Exploitation of Missing Looked-after Children

Graham Stringer Excerpts

Wednesday 23rd October 2019 Westminster Hall

[Ann Coffey (Stockport) (IGC)]

I beg to move,

That this House has considered the matter of sexual and criminal exploitation of missing looked after children.

It is a pleasure to serve under your chairmanship, Mr Evans. In 2012, an expert working group was set up by the then children’s Minister, the hon. Member for East Worthing and Shoreham (Tim Loughton), at the Department for Education, to look at—among other issues—out-of-area placements of children. That was because of the high number of looked-after children in children’s homes going missing, and concerns about their vulnerability to sexual exploitation. That group was set up partly in response to the 2012 inquiry by the all-party parliamentary group for runaway and missing children and adults, supported by The Children’s Society and Missing People. One of the objectives of that expert group was to make recommendations that would improve the care system, so that

“children are safer and better cared for in residential care—not disproportionately at risk of…exploitation”

because of their vulnerability. The group stated that placements should be

“close to home unless it is in the best interests of the child to be placed out of area”.

An analysis of the children’s home market was commissioned. At that time, more than 50% of homes were concentrated in three regions: the north-west, the west midlands, and the south-east. Some 25% of all children’s homes were in the north-west, and just 6% were in London. That meant there was an under-supply of places in some areas and an over-supply in others, resulting in an unnecessary level of out-of-area placements. One of the issues identified with children being placed out of area was the difficulty for social workers in being able to provide the necessary levels of support. In short, children with high needs were left isolated in children’s homes, miles away from family, friends and social workers, and they were targets for paedophiles.

In 2012, 26% of the children’s homes registered with Ofsted were run by local authorities, and 65% were run by private companies. The report expressed concern about the market being taken over by larger providers. It said that if the under-supply and over-supply in the market was not addressed, children would continue to be placed at a distance from their home communities. The report recommended a reduction in the number of out-of-area placements, and added that those that result in children being placed at very long distances should be exceptional and always explicitly justified in terms of the child’s best interests. The expert group recommended that national and regional information on the structure of the children’s residential care market be improved, and that such information should be used to determine a medium-term market strategy at regional and national levels.

That report is now seven years old. Over the intervening years, successive Ministers have committed to reducing the number of out-of-area placements, yet that figure continues to soar. Last month, the all-party parliamentary group for runaway and missing children and adults published our most recent report, “No Place at Home”. We found a 77% increase in the number of children placed in out-of-area placements since 2012; that figure is now at an all-time high. The majority of the 42 police forces that gave evidence to our inquiry were adamant that placing children out of area increased their risk of exploitation and very often resulted in their going missing.

Some 75% of all children’s homes are run by private companies, representing a 23% increase since 2012, and local authorities now run 19% of children’s homes, representing a decrease of 26% since the same year. According to Ofsted, 47 local authorities—one third—did not run any children’s homes at all in 2019. Given the increasing dominance of the private sector, the APPG recommended that Ofsted should have the same powers in relation to children’s homes as the Care Quality Commission has for nursing and care homes.

The north-west, west midlands and south-east remain the three regions with the highest concentration of children’s homes, accounting for 55% of all homes, and there continue to be issues with over-supply and under-supply. Some 80% of local authorities now place children outside their area. There has been an increase in the number of children coming into care, and an increase in the number of children’s homes. However, it is not clear whether, in practice, that means there are more places to meet the needs of children. Many of the children being placed in homes would previously have been placed in mental health provision or secure accommodation if it had been available. Homes may manage children with increasingly complex needs by reducing their bed occupancy.

The increase in the number of children coming into care also means that providers can pick and choose. In our “No Place at Home” inquiry, we heard evidence that one local authority had to try 150 providers to find suitable accommodation for a vulnerable 15-year-old boy. We have also heard that up to 25 children can be competing for a place at any one time. Those children go on a waiting list, and often end up in crisis and short-term placements because none of the registered children’s homes is willing or able to offer places. These can be the children with the greatest needs. In future, more children are likely to be placed in unregulated and unregistered short-term accommodation because of the pressure on children’s home places. Let us be clear: that means those children’s care needs will not be met.

I entirely accept that some children need to be placed outside of their area because it is in their best interests, but evidence to our inquiry suggested that the overwhelming reason why children are placed out of area is that it is the only place that can be found for them. When I announced that I had secured this debate, I received many comments on Twitter from practitioners who said that the system was broken. One, from the National Association of Independent Reviewing Officers, said:

“It’ll need money Ann, more importantly a wholesale rethink of the care ‘system’. Trying to find residential placements for young people is often ‘any port in a Storm’.”

The fact that distribution has not changed, together with pressure on places, explains the inevitable rise in out-of-area placements.

Our “No Place at Home” report focused on the risks faced by children who go missing from care. There has been a 97% rise in the number of reported incidents of children missing from children’s homes since 2015. The number of children missing from out-of-area placements has more than doubled since 2015, and about a third of children in unregulated provision went missing in 2018. We heard that record numbers of out-of-area children are repeatedly going missing. The inquiry heard evidence about the trauma and emotional impact that being sent away can have on children who have already suffered neglect and trauma.

[Graham Stringer (Blackley and Broughton) (Lab)]

My hon. Friend is making a powerful case about a very serious subject. Does she agree that since the Greater Manchester Police introduced the iOPS computer system, children in Greater Manchester are at even more risk than before? Children who go missing overnight are not being registered, and the information is not getting through to police officers when they come on duty the next morning. The reassurances of the chief constable that everything is all right are at odds with the evidence. The iOPS system is putting more children at risk, and when Her Majesty’s Chief Inspector of Constabulary goes into Greater Manchester, I hope he will look seriously at these problems.

[Ann Coffey]

I totally agree with my hon. Friend’s comments about the new computer system. A system that cannot manage information in a way that keeps children safe is not fit for purpose, so I am pleased he has raised that point.

Moving children to unknown and unfamiliar placements, particularly at short notice, causes anxiety, distress, fear and anger, as well as causing further trauma to children with both short-term and long-term impacts. The reaction of many is to go missing, enticed by those who have targeted them for exploitation. In June, research by Missing People that looked at nearly 600 episodes involving more than 200 missing children found that one in seven of the children had been sexually exploited, and one in 10 had been a victim of criminal or other forms of exploitation while missing.

There is an issue about the take-up of return-home interviews, which can be an invaluable source of information about further risks to that child and other children when they go missing. Research by The Children’s Society found that, on average, just 50% of missing episodes resulted in return-home interviews taking place, despite its being a statutory requirement on local authorities to offer them each time a child goes missing. That means that opportunities to safeguard children are being missed.

The Howard League told our inquiry that children are sometimes placed out of area to protect them from exploiters. Although that is often done with the best intentions, and sometimes successfully, there are considerable concerns about the practice. The Howard League said, for example, that criminals increasingly control children using social media, the reach of which extends wherever children go, and through threats to family members and siblings, which means that removing the child from a location does not resolve the problem and could make it worse.

The Howard League also said that children who are being exploited may be used to groom and exploit other children in their new location, and that children who are in out-of-area placements are separated from their families and support workers, and therefore more vulnerable to abuse and exploitation. We received evidence that county lines gangs had been sent to areas where young people were predominantly placed out of area to scout new opportunities where they could develop business and recruit new members.

The individual experiences recounted by children to the inquiry were a salutary reminder of the misery experienced by some children in care. One girl told the inquiry that she had run away 100 times since being moved out of her home area. Another boy tried to hang himself on Christmas day. Another girl walked 10 miles home to see her mum. That is the reality behind the statistics. The increasing number of children going missing is a protest by those children, who feel that the social care system does not care about them. It is the only protest they can make.

One area of increasing concern, which we raised in our report, is the rise in the number of older children, aged 16-plus, being sent to live in unregulated semi-independent accommodation—a shady twilight world. Some 80% of the police forces that gave evidence to our inquiry expressed concern about the increasing numbers in those unregulated establishments, which are off radar, because, unlike children’s homes, they are not registered or inspected. More than 5,000 looked-after children in England live in unregulated accommodation, which is up 70% on 10 years ago. Such accommodation is not registered by Ofsted because it does not provide care, although it is difficult to imagine under what circumstances a vulnerable 16 or 17-year-old would not require care as well as support.

The police gave us many examples of inappropriate and dangerous placements in unregulated homes, including a young person bailed for murder being placed in the same semi-independent accommodation as a child victim of trafficking, who was immediately recruited to sell drugs in a county lines gang. Another boy was sent to live more than 50 miles from his home area where he began drug-running and committing crimes. When he was returned to his home area, he took children from his new area back home to involve them in county lines because they were unknown to the police. Other examples included a girl who had been sexually exploited being housed alongside a perpetrator of sexual exploitation, and another young girl victim of sexual exploitation who was moved some distance from home and then targeted by a local organised crime group.

We should not forget the impact that unregulated accommodation, in which young people are not properly supervised and become involved in criminal activity, can have on the surrounding neighbourhood. After our report was published, I was contacted by a mother in Greater Manchester who described her “devastating experience” of the consequences of unregulated accommodation. Her two daughters were seriously attacked as they walked home by a group of older boys who were living in an unregulated home in their neighbourhood. Local residents had been reporting incidents of antisocial behaviour, sexual harassment, criminal activity and drugtaking in and around the accommodation for about six months. If the home had been regulated, there would have been a process by which it could have been closed down, but it continues to operate.

There are some good providers but, equally, there are some poor providers that should not be let anywhere near a vulnerable young person. One police force told us:

“Where there are areas of high deprivation, these will always present opportunities for potential unscrupulous organisations to set up ‘pop up’ children’s homes with little or no regulation, where the housing market is much cheaper, heightening the risk of the most vulnerable of children being exploited.”

I was recently made aware that there may be connections between organised crime gangs and providers of unregulated accommodation. It would be a logical extension of their business model to gain profit from providing accommodation at high cost to local authorities and, at the same time, have access to young people whom they can exploit to sell drugs.

Our report called for a regulatory framework that would ensure national standards, including checks on the suitability of providers and the qualifications of staff supporting young people. That is becoming urgent, as children under 16 are being placed in unregulated accommodation. As I have said, there are extremely good providers and very diligent social workers, but unregulated care is wide open to abuse. All the evidence shows that that abuse is happening.

Over the years, there have been many improvements in data sharing, guidance, notifications, multi-agency partnership work and understanding child sexual and criminal exploitation and the grooming process. Attitudes to children have changed and the term “child prostitute” has been replaced in law with “sexually exploited child”. There is an increasing understanding that young people can be groomed into criminal activity and county lines gangs. That understanding is reflected in the increasing number of children accepted on to the national referral mechanism as victims of criminal exploitation.

There is some excellent provision in the private and voluntary sectors and in local authority children’s homes. I pay tribute to the people who work in residential care homes with the most challenging young people. Government cuts have had a devastating effect on children’s social care; we are often asking social workers to safeguard children in the most difficult circumstances without the resources they need. An important part of providing resources is ensuring that there is sufficient residential provision to meet the needs of the children we take into our care. That is not happening.

We talk a lot about the voice of the child and how that should be at the heart of what we do, but it cannot be at the heart of decisions when we have no options to offer that child. The children’s homes market is failing and broken. There is widespread agreement and evidence that it is not providing a sufficiency of placements to meet the needs of the children we take into care. Until that is sorted out, we will continue to have care provision that is unsafe for some children and we will continue to fail in our responsibilities to the children who need us most. Urgent action is now needed.

The main recommendation of our APPG report echoes the recommendation made by the expert working group in 2012. We recommend that the Department for Education develops an emergency action plan to significantly reduce the number of out-of-area placements. The Government must take responsibility for ensuring that there are sufficient local placements to meet the needs of looked- after children. The plan should address the supply and distribution of children’s homes nationally and the use of unregulated semi-independent provision, and it should be backed by funding.

Local authorities have a statutory duty to ensure a sufficiency of school places to meet the needs of children in their area. The Department for Education provides capital funding and investment so that they can meet that statutory responsibility. It could equally provide the investment and capital funding to ensure a sufficiency of local places to meet children’s needs, working with local authorities and private and voluntary providers.

Section 22G of the Children Act 1989 places a duty on local authorities to take strategic action by requiring them to secure sufficient accommodation in their area that meets the needs of their looked-after children,

“so far as reasonably practicable”.

When private providers are unwilling, as they have been in the past, to run children’s homes in certain regions of the country, local authorities should be encouraged to develop their own direct provision. There is no way forward without the Department for Education taking leadership and responsibility for this. We do not need any more working parties or reports. There is widespread consensus among practitioners, professionals and children with experience of the care system that the children’s home market is failing children, and that urgent action is needed. Warm words are not enough, better data sharing is not enough, and more awareness is not enough. None of this is enough, if we cannot provide sufficient good care placements to meet the needs of children who have been failed by close adults in their life, and who are now being failed by a care system that cannot keep them safe and that leaves them wide open to criminal and sexual exploitation.

High Speed 2

Graham Stringer Excerpts

Wednesday 10th July 2019 Westminster Hall

[Andrea Leadsom]

The hon. Gentleman has raised the issue a number of times, and it is true to say that many think the costs will overrun. I will come back to that.

For me, both as a concerned constituency MP and as someone with 25 years of experience in finance, including project finance, I am alarmed at just how much the business case for HS2 has changed since the project was initially proposed. The business case that HS2 relies on now bears little resemblance to what Parliament was told at the start of the process—if I cast my mind back to when I first became an MP in 2010—nor to what we voted on when the enabling legislation was passed, which I voted against, or when the subsequent main legislation was enacted.

First, we were told that HS2 was about reducing journey times and improving the economy by bringing businesses and workers from the south to the north to spread economic prosperity around the country. Then we were told it was about capacity constraints on the west coast main line, and managing the continual growth in annual passenger numbers. Both arguments no longer stack up.

On improved journey times and associated productivity gains, the underlying assumption built into the business case for HS2 was that any time spent travelling for business purposes was wasted time, and that business travellers undertake no productive work while travelling. In the 21st century, technological advances such as mobile devices and improved wireless internet connections clearly mean that work and leisure activities are increasingly mobile, and increasingly affordable and accessible for rail passengers. Such advances are expected to continue.

[Graham Stringer (Blackley and Broughton) (Lab)]

I have great respect for the right hon. Lady, but she is fundamentally wrong on this issue, although she is right to criticise the way in which the Department for Transport uses travel times. In the assessment of all transport infrastructure, the Department fails to take into account the economic investment that always follows investment in transport. The case is the opposite of what she is saying: it underestimates the benefits from HS2.

[Andrea Leadsom]

The hon. Gentleman makes my point for me: the business case needs to be reassessed with accurate underlying factors taken into account. It is the case that the more productivity on trains increases, in particular as faster fifth generation—5G—mobile internet is rolled out across the country, the less valuable the journey time savings are, and therefore the smaller the estimated benefits of HS2 become on those measures.

--- Later in debate ---

[Liam Byrne]

The former Secretary of State is right to make that point, because a number of significant businesses are now relocating to what is the worst unemployment hotspot in the country; the worst unemployment and youth unemployment in the country is in and around east Birmingham. We have a chance ahead of us to wipe out that youth unemployment, but only if we grasp the nettle and drive through HS2.

[Graham Stringer]

My right hon. Friend makes a brilliant case. If anything, he underestimates the result. When the Transport Committee went to France to look at the impact of the TGV, it found that the go-ahead cities that used the high-speed lines got huge extra investment that had not been calculated in the original assessment. Birmingham, Manchester and Leeds are all go-ahead cities, so I expect more jobs than my right hon. Friend says.

[Liam Byrne]

Precisely. If we measure what we treasure, and if we treasure jobs, HS2 is, frankly, a project that we need.

However, that is not all I treasure; I also treasure tangible action to decarbonise our economy and our region. I want the west midlands to lead the first zero carbon revolution. Back in 1712, when the Newcomen engine was demonstrated up at Dudley castle, we sparked the carbon revolution the first time around. We need a radical plan that allows us to move trucks off the road and on to rail. Only with the capacity that comes with HS2 can we reopen 36 new freight lines that can take a million lorries off the road each year. We cannot de-clog the M6, the M5 or the M42 unless we get that freight off the road. It is impossible to see how we can drive forward the decarbonisation of a sector that contributes 40% of our carbon emissions each year if we do not drive ahead with HS2.

Santander Closures and Local Communities

Graham Stringer Excerpts

Thursday 14th February 2019 Westminster Hall

[David Linden]

Absolutely. That is one reason why I am delighted to see the hon. Member for Ceredigion (Ben Lake) here for the debate. His private Member’s Bill looks specifically at the impact of such closures, particularly on rural communities. My hon. Friend’s point is well made.

[Graham Stringer (Blackley and Broughton) (Lab)]

The hon. Gentleman is being extraordinarily generous in taking interventions. Does he agree that if local impact assessments are done, they are ignored, and not just by Santander? Banks want to force people into online banking, and the real threat of that is that they will move towards allowing algorithms, not human beings, to take decisions. It is not just the high street that goes, but the personal interaction and the ability to appeal to a human being if things go wrong.

[David Linden]

Absolutely. That fits nicely with the next point I want to make, which is about impact assessments. The bank concedes that only half of the customers who use the Parkhead branch use online, mobile or telephone banking services. The data concerning digital exclusion in the east end is widely available, so it beggars belief that Santander has overlooked it and still plans to pull down the shutters on a branch that serves some of the most vulnerable and isolated people in the country.

I want to turn now to the issue of reliance on the post office network to deliver banking services. Having asked the Minister about it during Treasury questions a couple of weeks ago, I can almost anticipate his response: that Santander customers can just do their banking at the post office. I think my hon. Friend the Member for Lanark and Hamilton East (Angela Crawley) felt frustration about that during her Adjournment debate last week.

UK as a Financial Services Hub

Graham Stringer Excerpts

Wednesday 6th February 2019 Westminster Hall

[Several hon. Members rose—]

[Graham Stringer (in the Chair)]

Order. I intend to call the Opposition Front-Bench speakers at 10.30 am; hon. Members who wish to speak can do the arithmetic themselves.

--- Later in debate ---

[Robert Neill]

That is perfectly true, and the need for the deal and for a time to thrash out our future relationships is all the more important because of it. There is not a simple scenario in which the sector works on a one-size-fits-all basis. The same thing applies to the legal services sector, which is a critical underpinning. It is worth remembering that with respect to financial flows, EU financial services trade with the UK between 2016-17 and the current time increased from £29 billion to £33 billion. That dwarfs the figure for trade with our next largest partner, the United States; it is only half, at £16 billion. The seven largest financial services markets added together—the US, Japan, Switzerland, Canada, China, India and Australia—come to only £26 billion, which is less than our financial services trade with the EU. That is why, at the same time as we look at the opportunities for opening out elsewhere, it is critical to maintain EU access, which has also been important to foreign inward investment into UK financial services as a gateway into EU markets.

It is worth bearing in mind that across measures of competitiveness London ranks as the top city and has the highest volume of financial services foreign direct investment globally. However, that is because of our current advantageous position, which we need to maintain. An important part of that advantageous position is the underpinning that legal services and the legal system give to the financial sector. I am concerned that although the Government have uttered warm words and issued advice to practitioners in the sector, real uncertainties would remain, should we leave the EU without a proper deal.

Some of the areas in question are similar to areas of concern in direct financial services, such as the loss of passporting rights, and the need to operate with a form of equivalence. However, the situation for legal services is even more stark, in some respects, because the establishment directive would go, as would mutual recognition of professional qualifications. That would not enable us to use the fly in, fly out arrangements that are so critical to enabling international law firms to advise their clients in real time while deals are going through. That needs to be dealt with, which is why, again, a transitional arrangement is critical.

The other critical point in that context is that unless we have a deal—if we leave without one—we will lose the existing arrangements for the mutual recognition and enforcement of UK court judgments in EU countries and vice versa. That is vital for contractual certainty and continuity. A contract is worthless if it cannot be enforced, and if it cannot be enforced through the judgment of a court there are no other means to do so. It is vital to find means to maintain that. TheCityUK has pointed out that losing it would mean profound difficulties in relation, for example, to insurance contracts—which would not be of value if we were to leave without the ability to enforce them in the event of default—and, significantly, uncleared derivatives. The derivatives market is particularly important to the UK. It is an area of expertise where, as my hon. Friend the Member for Hitchin and Harpenden said, financial services are not just about figures, but are relevant to real business. Most business work is now underpinned in one way or another by a form of financial instrument being traded, particularly in any significant commercial deal. That has been described as the plumbing of the business system, so anything that threatens the derivatives trade operating out of the City, and what relies on it, would be extremely dangerous.

There have been some areas of progress. I was pleased when the European Securities and Markets Authority agreed a memorandum of understanding with the Bank of England in relation to central counterparties and the central securities depository, which enables that issue of central clearing to continue. However, that is one part of a much more complex structure. There are other areas on which I hope for assurances that the Government are determined to see the issue as central to our negotiations. Those things are largely part of the future state negotiations, but we have to have a deal to get into those future state negotiations to begin with. That cannot be emphasised too strongly.

I also want to emphasise the fact that financial services and many aspects of legal services depend on the free flow of data to underpin them. At the moment that is available to us, in relation to our EU counterparties. However, unless—at least until a future state agreement is achieved—there is regulatory alignment on data sharing, we risk disruption to those data flows. That will severely disrupt the circumstances in which we could guarantee that trades could be carried out and completed. Again, insurance and uncleared derivatives are particularly vulnerable to disruption of data flows.

The City believes that an EU-level solution is the optimal one, and I hope the Government will reassure us that it is their intention to press for that, for the same reason as we spoke of before—the complexities of dealing with the 27 on bilateral agreements would be daunting to say the least, and would cause more delay, which would deter people from writing contracts while that period of uncertainty persisted. I know that a temporary solution to protect data flows is currently under discussion, relating to a non-enforcement period between regulators under what is known as a “safe harbour” precedent, but that is not guaranteed. I hope the Minister will be able to update us on progress and assure us that this, too, remains a very high priority for the UK Government.

Getting global regulation right and making it business-friendly, as my hon. Friend the Member for Hitchin and Harpenden said, is critical. Of course, the City of London Corporation provides the secretariat for the International Regulatory Strategy Group, which is a practitioner-led body comprising the leading UK financial and professional services figures. The key test of global regulation is not necessarily its quantity, but its quality and effectiveness. Thus far, the UK has been a world leader in that, and it is important that we continue to make that central to our policy.

My hon. Friend mentioned FinTech, and I am very pleased that he did, because I have constituents, including one of my councillors, working in the FinTech sector and there are real opportunities there. The ability to retain young talent in the UK is critical here; that applies also to young lawyers and to young professionals right across the board, so it is vital that we have a regime for immigration that not only does that in practice, but sets the right tone.

That is why I am pleased that we have scrapped the £65 fee for the settled status scheme; I rather regret that we ever had it to start with. I have in my constituency many EU-national professionals, working in the City of London, the west end and other sectors. They have been settled with their families in places such as Chislehurst and Bromley—commuter land—for many years, and the suggestion that they were going to have to pay to remain somewhere where they had already put down their roots and that they regarded as home sent the wrong signals. I am pleased that the Government thought twice about that, and I hope that can be reflected in the tone of our approach to our EU friends and neighbours hereafter.

However, we must bear in mind that it goes beyond that. International workers make up 40% of the City’s workforce and 35% of London’s finance and insurance jobs. Many of those are EU nationals; others will come from elsewhere, but having that welcoming and open approach is critical. Successful market economies are only successful if they have that open and broadminded approach, and it is important that we as the UK Parliament recognise and articulate that as strongly as we can.

Finally, sometimes people think that financial services are purely about profit; they see the City purely in terms of big financial institutions. The City of London does a great deal to encourage responsible business practice as well, and the two do not need to be separate. The financial services sector is one of the most active and engaged in corporate community investment across the country, as I see in some of the firms based in my constituency or where constituents of mine work.

New research that the City of London Corporation has published indicates that financial and professional services firms gave £535 million in cash and in-kind donations to various forms of community investment in 2017. It is worth saying that although a flourishing financial services sector is important to the economy, its leaders and the practitioners I know from my constituency also want to ensure that they pay their fair share not only to the Exchequer, but in kind to the communities that they serve. That is not separate from the day-to-day workings of our economy and our lives, but central to it, and I hope that this debate helps to bring that home.

[Graham Stringer (in the Chair)]

Just before I call Lee Rowley, I will say that I intend to call the Scottish National party spokesperson at 10.30 am.

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[Anneliese Dodds (Oxford East) (Lab/Co-op)]

It is a pleasure to participate in this debate, and I congratulate the hon. Member for Hitchin and Harpenden (Bim Afolami) on securing it. It has been an interesting debate, particularly when it comes to hearing about how Members’ professional experience has informed their approach to these matters in Parliament.

As many Members have said, financial and related professional services are an important area of the UK economy, and they contribute just over a twentieth of the UK’s overall economic output. There are interesting developments in the sector, which has traditionally not reflected the diversity of UK society. With the Women in Finance charter, changes are being made to reduce the pay gap. In relation to other characteristics, action is being taken to increase the number of people in the sector who have disabilities or are from black and minority ethnic or working class backgrounds.

We have discussed the fact that many people in the sector are not based in London or the south-east. I will add one statistic: there are more than 100,000 people employed in banking and finance in the north-west, which makes it the area with the third-largest number of people working in the sector, outside London and the south-east.

We have had an interesting discussion this morning about the sector’s tax contribution. Reference has been made to research undertaken by PwC that suggested that about 1p in every 10p of Government revenue comes from the sector. Let us be clear that that is counting the tax contributions of everybody who works in the sector, so it is not just looking at corporate taxation. As we all know, the corporation tax rate has been reduced. That has meant that the amount of corporation tax, in relative terms, has reduced. In absolute terms, it has gone up, but that is because these banks and so on have returned to profitability after the financial crash, so actually the burden has gone down in that area. Of course, it has also gone down when it comes to the bank levy, which has been scaled back. A surcharge has been applied as well, but when we look at both of them over time, we see that that burden is also going down.

Reference was made to stamp duty on shares. That stamp duty brings in about £3 billion of Government revenue a year. It is one of the most efficient and least avoided taxes, and for that reason Labour is considering extending it as part of a financial transactions tax. I would be very happy to talk to the hon. Member for Hitchin and Harpenden about how that would work.

As many hon. Members have said, financial services contribute significantly to Britain’s exports. In 2016, they were worth about £61 billion, with a surplus of £51 billion over imports of—yes, obviously—£11 billion. Of course, that is very significant in a situation in which other areas that traditionally were important for Britain’s export strength face tremendous headwinds, not least in relation to manufacturing, given the current uncertainty about Brexit.

As the hon. Member for Hitchin and Harpenden rightly mentioned, the UK is increasingly integrated into global markets. I would argue that the UK is already a very important hub when it comes to the Chinese financial markets, for example. About two thirds of renminbi payments outside mainland China and Hong Kong flow through London, so we are already catching quite a lot of that business. In addition, a number of Chinese firms have established themselves here. However, we need to be clear: yes, that activity is increasing, but, as others have said, we have to be sanguine about its current size. TheCityUK, in its report entitled “Key Facts about the UK as an international financial centre”, says that only about 0.4% of UK financial services exports currently go to China. That may of course increase in the future, but if we compare that with the 44% of our exports that go to the EU, there is a massive difference. As my right hon. Friend the shadow Chancellor of the Exchequer has intimated many times, it must continue to be possible for our financial services companies to win business across Europe and, reciprocally, for European companies to win business here.

As I have said many times during delegated legislation Committees on no-deal legislation, the UK Government have failed to prioritise sufficiently our financial services. I absolutely agree with the comments in that regard by the hon. Member for Aberdeen North (Kirsty Blackman). We appear to have accepted an outcome whereby equivalence, rather than passporting, is the likely eventuating circumstance, and of course that equivalence will operate on virtually exactly the same basis as it currently does for nations such as the US and Japan, which are far less dependent on access to the EU27’s markets than the UK is. On the question of how equivalence would work in the future, the point is that it would work the same for all third countries. If there were to be a stricter regime generally, that would apply to us in just the same way as it would to Japan and the US—the point is that it can also be removed at any point, from the perspective of the EU Commission—rather than there somehow being a more onerous regime for the UK, which I think would not be the case.

I very much associate myself with the remarks by the hon. Member for Bromley and Chislehurst (Robert Neill) concerning the current legal services conundrums and how they can have some kind of certainty on many regulatory issues.

Only very late in the day did our Government start to stress the shared interest of the UK and the EU27 in maintaining access to UK financial services. That was an enormous shame, because we have a mutual interest both in financial stability and resilience and in ensuring that the EU27 can continue to access the deep pool of capital that is available via our financial services. That recognition came only after a much longer period, sadly, in which a very damaging zero-sum narrative had developed, with the cut in corporation tax suggesting an intention to race to the bottom on tax and regulatory standards. That was immensely frustrating. What the hon. Member for North Warwickshire (Craig Tracey) described in relation to the insurance industry is actually what I am finding right across the financial services sector. There is no appetite anywhere, from what I can see, for a bonfire of regulations. Actually, the concern is to try to prevent regulatory turbulence and ensure that there is co-ordination into the future, and yet a picture has developed of a zero-sum approach whereby the UK would seek to reduce those regulations. I think that that has been very damaging.

On that issue, although I agreed with much that the hon. Member for Hitchin and Harpenden said, I did not agree with his comments about EU regulation. Actually, one root of the financial crisis was the misalignment of risk with reward. That was targeted by the cap on bankers’ bonuses, and rightly so. A second root of the financial crisis was the lack of transparency in financial markets—dark pool trading and so on. That was targeted by MiFID, which encouraged many other countries to adopt the kind of transparency standards that existed in the UK before. I therefore think that we need to be very careful about mounting any kind of wholesale assault on those regulatory systems. When it comes to having robust regulation of systemic providers of market infrastructure, I think that that is a very sensible approach and, indeed, it is one that has been supported a lot of the time by UK actors.

Co-ordination of regulation will become ever more important with more innovation in delivery models of financial services. I strongly agree with the comments by the hon. Member for Henley (John Howell), who is no longer in his place, about the need for regulations to keep in step with new developments—for example, in relation to digital currencies. I also agree with the comments made about the workforce, who are incredibly important. We need to ensure that we still have access to people from other countries who can contribute so much to our financial services.

I am a little surprised that we have not talked much in this debate about the contribution of financial services to investment, particularly in business. We need to be clear about what has happened over time. In 1988, almost a third of banks’ UK lending went to businesses. It is now less than a tenth, so there has been an incredible change over time. The Labour party thinks that we need to do something to deal with that. We need to learn from what other countries have done in relation to national investment banks—KfW in Germany, in particular. We need to look at the RBS branch network. I share the anger of the hon. Member for North East Derbyshire (Lee Rowley) about the closure of some of that network.

Of course, we need to focus on vulnerable consumers as well. Although we have seen many positive innovations in that space, that often has not been the case for consumers on low incomes. I will add one statistic to this debate, which is that about one in three families in the UK do not have the financial wherewithal to pay for a new cooker if their current one stops working. That quite extreme lack of financial resilience is now very present in our communities. Consumer credit debt is still far too high, not least for people with overdrafts, credit card debt and/or hire purchase debt. We need to see much more strenuous activity on that. I was very pleased to hear the comments of the hon. Member for Hitchin and Harpenden about credit unions in that regard. Yet again, I urge the Government to focus on better integrating credit unions into the Help to Save programme. I also ask the Government to look again at having a proper tribunal process for the businesses that were dealt with so badly during the RBS Global Restructuring Group scandal, so that there is some redress for small firms that may have been impacted on by banks’ practices.

[Graham Stringer (in the Chair)]

May I request that the Minister leaves a small space of time at the end of the debate for the mover of the motion to wind up?

Balanced Budget Rule

Graham Stringer Excerpts

Wednesday 23rd January 2019 Westminster Hall

[Lee Rowley (North East Derbyshire) (Con)]

I beg to move,

That this House has considered the balanced budget rule.

It is a pleasure to serve under your chairmanship, Mr Stringer. I am extremely pleased to have secured this debate to consider an issue that has slipped down the agenda in recent years, namely that of fiscal responsibility and the actions the state can take in order to uphold and, in some cases, guarantee it.

I am delighted to see so many right hon. Members and hon. Members here today. It is packed to the rafters and standing room only, which demonstrates the level of interest in the subject. I hope that, by holding such debates in Westminster Hall, and by dragging so many hon. Members to them to volunteer contributions, we can slowly raise this important issue back up the agenda and draw attention to it.

The particular issue I want to discuss is the principle of the United Kingdom adopting a balanced budget rule as a way to improve its finances, and the underlying responsibility of Members in this place to ensure that the country pays its way in the future. The idea, which though simple is not universally liked, is that over an appointed period, within an agreed timeline, Governments should follow the novel concept of living within their means and not spend more than they can afford. Crucially, that commitment goes beyond words and there should be consequences if there is a failure to adhere to it.

To some, that is dramatic news; to others, such as myself, it just makes sense that Governments should not seek to balance the books on the back of the nation’s children and grandchildren. The principle of the never-never is, with appropriate structuring, just as apt for the Exchequer as it is for the average household in towns such as Dronfield, Eckington, Clay Cross and Killamarsh in my North East Derbyshire consistency.

It was James Madison, one of the US founding fathers, who said in 1790 that he went

“on the principle that a Public Debt is a Public curse.”

We would do well to take heed of such sentiments.

I have prepared a long speech, because I did not think that so many Members would be here. Before I begin, I will frame the discussion to ensure that the next few minutes can be constructive and useful. The debate could easily, quickly and seamlessly descend into the usual tit-for-tat and back-and-forth on the current state of our national finances, who got us to where we are and why we are there. I am sure that that may happen during the debate. I will say a few words about that in a moment, but I hope we will not dwell on it too much. The idea is to take a broader and longer-term look at where we are, and how we ensure that we leave our country safer, more secure and more resilient than we found it. That resilience should stretch to the nation’s finances as much as it does to its borders and national security.

I declare this debate, in so far as I am able, a Brexit-free zone. That is not because Brexit will not have repercussions or implications for the issue at hand, because it blatantly will, given that the Government’s deficit elimination target has been revised in recent years. I hope my hon. Friend the Member for Southport (Damien Moore) will still have a speech to make after those comments. This debate is about a time beyond Brexit, if we can possibly imagine such a nirvana, and about the day when headlines talk about police, health and education again, rather than backstops, Juncker and tariffs. I have been in this place less than two years, and I would say that at least 90% of what we talk about is Brexit. It sucks the oxygen out of the room, and I say that as committed Brexiteer. It also looks likely to continue to do so for much of the next year, so I hope that for the next few minutes we can try to avoid it.

My proposition is simple: that the United Kingdom considers over the long term the adoption of the balanced budget rule, set in statute, which requires Government to spend only as much as they raise, over a set agreed period, and that there will be consequences if they fail to do that. That would not be an aim or an ambition, but a hard rule, which would be flexible only inasmuch as anything can be flexible when it is set down in law. To be provocative, if we were so minded we might even consider tying any attempt to change future legislation—presumably by a spendthrift Government eager to give out sweeties or goodies to buy votes—to a referendum of the people themselves, given that we have become so adept at referendums in recent years. That would certainly focus minds.

What is the point of legislating on this issue? First, we should all have a moral problem with excessive Government debt. The United Kingdom’s general Government gross debt in September 2018 was, according to the Office for National Statistics, about £1.8 trillion, which is equivalent to about 85% of our country’s GDP. Last year we borrowed, and therefore added to that figure, about £40 billion. In the last couple of decades, our debt as a proportion of GDP has risen from approximately 40% to more than 80%. Those may be just numbers, but they have real-life and real-world implications.

I acknowledge the challenges that the Government have had in trying to get the country’s deficit under control. My party remains resolutely of the view that the Administration prior to 2010 both mismanaged the country’s finances and failed to prepare for the inevitable recession, which could not be avoided given that mere mortals cannot abolish the cycle of boom and bust, and given the well-recited failure to mend the roof when the sun was shining. I support the Government’s deficit strategy and the work they continue to do to manage it down. It has proved a difficult issue to resolve, but we should acknowledge the important milestone that we hit this year, which is that debt as a proportion of GDP is falling for the first time in many years.

Even with the acknowledgement of the good work that has been and continues to be done, the reality is that we are going to run a deficit for a good number of years to come. Even when we eliminate that deficit, which I hope will be as soon as possible, we are merely returning to a place that stops us piling on any more problems for our children and grandchildren, without really having a way to cut down the problem that has already been created in absolute terms. What is the long-term strategy for cutting that debt pile in absolute rather than relative terms? How do we avoid the current position becoming the baseline and the place we start from when the next recession comes? That place would, by default, reduce our firepower to deal with those hard times.

It is worth dwelling on the moral case for not running a deficit and for keeping debt low. The debt that we run up, for whatever good or bad reason, needs to be paid back, and if we cannot pay it back, we need to service it or pay for it. That limits the headroom of future generations to make decisions about what they spend their taxes on, because some of their taxes will go on servicing the debt. It mandates that spending that benefits one generation will be dealt with by another, which is an intergenerational unfairness that we should reflect on much more deeply than we do today, as ever-eager politicians dream up another opportunity to spend.

Reducing our firepower or fiscal space in the event of a recession is the worst kind of lack of planning, and one that will hamstring our ability to pull ourselves out of those recessions, when they inevitably come. As Ryan Bourne of the Cato Institute pointed out in his excellent recent paper on the subject, at least some of the literature that has reviewed the issue highlights that when Government debt gets too high for too long, it tends to reduce growth rates overall, meaning less economic activity, less growth and less prosperity in the long run. [Interruption.]

[Graham Stringer (in the Chair)]

Order. There is a Division in the House. We will recommence in 15 minutes.

--- Later in debate ---

On resuming—

[Graham Stringer (in the Chair)]

Sorry about that. I had been told there was definitely a second vote, which there clearly was not. I call Mr Lee Rowley.

[Lee Rowley]

Before we went to vote I was talking about the moral case for low debt and ensuring that the servicing of that debt was as minimal as possible, to retain and support our ability to ensure economic activity in the future. It was not for nothing that Herbert Hoover intoned sarcastically:

“Blessed are the young, for they shall inherit the national debt.”

In this context, perhaps we can bestow a few less blessings on them in the future.

Putting aside the morality of debt, the key issue, which should drive all politicians regarding the accretion of Government debt, is the year-on-year cost of servicing and holding it, as mentioned earlier. The proponents of unfunded spending may highlight how the markets are not that concerned with relatively high borrowing so long as it can be funded. That may be the case. Let us hope, for all of our sakes, that we do not enter a period of high interest rates in the coming decades when national debt is to be rolled over.

The opportunity cost of that funding, on an ongoing basis, is much less understood in this place than in public discourse. It comprises a tax, year on year, on today’s generation for yesterday’s spending. Unlike the total debt to GDP ratio, which has oscillated wildly in the last century due to wartime spending, the cost of servicing the UK’s debt has been on an upward trajectory for the last century. Adjusted for inflation, the cost of servicing that debt has risen from an average of £12 billion per annum between 1900 and 1960 to nearly £30 billion at the turn of the 21st century. Since 2009, that average has hit £43 billion every year. In total, since 1900 the UK has spent something like £2.5 trillion just on servicing its debt. About half of that has been spent since I was born—I still like to think of myself as being relatively young.

The bad news is not likely to stop there. With the continuing running of deficits until well into the 2020s, the annual cost of servicing that debt is projected by the Office for Budget Responsibility to hit more than £50 billion by the start of the next decade. In this Parliament alone, debt servicing costs are projected to be about a quarter of a trillion pounds over the five years. The sums are huge and growing. They represent a significant opportunity cost to the UK as a whole.

High Speed 2

Graham Stringer Excerpts

Wednesday 12th September 2018 Westminster Hall

[Graham Stringer (Blackley and Broughton) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Howarth. I congratulate the hon. Member for Stone (Sir William Cash) on bringing HS2 to Westminster Hall for a serious debate today. Although I agree with him on a number of issues, on this issue we unfortunately find ourselves on opposite sides of the debate. I gently tease him about the start of his speech, where he referred to an opinion poll and laid a lot of the foundations of the logic of his argument on that poll and people not wanting HS2. I dismiss that opinion poll, because people will not have known all the facts about HS2, as I suspect he would dismiss opinion polls that ask for a second referendum on the EU.

The hon. Gentleman talked about the Select Committee on Transport examining HS2. From memory, that Committee has carried out three reports on HS2; I think the first was just after the 2010 general election. Every single one of those reports has supported the building of HS2. The Committee has looked in detail at one of the hon. Gentleman’s other points—whether there will be economic benefits from building HS2. It looked at the TGV system in France and found that some places that were connected to high-speed rail did not benefit, but those towns and cities that put effort into economic development and did not just sit back and do nothing—a point that is generally true, not just for high-speed rail—benefited enormously from the advent of TGV to their towns.

Another point that is often made against HS2, although the hon. Gentleman did not make it today, is that it will benefit London more than Manchester, Leeds or Birmingham. The argument against that is the Workington argument. If people wanted to be further away in time from London, we would all aspire to be in Workington, which is about as far away as we can get from London in time, but Manchester, Newcastle, Leeds and Birmingham actually do rather well, because they put effort into economic development and benefit from being close to London. Nobody wants slower times. They want faster times.

Of course, the serious argument in favour of HS2 was never simply about time. It is about capacity and improving our infrastructure. The number of passengers on the current rail network has doubled over the last 10 or 15 years, and one of the reasons for that—although not the only reason, given, for example, better marketing of tickets—is how poor our overall transport infrastructure is, how poor the motorway system is and how poor some of the rail system is. We need HS2, and it should go not only to Leeds and Manchester but to Scotland via Newcastle, Preston or wherever, which would help the infrastructure of the whole of the United Kingdom.

We see the London establishment—The Sunday Times, the Daily Mail and parts of the civil service—saying, “This is money going to the north of England.” In actual fact, the spending on transport in London and the south-east, but in London primarily, massively outstrips spending on transport in the rest of the country. The statistic I regularly give, which is getting more out of date but is still astonishing, is that the overspend on the Jubilee line in 2000 was more than the total expenditure on transport in the regions.

Another real competition is going on. Although Crossrail 1 massively overspent and is going to be delivered late—we still do not know what the costs will be, but it will happen and be a good thing, benefiting London and communities to its west and east—people now want Crossrail 2. The competition is not only for resources but for parliamentary time. It is about whether the Crossrail 2 hybrid Bill gets ahead of phase 2b of the HS2 Bill—the routes from Crewe to Manchester and from the west midlands to Leeds via Sheffield—which I completely oppose. Incidentally, the strongest support for HS2 has been in Greater Manchester and Leeds. There has been more opposition in London, where a lot of the costs fall because it is a very densely populated city. It would have been better if HS2 had started in Leeds and Manchester, not only because of the tremendous support but because there would have been immediate economic benefit, with people in London expecting and wanting the project to get to London faster. That is the competition we are seeing.

Another—rather subversive—argument is that the east-west route from Liverpool to Hull, which certainly needs improving, should take precedence over HS2. The two should go in step, because when HS2 is built— I believe it will be and go to Leeds, Sheffield and Manchester—in order to get passengers on and off the line, we will need the capacity to move across the north of England. There is not a competition as there is with Crossrail 2, because HS2 and the east-west route go arm in arm; we need both, and we need HS2 not to be delayed. I hope the Minister will reassure hon. Members that the HS2 phase 2 hybrid Bill will not fall behind the Crossrail 2 hybrid Bill in the schedule, because that would be a huge mistake.

One of the many points made by the hon. Member for Stone was, quite reasonably, about costs. Lots of infrastructure projects find it difficult to control costs and that is a completely reasonable point to make, as are points about the effects on our constituencies. The problem with the way in which the National Audit Office and the Department for Transport measure cost-benefit analysis is that transport schemes always favour London, because it is about the number of people and the time saved on their journeys. What is really being measured is the density of population, and that means that London schemes are always prioritised. The combination of the London establishment and the methodology used for cost-benefit analysis is bound to be biased against HS2, which is of major national importance for unifying the country after a period in which the north of England, other regions such as the south-west and whole countries such as Wales have been starved of resources.

[Dame Cheryl Gillan]

I understand the hon. Gentleman’s perspective. My father, having worked in the steel industry in Sheffield, would acknowledge that many businesspeople north of the Watford gap will prioritise the cross-Pennine links over HS2.

On the point that the hon. Gentleman is making, I argued in the initial stages that if we were going to do to this project to unify the United Kingdom, it should start in Scotland. Unfortunately, nobody listened. Does he agree that Scotland would have been a much better starting point?

[Graham Stringer]

The right hon. Lady makes a good point. I am a Manchester MP, I went to university in Sheffield and I always wanted the project to start in Manchester and Sheffield, but it would have been a unifying factor for the United Kingdom for the project to start in Scotland. There is no reason for it to start in only one or two places—it could have started in three; many projects of this scale do.

I could talk at length but many hon. Members want to speak. This is a project of national importance, like the third runway at Heathrow. I understand that the right hon. Member for Chesham and Amersham (Dame Cheryl Gillan) has constituency issues. Many of us understand national priorities but we are elected by our constituents and have to represent them. I understand that balance. I do not think that the HS2 consultation has always been perfect and it—and the compensation—could have been improved. I pay tribute to the right. hon Lady for the considerable amount of increased investment in HS2 tunnelling that she has managed to get for her area. We have to keep this in perspective. We do not want investment in the north of England to stop, yet again, because of the methodology and because lobbying in London is so intensely powerful.

[Mr George Howarth (in the Chair)]

Before I call the next speaker, I need to say that we will start on the wind-ups at 10.40 am. I will not set a time limit, but it would be helpful if those who speak from hereon in confine their remarks to about eight minutes.

Public Sector Pay

Graham Stringer Excerpts

Monday 4th December 2017 Westminster Hall

[Dan Carden]

No, I will not. We are starting to realise that the race to the bottom is one that we all stand to lose. The sooner Government Members realise that, the better off our and their constituents will be.

[Graham Stringer (in the Chair)]

We now move on to the Front-Bench spokespeople. I remind hon. Members that the Chair of the Petitions Committee, the hon. Member for Warrington North (Helen Jones), will wind up the debate after the three Front-Benchers have spoken.

--- Later in debate ---

[Catherine West]

Does the Minister accept that there is a link between the current crisis in numbers of nurses in the NHS and the pay on offer, particularly given the huge student debts that many nursing graduates have? It is up to £54,000 for those at London Metropolitan University. Does he believe that there is any link between a starting salary of £21,500 and a huge student debt of £54,000 for nurses?

[Graham Stringer (in the Chair)]

I remind hon. Members who wish to intervene on the Minister that there are 10 minutes left. I am sure that people would like to hear from the Chair of the Petitions Committee after the Minister. Time is now beginning to get tight.

[Andrew Jones]

I was not watching the clock, so thank you, Mr Stringer.

I recognise that starting salaries and debt are clearly related for people making choices, but our NHS provides a magnificent career with long-term security and pay progression. The current average salary for a nurse is £27,635, which is very near the national average salary. Nursing presents a great career.

I mentioned earlier the pressures within the health service. That is why the Chancellor announced at the Budget that if the Health Secretary’s ongoing discussions with the health unions bear fruit, he will provide further funding for pay awards for Agenda for Change staff. That will, of course, follow the pay review body process in the spring. We cannot prejudge those discussions or the pay review body process, but we want the talks to succeed, and we share with NHS workers the common objective of a highly skilled, compassionate, productive workforce working to improve outcomes for patients. The Chancellor made his public commitment with that in mind.

I re-emphasise that the Government are committed to providing fair pay awards across the public sector. That is why we have the pay review body process, which ensures that pay for public sector workers is fair to all sides. We must also recognise the depth of public feeling on the issue, which the 150,000 signatures on the petition demonstrate. The 1% pay policy is ending, as announced on 12 September and reconfirmed in the Budget on 22 November. However, it is important to remember that we now face the established processes for determining those pay awards, and we cannot prejudge them. I cannot comment on a report that has not yet been written.

For that reason, the Government have not set out an explicit target for public sector pay, but I can provide an assurance that this Government will take the recommendations into account. We will continue to invest in our public services and ensure that our public sector workers continue to be fairly remunerated. They deliver a fantastic level of public service on which we all rely, and that will continue to be the case under this Government.

HMRC Closures

Graham Stringer Excerpts

Thursday 2nd November 2017 Westminster Hall

[Peter Dowd]

The Minister is being incredibly generous with his time. The question of the criteria goes to the heart of the matter, Mr Stringer; incidentally, I welcome you to the Chair, and am delighted to see you. The Minister persists with the issue of the criteria, one of which is the ability to get to a particular site via transport mechanisms and infrastructure. The problem, however, is that in many situations there has not even been an assessment of how the particular criterion applies to particular sites. I understand what the Minister says—the criteria exist. They may do, but does he agree that if they are not applied, that shoots a hole through the whole process?

[Graham Stringer (in the Chair)]

Order. We have just over an hour left, but I remind hon. Members that interventions should be short and to the point.

[Mel Stride]

Thank you, Mr Stringer. I should agree with the hon. Member for Bootle if the premise of his assertion were true. In reality there has been an assessment. Of course, in each and every case, HMRC looked at the criteria and applied them to the various options in the various regions, and came to a conclusion as a result of the assessment. That is the logical and sensible way in which such matters move.

[Jim McMahon]

On a point of order, Mr Stringer. The Minister has said a number of times that an assessment has been made of the various sites and location options. If it transpired that the assessment had not been carried out, what remedy would the House have?

[Graham Stringer (in the Chair)]

That is a matter of fact, not a point of order relating to the debate.

[Peter Dowd]

rose—

Taxation: Beer and Pubs

Graham Stringer Excerpts

Tuesday 31st October 2017 Westminster Hall

[Mike Wood]

Partly because of the small breweries’ relief scheme, we now have a greater variety and, I would argue, greater quality of beer than we have had in the past. It is important that smaller brewers enjoy support that reflects the higher marginal cost of brewing on that scale. However, we also need to look at whether the relief scheme as currently framed is preventing brewers from expanding, or even causing some to scale down.

[Graham Stringer (Blackley and Broughton) (Lab)]

rose—

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

rose—

--- Later in debate ---

[Mike Wood]

The hon. Member for Coventry South (Mr Cunningham) of course makes an important and valid point in talking about the role not only of students but of young people more widely in employment, because the pub sector can generate an extremely fulfilling and constructive career for many that goes much wider than the stereotypical picture of students working in a pub until they are in full-time work.

[Graham Stringer]

Will the hon. Gentleman give way?

[Mike Wood]

I must continue because a lot of colleagues are waiting to get in.

The beer industry is a true success story for home-grown British manufacturing. A staggering 82% of all beer consumed in this country is made in the UK. The UK now has more than 2,000 breweries, producing 25 million barrels of beer a year. With 923 million pints exported to 110 different countries, beer is the third largest food and drink export sector in the UK and it is worth £550 million to the UK economy. In my constituency alone, the sector accounts for 1,156 jobs, of which 313 are held by under-25s. It also contributes more than £37 million to our local economy.

--- Later in debate ---

[Mike Wood]

Absolutely. That is as true in our towns as it is in our villages. About 80% of pubs are community or rural pubs. They bring not just jobs, but a community focus, often in areas of the country where other traditional providers of jobs and community coming-togetherness might have been lost.

[Graham Stringer (Blackley and Broughton) (Lab)]

The hon. Gentleman makes a profound point about the importance of pubs to rural villages, but does he agree that pubs in inner-city areas are just as important to the local community? There has been a migration of licences from inner-city areas into city centres, which has denuded our inner cities of many of the benefits of public houses.

[Mike Wood]

The hon. Gentleman is absolutely right. It is particularly troubling that those pubs that close in our towns and city centres are often housed in large buildings that are very difficult to fill and that remain as decaying monuments to the changing nature of consumer behaviour.