the ScotRail franchise from 2015 to 2025 to Abellio. Labour knows very well that the Railways Act 1993, enacted by John Major’s Government, specifically forbids UK publicly owned companies from bidding. It is a matter of rhetoric versus record.
Mr McLoughlin
The 1993 Act was indeed taken through by John Major, but will the hon. Gentleman also confirm that in 13 years the Labour party never changed the regulations?
Drew Hendry
The Labour party has put me in the position of having to agree with a member of the Cabinet. Imagine that—what an absolute shambles!
The Labour party spent 13 years in government without ever changing the situation, even though it heavily amended the 1993 Act with the Transport Act 2000 and the Railways Act 2005. Even though it had the power, it did absolutely nothing to repeal the 1993 Act.
This is not the first time we have heard such nonsense from the Labour party. Its leader is not so new to his position now, but not long after taking the leadership he told Marr:
“Listen I’ve been in Scotland a lot of times during the leadership campaign…I’m going to be in Scotland a great deal as leader of the party.”
We shall see whether that happens. He went on to say:
“Yes the SNP have a headline of being opposed to austerity—fine. The SNP are also privatising CalMac, also were behind the privatisation of ScotRail”.
What a pile of nonsense! Like successive Scottish Executives before them, the Scottish Government were simply following the tendering process that they are required to follow in EU law.
Patrick Grady (Glasgow North) (SNP)
Does my hon. Friend recall that, once upon a time, the Labour party was in power in Scotland as well as down here? At no point did it make any effort to allow the Scottish Parliament to take the railways into some kind of public ownership.
Drew Hendry
My hon. Friend is exactly right. Labour made no effort in government either here or in Scotland to do anything about that and, as I have said, it knows very well that the 1993 Act forbids the Scottish Government to do it.
As I have said, there was a fabrication by the Labour leader. He said that the SNP was behind the privatisation of ScotRail. Did he mean the 1993 Act introduced by John Major? There was not even a Scottish Parliament at that time, but let us not let the truth or the law get in the way of anything.
The Labour leader says that his party supports rail renationalisation, but where was that support when every single amendment that the SNP tabled to the Scotland Bill was voted down in this House? Clause 54 of the Bill will allow for the Scottish Government to consider bids from public operators. That was included in the SNP-Scottish Government submission to the Smith commission, but we tried to go further. We tabled a new clause to devolve rail services in Scotland, giving Scottish Ministers full powers and the flexibility to decide who would run such services. Like every other SNP amendment to the Scotland Bill, it was voted down by English MPs.
That new clause would also have disapplied the provisions of the 1993 Act and allowed for direct awards to be made for the operation of rail passenger services to the fullest extent permissible under the law. It would have allowed us to adjust the current ticketing system, which over-subsidises profits while having—to put it mildly—an arcane and unintuitive fare system.
An anytime single ticket from London to Edinburgh costs £140.50, while one from London to Newcastle— 100 miles south of Edinburgh—costs £138, £2.50 less. A similar ticket from London to Aberdeen, which is 100 miles north of Edinburgh, costs £157.50. That means that one journey of 100 miles costs £2.50, while another costs £9. It just does not make sense. Frequently, it is cheaper to split a ticket than to buy a direct one. A single from King’s Cross to Edinburgh costs £95, while often, but not always, a King’s Cross to York ticket and a York to Edinburgh ticket cost £66 in total. We could have done something to sort that out.
Let me just say that the Scottish Government and the SNP will take no lessons from the Labour leader when it comes to investing in Scotland. With such a lack of understanding, even of the basics, it is no wonder that, according to a recent Survation poll, his approval rating in Scotland is minus 17%, while that of the First Minister, Nicola Sturgeon, is plus 27%.
As we have already established, the issue of public ownership is out of the hands of the Scottish Government, so I want to finish by talking for a moment about the rail franchise in Scotland. The Scottish Government welcomed Abellio to the ScotRail franchise because it has moved its UK headquarters to Glasgow—creating 50 new jobs, in addition to securing another 150 jobs from First. As a result of the new deal, passengers and staff will enjoy a range of benefits: advance fares from £5 for journeys between Scottish cities; a commitment to earnings of at least the living wage—the living wage in Scotland, by the way—for all staff and contractors; at least 100 apprenticeships; a guarantee of no compulsory redundancies; protection for rail staff pensions and travel rights; free wi-fi on trains; a new approach to cycling, with more than 3,500 parking spaces, and bike hire at a number of stations, which should be compared with Southern; 80 new trains due to arrive at start of December 2017; and 23% more carriages across the network.
The Scottish Government’s record on rail consists of a commitment to a £5 billion programme of investing in Scotland’s railways over the five years to 2019, including £170 million on the Aberdeen to Inverness rail upgrade and £300 million to open the Airdrie-Bathgate rail link in 2010, which will provide a passenger service between north Lanarkshire and west Lothian for the first time in 54 years. Since privatisation, rail fares have been regulated by the Government to limit the size of increases on key tickets, but they have increased in real terms since the early years of this century. In January 2013, fares across all operators were 23% higher than they were in January 1995, with an average annual increase of 1.2%.
I will finish on this point. [Hon. Members: “Hooray!”] It is nice to be appreciated. This is the story of a Government who invest in public transport for their people. The Scottish Government’s budget has been cut by £12.5% since 2010—£1 in every £8 has gone—for unnecessary ideological austerity. Despite that, the SNP Scottish Government are still investing in infrastructure. Having already invested £15 billion in transport since 2007, they are committed to the largest transport investment programme that Scotland has ever seen, despite these relentless Westminster budget cuts.
Karen Lumley (Redditch) (Con)
I want to make a short speech and I will be very brief, because I know that the hon. Member for Oldham West and Royton (Jim McMahon) is waiting to make his maiden speech. All of us remember that feeling, so it is important that he gets to say his bit.
I would obviously have liked to talk about the fantastic Birmingham International airport, but I will save that for another debate. Instead, I will talk about some of the great rail links from Redditch to the west midlands area. My constituents can live in the lovely town of Redditch, while being able to travel to Birmingham to work. In 2014, a passing loop became operational in Alvechurch, meaning that there are now three trains an hour between Redditch and Birmingham. That makes it as easy to get there as to get to the midlands. On top of that is the £750 million refurbishment of Birmingham New Street International, including a brand-new John Lewis store, which is absolutely fantastic. Some £13 million has been awarded to the west midlands to run schemes until December 2017. The schemes cover upgrading ticket vending machines on the Redditch line, which includes making them contactless; fitting CCTV equipment to all trains on the line to ensure passenger safety; and equipping staff with technology to enable them to give customers up-to-date, live running information.
Transport needs joined-up thinking across the midlands. I welcome the devolution deal that was signed in November, which will power the midlands engine. The west midlands was the first region outside the north to sign a devolution deal with an elected mayor. The new authority, which includes Redditch, will take an overview of transport in the region, including the HS2 growth strategy.
Before I finish, I will say a bit about HS2. I am, and always have been, a huge fan of the project. The HS2 headquarters is moving to my region and huge investment is being put into the project. The project is often talked about as if it is all about speed, but it is about having the capacity on our railways to ensure that the transport network is fit for purpose. We talk a lot in this House about rebalancing the economy, and I believe that HS2 can help us do it.
There are two sides to every story. I want to put it on the record that Redditch and my region are benefiting from extra investment in the transport system after years of under-investment, and they will continue to do so for many years to come under this Government.
Jim McMahon (Oldham West and Royton) (Lab)
Thank you, Mr Deputy Speaker, for allowing me to make my maiden speech in this debate.
First, I should pay tribute to Michael Meacher, not simply because it is customary to do so, but because Michael was a dear friend to the people of Chadderton, Oldham and Royton. He will be missed and remembered locally, and by Members of this House, for decades to come.
I thank the voters of Oldham West and Royton for putting their trust in me as their representative here. I will work hard to make sure that I live up to that trust, along with my colleagues. From a Labour party point of view, we have shown what we can achieve when we pull together as a family. The result was very impressive for the Labour family.
As I stand here today, I reflect on the remarkable story—I would say that, wouldn’t I?—of a young boy from Miles Platting in Manchester who is now standing here in the House of Commons. The street where I grew up as a child no longer exists, but the values of hard work and courage instilled in me by my parents remain.
The borough of Oldham and its seven towns, with their culture, community and comradeship, have played a defining part in the history of our country. Oldham’s values of hard work, grit and integrity speak to the heart of British values—values that are exemplified in all of Oldham’s great and diverse communities today.
Chadderton secured its historical place through aviation, among other things. It made the world-famous Lancaster bomber. In its heyday, the Greengate site employed 20,000 people. When its doors closed in 2012, the 1,500 staff who remained moved out. That was a very sad day for the people of the town.
Our engineering and manufacturing base included the world-famous Ferranti, which was famous for making the components for the world’s first computer, and Platt Brothers, which was once famous for being the largest engineering plant in Europe. Both are now gone.
Royton has a little in common with this place. You may remember the rhyme, Mr Deputy Speaker, “Remember, remember the 26th of November”—26 November 1884, that is, when the gunpowder plot unfolded in Royton town hall, blowing off the windows and doors. Interestingly, it was led by a gangmaster who was campaigning against measures in the Factory Acts that banned children under 10 years old from working in the mills.
Many people here will know Oldham as an industrial giant, and it was. It was the king of cotton. In its heyday, the town spun more than 17 million spindles, which was more than the whole of the United States and 80% of the total number in the UK. For too many people, the Oldham of yesterday was built on exploitation, with very little regard for quality of life or fairness. People came from countries right around the world to make a better life for themselves, but do you know what the truth is? People struggled. They struggled in desperate poverty, while a lot of the money left town.
The exploitation did not stop in Oldham. Feeding the 17 million spindles required a lot of cotton, which was picked in the fields of the American south. As the machines raged on in 1860, it took 200,000 black slaves to pick enough cotton to feed the mills. So there was exploitation at home, exploitation abroad, and with the money taking leave from the town.
Today, hard-fought battles for better living standards, a welfare state that is there when people need it, and decent homes, are being eroded. People are seeing vital services—in some cases their lifeline—being taken away. For too many people, work does not pay and they cannot make ends meet.
People might think that I am painting Oldham as having been beaten, but mark my words: we are far from beaten. We have courage and determination. If our past successes were built on the industrial revolution, our future will be secured through solid hard work—an industrious revolution. Our town is going from strength to strength. We are rebuilding, attracting investment and creating new jobs. We can be proud of what we have achieved in recent years, but too often it feels as if we are doing it alone, and it should not be that way. Devolution must be more than a love affair with the big cities; it must deliver and provide a decent settlement for towns and districts. I want Oldham to flourish and to be the place we know it can be—a place where my sons, Jack and Harry, and the other 57,000 young people will be proud to call home.
With new powers devolved to Greater Manchester, the challenge is not simply one of good administration, but also of strong political leadership. We have shown that we can get things done. The continued expansion of the Metrolink tram system will certainly accelerate economic growth. We must also push for the future and for cross-borough expansion, and I will use this opportunity to lay down a marker for the Ashton loop line from Ashton town centre to Oldham Mumps, and for a Middleton spur from Oldham Westwood through Middleton and on to the Bury line, connecting the north-east conurbation of Greater Manchester. [Interruption.] The Secretary of State will realise that until Friday I was the council member responsible for transport in Greater Manchester, although given his interest in the northern powerhouse, our paths never crossed. [Laughter.] Perhaps he will be charitable in return, given that this is my maiden speech.
As we rightly fight to end the north-south divide in the UK, we know that infrastructure investment can help address Greater Manchester’s own north-south divide. Such investment would benefit not just Oldham, but Rochdale, Tameside and—importantly—the north of the city of Manchester. As we rightly point out the imbalance in the UK, we cannot ignore domestic matters closer to home in Greater Manchester. For every 10 jobs that were created in south Manchester in the last decade, only one was created in the north of the conurbation. We cannot carry on like that if devolution is to be a success.
I believe in devolution and will continue to fight for power to be moved away from Whitehall to empower communities—to be honest, devolution as it stands today does not empower those communities. As the former leader of Oldham Council, I worked with others to rally support for devolution to Greater Manchester, and I worked hard to ensure a clear vision for Oldham. It was important to sign up to the deal with the Chancellor, because it is far better to have devolution on terms that we do not necessarily agree with, than to have no devolution at all. It would also be wrong not to challenge where we know that things do not work, and not to push harder when needed.
Without a clear national framework for devolution, it is for the Chancellor to pick and choose who he deals with and what is on offer. The hallmark of devolution so far has been a Treasury power grab from other ministries. The Chancellor had the opportunity to devolve real financial freedoms, but he chose not to. He is quick to give away the power of his fellow Ministers—I am sure Conservative Members will be concerned about that—but evidence suggests that he is not that keen on giving away his own power. Without genuinely reforming central Government and addressing fair funding, the northern powerhouse as a brand is meaningless.
People in Oldham see that the magistrates court and the county court are closing. We do not have a single police custody cell open for a town of nearly 250,000 people. People see youth centres closing, libraries closing, day care centres closing, thousands of staff displaced or sacked, and our positive endeavours for regeneration blocked by central Government. And we are meant to be at the heart of the northern powerhouse!
The political challenge of our time is not how we divide to rule, but how we unite and forge a future where every man, woman and child sees that they have a stake in that future; where there is more to life—there has to be more to life—than just getting by and making ends meet. Oldham MP Winston Churchill once said:
“no one can come into close contact with the working folk of Lancashire without wishing them well”.
I agree with that; it is true. But well-wishers alone are simply not enough. The dark satanic mills that marked the skyline in Churchill’s time have by and large now gone and we are a long way from realising our own Jerusalem. Friends, let us not cease from mental fight, nor shall our swords sleep in our hands, till we have built Jerusalem in Oldham’s green and pleasant land.
Several hon. Members rose—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. We have a lot of speakers: we have 10 to get in. I am not going to put a time limit in place, as I think we can help each other. If Members have up to two minutes each, we will get everybody in.
Sir Simon Burns (Chelmsford) (Con)
May I say what a pleasure it was to listen to the maiden speech of the hon. Member for Oldham West and Royton (Jim McMahon)? It was an excellent maiden speech. As everyone in the Chamber knows, it is usually a nightmare to make your first speech in this Chamber. The way in which the hon. Gentleman delivered his speech, without showing a single nerve, justifies the reputation that outsiders from the south like me heard about in the run-up to the by-election: that he was a highly effective leader of his local council in Oldham. He is not a loss to Oldham and he is certainly a gain to the House of Commons. We look forward to his future contributions to our debates.
I read the motion very carefully and I listened to the shadow Secretary of State with great interest and growing amazement. I noticed that she was able to make her speech while keeping a straight face. It was quite incredible. Here is a motion which, if we look at the parts relating to the railways, is basically, in nice cuddly words, suggesting that we renationalise them. Many of my hon. Friends, and certainly the hon. Member for Oldham West and Royton, are too young to remember the days of British Rail, but the way that history has been rewritten to suggest that everything was wonderful under that monolithic organisation is extraordinary. It was late, expensive, the sandwiches curled up at the ends, and it did not provide a fit-for-purpose rail system for this country.
I am not going to rehearse, owing to the shortness of time, what has happened since rail privatisation. What I will say is that because of the private sector and the Government, there has been massive investment in our rail network. Because I am more generous than the Labour Front-Bench spokesmen, I accept that the previous Labour Government began the process of reinvesting in our railways to make them fit for purpose. I would ask, however, that they be equally generous in accepting that we are spending billions and billions of pounds, from a variety of sources, to invest in building on that improvement, to make sure that we have a proper rail service. In control period 5, £38 billion is being spent.
More has to be done, of course, but we are investing in the future and in passengers to ensure that we have a proper railway. Anyone who suggests going back to a nationalised rail service is living in cloud cuckoo land and is driven by dogma, not reality.
Mr Chuka Umunna (Streatham) (Lab)
May I say what a pleasure it is to follow our new Labour colleague, my hon. Friend the Member for Oldham West and Royton (Jim McMahon)?
I will be as quick as I can. My main contention is that the cost of travelling on the train to and from my constituency on Govia Thameslink Railway, which runs Thameslink, Southern and Gatwick Express services through London and the south-east, is a complete and utter rip off, given the dreadful service commuters have been receiving over the past few weeks and months. I stand not to make party political points; I and commuters just want answers.
I pay tribute to Transport Focus, Martin Abrams and everyone at the Campaign for Better Transport who have been highlighting the hell experienced by commuters. According to Transport Focus’s most recent passenger satisfaction survey, GTR scored worst for overall satisfaction. According to Which? it is third from bottom out of 21 services. According to Network Rail’s public performance measure for this franchise, the percentage of GTR trains that arrive at the terminating station on time is rock bottom. And Network Rail is not without blame. According to the most recent statistics—for December and January—55% of delays are attributed to Network Rail.
Members on both sides of the House who have had meetings with executives of the companies have received excuse after excuse and broken promise after broken promise, but we have seen no change whatsoever. Instead, we are given excuses about big transformation works at London Bridge causing problems, industrial relations issues, historical under-investment in infrastructure and the complexities of running a big franchise. That is all well and good, but other transport operators face exactly the same challenges and provide a better service. This company has failed to recruit drivers and failed properly to maintain its rolling stock. People deserve answers, so instead of the same old excuses, I want a proper deadline set for GTR to provide a decent service to constituents; I would like suburban and London transport rail services transferred to TfL in the medium term; and I would like to see Crossrail 2 come to my constituency. Once we get decent services, perhaps Ministers can argue that almost £1,000 for a season ticket from my constituency to London Victoria is justified.
Heather Wheeler (South Derbyshire) (Con)
I want to talk about the midland main line, the situation of which has been well charted, and the important reason why this project will go ahead, notwithstanding what is in the motion. The reason it will go ahead is that Derby is a centre of excellence for the rail industry and rail innovation: more than 200 companies around Derby operate solely within the rail industry. We are the best placed area in the whole country when it comes to opportunities for training, innovation, for a college—for whatever it might be. I think the Government ought to listen more carefully in terms of the opportunities for people growing up in Derbyshire who understand rail and have it in their DNA. We must get the best products, whether for Crossrail 2, Crossrail 3, HS2 or HS3, going up to Scotland, which we all want to see. I think that these are fantastic opportunities.
I will not take up any more time, other than to congratulate the hon. Member for Oldham West and Royton (Jim McMahon) on his excellent maiden speech. It was a pleasure to hear so much history, but he has got a bit of doing to do in the future as well.
Jessica Morden (Newport East) (Lab)
I promise to be snappy, but first may I congratulate my hon. Friend the Member for Oldham West and Royton (Jim McMahon) on his fantastic maiden speech? It was a pleasure to be in the Chamber for it. His experience, his background, his love for his constituency and home—it all shone through in his speech. I know he will make a huge contribution to this place.
With a constituency on the border with England, one never misses an opportunity to talk about rail, yes, but about the Severn bridge tolls too, which are the subject of many questions to Transport Ministers and of many debates here. I know that this will continue until we know the Government’s plans for tolling in the future when the bridge is returned to public ownership. About 12,000 people in Newport and Monmouthshire commute to work over the bridges every day. As ably highlighted by our Front-Bench team in today’s debate, the cost of commuting has increased substantially.
Carolyn Harris (Swansea East) (Lab)
Does my hon. Friend agree that it is not only those living in her constituency who are affected, because every person who travels over the bridge into God’s own country is exploited by the exorbitant tolls, which act as a deterrent to trade and tourism?
Jessica Morden
My hon. Friend is absolutely right, and I thank her for adding weight to the campaign to lower the Severn bridge tolls, which is much appreciated.
My constituents are basically trapped: they must either pay rising fail fares or the Severn bridge tolls. Commuters, as well articulated by our Front-Bench team, face ever-rising rail fares. Since 2010, season tickets for commuters have risen by 25%. Newport to London commuters face having to pay £2,000 a year more than in 2010, and the cost of travelling from Newport to Bristol Temple Meads has gone up by 27%—a £500 increase. Demand for these services is growing fast, yet we see no improvement in services. Trains are heavily overcrowded, and there are frequently not enough carriages, especially for those getting on at the Severn Tunnel junction in my constituency. I get that feedback every week: carriages are overflowing and constituents are often left on the platform when there is insufficient capacity to take them.
There is an alternative—crossing the Severn bridges, and this is probably the local issue that is raised with me most frequently. Since 2011, the bridge tolls have gone up by 20% for cars. This matters for my Newport East constituents, when those in full-time work have seen only a 2.4% increase in their wages. The fundamental point is that the money taken by the Severn River Crossing is protected from inflationary pressures, while my constituents’ wages are not.
Tolls on the Severn bridges are the most expensive in the UK. The Western Mail said a few years ago that they were the most expensive per mile in the world. I very much look forward to seeing Transport Ministers tackling that issue for my constituents. We need to know very soon what the Government’s plans are, as they affect the rail services or the Severn bridge tolls, as we reach the bridges’ return to public ownership in 2018.
Alec Shelbrooke (Elmet and Rothwell) (Con)
I congratulate the hon. Member for Oldham West and Royton (Jim McMahon) on his excellent speech. I am sure he will be joining the Opposition Front-Bench team a lot sooner than is customary—he certainly made an excellent speech.
My right hon. Friend the Member for Chelmsford (Sir Simon Burns) pretty much laid out exactly what I intended to say about investment in the railways. I can tell my right hon. Friend that I am just about old enough to remember British Rail. I remember the fact that if people were wearing a light-coloured suit or trousers, they would be dirty when they got up. I remember lice coming off the back of the chairs, and I remember carriages literally covered in excrement and never cleaned.
That was the state of the railways when they were in public hands. It was not invested in, and there can be no doubt that over these last 20 years, the standard of the railways, of the rolling-stock and of the whole thing has moved forward. We simply do not hear on the comedy circuit the British rail catering jokes that we used to hear 20 years ago, because it has improved and become a thing of the past.
On the issue of investment, when we talk about what is happening with the railways—there is still a lot of work to do, and I know that my right hon. and hon. Friends on the Front Bench are looking carefully at what happens with ticketing—we should bear in mind that we need to create more track and more rail. My city of Leeds, for example, shows that an integrated tram-train system that can use the heavy rail and operate in the city centre is vital. That will never be built by Government through public ownership. It can be built only by attracting investment from the private sector to run, operate and get it going, so that people can make cheaper journeys into the city centre than they have to make now. It can be more reliable and once there cannot be moved. I just wanted to make that brief point that investment in the railways is vital and simply cannot be delivered via public ownership, as was proved time and again under British Rail.
Simon Danczuk (Rochdale) (Ind)
It was a delight to hear the maiden speech of my hon. Friend the Member for Oldham West and Royton (Jim McMahon). He made an insightful contribution not only to the debate in the Chamber, but to the debate in and around Greater Manchester.
Let me make three very quick points. First, I am extremely concerned about the fact that rail fares have rocketed by a staggering 25% since 2010. Many of my constituents rely on rail travel, not least to commute in and out of Manchester and, indeed, Greater Manchester. Secondly, I am concerned about the Government’s use of the retail prices index to calculate rises in regulated fares. Perhaps the Minister will tell us whether he thinks that that is fair.
Thirdly, perhaps the Minister will explain to me and to my constituents why they pay 20% more in fares than Bolton constituents pay for a similar journey. A peak return fare from Bolton to Manchester Victoria will set Bolton constituents back £6.40, but my constituents pay £7.70 for the similar journey from Rochdale to Manchester Victoria. Why is that? Richard Greenwood, chairman of the Support the Oldham Rochdale Manchester rail lines group, has said that the fares in my constituency are “artificially high”. That level of fares applies almost nowhere else in the country, and I see no fit reason for it to apply to Rochdale either. Perhaps the Minister will share his thoughts.
Iain Stewart (Milton Keynes South) (Con)
I, too, congratulate the hon. Member for Oldham West and Royton (Jim McMahon), and I wish him well for the securing of his Metrolink extensions. A wish that I expressed in my maiden speech came true, and I hope that he has similarly good fortune.
In the brief time that is available to me, I want to inject a degree of realism into the debate about rail fares. Let me say first that whoever owns the railways, there is a balance to be struck between what the passenger contributes and what is funded from general taxation. If, as the motion suggests, Labour Members want the passenger contribution to decrease, they must either say which taxes will be increased to pay for that, or spell out which part of current spending on the railways will be cut.
The vast majority of the income from the fares that are currently paid—more than three quarters—is spent on staff salaries, and I cannot imagine that Labour Members would want those to be cut. Some of the income is spent on maintaining and improving the track—we have the safest railways in Europe, and I cannot imagine that Labour Members want to compromise that—and some is spent on investment in new rolling stock, new stations, new lines and electrification. The profit margin is tiny: 3% of every pound that is spent. That funds innovation and development in the railways, which has doubled in the last 20 years. That is the reality of the railways today.
I had hoped that we could have a more sensible debate about the new technology and innovations on the railways, but time did not permit it. The philosophical debate about renationalising the railways has obliterated the time in which we could have talked about that issue, but it is what we should be talking about.
Finally, I want to knock on the head the myth that Britain has the highest rail fares in Europe. That is simply not the case. I invite Members to look at a wonderful website, The Man in Seat Sixty-One. The man in question compares the cost of rail journeys across Europe, and Members will find that in 85% of cases, United Kingdom rail fares are either the same as or cheaper than those on the continent.
Stewart Malcolm McDonald (Glasgow South) (SNP)
I congratulate the hon. Member for Oldham West and Royton (Jim McMahon), and welcome him to the House. I also congratulate him on the thumping that he gave UKIP at the by-election, which was pleasing for all SNP Members. I regret, however, the rather infantile manner in which his party has approached the debate.
I would never trust the Tories with the railways, but, frankly, I would not trust Labour Members with a train set, given the way in which they have conducted themselves this evening. The mistake that they have made in their motion is a schoolboy howler. They have accused the Scottish Government of not using a power which that Government do not have, and which, moreover, every single Labour Member—with the exception of the hon. Member for Oldham West and Royton—voted explicitly, along with the Conservatives, to prevent Scotland from having during the debate on Scotland Bill. They almost give brass necks a bad name.
In all seriousness, there are two things that my constituents would want me to mention tonight. The first is smart ticketing. It is about time that people travelling by rail or bus, or both, were able to experience their journey right from the point of payment in a way that befits the century they are travelling in. People want to be able to use apps on their smartphones to make life easier, rather than hanging around queueing for a piece of paper to allow them to travel.
My second point, which I have made many times in this Chamber, relates to HS2. We want to see Scotland connected to London and to the great cities of the north, irrespective of our constitutional opinion, because London is our closest world financial capital. We want Scotland and London to benefit from greater connectivity. We want the United Kingdom to up its game so that we can have a high-speed network that serves the whole of the British Isles and not just a small part of them. We need to catch up with France, Spain and China and we need to take the high-speed debate seriously. Like the hon. Member for Milton Keynes South (Iain Stewart), I regret that we have not had enough time for a serious debate on these issues. I can only hope that we will have such an opportunity soon.
Byron Davies (Gower) (Con)
I should also like to congratulate the hon. Member for Oldham West and Royton (Jim McMahon) on a most memorable maiden speech.
Like it or not, this Government have launched the largest modernisation of the railways since Victorian times. An integrated and reliable rail service with stations fit for the 21st century is crucial to economic growth. The electrification of the Great Western line is mentioned in the motion and it has continually been spoken about in a damaging manner by Opposition Members. The Prime Minister has committed to the electrification of the line to Swansea, as have the Chancellor and the Secretary of State for Transport. Indeed, the project was confirmed by the Under-Secretary of State for Wales, my hon. Friend the Member for Vale of Glamorgan (Alun Cairns), only last week in this Chamber.
Under this Conservative Government, the Great Western line will be electrified all the way to Swansea. Under 13 years of Labour rule, how much of that line in Wales was electrified? Not a single mile. For all the bravado from Labour Members, they have absolutely no record in government to support their assertions. That stands in stark contrast to this Government’s record and their commitment to Wales and to my constituency.
The record of the Welsh Labour Government in Cardiff speaks for itself. The integrated transport system in Wales is poor, in the sense that it simply does not exist as a fully integrated transport system. We need look no further than the bus system in Wales to see the issues that many people there face, particularly those in rural communities. When Sustrans gave evidence at the Welsh Assembly Enterprise and Business Committee in October 2015, it said of the bus sector:
“The current state of the sector is evidently not successful, as shown by the decline in bus usage compared to other areas of the United Kingdom.”
Wales lags behind the rest of the UK on nearly every economic measure, and three rounds of EU structural funds have resulted in almost nothing in the way of major transport infrastructure projects that could really benefit the Welsh economy. However, I am grateful to my right hon. Friend the Secretary of State for initiating the electrification of the line to Swansea.
Several hon. Members rose—
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. The next two speakers may have one minute each.
Liz McInnes (Heywood and Middleton) (Lab)
One minute will be just enough to pay tribute to my hon. Friend the Member for Oldham West and Royton (Jim McMahon). I would like to thank him for a brilliant maiden speech and to welcome him to the exclusive group of by-election MPs. I also fully support any projects relating to the Middleton spur.
Ministers say that passengers need to realise that they are paying “fair fares for a comfortable commute”, but none of us has to look far in our own constituencies to find examples of run-down, overcrowded, overpriced and infrequent services. In my constituency, there is only one bus from Heywood to our major city, Manchester, where many of my constituents work and study. At peak times, the bus is overcrowded and the 12-mile journey can take up to 1 hour and 40 minutes.
Passengers were always told that higher fares would pay for improvements, but the link between fare rises and investment has been broken. Just recently, the Department for Transport made it clear that it wanted a significant expansion of driver-only operation on our trains, with no guard on board to assist passengers. That is a really retrograde step for passenger safety. I shall not take up any more time, but I would like to ask the Government and the Department to reconsider their decision on driver-only operation.
Corri Wilson (Ayr, Carrick and Cumnock) (SNP)
Transport is essential in providing people with access to work, learning, healthcare, food shops and leisure activities, especially in rural constituencies such as mine. But the reality is that the elderly, the young and the unemployed, who rely on public transport, struggle to reach hospitals, schools, jobcentres and the like. Because of cost and accessibility, most rural households are dependent on cars, and because alternatives are limited or non-existent, rural drivers are left doing more driving, spending more on fuel and paying higher fuel costs. Rising motoring costs will undermine the sustainability of rural communities and lead to increased social exclusion, with resulting decline in rural shops and services being accelerated.
Cost has a great impact on public transport, but there is a fundamental difference between mobility and accessibility. Some rural areas are already suffering from population decline, poverty and deprivation, and people there are less likely to be able to afford a car and rely on public transport. Limited public transport results in an increase in isolation and further decline—in my constituency, some villages no longer exist.
We have already discussed the Labour party being in power for 13 years and not addressing the issue mentioned in its motion today, but a change in the legislation would enable us in Scotland to ensure the delivery of a rail service with the maximum social and economic benefits that addresses our specific needs. Instead of attacking the Scottish Government for something they have absolutely no control over, perhaps Members on both sides of this House should be applauding them for what they have achieved, despite constant Westminster cuts. Better still, they should devolve these powers to Scotland and let us get on with it.
Daniel Zeichner (Cambridge) (Lab)
As we debate the cost of travel, thousands of our fellow citizens, in all our constituencies, are in buses, on trains or on roads, in cars or on bikes. The quality of our transport system makes a difference to each of their lives every day, which is why this debate matters. That was brought home to me on the first day of this year, when I was sitting on a train on the way to Ipswich to join Labour campaigners protesting about the ever-rising cost of rail fares. Across the aisle from me, a young woman who worked in a supermarket near Ipswich station was telling her friend, glumly, about the shock she got when she purchased her ticket that morning. It had cost an extra 60p, so it would be an extra three quid a week— £3 out of not much left over. There will have been similar stories on trains and buses up and down the country. For millions of our constituents, every penny counts, and in today’s debate we have not heard enough about the problems on buses, in particular.
Let me start by welcoming the first contribution made in this place by my hon. Friend the Member for Oldham West and Royton (Jim McMahon). Members have expressed their appreciation before for his revered predecessor, who has quite a successor. Like many colleagues, I enjoyed campaigning in my hon. Friend’s constituency in the autumn and noted that before coming to Parliament he had already made a powerful impact on the national scene through his inspirational work leading the local council. His powerful contribution today pointed out some of the very real contradictions and weaknesses in the Government’s devolution policies.
Despite the lack of time, we heard other excellent contributions today, including those from my hon. Friend the Member for Streatham (Mr Umunna), who outlined the very poor services from which his constituents are suffering at the moment, and from my hon. Friend the Member for Newport East (Jessica Morden), who talked about the challenges facing her constituents. What they all confirmed was what we already knew, which is that rail and bus fares have shot up since the Conservative party came to power. We all trade figures on these things, but the key one is the comparison between fares and wages: what it really costs people. The truth is that fares have risen three times faster than wages, and that is why it hurts.
There are, however, some who do not feel the pain. The Secretary of State clearly seems impervious to it. Several months ago, he said:
“More transport, better transport...Under our Conservative majority government it's happening.”
Has he really forgotten about the broken election pledges to electrify key routes in the midlands and the north just weeks after the ballot boxes had closed? Or do the Government say that this was just paused? Is it not interesting how Governments introduce new words into the political lexicon. The word “paused” sounds so innocuous but it could ultimately be this Government’s epitaph: a country on pause.
We now have a rail investment programme delayed by years; more than two thirds of councils cutting local bus services; and more than 2,400 local authority-supported bus routes cut or downgraded. We could go on a national tour of bus shelters where there are no buses—perhaps they are paused, too.
Mary Creagh (Wakefield) (Lab)
My hon. Friend is making an excellent point. Will he comment on the introduction of a fare increase by stealth? People expect rail fares to go up once a year on the first day back in January, but we must not forget that, a year ago in September, this Government introduced an evening peak on Northern Rail, which hit part-time workers and students in particular and caused chaos in railway stations across the north.
Daniel Zeichner
Indeed, and my hon. Friend makes a very strong point.
When it comes to buses in particular, we know that the Conservative party always talks about local decisions. The truth is that, by slashing funding to local councils, the Government are passing the buck. It is no good Government Members complaining about problems with their services, as famously the Prime Minister did, when they just troop through the Lobby imposing cuts on local councils. They really must take some responsibility.
We on Labour’s Benches strongly believe in the principle of local communities having a say over their public transport, and we have long been committed to that, but what the Government are offering for bus services is a sham. They are giving localities power with one hand while taking funding away with the other. With a 37% reduction in central Government funding to English local authorities over the course of the previous Parliament, and a further reduction of 24% to come, local authorities have been left with little choice but to cut to the bone.
For Labour, the devolution agenda seems to be little more than a front for public transport funding cuts and fare increases. As Labour Members have observed before, this is not so much a northern powerhouse, as a northern power cut. Whatever the Government spin on being in for a penny, in for a pound, it is clear that the link between fare rises and investment has been broken.
When the Government’s bus service operators grant, which is effectively used to subsidise bus services, was cut by 20% after 2010, the Department for Transport warned that small towns, and particularly rural areas, would be worst affected. It certainly got that right— they were.
What needs to be done? The answer is this: not carry on as we are. It has been fascinating to watch the delicate U-turn being carried out in the DfT as it grasps that the Treasury has finally cottoned on to the fact that we are being taken for a ride by many of the bus operators. It is an irony, is it not, that the Government are now looking to pursue Labour’s policy of bus reregulation? In the past, they were totally opposed to such deregulation. In fact, in the previous Parliament, they directly punished those areas that attempted to pursue bus tendering.
At the election, we promised the biggest shake-up of the bus industry in years. How astonished the operators must have been to find that, after the election, it is now a Conservative Government who are looking to learn from the positive experience in London and apply it across the country. Some of us are just a bit sceptical about this conversion, but we eagerly await the forthcoming bus legislation, and hope to see within it genuine power for local people and local authorities to have real leverage over their local services. The case for reform is incontrovertible and urgent because the status quo just is not working. Private bus operators have abandoned bus routes and services that they found to be commercially unprofitable, leaving the most vulnerable in our society stranded.
We want to give communities genuine power to plan fares and timetables, and to reflect local needs. Although some bus operators have strongly resisted moves towards greater co-ordination, these powers are already in use in London and they are the norm in Europe. If it is good enough for London then it is good enough for the north-east, Greater Manchester, Sheffield, Cornwall, and any other area that wants them. The alternative of continuing to watch bus services uncontrollably deteriorate is no alternative at all. At the election, the Prime Minister made many promises that have not stood up to scrutiny. He promised older people that the free bus pass, introduced by Labour, would be maintained, but, as so often with this Prime Minister, it is important to read the small print. He kept the bus pass, but said nothing about keeping the bus. The number of concessionary passes has gone up, but the number of concessionary bus journeys has gone down. How useful is a bus pass without a bus? We need a better way.
The Parliamentary Under-Secretary of State for Transport (Mr Robert Goodwill)
This is only the third Opposition day debate on transport since 2010. This Government are always keen to debate transport issues in the House, so let us hope that, like London buses, two will come along very soon.
The hon. Member for Inverness, Nairn, Badenoch and Strathspey (Drew Hendry) talked about the importance of aviation. We understand how important that is for remote communities, which is why, for example, we are supporting connections between London and Dundee and London and Newquay. He accused the Government of spending more time opposing the SNP than Labour, so I will move on to the next speaker.
My hon. Friend the Member for Redditch (Karen Lumley) explained how Government investment is delivering for her region and, in particular, the benefits for the Birmingham area from HS2 and the capacity it will deliver.
The hon. Member for Oldham West and Royton (Jim McMahon), in an excellent maiden speech, paid tribute to his predecessor. He has a track record of delivering locally, which I am sure had a lot to do with his by-election success. He talked about the courage and determination of Oldham folk, a quality shared on both sides of the Pennines, and I am sure that that his sons Jack and Harry will be very proud of their dad today.
My right hon. Friend the Member for Chelmsford (Sir Simon Burns) gave us a reality check about the bad old days of British Rail. If Opposition Members were paying attention, they might want to remove their rose-tinted spectacles. The hon. Member for Streatham (Mr Umunna) spoke for hard-pressed commuters and I bet that if he was leading his party today he would not be contemplating nationalising the railways.
My hon. Friend the Member for South Derbyshire (Heather Wheeler) welcomed HS2 and investment in the midland mainline. The hon. Member for Newport East (Jessica Morden) highlighted the cost to communities of the Severn crossing. There was a reference in an intervention during her speech to God’s own country, but I thought for a minute it was to God’s own county.
My hon. Friend the Member for Elmet and Rothwell (Alec Shelbrooke) talked about Leeds, which, as we know, is the biggest European city to have no integrated transport system of its own.
The hon. Member for Rochdale (Simon Danczuk) talked about how we should link fare rises to inflation, but I point out that that means inflation plus zero, which the previous Government failed to do. Whichever measure we use, it is important to note that fares will rise more slowly under this Government than wages.
My hon. Friend the Member for Milton Keynes South (Iain Stewart), to whom I pay tribute for his work on the Transport Committee, asked a big question that the Opposition need to address, which is how they will pay for all their promises. They could not make that argument in 2015 and I suspect that they will fail again in 2020. He talked about the cost of fares, and the point is often made that fares in Europe are higher than fares here in Britain. I checked out what it would cost my children to return from university for Easter. My daughter, who lives in London, can travel one way from King’s Cross to York for as little as £20 if she decides to depart at 7.08 in the morning, but as she is a student I suspect she will want to travel later. To arrive for lunchtime, she can pay £38 but she gets a discount of one third as she has a student railcard, so she can come to York for £25.10 on the east coast main line, run by Virgin. My son, who is travelling down from Newcastle, can do so for £6.90 or £9.40.
I am not sure whether, just before the election in 2010, the outgoing Chief Secretary to the Treasury was following a tradition or setting a precedent when he left the now-infamous note saying:
“I’m afraid there is no money”.
How refreshingly honest. I thought I would follow suit and on my last day in the Department for Transport, as I packed up my personal effects before leaving to fight the election last year, having paid particular attention to the opinion polls, I concluded that a return to Great Minster House was unlikely, but hoped that my replacement would be cheered by a message. Here it is, in my hand. It reads: “There is money for infrastructure thanks to our long-term economic plan.” I am sure that that is one reason why we have had so few Opposition day debates on transport over the past five and a half years. Ours is a record of delivery compared with 13 years of disappointment under Labour.
The Secretary of State pointed out that electrification under Labour was carried out at less than a snail’s pace, less than 1 mile a year—or, to put it another way, Hornby delivered more electrified rail network in the time Labour was in government. The investment mentioned in my note is being delivered, with 4,000 new carriages, £38.5 billion to improve our railways, £15 billion for a proper multi-annual road investment strategy and £6 billion to address the pothole backlog we inherited. There is also, of course, high-speed rail to free up existing rail capacity for passengers and freight, shrinking the size of our country, running to Manchester and Scotland from day one. Indeed, HS2 will run to Glasgow from day one; Scottish crews will be manning trains in Glasgow from day one.
When I go to Brussels, I realise that it is our franchising model that countries such as Italy and Spain want to emulate, and British train companies are winning franchises in Germany. They can see how the competitive franchise system is delivering better services, new rolling stock, smart ticketing and more user-friendly refunds for delays.
Dame Rosie Winterton (Doncaster Central) (Lab)
claimed to move the closure (Standing Order No. 36).
Question put forthwith, That the Question be now put.
Question agreed to.
Main Question accordingly put.
Business without Debate
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Deputy Speaker (Mr Lindsay Hoyle)
With the leave of the House, we will take motions 3 and 4 together.
Ordered,
That the Measure passed by the General Synod of the Church of England, entitled Safeguarding and Clergy Discipline Measure (HC 722), be referred to a Delegated Legislation Committee.
That the Measure passed by the General Synod of the Church of England, entitled Diocesan Stipends Fund (Amendment) Measure (HC 723), be referred to a Delegated Legislation Committee.—(Charlie Elphicke .)
Post-SSI Support Package: Redcar
(8 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Anna Turley (Redcar) (Lab/Co-op)
As has been well documented in this House and in the national media, my constituency has been through one of the toughest times in its existence. I could debate all day with the Minister about what more I believe the Government could have done to save the Redcar coke ovens and blast furnace. I also have many outstanding questions on the future of the site and who will be paying for it. But I want to make the people who have borne the brunt of the tragedy the topic of this debate.
Some 2,200 men and women lost their jobs directly when SSI went into liquidation. Twenty-six supply chain businesses were also affected, with a further 954 redundancies. As is the case after such a calamitous economic shock, numbers continue to increase as local businesses, shops, childminders, decorators, hairdressers and many others are affected by the money being taken out of the local economy. Each of these is a tragedy. Each of these is a life that needs to be picked up, a mortgage that needs to be paid, a Christmas that had to be got through. Redcar and Cleveland Mind has had a 91% increase in mental health referrals in the past year, and we know that January and February are hard at the best of times. I therefore thought it important to stop at this point and to take stock of where we are and what is happening.
Andy McDonald (Middlesbrough) (Lab)
Does my hon. Friend agree that the collapse of SSI has had massive ramifications right across Teesside, so any response that the Government may give, including Lord Heseltine’s review, has to deliver immediate and targeted support to ensure that all our constituents who are so affected have the employment opportunities that they, and our communities, deserve?
Anna Turley
My hon. Friend is absolutely right. The scale of this has been absolutely devastating, not just for those who were directly employed, but, as I said, in the knock-on repercussions for our community.
This debate is about trying to learn lessons from the support package that has been put in place—lessons at local level and, indeed, national level. It aims to look at how the £50 million support package from the Government is being applied, what is working and what is not, and what lessons can be learned, particularly as we see other steelmaking areas in the country now facing the same tragedy as us.
Out of the tragedy has come some positive learning. The steel taskforce has been an important creation to enable multi-agency co-operation from the start. Weekly meetings have allowed local partners from the Department for Work and Pensions, the local authority, BIS, the unions, the local enterprise partnership, the local media, elected politicians and others to clarify communications processes and to get to the root of the issues and concerns. I believe that every region should consider putting together a committee of this kind that could be called on in the event of a catastrophe similar to that which we saw last year. Indeed, areas with similar high levels of unemployment may want to consider organising such partnerships as a standard procedure to tackle the challenges they face in employment and skills.
It has also been encouraging that national and local agencies have worked together in a way that departmental silos and local versus national boundaries all too often prevent. The National Careers Service has provided guidance and advice. The Skills Funding Agency has acted to remove barriers and increase the flexible use of its funding for SSI workers. Jobcentre Plus has worked closely alongside the DWP and BIS, allowing rapid response processes to be put in place and creating an efficient system for passing on referrals. FE Plus, a group of colleges in Teesside, has forged a close working relationship with private training providers, allowing referrals to be passed from public sector providers to private sector education providers with specialist provision.
This experience has highlighted the complex and bureaucratic nature of skills funding and provision, but it has also clearly indicated that after an initial period of shock, enabling agencies to work together at regional level has allowed many of the usual barriers to be overcome, helped particularly by the benefit of a clear decision-making body in the form of the taskforce.
Alex Cunningham (Stockton North) (Lab)
I congratulate my hon. Friend on securing this debate and on the sterling work she is doing for people across Teesside and elsewhere. My surgeries have been full of people who are contracted employees and who are not getting the same level of support as direct employees. Does she agree that barriers need to be broken down so that they can get help similar to that for direct employees?
Anna Turley
My hon. Friend makes an extremely important point. I have met a number of contractors, many of whom have service of over 30 years in the steel industry, having worked in catering and on the site itself. They have all provided as much value to the steel industry as others, and they deserve equal treatment. I will go on to talk about one of the successful experiences that we have had. Again, I hope that lessons can be learned to make sure that there is not a two-tier system for contractors and the full-time employed.
Jim Shannon (Strangford) (DUP)
We sometimes overlook one important issue. This is not just about jobs; it is about the financial, emotional and physical impact on families as they wonder how they are going to pay their bills and mortgages. Does the hon. Lady think that the Government should provide help for people to get through this hard time and make sure that they can cope at a time of stress?
Anna Turley
The hon. Gentleman is absolutely right. We pushed for the Government funding to go towards crisis loans and crisis management, and the taskforce has been excellent at putting in place support for mortgage payments and transport issues and for ensuring that people can pay their bills. I want to make sure that that is replicated when addressing the problems in Port Talbot and elsewhere and that they learn from our experience in Redcar. That is not to diminish, however, the devastating consequences of what has happened. There were huge challenges over Christmas. Many people got through Christmas and provided for their families, but, looking ahead, we have to press on and give them the long-term help and support they need to get back into work. The hon. Gentleman makes an extremely important point.
One of the most important factors in the response has been the flexibility of the funding available through the support package. It ensured that people were not limited in the courses to which they had access, as would usually be the case, and that specialist and professional training ordinarily paid for by employers was now funded by Government for these priority workers. That flexibility was coupled with the relaxation of certain rules, such as the Jobcentre Plus 16-hour limit for training or education, and the fact that applicants were not restricted to just one course or to those that were relevant only to previous employment or experience, which was an issue at the beginning of the process. Such barriers would have got in the way of accessing opportunities. The DWP and BIS should look at that at a national level in order to widen access and opportunity to all.
Jobcentre Plus organised rapid response sessions just three days after liquidation, and it saw more than 2,000 people in the course of just a few weeks. It then worked with the National Careers Service to organise the subsequent individual one-to-one skills sessions, which have helped to inform training needs.
There has also been an unprecedented level of contact between colleges in my area and employers, with further education providers in my constituency contacting more than 2,500 separate companies directly. That has ensured that employers were made aware of the funding and training that local colleges had available to fill vacancies that the businesses were advertising. There have been three jobs fairs, one which took place just two weeks after the announcement, and we understand that they have filled about 200 vacancies, although the Minister may have some more up-to-date statistics.
There are also plans to engage more large-scale companies locally, particularly those that may be six months to a year away from starting up, to ensure that we shift the focus from immediate recruitment to creating bespoke training packages so that people can get the skills they need down the line, when those companies come on board and invest in our area. I want to take this opportunity to thank the countless local businesses that have got on board quickly and been extremely helpful and forthcoming in the support they have provided to those workers and apprentices affected.
Despite positive collaboration and partnership at local level, however, the success of a venture such as this can only truly be measured by the experience of those who are on the receiving end of the support. I want to set out some of the challenges we have faced so that the lessons can be taken up by Government. At an early taskforce meeting, it transpired that no agency or individual had a full and comprehensive list of all those who had been affected by the closure of SSI. The taskforce had to re-collect information on names, addresses, skill sets and qualifications. We need to ensure that data sharing is seen as an early priority in the unfortunate event of another area being affected. We also need accurate and longitudinal information on who has accessed help and support, who is in work and where that work is located geographically.
There were also well-documented problems with accessing the central Government money announced by Ministers. It took hard work from the chair of the local taskforce to convince risk-averse Whitehall mandarins that support for apprentices and the use of the funding to incentivise recruitment did not constitute state aid. I hope that BIS has learned to be more ambitious in the way it supports enterprise than this episode has demonstrated.
Unfortunately, there have also been widespread delays in accessing training, as some of the agencies involved struggled to deal with the massively increased demand. Further education funding has been reduced by 14% in the past five years. Although the £3 million available to local Teesside colleges for courses is excellent, the challenges in upscaling rapidly to cope with the levels of demand have led to delays for those accessing courses.
For example, a constituent of mine with 31 years’ experience in the steelworks applied for training no less than three months ago. Since then, he has been passed from agency to agency and is now on the verge of missing the deadline for the next wave of training courses in February. I have received many similar concerns about delays to accessing training. I have even had cases where ex-SSI workers have been forced to attend existing college courses with 16 to 18-year-old students, which is disruptive for all parties involved. Others are on courses between the hours of 9 am and 5pm, but have been told that they must attend the jobcentre during those hours. Of course, the organisation and administrative challenges that come with dealing with thousands of requests after years of cutbacks is huge, but the human impact of such delays is tragic.
Unfortunately, despite the good work done by many jobcentre staff, numerous constituents have contacted me to raise the dehumanising treatment they have received in jobcentres. Many of these workers have never been out of work, and for many of them, as for so many in my constituency, the experience of being on the dole is horrendous. For example, we were assured originally that ex-SSI employees who claimed jobseeker’s allowance would be afforded a 13-week period of grace, which is a mechanism available to all job coaches to allow individuals with extensive experience in a particular field to have some time to focus on applying for jobs in that sector. However, my constituents—I stress, not exclusively those affected by SSI—have been threatened with sanctions if they do not apply for work in bars or retail as early as two weeks into their claim. Many right hon. and hon. Members have spoken about widespread problems in Jobcentre Plus. The issues about sanctions must be addressed. Sanctions should not be used as a mechanism to force claimants to apply for jobs that are not relevant in this instance; such jobs should be a last resort.
Another challenge we face is the confusions on pensions. Ex-SSI employees were left shellshocked to find that the money leaving their monthly pay packets had not in fact ended up in a pension fund. I am now pleased to say that the continued dialogue between the official receiver and the Community trade union has resulted in all the contributions—both employee and employer contributions—being received by Scottish Widows, and they are now being applied to employees’ pension accounts on a month-by-month basis. The continued weekly dialogue between the official receiver and the Community trade union has ensured that there is continued communication and that problems on the site are worked through. I want to commend the Community union for all it has done to support its members at this difficult time.
One of the other challenges we face is dealing with the fact that a number of other companies on Teesside have made workers redundant, including Boulby Potash and Air Products, since the SSI announcement. As a result, an initiative to help people find work following the closure of SSI is being rolled out across the Tees valley. This resource hub brings together a number of agencies to provide advice and support to anyone who has been made redundant or who is out of work. Advice will be available on a wide range of topics, including CV writing, new career opportunities, interview techniques, trade union representation and money management. That is exactly the kind of learning that I want tonight’s debate to share more widely.
Another achievement has been the Insolvency Service’s decision to grant employee status to agency workers, as my hon. Friend the Member for Stockton North (Alex Cunningham) mentioned. We fought to ensure that the 29 workers from Jo Hand Recruitment were in full receipt of their statutory redundancy pay, holiday pay and notice pay. I just wonder how many more of these injustices are happening around the country outside the SSI spotlight.
In conclusion, we are only three months in and we still have a mountain to climb. Many people have not had the help and support they require. Our challenge is to find them and to ensure that they get the support they need to rebuild their lives. Ultimately, the challenge of bringing jobs and economic regeneration to our area is a long-term one, but given the kind of resilience and determination that has been shown in Teesside during the past few months, the challenges are not insurmountable. With the right help and flexibility from Departments and with the devolution of power and funding to local stakeholders, I see no reason why we cannot overcome this tragedy and build a bright future for our town. We know our challenges, and we are showing we can find solutions. I sincerely hope the Government will support us.
The Minister for Small Business, Industry and Enterprise (Anna Soubry)
I congratulate the hon. Member for Redcar (Anna Turley) on securing this debate, and on placing on public record—this does not have anything to do with party politics—that undoubtedly, throughout this wholly unfortunate and sorry episode, she has always fought hard for her constituents, which she will of course continue to do. Obviously, we do not agree politically at all, but we do agree on the huge resilience and the remarkable achievements we can already see, notwithstanding the terrible closure of SSI. We are agreed about the remarkable people she represents and all that has been achieved, although there is of course an awful lot more to do.
The hon. Lady makes a very good point. In such difficult times, with the closure of a very important industry that employs a lot of people in an area where not many people live—in other words, the industry has a huge impact on the local community—or with a large number of redundancies, as we saw yesterday with the Tata decision about Port Talbot, we must learn the lessons from our being there to support them financially and by setting up bodies to administer the money. She has quite properly highlighted several problems and difficulties. She makes the good point, although it sounds perverse, that we should always be aware that the worst could happen and that it is good to make contingency plans for the worst-case scenario.
When I went to Redcar just before it closed, a good structure was already in place. There was a good local enterprise partnership, and there were good relationships between the local council, under the outstanding leadership of its chief executive, Amanda Skelton, and local businesses, with the involvement of Paul Booth, the excellent chair of the LEP. Sadly, the community had been through it all before and this was not new territory. Because the community had experienced the mothballing by Tata, it had been through a similar experience and was prepared for the worst. There was a lot of realism and reasonableness, notably from the union leaders. I pay tribute to them, as did the hon. Lady. When the dreadful moment came, they could put things together very quickly. I remember the first meeting of the taskforce, when the spirit of togetherness was obvious. They knew what they were doing; they just needed to get on with dealing with the money.
Alex Cunningham
The Minister clearly recognises the tremendous job that has been done on Teesside by so many people, including the local authorities. She will also be aware that yesterday’s announcement affects my neighbouring constituency of Hartlepool, where 100 jobs will be lost. Has she given any consideration to what will happen to those workers, particularly in relation to the excellent package that is available for SSI workers?
Anna Soubry
I am not aware of anything in particular in respect of the redundancies in Hartlepool, but if the hon. Gentleman and those in the neighbouring community want to put forward a case, I am always willing to listen.
Tom Blenkinsop (Middlesbrough South and East Cleveland) (Lab)
First, this situation is unlike the mothballing scenario in 2010, when I was a union officer on site, because there was not a single hard redundancy in the 22-month period. Now, there is a liquidation scenario and we have seen many hard redundancies. Secondly, I have written to the Minister about extending the remit of the taskforce to encompass the whole Tees conurbation and to help other workers who lose their jobs, such as those at Caparo, Tata and Boulby in my constituency. Thirdly, this will happen again and again. We have seen it in Port Talbot, Trostre, Llanwern, Dalzell and Clydebridge. We need a national network of taskforces to see how steelworkers and other workers are being treated in different areas of the country. This cannot be dealt with in a devolved, fragmented way. It is a sectoral issue that encompasses the whole of the UK.
Anna Soubry
I do not have time to deal with all those points because I want to respond to the specific points that were made by the hon. Member for Redcar, but there are lessons to be learned. It behoves any community, in the event of serious job losses, to act quickly and pull it all together. Many communities do so and that was critical in Redcar.
I pay tribute to the hon. Members for Redcar and for Middlesbrough South and East Cleveland (Tom Blenkinsop), and other hon. Members, for the way in which they have worked with the taskforce. I have paid tribute to Amanda Skelton and Paul Booth for the way in which they formed the taskforce almost before the dreadful news came on that Friday. As the hon. Gentleman said, at least 2,000 people were immediately put into redundancy, with all the consequences that that has for the supply chain, and many hundreds of them had not been paid for a considerable period. One reason why the taskforce was successful was that there were already good relationships between business, the council, Members of Parliament and all the other people one would expect to be there.
As a Government, we quickly put forward a financial package. In effect, there was £60 million. There was a headline figure of £80 million, but just under £30 million of that was used for redundancies, so the money that could be put into helping people get back into work was in the region of £50 million. I want to put it on the record that there was a £2.4 million safety net fund and that £1.7 million was eventually made available for apprentices. It took a bit of a fight, but we got there. There was £3 million for retraining courses, £2.6 million for a flexible support fund, £750,000 for business start-ups, a jobs and skills fund of £16.5 million, and £16 million of support for firms in the supply chain and the wider Tees valley area. There were also redundancy payments.
The hon. Lady is right to say that there is often a big problem in Whitehall. We said to those people, “We trust you to work out where the money needs to go.” However, the situation was, frankly, maddening and infuriating, and I only found out about it after she sent me a text. I do things differently, Mr Deputy Speaker. I give people my mobile phone number and say, “You contact me. You text me”, and they do! In a way it should not be like that, but it is good—we can exchange numbers later in private, Mr Deputy Speaker. The reason I do that is because of the situation that we found at Redcar. We had a group of people in the taskforce whom we trusted, and I pay tribute to all of them. They are not paid to do that, and they have worked incredibly hard. Amanda Skelton is paid to be the chief executive of the council, but she has worked like an absolute trooper and well beyond the hours for which she is paid—astonishing!
We trusted those people to put together a package and to have the funds, but we then had to go through the most bizarre set of hoops and all the rest of it, because they had to show that the package was value for money. As I put it to my otherwise excellent civil servants, this is a chief executive of a unitary authority who, on a daily basis, deals with large amounts of money and a huge budget. She is more than capable of looking at value for money, because unfortunately she has had to make lots of cuts, to reorganise and so on. In other words, I cannot think of many people who are more qualified to decide where the money should go, and who also have the responsibility to safeguard what is taxpayers’ money, but instead a system had to be followed—and Governments, of whichever colour, are blighted by too many systems and processes. We say that we will trust people, but too often we do not. However, we cut through that system—the instruction I always give is, “Get on with it. Trust these people and give them the money so that they can get on with it.”
There is no better example of the determination of those people involved in the taskforce—and beyond in the community—to do the right thing by all those who were made redundant at Redcar than what happened with the apprentices. There were 51 apprentices at SSI, and those jobs finished on that Friday. Some of those youngsters were on three-year apprenticeships, and it had all gone. This is a lot of money to ordinary folk, but we were talking about £1.7 million. It was astonishing. People such as Paul Booth went out there and found a place for every single one of those 51 apprentices within a week. That speaks volumes about their abilities, and about the reaction from the community and businesses. We then had to get the money—bit of a nightmare—but we got it, and all 51 apprentices can continue their apprenticeships.
Anna Turley
The right hon. Lady is right about the apprentices, but there were a few weeks between them losing their jobs and being reappointed. One apprentice came to my surgery and told me that he had been to Jobcentre Plus. Despite having done two and a half years of his engineering apprenticeship, he was told that he should get a job in a bar. It comes back to the point I made earlier: there are issues with the DWP’s systems, and that is one of the main points that I wanted to raise.
Anna Soubry
Again, that is a good point extremely well made. Such things are not acceptable. Of course I pay full credit to Jobcentre Plus. I know that Ministers stand here and say, “The taskforce has gone whizzing in.” From my experience in Nottinghamshire, when Thoresby colliery closed down, the taskforce went in and it all sounded great, marvellous and wonderful. In a way, it was great and marvellous. A lot of people put a lot of effort in. What matters, however, is the advice that somebody then receives.
There was another problem that the hon. Lady will remember: people being told that they could not sign up to HGV courses. The workforce in our steelworks is almost exclusively highly skilled. It is absolutely obvious that somebody who has been working in a place like SSI at Redcar may well want to change, enhance or add to their skills by training to be an HGV driver. What did we discover? That they could not have any money to do that. The stuff of madness! After a text from the hon. Lady, we got that one sorted out.
We then had some problems in making sure that the money was delivered to the colleges. When, unfortunately, 800 jobs were going in Scunthorpe, we put £9 million in because we had learnt from the experience in Redcar. That was replicated when Labour Members came to see me about the situation in Rotherham. They made a very good argument for a package of support. One of the things the Skills Minister and I did—by way of text, if I may say so again, Mr Deputy Speaker; it got the job done—was to release the money literally within 24 hours. No disrespect to our great civil servants, but we cut all the corners and cut out all the nonsense. The Minister gave a direction and said, “Get that skills money sorted out, so they can have it in Rotherham,” and we did the same in Scunthorpe. That was because of the lessons we learned from our experience in Redcar. However, the hon. Lady is right that there is more we can learn.
I think there is some good news. Over 400 former SSI workers have not yet made any benefit claim to date. We do not know why. I am hoping it is because they have got jobs, not because they have dropped out of the system.
The hon. Lady is also right about data. We always have to have people’s permission before we can share data. Nearly 700 former SSI supply chain workers are no longer claiming benefit. We hope that the majority are either in full-time work or in training. Some 166 people were employed as a direct result of the first jobs fair, which was held, as she said, very quickly in October. Nearly 900 people attended the second jobs and skills fair at the end of November at the Riverside Stadium, where more than 700 immediate vacancies were on offer.
I want to pay tribute to the noble Lord Heseltine. I know he can often be a controversial figure, but he is an astonishing person. He has the ability to bring all the people and all the organisations together. He has vision and drive. It was my idea, if there is anybody to blame—although I do not think anybody should be blamed, because he has been absolutely the right person for this. He has gone up there, and he has a vision and is knitting things together. I hope that in a short period of time we will be in a position to announce more about the future of the works at SSI and what we can do there.
I want to put it on record that 2,000 rapid response sessions have now been delivered, 2,969 people have received advice and help from the support hub, and 5,200 calls were made to the Jobcentre Plus helpline.
Anna Turley
Tonight has been about the people, but the site is extremely important too. I hope Lord Heseltine will not make any announcements without discussing with local people what they would like to see from that site, which is so important to the local economy and for local jobs.
Anna Soubry
Absolutely. One of the great joys of Lord Heseltine is that he is able to work with people. He brings people together. As I say, he has the right connections and the right vision.
It is great to have had this debate. There are lessons to be learned. We have already learned some of them. However, the ideal position to be in is never to have to set up a taskforce or to give out these sums of money in the first place. We do not want to see the redundancies that we saw in Redcar.