Oral Answers to Questions

Debate between Jon Trickett and Oliver Dowden

Wednesday 24th April 2019 Commons Chamber

[Oliver Dowden]

I can tell my hon. Friend that the latest data shows that 10 of the 16 Government Departments were meeting the target of paying 90% of suppliers within five days, and 10 were also meeting the target of at least 96% of invoices within the 30-day target, so there is a good record overall.

[Jon Trickett (Hemsworth) (Lab)]

The Minister’s own Department has seen a threefold increase in late payments over the last couple of years. As we know, the Government are diverted from their day jobs with daydreams of a new Prime Minister, and this distracted Government are raising incompetence to a completely new level. We have seen that they are careless when paying small and medium-sized enterprises that provide services to the public, and those SMEs are the backbone of our economy. Yet the Government are very careful when it comes to outsourcing to wounded giants such as Interserve or failed dinosaurs such as Carillion. Is it not time that the Minister and his Department got their act together?

[Oliver Dowden]

I assure the hon. Gentleman that I am dreaming of nothing but securing my right hon. Friend the Prime Minister in her continued position as Prime Minister.

[Jon Trickett]

“It says here.”

[Oliver Dowden]

Sadly, I do not have a note on that point.

I can also reassure the hon. Gentleman on his point regarding prompt payments in my own Department, the Cabinet Office. According to the latest figures, in March we paid 88% of all our suppliers within five days and 98% within 30 days—a perfectly credible record.

Capita

Debate between Jon Trickett and Oliver Dowden

Thursday 1st February 2018 Commons Chamber

[Jon Trickett (Hemsworth) (Lab)]

I will take your advice, Mr Speaker.

Only two weeks ago, I warned that there was a danger that this whole outsourcing problem would become a set of dominoes, with one falling after another. I believe the House will conclude that the Government’s behaviour in response, and the Minister’s response today, has been marked by indifference to corporate mismanagement, incompetence in office and complacency in the face of a crisis.

The Minister will not tell the House, but I will: Capita was given 154 Government contracts last year. Only last week, Carillion contracts were being re-brokered to Capita, yet the company was clearly in trouble. Share values were plummeting and profit warnings were being issued. There was short selling on the stock market and allegations against Capita of fraud in the handling of public contracts. Yesterday, Capita’s total value on the exchange was barely much more than its total debt. The company is in serious trouble. It is a familiar tale of woe, with strong echoes of Carillion.

We want to know that the Government’s contingency plans in relation to Capita will assure jobs for current employees and protect the pensions of those employees and the pensions of the public sector workers that the company is managing. Will the Minister confirm that the public services that Capita manages will be protected in the event of a corporate disaster? Does the Government’s contingency plan allow for that? What will be the common impact of the problems at Carillion, and now Capita, on the spiralling costs of HS2? Does the Minister agree with the Opposition that not a single penny should be used to prop up badly managed outsourcing companies?

The Government are blind to the corporate greed of these outsourcing companies. Does the Minister agree that it is clear that, as the Under-Secretary of State for Justice, the hon. Member for Bracknell (Dr Lee), said only the other day, the Government should be driven by the “evidence, not dogma” on outsourcing?

[Oliver Dowden]

I thank the hon. Gentleman for his questions, the core of which was about support for outsourcing companies. He said we should not provide a penny more to prop up badly managed outsourcing companies. Indeed, that is exactly what we did in respect of Carillion. We took the decision that this was a private company and should bear the loss. That is why shareholders in Carillion are unlikely to get more than a few pennies in the pound back for their investment. The private sector has taken the risk, but the job of the Government is to ensure the continued delivery of those public services—to ensure that the dinner ladies get paid, that the hospitals get cleaned, and that the railways continue to be built. That is exactly what we did in respect of Carillion and it is exactly what our contingencies involve for all our strategic suppliers. That is the test for the Government: can we ensure the continued delivery of those public services, and can those public services continue to be delivered?

The hon. Gentleman made a point about pensions. The fact that Capita has embarked on this course of restructuring means that it is effectively choosing to switch resources away from the continued payment of dividends and towards pension funds. That should give pensioners confidence in respect of that pension fund. He also asked about jobs, and again, the restructuring can give confidence about the continuing delivery of those jobs.

I keep coming back to the same point. This is a private company and the interest of the Government is to ensure the continued delivery of those public services, and those public services continue to be delivered. That takes me back to Labour’s position. What Labour seems to be suggesting is that the private sector has no role in public life, and that the level of small and medium-sized businesses working for the Government should be zero. If that is not Labour Members’ position, are they going to tell us where they choose to draw the line? Labour has gone from pumping billions of pounds into private companies for the delivery of public services when Gordon Brown and Tony Blair were Prime Minister, to saying that they should not have a penny. Some clarity would be helpful, because otherwise people may draw the conclusion that there is more than an element of opportunism here.

Oral Answers to Questions

Debate between Jon Trickett and Oliver Dowden

Wednesday 10th January 2018 Commons Chamber

[Oliver Dowden]

I thank my right hon. and learned Hertfordshire Friend for his welcome. He raises an important point. There are two aspects of this: there is the direct spend—as I have said, it is about £5.6 billion—but we also need to ensure that we get spend into contracts lower down, with people who have Government contracts then spending with small businesses, which is something we are committed to doing as a Government.

[Jon Trickett (Hemsworth) (Lab)]

Too often, rather than outsourcing to SMEs, very large companies are employed. In this respect, despite being under investigation by the Financial Conduct Authority and reportedly having debts of £1.5 billion, the massive outsourcing company Carillion remains a major supplier in terms of Government procurement. If it were to collapse, it would risk massive damage to a range of public services. Do the Government have a contingency plan for such an eventuality, and what is the likely cost to the taxpayer?

[Oliver Dowden]

As the hon. Gentleman would expect, we of course make contingency plans for all eventualities. If I could briefly update the House, Carillion, as Members will know, is a major supplier to the Government, with a number of long-term contracts. We are committed to maintaining a healthy supplier market and working closely with our key suppliers. I can tell the House that Carillion’s operational performance has continued to be positive. For example, it advanced its work on Crossrail over the Christmas period.

[Jon Trickett]

The truth is that the Minister has failed to answer the central question. The Government have been outsourcing public services to large outsourcing companies on an industrial scale. When these massive outsourcing companies fail, as too often they do, does the Minister really think it is fair that the costs stay with the taxpayer, while the profits are creamed off by the shareholders?

[Oliver Dowden]

I do not think there is anything wrong with profit. Profit is a reward for investment made by businesses. Perhaps if the hon. Gentleman had listened to my answer, he would not have had to read a pre-scripted question. I gently suggest to him that this is something the Government take very seriously. We, for the first time, as a Government—this had not been done for 13 years previously—started measuring the number of small and medium-sized enterprises that have Government contracts. We set a target of 25% in the last Parliament, and we have delivered on that, so I think that is a record of success for this Government.