Civil Service Compensation Scheme
Lord Maude of Horsham Excerpts(13 years, 5 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I am laying before Parliament today the Civil Service Compensation Scheme (Amendment No.2) Scheme 2010 and the associated revisions to the Principal Civil Service Pension Scheme.
The new scheme will replace the old scheme which the previous Government tried to reform in February 2010. I first announced that the coalition Government intended to reform the civil service compensation scheme on 6 July 2010, following which the Superannuation Bill was introduced to Parliament on 15 July to ensure that reform of the scheme could not be vetoed by any one of the unions. Extensive discussions then took place between officials and Ministers and the civil service trade unions. Proposals were put to the Council of Civil Service Unions on 24 September. In the event, the council did not accept those proposals, but five of the unions—Prospect, the FDA, the Prison Officers’ Association (POA), the GMB and Unite—approached the Government directly and asked to continue discussions on those terms. There followed an intensive period of meetings between the five unions and officials, which on 5 October resulted in an agreement being reached between the negotiators on terms that might form the basis of a new compensation scheme. The five unions wrote to confirm that these terms had accurately recorded an agreement, that all their negotiating teams were able to recommend positively to their executives, as being the best that might be achieved in negotiation.
Subsequently, the POA’s executive committee voted to distance itself from that agreement and to request further discussion. The sixth union, the Public and Commercial Services (PCS) Union, had decided not to take part in the talks at the point when the five other unions had agreed to negotiate separately with the Government.
The Superannuation Act 2010, which received Royal Assent on 16 December, amended the Superannuation Act 1972 so as to remove the requirement for agreement of the civil service unions to any changes that could reduce the benefits of the compensation scheme. However, during the passage through Parliament of the Superannuation Bill, the Government agreed a number of changes to it, including a further amendment to the Superannuation Act 1972 so as to introduce a clear requirement that future consultation on any changes that would reduce the value of the civil service compensation scheme must be undertaken
“with a view to reaching agreement”
and that a report is made to Parliament setting out the details of the consultation that has been carried out with the unions.
During the Superannuation Bill’s passage through Parliament, the Government remained committed to trying to reach an agreement with the Council of Civil Service Unions and offered every opportunity to those unions that wished to engage constructively in negotiations. Five of them did so, and their proposals formed the basis of the discussions and subsequent agreement on which the new proposed scheme is based.
On 9 November, the Council of Civil Service Unions wrote with suggestions for areas that could be considered in further talks, and I responded on 15 November. The suggestions made in the council’s letter would have had the effect of reducing the level of compensation paid to many lower-paid civil servants, and I therefore did not wish those suggestions to form the basis of further discussions. Having a new scheme that provides genuinely better protection for the lowest-paid civil service workers, many of whom are members of the PCS, has been an important aim of the Government throughout the discussions on reform.
I explained to the Council of Civil Service Unions that, in the absence of detailed proposals from the PCS, work would have to proceed on drafting the rules for a new scheme. On 6 December 2010 officials sent the draft rules for the new compensation scheme to the Council of Civil Service Unions to seek its views. Those rules form the basis of the new compensation scheme, which is being laid before Parliament today.
The Superannuation Act 2010 provides a fall-back position by introducing statutory caps on compensation which would be applied if, for any reason, the Government cannot implement the new proposals. The Government are now in a position to be able to repeal the caps set out in the Act through the Superannuation Act 2010 (Repeal of Limits on Compensation) Order 2010, which comes into force today. The repeal means that the statutory caps of a maximum of 15 months’ pay for voluntary departures and 12 months’ pay for compulsory departures, will not apply to the new civil service compensation scheme that is starting on 22 December 2010. The key points of the new civil service compensation scheme are as follows:
Voluntary Redundancy
Below normal pension age (either aged 60 or 65)—one month’s pay per year of service up to 21 months, with a taper of between a maximum of 21 months’ and six months’ compensation for those approaching pension age;
At or above normal pension age—one month’s pay per year of service up to a maximum of six months;
Staff who have reached minimum pension age (either aged 50 or 55) can choose to opt for early retirement on their current pension entitlement. Staff will be asked to surrender some (or all) of their severance payment to meet the cost of receiving this pension early.
Period of notice
All staff will be entitled to at least three months’ notice.
Compulsory Redundancy
One month’s pay per year of service up to 12 months. All staff who may face compulsory redundancy will first have had the opportunity to exit under voluntary terms.
Low and high pay thresholds
All staff earning less than £23,000, on a full time equivalent basis, will be treated as if they earn £23,000 for the purpose of calculating their redundancy payments.
There will also be an upper pay threshold of £149,820. Staff earning more will have their salary capped at this figure for the purpose of calculating their redundancy payments.
Superannuation Bill
Lord Maude of Horsham Excerpts(13 years, 5 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I beg to move, That this House agrees with Lords amendment 1.
Mr Deputy Speaker (Mr Lindsay Hoyle)
With this we may take Lords amendments 2, 3 and 7.
Mr Maude
When I opened the debate on Second Reading in September, I set out—at some length, I regret to say—the history and background of compensation in the civil service since 1859. I do not propose to do the same this afternoon. However, it is timely to bring the story up to date as regards what has happened since the Bill left this House on 13 October to go to the other place.
I reiterate that from the day I first announced that the Government intended to reform the civil service compensation scheme on 6 July, extensive discussions have taken place between my officials—and myself on a number of occasions—and the civil service trade unions. Proposals were put to the Council of Civil Service Unions on 24 September. In the event, the council did not accept those proposals, but five of the unions—Prospect, the First Division Association, the Prison Officers Association, the GMB and Unite—approached the Government directly and asked to continue discussions on those terms. There followed an intensive period of meetings between the five unions and officials, which on 5 October resulted in an agreement between the negotiators on terms that might form the basis of a new compensation scheme. Later that day, the five unions wrote to confirm that they had accurately recorded an agreement that all their negotiating teams were able to recommend positively to their executives as being the best that might be achieved in negotiation.
Soon after 5 October, agreement was reached between the Government and the trade union negotiating teams. The POA’s executive committee voted to distance itself from that agreement and to request further discussion. The sixth union, the Public and Commercial Services Union, withdrew from the talks at the point when the five other unions had agreed to negotiate separately with the Government. While the Bill was in the other place, the Government agreed a number of changes to it, and this House now has the opportunity to consider those. The group of amendments that we are dealing with responds to a commitment that I made when we discussed this on Report—that is, to reinforce the requirement for meaningful consultation on any changes to civil service consultation schemes.
The new clause includes a clear requirement that future consultation on any changes that would reduce the value of the civil service compensation scheme must be undertaken
“with a view to reaching agreement”,
and it requires a report to be made to Parliament setting out the details of the consultation that had been carried out with the unions. My noble Friend Lord Wallace of Saltaire accepted an Opposition amendment in the other place to delete wording that would have limited the content of that report to such information as the Minister considered appropriate. Lord Wallace also agreed that we would table written ministerial statements in both Houses when the imminent new scheme is laid before Parliament to draw attention to it and to the steps that have been taken to consult the unions. Furthermore, we agreed to limit to three years—this is the subject of the next group of amendments—the power to revive the caps in the Bill by order, and to drop our proposals that would have allowed that time limit to have been extended by a further six months at a time.
During the Bill’s passage through the other place, the Government remained committed to trying to reach an agreement with the Council of Civil Service Unions. I made a number of personal approaches, both orally and in writing, to the PCS general secretary and to the POA inviting the CCSU to put forward alternative proposals for a reformed civil service compensation scheme and seeking to engage further. I reiterated the Government’s continuing aim of reaching an agreement with all the unions. I have offered every opportunity to those unions that wish to engage constructively in negotiations. As I said, five of them did so, and their proposals formed the basis of the agreement on which the new proposed scheme is based. If the Bill goes through its processes and achieves Royal Assent, I would intend to lay that scheme before Parliament before Christmas.
On 9 November, the Council of Civil Service Unions wrote to me with suggestions for areas that could be considered in further talks, and I responded on 15 November. I have to say that the suggestions made in the council’s letter would have had the effect of reducing the level of compensation paid to many lower-paid civil servants, and so it could not form the basis of further discussions. Having a new scheme that provides genuinely better protection for the lowest-paid civil service workers, many of whom are members of the PCS, has been crucial in all the discussions we have had. As I have made clear throughout the process, including when I made the announcement of our intention to reform and on Second Reading, that is crucial to the aims of the coalition Government.
I explained to the Council of Civil Service Unions that, in the absence of detailed proposals from the PCS, work would have to proceed on drafting the rules for a new scheme. Last week, my officials sent the draft rules for the new compensation scheme to the Council of Civil Service Unions to seek its views. Those rules will form the basis of the new compensation scheme, which as I said I intend to lay before Parliament as soon as possible, assuming that the Bill completes its passage and achieves Royal Assent.
The Lords amendments are intended to reassure the House, the unions and all stakeholders that the Government will consult fully with the unions should there be future proposals to change the compensation scheme that would reduce the benefits for civil servants. They merely put into statute what has always been our intention. Arguably, that requirement is already contained in the Superannuation Act 1972, but the amendments will put it beyond peradventure or doubt.
The amendments reflect the lengthy consultation process that I have just described. They are Government amendments that were made in the other place to respond to commitments that I made on Report and Third Reading. I am grateful for the constructive involvement of the unions and those on the Opposition Front Bench throughout the process of refining the amendments to achieve the maximum consensus.
Lords amendment 1, which is the lead amendment, inserts a new clause after clause 1. As I said, it makes it clear that consultation should be undertaken
“with a view to reaching agreement”,
and it requires that a report of that consultation be laid before Parliament. The new provisions will apply when there is a change to the compensation scheme that will result in reduced benefits. The report would have to include details of
“the consultation that took place”,
the steps that were taken
“with a view to reaching agreement”
with the unions or other persons consulted, and
“whether such agreement has been reached.”
I repeat that the Government are committed to consultation with the unions. Like the previous Administration, we will always seek to reach agreement with all unions on changes to the compensation scheme. We know from experience that that may not always be possible, and in such cases, the report will explain why.
The effect of Lords amendments 2 and 3 is that the consultation provisions will come into force two months after Royal Assent. That is the standard interval before the commencement of new legislation. However, because of the need for certainty, the other provisions of the Bill will come into force immediately on Royal Assent. As a consequence, the requirement to publish and lay before Parliament a report on the consultation will apply to future changes to the compensation scheme, and not to those currently being developed for implementation when the Bill is enacted.
A requirement for a report on the current consultation would be nugatory, because no one can claim that there has been anything other than long and extensive consultation, carried out not just by myself and my officials, but by my predecessor in this process, the right hon. Member for Dulwich and West Norwood (Tessa Jowell), and the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), who is now on the Opposition Front Bench. This process goes back a long time; there have been three years of drawn out extensive consultation and negotiation. Parliament is well aware, and nobody can have any doubt, that the process has been extensive and thorough; it has been described by the right hon. Gentleman, the right hon. Lady and myself. Equally, it would be wrong to risk a further delay, while a report was prepared and laid before Parliament, before the proposed scheme could be introduced. I have agreed, as Lord Wallace said in the other place, to table written ministerial statements to set out what consultation there has been.
I hope the House will recognise that the Government are seeking to provide the additional reassurance that was sought by the Opposition, and that the changes to the Bill meet my earlier commitments.
John McDonnell (Hayes and Harlington) (Lab)
Lords amendment 1 requires the Government to consult with the aim of seeking agreement, and provides for a report to Parliament in due course. Lords amendments 2 and 3 will bring the Bill into force two months after Royal Assent and I find it extraordinary that the Government see that as some form of concession, because the bulk of the staff who will be made redundant in the coming period will be made redundant under a scheme that is still to be imposed. The Government intend that that scheme will be introduced within the two months after Royal Assent, so there will be no report to Parliament, no commitment to consultation and no commitment to take steps to reach agreement, as is embedded in Lords amendment 1. The terms of the scheme, as they stand in the original proposals in the Bill, will be imposed. So although Lords amendment 1 proposes a system whereby there is at least some commitment to parliamentary scrutiny of the willingness and commitment of the Government to negotiate and seek an agreed settlement, Lords amendments 2 and 3 take away that commitment, because we know that the scheme will be amended within the two months to which Lords amendment 1 does not apply.
I cannot think of a better mechanism to incite industrial action. It could be construed as an act of contorted bad faith. Although there have been commitments in ministerial written statements, there has been no commitment to adhere to Lords amendment 1, because it would not otherwise be virtually vetoed by Lords amendments 2 and 3. In my view, that will not only result in industrial relations deteriorating but enhance the potential for legal challenges. It certainly will not enhance the legal protections for which the Government were hoping as a result of the amendments.
The amendments do not address the problematic core of the Bill, which is the imposition of caps and limits on the compensation scheme without the agreement of the unions representing the members affected. I have heard a lot about the four out of the six unions agreeing or recommending the scheme that is being imposed. I remind the House, however, that of the two main unions that represent the vast bulk—more than 75%—of the members affected, one, PCS, or the Public and Commercial Services Union, has not agreed the scheme and is recommending that its members reject it in the ballot; the executive of the other, the POA, has recommended that its members reject the scheme in the ballot, too.
I find it an absolute irony that in any future negotiations, which will, I suppose, probably be relatively minor because the Government will impose the bulk of the change in the next couple of months, the House will have some form of scrutiny of the negotiations as a result of Lords amendment 1, but it will not be able to exercise it in those two months. The reason for that is that if there was a full exposure of what went on in the negotiations, it would provoke even more anger among PCS and POA members.
This has been the worst example of industrial relations practice that we have seen in years. First, there was the use of a “blunt instrument”—I use the Government’s own words—of the threat of a Bill’s being brought forward to impose such severe caps that many would have lost more than two thirds of the redundancy payments that they had acquired as accrued rights over the years. There was then an extremely crude attempt to divide and rule the unions. I believe that the POA is seeking some form of legal redress against the Minister for the Cabinet Office for some of his statements. Those practices have now resulted in the virtual chaotic breakdown of the formal negotiating structures that have held good under past Governments throughout the decades.
If Lords amendment 1 comes into force, at least there will be some reflection of the negotiations that took place—and it might be more accurate. As the Minister has dwelt on the process of the negotiations, perhaps I might put on the record an alternative historical account of what occurred. Yes, the civil service unions—all six of them—sought to negotiate some form of agreed settlement throughout the summer. They did that in the light of the threat of the imposition of a Bill that would cut significantly their members’ redundancy payments.
In September, the Treasury intervened to insist on a cash cap on the new scheme, so there was no room to manoeuvre to improve the scheme beyond that cap. I believe that that significantly undermined the potential for a settlement. On 28 September, the Minister declared that he was pursuing agreement with five of the unions, excluding the PCS, and on 4 October a formal offer was submitted. On 11 October, PCS and the POA held a constructive meeting with the Minister, focusing on the cap on redundancy proposals and making proposals to redistribute from high earners to the vast majority of civil servants, enhancing the protection for the majority.
Mr Maude
The hon. Gentleman refers to a report of that meeting, but I can give him another account, because I was there—it was my meeting. No concrete proposals were made at that stage, and certainly not proposals that could in any way remotely or realistically redistribute benefits away from higher earners, whose payments are anyway capped under the scheme that we have agreed, towards the lower paid and particularly the lowest paid, who are much better protected now than they were under the previous Labour Government’s scheme of last February.
John McDonnell
My understanding is that on 11 October, PCS and POA tried to explore with the Minister opportunities to make the scheme fairer and more just for their members, and to set out certain parameters in which negotiations could take place. The PCS executive was scheduled to meet on 26 October to consider the next steps in its negotiations with the Government, but on 25 October it received a letter from the Minister, who told them that negotiations had been concluded and that he would implement the proposals that he set out on 4 October. I do not consider that an appropriate way to seek agreement.
As a result, PCS wrote to the Minister on 26 October to say that it was willing to submit proposals. He welcomed that offer and confirmed he would reopen talks if proposals came from the Council of Civil Service Unions, which is exactly what the PCS did—it submitted the parameters and proposals via the CCSU in a constructive approach to reach agreement. The Cabinet Office made no attempt to go into any detail on those proposals or to cost them, and on 9 November, the CCSU submitted terms to open the detail of talks with the Minister, who must have been aware of the background to that letter and of the detail of the PCS proposals. However, on 15 November, he said that the window for talks was closed. Although PCS sent a further letter on 16 November, it was informed that there would be no future talks.
That is a different historical account of those negotiations. The unions, which represented the vast majority of their members, were open to continuing talks to reach an agreed settlement. If amendment 1 had been in place before those talks, the House might have had a more objective historical account of the negotiations than the Minister or I have given—at least we would have had the opportunity of receiving a full report. However, the Minister’s amendments have denied us the opportunity of a report on those negotiations and allow a report only of future negotiations. That is extremely disappointing. It is another act that will undermine civil servants’ confidence that they are being treated fairly by the Government at this critical time in their lives—we are told that 360,000 of them will lose their jobs because of the comprehensive spending review and subsequently.
In addition to souring the industrial relations climate, the Government have opened up a vista of legal challenges—under article 11 of the European convention on human rights and article 1, protocol 1—which has occurred before. Amendment 1 is the Government’s attempt to find legal cover for their infringement of those articles, particularly article 11, but it does not go far enough. In fact, amendments 2 and 3 take away that cover completely in respect of the current negotiations. The Government’s proposals are legally precarious to say the least. I am sure that there will be a legal challenge from PCS. I believe that it will be successful.
In the previous Government’s negotiations, PCS threatened legal challenge, and it was advised by civil servants—they met us a week before the general election was declared—that the Government were confident of winning in court. The same civil servants advise this Government of the same thing. They were wrong before the election, and I believe that they are wrong now. In fact, PCS is yet to lose a case against the Government. We have the prospect of tens or perhaps hundreds of thousands of civil servants being made redundant. If the Government’s proposals are overturned, the civil servants who are made redundant under the imposed scheme could seek legal redress and compensation, which could run into many millions of pounds.
Mr Maude
I am grateful to the right hon. Member for Birmingham, Hodge Hill (Mr Byrne), who spoke from the Opposition Front Bench, and to my hon. Friend the Member for Birmingham, Yardley (John Hemming) for their support for the amendments and for where the Government have got to. I would like to say one or two words in response to the points that have been raised.
The first point to make is that the coalition Government are deeply committed to supporting the civil service and supporting its independence. We profoundly believe in the ethos of public service and political impartiality that motivates the civil service and with which it is imbued. We wish to support that, and, just as with the previous Government’s attempt to reform the compensation scheme, nothing in what we are attempting to do should be interpreted as anything other than a desire to treat people fairly and achieve the right balance between the interests of the taxpayer and the interests of hard-working, dedicated civil servants who, as the hon. Member for Hayes and Harlington (John McDonnell) said, have in many cases spent their lives in public service. We honour and respect that, and we want them to be treated fairly. I want to put that firmly on the record.
We were happy to accept the point that consultation must be serious, which is why we accepted an amendment that said that consultation has to take place with a view to reaching agreement. It is not enough for the Government to go through the motions. I do not think that anyone who has taken part in the consultations and negotiations that have brought us to this point would say that they were about going through the motions—I think the right hon. Member for Birmingham, Hodge Hill would bear that out. Rather, they were about serious work aimed at getting agreement, and it is a matter of great regret that such agreement has not been reached. The suggestion that the ability for collective bargaining has in some sense been reduced and that this is a breach of the European convention on human rights simply does not stack up. The changes that we are making actually strengthen the commitment to consultation, making it more necessary that, in making any future changes, the Government should consult seriously, with a view to reaching an agreement. The commitment on collective bargaining is enhanced, not diminished.
Mr Nigel Dodds (Belfast North) (DUP)
I have listened to the debate with great interest, particularly on the consultation with the POA, PCS and the other unions, but what is the position, both in the current negotiations and in any future consultations relating to the provisions that we are debating, on those who are not in unions? We found from our experience of negotiating with civil servants in Northern Ireland that many were not in unions, which raised a whole lot of other issues. How does that play into the consultation provisions that the right hon. Gentleman is introducing and the current negotiations?
Mr Maude
The right hon. Gentleman raises a good point, which is that it is by no means true that all civil servants belong to a trade union. The figures show that something in the region of 60% of civil servants belong to a trade union, but many are unrepresented. I am not sure that the Superannuation Act 1972 or what we are proposing in the Bill makes requisite any particular form of consultation with those who are unrepresented. However, he raises a good point that those who engage in future consultations should be alive to.
The hon. Member for Hayes and Harlington referred to his concern that, because the consultation requirement will not be commenced for two months, there will somehow be no obligation to consult. There has been extensive consultation. He raised concerns about the proposals that he claims were made by PCS and the POA, but the outline suggestions that eventually emerged from PCS, if implemented within the cost envelope, which I have always said exists and which would have existed under whichever Government were in power, would have had the effect of reducing the compensation available to those over pensionable age—that is, those over 50 and approaching retirement—and reducing the benefits available to the lowest paid. I say again that our primary concern has been to ensure that there is proper additional protection for those who are lower paid.
John McDonnell
I am sure that the right hon. Gentleman would not want inadvertently to mislead the House. Just for the record, that is contested by the unions themselves, because it was open to the discussions that the union was hoping to pursue with him, but which he declined.
Mr Maude
The concern raised by the unions at the time was that there was insufficient compensation in the scheme that we were developing with the other unions for those who were above the £23,000 salary underpin. We could have increased the compensation payments for them only by taking away from others. The only ways in which that could have been achieved—these suggestions were canvassed—would have been by lowering the £23,000 underpin so that all those earning less than that would have been penalised, or by taking away the significant protection that rightly continues to exist for those over 50. I recognise that someone who started work as a civil servant as a teenager straight after leaving school, and who has worked as nothing else until leaving the civil service in their 50s, might not find themselves in a fantastic place in the labour market. It is therefore right that there should be proper protection for people in those circumstances. That is why protecting those approaching retirement and the lowest paid people in the civil service was an absolute priority for us. I believe that the scheme that we have put in place meets those commitments and priorities.
Mr Michael McCann (East Kilbride, Strathaven and Lesmahagow) (Lab)
Two pieces of information have come out on this. First, we received a Cabinet Office circular from the right hon. Gentleman which sets out in detail how the negotiations went. It specifically makes the point that PCS made a proposal that would have reduced the amount of money being made available to lower paid staff in order to pay for enhanced benefits for those at the higher end of the scale. However, the trade unions have said that that is not the case. In order to give us more information about the negotiation process, can the Minister provide the figures to demonstrate how much would have needed to go to those at the top to cover those enhancements, and how much would have been taken away from those at the bottom?
Mr Maude
It is really hard to do that, because, as I pointed out in the letter that I sent to all Members, there were only outline suggestions made by PCS. Back in September, five of the unions—the five not including PCS—wrote to me with some proposals that they had signed up to, and that PCS had declined to sign up to. At their request, we entered into discussions with the five unions, and the ensuing proposals formed the basis of the new scheme that we have developed. They are not totally reflected in the scheme, but they formed the basis for it. I constantly and consistently urged PCS to join that process and to make concrete proposals, but it had declined to sign the letter that the other five unions had signed, despite being asked to do so by the five unions.
That protracted process involved meetings with Mark Serwotka of PCS and Steve Gillan of the POA, at which I urged them to make concrete proposals that would enable us to work towards a full agreement. All that emerged, however, after protracted delays, were outline suggestions. When asked how any additional protection for higher-paid people—not highly paid people, but those above the £23,000 underpin—was to be paid for, the only suggestions were either to lower the underpin, which would have meant that all lower-paid workers would have been penalised, or to reduce the protection available to those over 50. We were not willing to do that because providing protection was a priority for us.
John McDonnell
Following on from an earlier point, the Minister will know better than most of us that these negotiations are complex. He has said that it was difficult at times to calculate the overall consequences. That is why the Public and Commercial Services Union—through the Council of Civil Service Unions as the Minister requested—put forward outline proposals for detailed negotiations with staff. However, the Minister for the Cabinet Office then closed the window for those negotiations, just as they were becoming productive. There are complexities and if the Minister objected to issues like that, those points could have been taken up in the next round of negotiations.
Mr Maude
I have to take issue with the hon. Gentleman’s phrase about the process just beginning to become productive, because it was not. The outline suggestions were vague and the only way of paying for them would have been by taking money away from lower-paid workers or people approaching retirement. We explored whether there was any other source from which those funds could be redistributed, but it turned out that there were no alternatives.
John McDonnell
If that is the right hon. Gentleman’s only concern and his only objection to the position of PCS, supported by the POA, why can he not simply reopen negotiations now to resolve the matter?
Mr Maude
The hon. Gentleman talks as if this were a trifling consideration, but it is not. This process has been going on for three years. If the Bill goes through the remainder of its stages and on to the statute book, the new scheme that I hope to lay before Parliament before we rise for the Christmas recess, superseding the current scheme, will have been the product of many months—indeed, years—of protracted discussions. I know that he disagrees, but I have to say that despite repeated requests, the PCS has been tardy, to say the least, in coming forward with proposals and has, at best, made outline suggestions but never concrete proposals that could have formed the basis of an agreement. The other five unions did, and I am grateful to them for their engagement, which enabled us to forge a new scheme—as I said, we hope to lay it before Parliament next week—that will provide a fair balance between the interests of taxpayers and the interests of civil servants and protect those approaching retirement and the lowest paid.
John McDonnell
I am grateful to the Minister for giving way. Let me quote to him his statement to the House on 30 October, when he gave a commitment that he would “strain every sinew” to achieve a negotiated settlement. What I am suggesting is that, if he has identified an issue as an impediment to a negotiated settlement, he should now adhere to his commitment to strain every sinew and meet the unions again. It is no use repeating over and over again the fact that five out of six unions have agreed a settlement. They have not. The two unions that represent the vast majority of members have rejected the Minister’s proposals. Surely it behoves him now to go the extra mile and strain that extra sinew to seek a negotiated settlement before he provokes industrial action or legal challenge.
Mr Maude
Those are not concerns that have just arisen; they have been there throughout. I have been forthright in ventilating them with the leadership of the PCS and POA, and they know that. We have been clear about the envelope within which it would be possible to make changes because increasing protection for one group can be done only at the expense of other groups. There is no way around that. That is the basis on which we have formulated the new scheme, which I hope to lay before Parliament before the Christmas recess. That is the basis of my case.
Mr Deputy Speaker (Mr Lindsay Hoyle)
All the Lords amendments to the Bill engage the financial privilege of the House. If they are agreed to, the appropriate record will be made in the Journal of the House.
Lords amendment 1 agreed to, with Commons financial privileges waived.
Lords amendments 2 and 3 agreed to, with Commons financial privileges waived.
Clause 3
Final provisions
Mr Deputy Speaker
With this we may take Lords amendments 5 and 6 and amendment (a) thereto.
Mr Maude
The amendments respond to concerns raised by Opposition Members on Second Reading in the other place about the potential for the caps in what is now clause 2 to be revived after being put into abeyance, which is what I propose to do next week before the House rises and before the new scheme is laid. The Government also proposed the amendments to respond to the comments about the unusual use of a sunrise provision in clause 3(4)(c) that were made in the third report of the House of Lords Delegated Powers and Regulatory Reform Committee, published on 28 October. My noble Friend Lord Wallace of Saltaire provided a full response to the Committee in his letter of 1 December. We are grateful to the Committee for its report.
The Committee also commented on the other provisions in clause 3 which would enable, by order, the caps included in clause 2 to be repealed and also to be extended by six months at a time. That would override the so-called sunset provision in clause 3(3), which would otherwise mean that the caps on civil service compensation provided in clause 2 would expire automatically after 12 months. The Committee said that “these arrangements are complex”, but added that the two delegated powers
“do not appear to the Committee to be inappropriate”.
However, the Committee was not so persuaded of the need for the power in clause 3 to revive the caps in clause 2, that being an unlimited power that would have been available to any future Government in circumstances that we cannot predict today. The amendments respond to that point. The Government accept that there should not be an unlimited power to revive clause 2. Lords amendment 6 therefore provides for subsection 3(4)(c) itself to expire three years after Royal Assent, which is in effect a sunset of the sunrise provision. I can see why some people might say that that was a bit complex, but I think that, when fully parsed, it makes perfectly good sense.
The sunset of the power to revive clause 2 would mean that it would be there, as the Government intend, as a fallback to revive the caps in clause 2, just in case they were needed because of future problems in implementing the new civil service compensation scheme. However, the introduction of the three-year time limit should provide a reassurance that the power to revive clause 2 would not be available indefinitely to future Governments.
The caps are there as a potential fall-back so that we can be certain—as both the last Government and we have wanted to be—that we can reform the civil service compensation scheme. We have an absolute obligation, in the public interest, to address the unfair and unaffordable nature of the current scheme, and we need to ensure that if a legal challenge is mounted to our revised scheme—and it has been suggested that that may well happen—there is a fall-back option, albeit one that we have absolutely no desire to use. We do not expect or intend to use the powers to impose the caps in clause 2; what we want is to see in operation as quickly as possible is the reformed civil service compensation scheme. We are determined that, if all else fails, there will be a fall-back position so that we are not left high and dry—as the last Government were—because of a legal challenge to the details of the new scheme.
Before the new scheme is laid before Parliament, I intend an order to be made under clause 3(4)(a) to repeal the caps in clause 2 in relation to any new scheme. We intend the order to include a saving provision so that the caps could be applied if, and only if, the old unreformed scheme had to be reintroduced. The saving provision would allow that to happen automatically, without the need to use the revival power by order under clause 3(4)(c). I should make it clear that this saving provision would apply only if there were an attempt to revert to the old scheme. An order under clause 3(4)(c) would be required, subject to the affirmative procedure, if it were ever proposed to revive the caps in clause 2 and to impose them over the new civil service compensation scheme that will be put in place following the completion of this Bill’s passage.
Finally, unless further extended by order under clause 3(4)(b), clause 2 in its entirety—including the saving provision—will expire 12 months after Royal Assent. From that point on, any revival of the caps would have to use the order-making power in clause 3(4)(c), which, because of these Lords amendments, will be available only within three years of Royal Assent. I very much hope that by then the new civil service compensation scheme will be in place and be operating satisfactorily for all concerned—civil servants, departmental employers and the civil service trade unions—and that the taxpayers’ interests and the proper interests of civil servants will be being met. Amendments 4 and 5 are consequential on amendment 6.
John McDonnell
The House needs to be aware of what this measure actually means, and I make it clear that I will press my amendment to a Division.
Mr Byrne
I want to speak briefly about Lords amendments 4, 5 and 6, as well as amendment (a), tabled by my hon. Friend the Member for Hayes and Harlington (John McDonnell). During proceedings on the Bill, my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) has consistently raised concerns about the arbitrary caps that the Government introduced at the start of this process, which now form the body of clause 2. I confess that we are still not clear about why the caps are still in the Bill given that clause 1, which was newly introduced on Report, effectively gives the Government the power to impose any settlement after the consultations that we discussed earlier have been completed. We heard, in the Minister’s helpful update to the House, that there is a degree of agreement with at least some of the trade unions, which the Government have declared will supersede the terms in the Bill. Why then do they not seek to introduce a sharp instrument containing the specific terms they have agreed with the trade unions, rather than the blunt instrument containing general powers that is the Bill before us?
We are pleased that the Minister has given a clear commitment, in a letter to right hon. and hon. Members, that it is his ambition to
“repeal the caps in clause 3 insofar as they could impact on the new civil service compensation scheme”.
His letter also says that if the caps were ever revived he
“would table an order…so as to increase the caps to such a level that would…reflect what would otherwise apply under the new scheme.”
Most of us will welcome that good progress.
In earlier debates, we raised concerns that the Bill would allow the revival of caps at any time in the future even after a negotiated settlement was in place. We fear that the relevant measure, which the Government call a sunrise clause, would put an undesirable amount of power in their hands during negotiations, as they could simply threaten to revive statutory powers whenever they ran into any dispute on any matter, not just issues of redundancy. Given that it would allow the Government to resurrect the terms of a long-dead provision, it is not so much a sunrise clause as a zombie clause, which would live on for ever. Whatever we call it, the measure is entirely without precedent in a Bill of this nature. Indeed, the only recorded precedent of such a measure is in the Prevention of Terrorism Act 2005.
We are pleased that there will be a limit of three years on the caps if they are revived, and that the Government cannot extend that period. Given what the Minister has said this afternoon, however, I do not see how he can argue that the correct balance of time and the correct limit to any revived power should be three years. The whole House will welcome what the Minister said this afternoon about his ambition that the revival of the caps should never be triggered. If that is true—and I am prepared to accept that it is—I do not see why he cannot accept the very sensible amendment tabled by my hon. Friend the Member for Hayes and Harlington. Although we are happy to accept amendments from the Lords, we shall support amendment (a).
Mr Maude
The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) asked why we needed to keep the caps at all. The answer is simple. The caps will be established in primary legislation, but the new civil service compensation scheme, which I hope to lay before Parliament next week, before the House rises, does not have the full force of primary legislation, despite the changes to the Superannuation Act 1972 made by clause 1.
I shall be frank. We want to avoid being in the position that followed the High Court judgment in May this year, which resulted in the previous Government’s February scheme being quashed. The effect of the scheme being quashed is that the existing scheme remains unreformed and in force. Indeed, the old scheme—unaffordable, unsustainable and unreconstructed—is in force today. Of course, in preparing the new scheme we were at some pains to ensure that it would be legally robust, and we shall vigorously defend any legal challenge to it. However, as was apparent from the litigation against the previous Administration’s scheme, there can never be guarantees in litigation. Even litigation that is destined ultimately to fail can be disruptive, because of the uncertainty it causes until the case is concluded.
John McDonnell
Could we clarify what the Minister has just said? Is the provision he supports simply a device to be used to prevent UK courts from quashing the Government’s proposals?
Mr Maude
I shall be clear: both sides of the House have accepted that the current scheme is unsustainable and needs to be reformed. With the possible exception of the hon. Gentleman, everyone—and certainly Opposition Front Benchers—has accepted that it is unacceptable for it to be possible for a union, or two unions, to veto reform of the scheme. It must be possible for the Government and Parliament to effect reform of the civil service compensation scheme. If there is a successful legal challenge to a new civil service compensation scheme—unlikely though that may seem—we cannot have the position where the old scheme trundles on in its unsustainable, unaffordable and unfair form. That is why there must be a fall-back position for a limited period. We have listened to the arguments and we have accepted that it will be a limited period, so that caps on the use of the old scheme will be in existence, should the new scheme be quashed as the previous Government’s scheme was, by order of the High Court.
What is the right period for the power to revive the caps? Is it one year, three years, five years or 10 years? There is no precise science, because no one knows how long the period is beyond which we could be sure that a successful legal challenge would not be raised. It is our judgment that three years is the right period. That is the view that we have taken. That is why we urged the Lords to agree, and I urge the House to accept that view today. We would thus be agreeing with the Lords in their amendments, and disagreeing with the amendment proposed by the hon. Member for Hayes and Harlington.
Lords amendment 4 agreed to, with Commons financial privileges waived.
Lords amendment 5 agreed to, with Commons financial privileges waived.
Amendment (a) proposed to Lords amendment 6.—(John McDonnell.)
Question put, That the amendment be made.
Oral Answers to Questions
Lord Maude of Horsham Excerpts(13 years, 5 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Stephen Phillips
One of the problems with the delivery of public services in the past was the previous Government’s focus on delivery through either private contractors or existing local and central Government bodies. Many public sector workers were thus prevented from suggesting innovative ideas for the more efficient and cost-effective delivery of services. How will they now be encouraged to come forward with their ideas?
Mr Maude
We have already encouraged them to come forward with ideas. As part of the spending challenge that we launched in the summer, we invited public sector workers to come up with ideas to save money while protecting front-line services, and 65,000 of them did so, indicating a huge amount of pent-up frustration. We are now encouraging as many of them as possible who are interested not only in having ideas but in putting them into effect to form worker co-operatives to spin out of the public sector while continuing to deliver services.
Jon Trickett (Hemsworth) (Lab)
Given that there are strict procurement rules designed to demonstrate probity and value for money, and to avoid political interference, does the Minister think that it was wise for the Department for Education to hand out a £500,000 contract to the New Schools Network, an organisation led by a former associate of the Secretary of State? Was that contract fully compliant with all the relevant tendering regulations?
James Morris (Halesowen and Rowley Regis) (Con)
2. What progress he has made on the establishment of public sector mutuals.
Alun Cairns (Vale of Glamorgan) (Con)
9. What progress he has made on establishing public sector mutuals.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I announced last week that every Department will put in place “rights to provide” for public sector workers to take over the running of their services. The first wave of 12 pathfinder projects was launched in August this year. Leading organisations in the sector, including Local Partnerships, the Employee Ownership Association and Co-operatives UK, have come together to launch an information and support service for public sector workers interested in mutualisation. I hope that Members on both sides of the House will encourage and support these worker co-operatives.
James Morris
Many public sector organisations and employees in my constituency are interested in this idea. Will my right hon. Friend clarify whether he sees these policies applying more to local community organisations, or whether he envisages organisations on the scale of, say, NHS trusts being able to take on mutual status?
Mr Maude
I do not think that we should be prescriptive about how large or small, or how local or broad, these co-operatives could be. The pathfinders range enormously in size: I think that the smallest has only three potential employees or members, while the largest has 1,100, and it is possible to imagine them being even larger. I hope that groups of public sector workers from right across the sector will consider whether this could be a good route forward for them to take, and we will make it as easy as possible for them to take it.
Alun Cairns
What action is the Minister taking to protect the interests of innovative public sector workers who come up with exciting ideas for public sector mutuals, but whose senior management do not support them because it might not be in their personal interest to do so?
Mr Maude
It is possible that such a situation could come about, which is why we have encouraged the organisations that I mentioned to set up the information and support service for groups of public sector workers. We will also establish a challenge group, into which this service can feed thoughts and suggestions. If there are concerns that middle and senior managers are obstructing the right of public sector workers to form these co-operatives, I hope that people will feed them directly to us, through the challenge group, so that we can take the appropriate steps.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
Does the Minister accept that there is a fundamental difference between a worker co-operative and an organisation that is fully mutual? Can he assure me that there will be a democratic process within public sector mutuals and that there will be a membership element to it?
Mr Maude
We do not have a dogmatic view about exactly what form these should take. I hope there will be considerable innovation. Some will want to form joint ventures with outside providers; in other entities, the Government or whatever other state agency is the commissioning body might want to retain a stake in the organisation. There will be strong democratic worker involvement in many of them, but the key element is a degree of ownership by the employees themselves.
Lindsay Roy (Glenrothes) (Lab)
May I probe the Minister further on what specific advice and support the Government are offering to organisations that wish to become mutuals or co-operatives?
Mr Maude
A range of advice is available. The 12 pathfinder projects are supported by organisations that are able to provide support—for example, Co-operatives UK and the John Lewis Partnership, which have enormous experience in this area. The advice and support service that these organisations are putting together will be able directly to channel support and advice from organisations such as the Employee Ownership Association. That should help organisations to find the right advice for the particular circumstances of a particular group of workers.
Mr David Ruffley (Bury St Edmunds) (Con)
3. What steps he is taking to increase the participation of voluntary and charitable bodies in bidding processes for Government contracts.
Mr David Amess (Southend West) (Con)
6. What estimate he has made of the change in his Department’s spending on consultancy between 2009-10 and 2010-11.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The Government have cut the previous Government’s profligate spending on consultancy. In the first six months of this financial year, consulting spend by the Cabinet Office fell by 42% compared with the trajectory for the previous year. In the first six months of this year, consulting spend right across central Government fell by £350 million—or more than 50%, so it has more than halved—compared with the same period last year.
Mr Maude
I can only assume that the proper processes were followed, because this happened under the previous Government, when the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) was Minister for the Cabinet Office. Any suggestions of a conflict of interest arising from the position of the Deputy Prime Minister’s wife are wholly misplaced, because the contract was placed before he was anywhere near government.
Mr Denis MacShane (Rotherham) (Lab)
I welcome the Minister’s statement on a reduction in consultancy fees, but hundreds of millions of pounds of taxpayers’ money is still being spent with these firms. Why does he not simply say no and get civil servants to do their jobs?
Mr Maude
I am grateful for the right hon. Gentleman’s robust support for this Government’s change in direction from that taken by the Government of whom he was a member. We believe that the incontinent use of consultants is demeaning for civil servants, who would, in many cases, like to be doing this work and are very capable of doing it. [Interruption.]
Mr Speaker
Order. Far too many private conversations are taking place in the Chamber. This is very discourteous and it should end.
Jeremy Lefroy (Stafford) (Con)
10. What recent progress he has made on his proposals for reform of the civil service compensation scheme.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The Superannuation Bill, which will impose caps on compensation payments and permit the reform of the civil service compensation scheme, is proceeding through the other place. I remain confident of being able to introduce a new scheme before the House rises.
Claire Perry
I thank the Minister for that reply. More than 30% of the work force in my constituency are employed by the public sector, given the heavy proportion of Army personnel and Ministry of Defence civil servants. Many of the MOD civil servants are members of the Public and Commercial Services union. Has it come to the table and joined the negotiations, or does it still stand alone?
Mr Maude
Sadly, despite repeated invitations, the PCS has not come forward with concrete proposals. The other five unions engaged constructively and their proposals formed the basis for the new scheme that we have developed. I am sorry that the PCS, which represents so many civil servants, particularly lower-paid civil servants, has not chosen to take part in a constructive spirit.
Jeremy Lefroy
In my right hon. Friend’s proposals for reforming the scheme, what account is he taking of the protection of the lowest paid staff in the civil service?
Mr Maude
That has been our principal concern in fashioning a new scheme. Civil servants’ average pay is lower than that in the private sector and the wider public sector, and it is right that they should be at the forefront of our concerns. The scheme that we have developed, in negotiation and consultation with five of the six unions, gives particular protection for them by deeming that the salary on which their compensation calculation is based is £23,000, so anyone paid less than that will have their compensation calculated on that basis.
Dr Julian Huppert (Cambridge) (LD)
8. How his Department plans to measure and promote well-being.
Directgov (Review)
Lord Maude of Horsham Excerpts(13 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
I invited Martha Lane Fox, the Government’s digital champion, to undertake a strategic review of Directgov which was completed on 14 October 2010. This supported the work that the Efficiency and Reform Board had undertaken on channel shift and the opportunity for digital channels to support delivery of the spending review. The Chief Secretary to the Treasury and I wrote to Departments in September outlining our commitment to improving services and driving efficiencies by making digital the default channel for Government information and transactional services.
Martha Lane Fox submitted her report “Directgov 2010 and beyond: revolution not evolution” to me in October. The report places Directgov in the context of how Government should use the internet both to communicate and interact better with citizens and to deliver significant efficiency savings from making digital the default delivery channel for Government information and services.
I have written to Martha Lane Fox today thanking her for her report and saying that I am minded to accept her proposals in full, but that I will need to consult colleagues before making any final decisions about how to take them forward. I have placed Martha Lane Fox’s report and my response in the Library. Both documents are also available on the Cabinet Office website (www.cabinetoffice.gov.uk)
I expect quick and broad agreement on some of Martha Lane Fox’s proposals where we can make rapid progress and that in some areas—such as moving to a single domain for Government—I will have to work with Departments to test different approaches and work through the details and timescales. It is important to set a clear direction of travel and that is what I have done in my reply as the initial Government response to Martha Lane Fox’s proposals.
Departmental Expenditure Limits
Lord Maude of Horsham Excerpts(13 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Subject to parliamentary approval of the winter supplementary estimate 2010-11, the Cabinet Office total departmental expenditure limit (DEL) will be increased by £229,588,000 from £329,499,000 to £559,087,000.
The impact on resources and capital is set out in the following table:
Government Spending Data (Publication)
Lord Maude of Horsham Excerpts(13 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Today we have released all Government spend processed since the Government took office. This set of data is the key to so much that this Government wants to achieve—driving value for money by forcing accountability for every penny spent, encouraging competition and innovation in providing services and driving economic growth.
Starting from now, and updated every month, each Government Department will publish on www.Data.gov.uk every item of spending over £25,000. Some Departments are going even further by publishing everything over £500. Each item will be listed in detail, with the date of transaction, the value, the name of the contractor and the description of the good or service purchased.
It is our defining purpose to bring about a power shift in this country—to transfer control to individuals and neighbourhoods. Control over public services so people decide the things that really matter to them—the school they send their child to or the hospital they get treated in. And because information is power, transparency is a crucial part of this power shift. After all, it is information that lets people take on the political class, question them, demand answers and get those answers. It is information that lets people choose between different public services, increasing competition and raising standards.
Employee-led Mutual Organisations
Lord Maude of Horsham Excerpts(13 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Today, I am setting-out the steps the Government are taking to support workers to establish employee-led mutual organisations.
Every Government Department will put in place a “Right to Provide”—a right for public sector workers to take over the running of services.
These rights will not be uniform across Departments because each Department’s requirements will be different. The rights will be as far reaching as possible, but we accept there will be areas where it will not be possible to mutualise, for example, because of security or operational stability concerns. It will be for Departments to set these areas out.
Cabinet Office will work with Departments to explore where public procurement processes allow for staff forming a mutual to be awarded a contract to continue providing services. Mutuals will have to negotiate contracts with the applicable Department or local commissioning body, which show how they will provide services while minimising administration and overheads.
In developing and implementing these new rights it is important that central Government lead by example. I will announce today that the Government will develop a right for civil servants directly employed by Departments to form mutuals. In the wider public sector workforce, it will be necessary for Government to work with local public sector bodies and employers.
The Government will not seek to dictate what is best for employees and for the users of services; rather the precise model of mutualisation should follow the service being provided; this could for example include joint ventures.
I am establishing a “challenge group” in Government to advise me and other ministerial colleagues about how we can best enable the success of this policy. This group will convene key policymakers and experts to drive the changes to policy and process necessary across Whitehall.
From spring 2011, the Government will invest over £10 million to fund a programme of support for some of the most promising and innovative mutuals so that they reach the point of investment readiness. This will build on the work of leading organisations in the sector to develop a network within which public sector employees, investors and public service commissioners can develop viable businesses.
The new suite of Rights to Provide are part of the Government’s broader commitment to ensure that a much wider range of organisations can deliver excellent and efficient public services. The Government will publish a White Paper on reform early next year, setting out where we can go further to shift power away from central Government to citizens, communities and independent providers.
London Regional Committee Report (Government Response)
Lord Maude of Horsham Excerpts(13 years, 6 months ago)
Written StatementsRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
The report by the House of Commons London Regional Committee on their only inquiry into London’s population and the 2011 census was published on 31 March 2010 (HC 349). This Government did not re-establish the Regional Committees. They recognise the importance of providing a response to Parliament on the issues raised by the Committee. The majority of the recommendations in the report were for the Office for National Statistics (ONS). Two of the Committee’s recommendations were for Government and this written ministerial statement provides the Government’s response. The other recommendations were for ONS and I have placed today a copy of its response in the Library of the House.
This Government have serious concerns about the 2011 census introduced by the previous Parliament. Having given the issue serious consideration, and the costs already incurred, the 2011 census is the only way that unique information can be provided to meet essential UK and EU requirements in the given timeframe at no extra cost than that budgeted. It is important that the 2011 census goes ahead and this Government will continue to promote the importance of the public engaging with the 2011 census.
Given the highly mobile nature of the population, the UK Statistics Authority recognises the increasing difficulties and costs in carrying out a census. The authority has therefore instructed ONS to urgently work on developing alternatives, with the intention that the 2011 census is the last of its kind.
Recommendation 21 of the Committee’s report was dealt with by the previous Government, with my predecessor writing to the Chair of the Committee shortly before the report was published.
Recommendation 14 of the report was on the need for the census address register being developed by the ONS for the 2011 census to be maintained after the census. The previous Government failed to deliver a definitive address register, despite the demands for such a register and the associated costs of inefficiency in maintaining a number of similar registers. This Government are working with the parties concerned and will look to deliver a definitive register. Considerable progress has already been achieved. The work ONS has done will form part of the solution.
Oral Answers to Questions
Lord Maude of Horsham Excerpts(13 years, 7 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
Julian Smith (Skipton and Ripon) (Con)
8. What steps he has taken to increase the efficiency of his Department’s mechanisms for Government procurement.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Procurements of major projects by the British Government have typically taken 77 weeks. They have frequently involved the extensive use of external consultants. That process is costly and wasteful, excluding small businesses, social enterprises, and voluntary and charitable organisations. That results in procurements that are too often uncompetitive, delayed, expensive and ineffective. We are taking steps to streamline the process. In the meantime, we are renegotiating contracts with the bigger suppliers to the Government on a single-customer basis, thus leveraging the Government’s buying power. That will deliver some £800 million-worth of savings in this financial year alone.
Stuart Andrew
Sir Philip Green’s report showed just how little time the previous Government afforded to the basic principles of cost-effective commissioning and procurement. Does the Minister feel that that attitude is embodied in the ill-considered note left by the ex-Chief Secretary to the Treasury as he left his old job?
Mr Maude
If the last Government, including the right hon. Gentleman, had bothered to spend the time that we are spending getting into the unglamorous parts of Government spending to find out just how much money can be saved, he might not have felt it necessary to leave a note in quite the stark terms that he did, true though it was. The fact is that there is a huge amount of wasteful spending. Sir Philip Green has done a sterling service in picking up some stones and providing the evidence for that, and we will be acting on his recommendations to see how we can take costs out of the overheads of Government. That is the best way to protect front-line services and to protect the jobs of dedicated public servants, which the right hon. Gentleman claims to care about.
Julian Smith
Does my right hon. Friend agree that small business has been locked out of the procurement process for far too long? Will he start to give small businesses, particularly those in Yorkshire, a fairer crack of the whip?
Mr Maude
A big benefit arising from the changes that we are proposing to make to the way in which services are procured is that they will open the door to smaller businesses. Over-prescriptive procurements make it very expensive for small businesses to take the risk of committing to tendering, and they tend to be excluded on a self-selecting basis. We want to change that. It is our aspiration that 25% of contracts should be let with small and medium-sized enterprises. That is the direction in which we hope to go, and I am sure that my hon. Friend’s constituents in Yorkshire will take full advantage of it.
Gordon Banks (Ochil and South Perthshire) (Lab)
Will the Minister be able to publish information in future to show that his aspiration to help small business is not just an aspiration but a reality?
Mr Maude
One of the stark conclusions of Sir Philip Green’s review was that the quality of Government data is lamentably poor. It is not easy to know exactly what the position is. The right hon. Member for Birmingham, Hodge Hill (Mr Byrne) referred to the lack of centrally held data about contracts with the voluntary and charitable sector; that merely begins to illustrate the problem.
Mr Nigel Dodds (Belfast North) (DUP)
The Minister talks about small and medium-sized enterprises gaining more from Government contracts, but can he indicate what he is doing to ensure that there is a good spread of that throughout all regions of the United Kingdom?
Mr Maude
All regions and nations across the United Kingdom should be able to benefit from that aspiration. We are going to expose much more widely the tender documents that are available so that small businesses will find it much easier to take part in these sometimes quite intimidating processes that have excluded many of them in the past. [Interruption.]
Mr Speaker
Order. I understand that the House is eagerly anticipating later business, but when there is a constant hubbub it is very discourteous and most unfair both on the person wanting to ask the question and on the Minister deputed to answer it.
Chris Skidmore (Kingswood) (Con)
13. What recent progress has been made on his Department’s review of non-departmental public bodies.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Last week I announced the first results of the Government’s review of quangos. This is a work in progress; the principal aim is to increase accountability. We believe that where the state carries out a function it should be accountable to a Minister or to a local council unless one of three rigorous tests is met. To pass, the function must be purely technical, tasked with measuring facts or figures, or plainly required to be politically impartial. We reviewed 901 bodies and intend that nearly 200 will cease to be NDPBs, and we will merge a further 118 and substantially reform a further 171.
Charlie Elphicke
Does the Minister agree that the review should include the misuse of public funds by quangos and public sector balance sheet organisations in paying lobbyists to brief against the Government or elected Members in the execution of their mandates?
Mr Maude
Guidelines already limit the use of external consultants for those purposes, and we intend to tighten them further, because the public find it quite offensive that a quango should be spending taxpayers’ money on hiring external consultants to lobby the Government to encourage them to spend more taxpayers’ money.
Chris Skidmore
Will the Minister tell the House how many quangos were created by the previous Government and, of those, how many will remain as a result of the changes that he is introducing?
Albert Owen (Ynys Môn) (Lab)
Last week the Minister announced that many quangos would be done away with and their responsibilities transferred to third sector organisations. Will he assure the House and myself that those organisations, such as citizens advice bureaux, will be properly resourced so that they can provide people with specialised advice? Will he dispel the myth that this is being done on the cheap?
Mr Maude
The aim of the quango review is not particularly to save costs or money—although it will—but principally to increase accountability. When functions are transferred, such as consumer advocacy functions to CABs, there will be a transfer of resources. The hon. Gentleman will have to wait a little longer to hear the extent of those resources.
Mr David Lammy (Tottenham) (Lab)
Why does the Minister intend to disembowel the Equality and Human Rights Commission? Does he not believe that its responsibility to promote equality on behalf of women and ethnic minorities is important? Why is he reducing it to a purely regulatory body?
Mr Maude
Many people felt that that body was not spending taxpayers’ money well. Its function is important and we concluded that it justified the EHRC continuing to exist as an independent body, but given that we are facing a situation in which, as the former Chief Secretary helpfully pointed out, there is no money left, significant savings have to be made. The EHRC will have to play its part in that.
Mary Macleod (Brentford and Isleworth) (Con)
4. What recent progress has been made on establishing the national citizen service.
Stephen Metcalfe (South Basildon and East Thurrock) (Con)
6. What recent progress has been made in delivering his Department’s policies on Government commissioning and procurement.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Commissioning is currently too prescriptive; tender documents can be immensely lengthy, specifying every detail of every step in every process. That stifles innovation, excludes new entrants to the market and adds wholly unnecessary cost. We intend that commissioning should be outcome-based, leaving much more scope for innovative providers from the social enterprise, voluntary, charitable and small business sectors to bid. Whenever possible, commissioning should be based on a payment-by-results model.
On procurement, I refer my hon. Friend to my reply to Question 2. [Interruption.]
Mr Speaker
Order. Once again, I understand the excitement and anticipation, but the House must come to order. Such conduct makes a bad impression on the electorate, whose support we so recently sought.
Stephen Metcalfe
I thank my right hon. Friend the Minister for his answer. Following his earlier comments, I seek assurance that small and medium-sized enterprises in my constituency can access Government contracts. Can he give me any examples of practical help now or in future that would make that easier to achieve?
Mr Maude
We certainly hope that that will be the case. It is our aspiration that 25% of Government contracts should end up in the small and medium-sized sector. We are committed to publishing online, in an easily accessible form, all Government tender documents. That will make it much easier for small businesses, which can otherwise be put off the process, to take part.
Jon Trickett (Hemsworth) (Lab)
In terms of commissioning and procurement, the public sector procures £13 billion-worth of services from the charitable sector. On Monday, a think-tank suggested that the Government’s statement today will wipe out about £5 billion of that procurement—the whole of the increase that was achieved in the past 10 years. What are the Minister’s intentions for funding the voluntary sector? How does he reconcile cuts in that sector with the Prime Minister’s aspiration for the big society?
Mr Maude
We are very aware of concerns in the sector. The Chancellor is very aware of them, and will have something to say about the matter a little later. However, there must be reductions in public spending for the simple reason that the former Chief Secretary set out with such uncharacteristic lucidity in his valedictory note.
Mark Pawsey (Rugby) (Con)
10. What steps his Department is taking to share best practice in procurement among Departments.
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Procurement of basic commodities was carried out without any effort to leverage the scale and buying power of the whole Government—[Interruption.]
Mr Speaker
Order. I understand the excitement, but I hope that that practice, which was discontinued some time ago, will be discontinued in future. The Minister must be heard.
Mr Maude
That led to one part of the Government buying basic office supplies at seven and a half times the cost that other parts incurred. Allowing wasteful spending of that type to remain unreformed would mean that front-line services and the jobs of dedicated public servants would be more at risk. We are mandating that all Departments and public bodies should in future buy through supplier contracts negotiated on behalf of the whole of central Government. That will cut the costs of Government overheads by some—[Interruption]
Mr Speaker
Order—[Interruption.] Order. In so far as we could hear the Minister, I think we have got the drift of it.
Mark Pawsey
I thank the Minister for his reply in as much as I heard it. It is sound commercial practice to maximise buying power by adding together the purchases of all bodies within an organisation and to use that to drive down prices from suppliers, yet Sir Philip Green found waste arising from huge variation in the prices paid by different Departments. What steps will the Minister take to co-ordinate Government procurement in future?
Dr Alan Whitehead (Southampton, Test) (Lab)
Will the Minister ensure that best practice in sustainable and green procurement is part of his briefing in ensuring best practice in Departments, and does he consider that the abolition of the Sustainable Development Commission will help or hinder him in that process?
Public Bodies Reform
Lord Maude of Horsham Excerpts(13 years, 7 months ago)
Commons ChamberRead Full debate Read Hansard Text Read Debate Ministerial Extracts
The Minister for the Cabinet Office and Paymaster General (Mr Francis Maude)
Today, the Government have taken decisive action to restore accountability and responsibility to public life. For too long, this country has tolerated Ministers who duck the difficult decisions they were elected to make. For too long, we have had too many people who were unaccountable, with a licence to meddle in people’s lives. For too long, we have had quango pay spiralling out of control, so that seven people in the Audit Commission are paid more than £150,000 a year at a time when the average civil servant’s pay is £23,000.
The landscape for public bodies needs radical reform to increase transparency and accountability, to cut out duplication of activity and to discontinue activities that are simply no longer needed. My written statement this morning outlined the start of a process to curtail the quango state. I have led an intensive review into public bodies, subjecting each to four tests. The first test was existential and asked, does the body need to exist and do its functions need to be carried out at all? The answer to that question in some cases was no. For example, we decided that the Government probably do not need an independent body to deliberate on the purchase of wine.
If, as in most cases, the body’s functions were deemed necessary, we then sought to establish whether those functions should properly be carried out at arm’s length to government. If the body carries out a highly technical activity, is required to be politically impartial or needs to act independently to establish facts, then it is right for it to remain outside direct ministerial accountability. That is the case with bodies such as the new Office for Budget Responsibility and Ofgem. However, any quango that does not meet one of these tests will be either brought back into a Department or devolved to local authorities—in both of which cases, there will be democratic accountability—or its functions will be carried out outside the state altogether in the private or voluntary sectors.
We have gone through an extensive process to determine the outcome of the review. Our first task was quite simply to identify how many quangos there are and what they do. It may sound absurd but it was and remains incredibly difficult to gain firm information on such bodies. Many do not publish accounts, there is no central list and there are myriad different types all with different statuses. The official list of non-departmental public bodies has 679 bodies, excluding those in Northern Ireland, but that does not include non-ministerial Departments, Government-owned public corporations or trading funds. Our review covered 901 bodies and we believe, but cannot be certain, that that is the true extent of the landscape. I stress that departmental agencies—Executive agencies—are not in the review’s scope. They are directly controlled by Ministers who are accountable to Parliament for what they do.
Once we established the overall lists, each Department went through a rigorous process to determine whether each of its quangos met any of the tests. The list I have published today is not complete but is a work in progress. The House will note that a number of bodies are subject to a longer-term review—for example, the Children’s Commissioner and the Office for Fair Access.
Of the 901 bodies in the review, substantial reforms are proposed for more than half. We propose that 192 should cease to be public bodies at all and that 118 should be merged down into 57 successor bodies, removing wasteful and complicating duplication of effort. Some 171 bodies are proposed for substantial reform while retaining their current status. For those bodies that we are abolishing, I stress that in many cases that does not mean the end of the function. Abolishing the regional development agencies, for example, does not mean that we no longer care about promoting regional business—[Interruption.] The Opposition’s response is very revealing, because it suggests something fundamental about what we are trying to change: the assumption that one can prove that one cares about something only if one sets up a quango. We think that there is a different and a better answer, and that we can promote regional business in a better way.
Since the introduction of RDAs, regional imbalances have become not better, but worse, and the development agencies carried a staggering £212 million in administration costs. We believe that local businesses and local authorities are better placed to decide what they need, not highly paid executives imposed on them by Government. An activity does not need an unaccountable bureaucratic structure to signify its importance; the exact converse is true. If something is important, someone who is elected should make decisions about how it is done. That is why we are bringing a host of functions back into Departments, such as those of the Child Maintenance and Enforcement Commission and the Renewable Fuels Agency to name but two.
All remaining public bodies will be subject to a rigorous triennial review to ensure that the previous pattern of public bodies often outliving the purpose for which they were established is not repeated. They will be expected to become more open, accountable and efficient. In the new year, I shall outline to the House in more detail the new framework for those remaining quangos.
All proposed changes will be delivered within Departments’ spending review settlements. Those bodies whose status is being retained may be subjected to further reforms following the spending review, in the same way as all other parts of the public sector. I want to acknowledge the dedication and hard work of those who work in public bodies. We are committed to working with the chairs and chief executives of those bodies to ensure that change is conducted as fairly and as smoothly as possible.
To enable the proposed changes to be implemented, the Government will shortly introduce a public bodies Bill, which will give Ministers power to make changes to named statutory bodies. Other forthcoming legislation, such as the education Bill and the localism Bill, will also be used to make changes directly.
I believe that these reforms are the first and necessary step to restoring proper democratic accountability to public life. They signal a complete culture change in government, from one that ducks difficult decisions, is opaque and allows profligacy, inflated salaries and waste, to an Administration who are open and transparent about what they do, with Ministers who take responsibility for their actions and are mindful of every penny of taxpayers’ money. I commend these reforms to the House.
Mr Liam Byrne (Birmingham, Hodge Hill) (Lab)
I am very grateful to the right hon. Gentleman for early sight of his statement—in the Financial Times, The Guardian and The Daily Telegraph this morning. He is a man who appreciates the courtesies of this House, so I know that he will provide you, Mr Speaker, with an explanation of how the media could possibly have been briefed before Members were.
May I, however, start on a note of consensus? I thank the Minister for his work in completing a process that was set in train during my time at the Treasury. In March I told the House that 123 quangos would need to close, and from first glance at this statement it appears that two thirds of the 192 arm’s length bodies that need to close are those that I announced in March. Instead of 20% of quangos being closed, the Minister has announced that 25% will be.
I am grateful, too, that his tests largely confirmed the approach that I set out in March. I welcome his endorsement of the principles of a sunset clause for quangos and of triennial reviews. I am especially grateful for his confirmation of our decision to mutualise British Waterways, which will be an important institution in the third sector that I know we both support.
May I, however, raise the slightly obvious question about the way in which the right hon. Gentleman has conducted this exercise? All of us want to improve accountability—it was one of the three principles that we set out in the ALB review in March—but we also want to save money, and once upon a time I thought that the current Prime Minister agreed, because, in a typically thoughtful and measured intervention, he said in October 2008:
“Sound money means…destroying all these useless quangos and initiatives.”
Now the Minister tells us that the Prime Minister in fact got it wrong. Saving money
“is not the principal objective”,
he told the “Today” programme this morning.
Labour’s plan would have saved £500 billion by 2012-13. Now we are told that the Government’s approach will not in all cases save money at all. In fact, it could cost more money than it saves at the Audit Commission, the RDAs, the UK Film Council, Standards for England and the Human Fertilisation and Embryology Authority. I am afraid that the Minister has become the most expensive butcher in the country. His friend the Chancellor will no doubt be delighted.
Will the Minister, first, set out the total cost of implementing the plan this year and next? He should have those figures at his fingertips now that the review is almost complete. Secondly, can he explain the impact on jobs and unemployment? Organisations such as the UK Film Council help to strengthen industry and tax revenues. What estimate has he made of the impact of his announcement on growth and jobs?
Thirdly, the principle of independence is sometimes important, and I am glad that he acknowledges that, but it is not clear how he has applied it in all cases. For example, we need to hear a little more from the Minister about the Football Licensing Authority. The Secretary of State for Culture, Media and Sport infamously had to apologise for blaming Liverpool fans for the Hillsborough tragedy; now the Government are scrapping the organisation established to ensure that a Hillsborough never happens again, without being clear about what will be put in its place.
Finally, in March I introduced a new principle whereby quangos would be set up only as a last resort. The Minister’s statement confirms his presumption that state activity should be undertaken by bodies that are democratically accountable. His party’s manifesto promised 20 new quangos—one third of the extra quangos that he has abolished today. Will he confirm that those quangos will not go ahead?
Mr Maude
It is very good to have such a consensual approach from the man who famously told the world on leaving government that there was no money left. There will be savings as a result of the process, and there need to be because the right hon. Gentleman was a prominent member of a Government who left office spending £4 for every £3 of revenue. They were having to borrow £1 out of every £4 just to keep the lights on, the teachers in the schools, the pensions being paid and the doctors and nurses in the hospitals. This Government have to clear up the mess that his Government shamefully left behind, and there will be savings from the process.
Mr Maude
We became used to the previous Labour Government bandying around large numbers in respect of the savings that they proposed to make, but we know that when the National Audit Office went around after those much vaunted efficiency exercises over which he and his colleagues presided, it found that in most cases they had not saved money at all. It was all about the optics and trying to make a point; it had nothing to do with reality.
I am sorry to say that jobs will be lost as a result of this process, but, in order to clear up the fiscal mess that the right hon. Gentleman’s Government left behind, that is sadly an inevitability. Savings will be made as a result of the exercise, but, as I said at the outset, it is not principally about saving money, although it will do so. It is principally about increasing accountability—the important presumption that when an activity is carried out by the state, and there is no pressing need to do so at arm’s length from government, it should be carried out by someone who is accountable democratically, either a Minister who is accountable to this House and, through this House, to the public, or a local authority that is accountable to local residents.
It is very good that the right hon. Gentleman agrees with our approach and thinks it sensible. He tried to claim credit for it himself, actually, so, as the various bodies that we have discussed today start to complain, as some will, and as some vested interests will with a very loud voice, I shall be able to tell them that our approach is a consensual one—that the Labour party wants to play its full part in responsibility for the whole exercise.
Mr Maude
The hon. Member for Bolsover (Mr Skinner) says, rather regretfully, “Not very much.” It sounds as though he wants us to be more regulated and bossed around—that is somehow in his nature.
The answer to my right hon. Friend the Member for Wokingham (Mr Redwood) is that some functions will not be carried out at all. The key point is that the presumption will be that where there is a state activity, at least he and the rest of the House will be able to hold a Minister to account for what is done. What people find so irritating is the sense that there has been incontinently set up, in large part by the previous Government, this huge amount of activity by bodies that are in no way accountable: no one can hold them accountable for what they do. That is what we are seeking to change.
Mr Jack Straw (Blackburn) (Lab)
May I first invite the Minister, in the spirit of consensus that we certainly want on this, to show just a tiny bit of humility in recognising that the high point of the unaccountable quango state was under the Major Government, of whom he was, I think, an adornment? At that time, outrageously, as I found when I became Home Secretary, having endured it in opposition, even parliamentary questions to the Secretary of State about prisons were being answered not by a Minister but by the chief executive of the agency concerned. That was preposterous and it happened under a Conservative Government, but we ended it very quickly. I hope that he recognises that the history goes right back to the Major Government.
Secondly, may I ask the Minister a specific question about the Youth Justice Board? I set that up; I accept that it does not have life eternal and that there is a case for reviewing its future. However, will he ensure that as its future is reviewed, its key functions of delivering effective youth justice are preserved?
Mr Maude
It is a pleasure to welcome the right hon. Gentleman into our big tent; it is open to all-comers, and it is a delight to have him as a resident. I think that he confuses the role of Executive agencies with the function of a quango. It seems to me perfectly proper that when Members of Parliament inquire about an activity they receive a reply from the Executive agency’s chief executive. That does not mean that that agency is not accountable to Parliament through what a Minister says and does. The right hon. Gentleman will have found himself, as Home Secretary, directly accountable to this House for those functions.
Some of the functions performed by the Youth Justice Board will continue to be very important, but we take the view that the need for independent oversight of the process has now outlived its usefulness.
Andrew Bingham (High Peak) (Con)
I am pleased to hear my right hon. Friend say that overall costs will be reduced. A Local Government Association publication of December last year outlined 790 quangos costing £43 billion. How can he ensure that more quangos will not reappear as some disappear?
Mr Maude
I am sure that there will occasionally be a case for new independent bodies coming into existence, but they will need to meet rigorous tests. They will need to show that they are needed to provide a seriously technical function, or that the function has to be carried out in a way that is demonstrably politically impartial, or that they are measuring facts in some way that requires independence. The Office for Budget Responsibility, which my right hon. Friend the Chancellor set up early in the life of this Government, is one such body that meets all those tests. They will have to go through a rigorous process before consent is given to their creation.
Mr George Howarth (Knowsley) (Lab)
Does the Minister accept that some of these bodies were set up almost as debts of honour? I particularly mention the Football Licensing Authority and the Human Tissue Authority, which were set up respectively after the Hillsborough stadium disaster and the scandal at Alder Hey hospital. Does he accept that a lot of people who were affected by those events will be aghast that that debt of honour has now been reneged on by this Government?
Mr Maude
I hear what the right hon. Gentleman says, and I know how deeply he, and many people, feel about that. Those two events caused a deep scar in the lives and memories of very many people, and they were scars on the life and history of this country. I would simply make this point to him: we should not be setting up bodies, or retaining bodies in existence, merely for symbolic purposes. It will remain important that there is expertise about safety measures in football grounds. That function does not disappear, but it does not necessarily need to have its own separate, unaccountable organisation to dispense it. Similarly, the functions of the Human Tissue Authority can be carried out perfectly properly within the plethora of regulatory bodies in the health sector, to which my right hon. Friend the Health Secretary is rightly applying some reforming rigour.
Mr Mark Williams (Ceredigion) (LD)
Liberal Democrat Back Benchers welcome the statement on the grounds of cost, improved efficiency and, above all, embarking on dealing with the problem of democratic deficit. However, behind the names of these organisations there are many people genuinely fearful for their jobs. Will the Minister emphasise this line in his statement: “For those bodies that we are abolishing, I should stress that in many cases this does not mean the end of the function”? That is very important, and that reassurance needs to be made to many other people.
On the ending of Consumer Focus and the passing of its responsibilities to citizens advice bureaux, the Minister is aware that there are many concerns about funding for Citizens Advice at a central level. What discussions has he had with his colleagues about enhancing the role of CABs and, indeed, increased funding—
Mr Speaker
I am extremely grateful to the hon. Gentleman, and I will be grateful to the Minister for a brief reply.
Mr Maude
My hon. Friend makes a perfectly proper point about staff. We hope that jobs will not be lost, although some will be; we recognise that every single one is a personal disaster for the family involved. The chief executives of all bodies affected by the changes I am announcing should have communicated with staff this morning to give them as much certainty as possible about the future.
As regards Consumer Focus and consumer activities, the funding implications are being considered by my right hon. Friend the Business Secretary, and results will emerge in due course. We recognise that we cannot just hand these functions over to outside bodies without any resource implications.
Mark Durkan (Foyle) (SDLP)
In pursuit of his body count, did the Minister consider the role of the Investigatory Powers Tribunal, which has upheld absolutely no complaints against the security services and has never offered any reason? Its existence is merely a deceit of scrutiny to mask the conceit of unaccountable, secret powers. Has he found any more faceless, toothless or spineless creatures in the ecosystem of government?
Caroline Dinenage (Gosport) (Con)
In Gosport, we face the prospect that our outstanding Navy engineering training school at HMS Sultan will move to St Athan in Wales under a massive and unnecessarily expensive private finance initiative. What will happen to some of the other outrageous PFIs that quangos have entered into, such as the National School of Government?
Mr Maude
As we spend more time in government and pick up stones, we find quite a lot of contracts in place that make one wonder a bit about the diligence that Ministers took in exploring them at the time. Going through the detail of contracts is not necessarily the most amusing way to spend one’s life, but it is rather important because there is a lot of public money involved; the body to which my hon. Friend refers is one such example.
Alison McGovern (Wirral South) (Lab)
Will the Minister say what will happen to the functions of the Football Licensing Authority and who will give its world-class advice on safety? That issue is of high importance to my constituents and to many others around the country.
Mr Maude
The FLA does not license football grounds, of course. That responsibility rests in all cases with local authorities, which will continue to exercise that incredibly important function. The central expertise to support the licensing activity could exist in a number of bodies, such as the Health and Safety Executive, or the Football Association could provide it. My right hon. Friend the Secretary of State for Culture, Olympics, Media and Sport will explore all those options.
David Rutley (Macclesfield) (Con)
I congratulate the Minister on the speed with which he has taken forward the review and this activity. [Interruption.] Well, it was completely ducked by the Labour Government. What further steps is he taking to give the remaining public bodies an increased focus on effectiveness and value for money, which is much needed as part of the culture changes set out in his statement?
Mr Maude
I am grateful to my hon. Friend for his remarks. In my written statement and the list attached it, we have identified 40 bodies that are still under review, in many cases because a formal review has been launched but has not yet reached its end. The Chancellor’s comprehensive spending review, which I believe he will announce to the House next Wednesday, will set out the spending envelopes for all remaining bodies and place them under considerable financial rigour. For those that remain independent bodies there will be more transparency, which we have already started with the disclosure of higher salaries above £150,000. That has raised a number of questions about how those bodies are run.
Ian Lucas (Wrexham) (Lab)
Some of the most vulnerable people in Wrexham work at the local Remploy factory. What kind of Government is it who include two words—“under consideration”—about their jobs, and what consultation is the Department for Work and Pensions undertaking with people whose jobs the Government are threatening?
Mr Maude
To put it bluntly to the hon. Gentleman, it is a Government who are having to clear up an appalling mess left by his party, which left office spending £4 for every £3 in revenue. This coalition Government are having to reduce and eliminate a budget deficit that was created by his party with gross irresponsibility. My right hon. Friend the Secretary of State for Work and Pensions is undertaking a serious review of the future status of Remploy, and is very much aware of its good work and the valuable employment that it provides for many disabled people.
Bob Russell (Colchester) (LD)
Quango is not a description usually associated with the Independent Parliamentary Standards Authority. If it is not on the Minister’s culling list, will he please consider putting it in there? This morning, IPSA refused to refund the cost of an advertisement for an advice bureau for my constituents. Is that not an affront to the House? Perhaps the Minister would like to invite Sir Philip Green to take over IPSA. I am pretty sure that the backroom staff of Topshop could do a far better job.
Mr Maude
I have been invited to go down that path before, and I am a cautious fellow so I shall resist the temptation to do so. I am grateful to my hon. Friend for his endorsement of the approach that Sir Philip Green has taken in helping the Government pick up a number of stones to find out exactly what is crawling around underneath.
David Cairns (Inverclyde) (Lab)
The Minister is proposing to merge UK Sport and Sport England, which do quite distinct jobs—there is a clue in their titles. From his existential ruminations, will he tell me how he proposes to guarantee that elite athletes in Wales, Scotland and Northern Ireland, who are getting magnificent support from UK Sport in the run-up to the Olympic games, are not disadvantaged by what is effectively a takeover by Sport England, which understandably has a quite different focus?
Mr Maude
This is cross-Government activity, and the review has taken place across the Government. The hon. Gentleman will find that my right hon. Friends in charge of other Departments will make statements publicly today, and then he can pursue the matter. Of course the two organisations have different focuses, but they none the less cover a lot of the same ground. Having two separate lots of unproductive overheads when one set could do the job just as well does not seem a good way to spend taxpayers’ money.
Mr Dominic Raab (Esher and Walton) (Con)
I commend the Minister for his statement. Does he agree that the problem with quangos is not just their cost but their effectiveness? Competition law is vital for a free market, but having three regulatory bodies—the Office of Fair Trading, the Competition Commission and the European Commission—has made business more bureaucratic and regulation less effective. When Lloyds bought HBOS, the OFT’s competition concerns were brushed aside with a wink and a nudge from the last Prime Minister at a cocktail party. Does the Minister agree that that is a good example of how less overlapping bureaucracy can mean more independent and robust regulation?
Mr Maude
My hon. Friend is completely right. The way in which the competition scrutiny process, which is really important for an effective economy, currently works can be very complex, confused and slow. If we can simplify it by merging competition functions into one place, as we propose, there will be a benefit for the economy and for business and it will assist in creating jobs, which will be really important.
Kate Green (Stretford and Urmston) (Lab)
I noted with interest that the Child Maintenance and Enforcement Commission was one of the bodies to be brought back within the Government tent. Of course, it has not been subject to the same lack of public confidence as the Child Support Agency suffered for many years. How can the Minister guarantee that the stakeholders whose interests are put at the heart of the CMEC’s functions within Government are parents and, crucially, children, and not primarily the state, as was the case with the CSA?
Mr Maude
I suppose the short answer to the hon. Lady is that this Government believe that Ministers should make themselves available to be held to account for what is done in their name. I understand that the previous Government preferred not to do that and set up independent bodies to carry out important functions. The child maintenance function does not meet any of the three tests that I set out. It obviously needs to exist, but it does not need to be politically impartial, and indeed Ministers should be ready to be held to account for it.
Richard Harrington (Watford) (Con)
I very much welcome my right hon. Friend’s statement. Contrary to what the right hon. Member for Birmingham, Hodge Hill (Mr Byrne) said, I have found that in the case of a quango that I have been dealing with, the UK Film Council, the industry is delighted that in future it will have direct access to Government instead of having to go through a third party. My concern, however, is that the same people who are working in such quangos will simply become Government employees. What measures will he take to ensure that that does not happen?
Mr Maude
I suppose from my hon. Friend’s point of view the bad news is that many of them will become Government employees, but in those circumstances Ministers will be held responsible for what they do. I make no apology for restating that the principal purpose of the review is to increase accountability. The fact that someone becomes a civil servant employed directly by a Government Department rather than by a public body will make them more accountable, not less. We will be able to drive value for money and effectiveness much better.
Mr Tom Clarke (Coatbridge, Chryston and Bellshill) (Lab)
On the same subject, the Minister did not respond to the question that my right hon. Friend the Member for Birmingham, Hodge Hill (Mr Byrne) asked about the UK Film Council. I declare an interest: I co-chaired with Stewart Till of Universal the review “A Bigger Picture”, which led to the formation of the council. I am sure the Minister would agree that since that time, there has been a huge renaissance of the British film industry. How can it be considered achievable and accountable to switch responsibilities from the council to the British film industry, and how can he say that we will have access to more transparency?
Mr Maude
I treat what the right hon. Gentleman says with great respect, because I know that he has a long background in the film industry. He is passionate about it and has done a huge amount in the course of his illustrious career to support it, but I take issue with his central contention. The implication of what he sets forth is that the excellent renaissance of the British film industry is somehow inextricably linked with the creation of the UK Film Council, but the creativity of the people who make films delivered that. I find that there has been a mixed response to the announcement that the UK Film Council will be abolished, which was made by my right hon. Friend the Secretary of State for Culture, Olympics, Media and Sport back in July. Very many eminent people in the film industry say that the UK Film Council’s work was not central to the great success of the British film industry, but marginal in many cases.
Robert Halfon (Harlow) (Con)
Does my right hon. Friend agree that hard-working taxpayers in my constituency will be glad that their taxes will no longer subsidise regional bureaucrats and quangos in the east of England? Does he also agree that that work could be done much better by local federations of small businesses and chambers of commerce, and that the new local enterprise partnerships should be lean and mean?
Mr Maude
I am confident that they will be, because they will be under much closer local control. Local business organisations will contribute to them and local authorities, which are of course democratically accountable, will influence them. The fact is that regional development agencies did not contribute to narrowing the regional imbalances in our economy. In fact, those imbalances got worse and not better when the agencies existed over the lifetime of the previous Labour Government. This Government believe that support for local and regional businesses that is focused more locally and that is more locally accountable is likely to deliver greater success.
Derek Twigg (Halton) (Lab)
There is great concern in the field of health about the impact of the changes in loss of expertise, which we will examine closely in the coming days and weeks. Would the Minister today like to give a guarantee on the Floor of the House that there will be absolutely no loss of expertise?
Mr Andrew Turner (Isle of Wight) (Con)
How will the Minister ensure that quangos handed back to the Government do not generate more costly parliamentary questions?
Mr Maude
The number of parliamentary questions generated is not a matter of where functions sit within government, but generally a matter of how many questions my hon. Friend and other colleagues in the House ask. If bodies become more democratically accountable through the House, they will be subject to more parliamentary questions—by definition—but it seems to me that that is a good thing and not a bad thing. That is what accountability is about.
Tristram Hunt (Stoke-on-Trent Central) (Lab)
Now that the much-vaunted bonfire of the quangos has turned into a clammy Sunday afternoon barbecue, may I congratulate the Minister on his plans for British Waterways? He seems to be taking exactly the right approach, but we await information on the allocation of property assets.
What do the Government plan to do with the National Endowment for Science, Technology and the Arts? May I also urge the Minister to encourage his right hon. Friend the Work and Pensions Secretary to hurry up in sorting out the future of the Independent Living Fund, because that is causing real concern to my constituents?
Mr Maude
I am sure my right hon. Friend the Work and Pensions Secretary will have heard the hon. Gentleman’s last point and I know that he is addressing the matter with urgency. I welcome the hon. Gentleman into the big tent as far as the British Waterways Board is concerned. That is a good route to follow.
The hon. Gentleman also asked about the future of NESTA, which will become an independent endowment outside the Government. When the Bill that set it up went through the House, I was the Opposition spokesman, and I urged that it should be set up as a wholly independent endowment that is outside, and not in any way subject to the whim of, the Government.
Mr David Nuttall (Bury North) (Con)
Although I welcome the proposal for a triennial review of the remaining quangos, can my right hon. Friend confirm that if it becomes clear that a quango no longer serves a useful purpose, it will be abolished immediately, without waiting for the completion of the three-year review?
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
Going through the list of quangos in the Department of Health, I can see the logic of pooling some of their regulatory functions. However, the Human Fertilisation and Embryology Authority provided more than regulatory functions; it also provided the forum for some very tricky ethical debates, without which the previous Parliament would have been unable to pass some of the legislation on such matters, because debates would have polarised along political or religious lines. Can the Minister assure me where that function of that authority now lies? Will he reconsider that change? The Health Secretary will have heard that as well because he has just arrived in the Chamber.
Tony Baldry (Banbury) (Con)
As my right hon. Friend will know, the Oxford canal goes right through the heart of my constituency. Waterway users generally will welcome the opportunities provided by the setting up of a new waterways trust. However, the hon. Member for Stoke-on-Trent Central (Tristram Hunt) made an important point when he asked what happens to existing British Waterways assets. Will they be transferred to a new waterways trust? Presumably, in this as in any other aspect of my right hon. Friend’s statement, Secretaries of State for the Departments concerned will be willing to answer written parliamentary questions about the detail of such matters. The changes provide an enormous opportunity for civil society to engage in the running and maintenance of our waterways.
Mr Maude
My hon. Friend is completely right on that. Secretaries of State will indeed be willing to answer detailed questions on exactly those issues. On many of the changes, complicated questions arise on the ownership of assets and where they will end up. The public bodies Bill will provide a power by secondary legislation to deal with asset distribution, and I am confident that my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs will have heard my hon. Friend’s concerns about British Waterways Board assets.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
I have heard the Minister say a number of times that if something is important, Ministers ought to take decisions on it and to be accountable. In that context, does he believe that consumer protection and a consumer voice are important? If so, why has he chosen specifically to abolish Consumer Focus and to transfer its functions to Citizens Advice? The latter is a worthy organisation, but it surely has enough to do in coping with the increasing demands for advice that result directly from the Government’s welfare reforms.
Mr Maude
The short point is that citizens advice bureaux carry a high degree of trust with citizens. They exist locally and are well supported, and they manage to mobilise very large amounts of voluntary activity. We must get away from the slightly outdated idea that to show that we care about something very much, we must set up a quango to express it.
Priti Patel (Witham) (Con)
Will the Minister join me in welcoming the complete abolition of the Union Modernisation Fund Supervisory Board, which wasted hard-earned taxpayers’ money holding secret meetings in expensive hotels? It effectively handed taxpayers’ money to the trade unions. Will he give an assurance that he will take action to prevent such abuses of taxpayers’ money from happening in again?
Mr Maude
We have not taken a decision on the future of the Union Modernisation Fund itself, but my hon. Friend raises genuine concerns about the way in which the supervisory body operated. In the previous Parliament, I asked a number of questions about the publication of its minutes, but somewhat to my surprise I discovered that no such minutes were kept. That is the epitome of unaccountability and lack of transparency, which is exactly what I am seeking to address.
Mr Kevan Jones (North Durham) (Lab)
The decision to strangle at birth the chief coroners office will be viewed with dismay by many organisations, including the Royal British Legion, which campaigned for it to improve the coroners service. Can he explain why the Opposition supported the proposal during consideration of the Coroners and Justice Act 2009, but now they are in government they wish to abolish the office?
Dr Sarah Wollaston (Totnes) (Con)
I am looking forward to warming my hands in front of the bonfire of the quangos, with 192 on the flames. Can my right hon. Friend confirm how many quangos were abolished under the last Administration?
Mr Maude
I have learned to treat the claims made by the last Government with some scepticism, because they often claimed to have got rid of things, but on closer scrutiny they turned out to be merely resting, not defunct. I do not know whether this is a bonfire or, in the term used by the hon. Member for Stoke-on-Trent Central (Tristram Hunt), a damp Sunday afternoon barbecue, but we should not knock barbecues.
Mr Andrew Love (Edmonton) (Lab/Co-op)
The Minister talked, both in his statement and in answer to questions, about exorbitant pay in quangos and the public sector. Would it not add force to his argument if he and his colleagues also talked about exorbitant pay in the private sector? On the transfer of employees from quangos back to the public services, I seek reassurance that their pay and conditions will be protected in that process.
Mr Maude
There is a bit of a difference between pay in the private sector and pay in the public sector—[Interruption.] The fact that the hon. Gentleman finds it difficult to make the distinction tells us a lot about the mentality behind the last Government. In the public sector, it is taxpayers’ money that is being spent and Ministers have a responsibility to ensure that it is well spent. The fact that they did not is one of the reasons why we are now facing the scale of budget deficit that we are. The transparency that we have applied to pay in the quangos has meant that people have been shocked to find out how profligate some of the pay has been.
On the transfer of staff into the civil service, the terms and conditions will of course be transferred according to the TUPE rules, as the hon. Gentleman would expect.
Henry Smith (Crawley) (Con)
In a previous existence, I was a leader of a local authority, and three things got in the way of effectiveness—an increasing lack of democratic authority; an over-burdensome inspection regime; and a lack of funding. All three of those problems often stemmed from the existence of far too many quangos. I seek an assurance from my right hon. Friend that functions presently carried out by quangos that are to be abolished will be devolved to the local level.
Mr Maude
Wherever possible, that is our preference. We believe in localism and in trusting local authorities to take responsibility for what they do. Our commitment to localism does not only mean devolving to local authorities. In the case of consumer functions, for example, we think that devolving beyond local authorities to citizens advice bureaux is potentially a better approach. However, I can confirm our preference to devolve powers to as close to the front line of where citizens use services as possible.
Chi Onwurah (Newcastle upon Tyne Central) (Lab)
Does the proposal to abolish Consumer Focus and transfer its functions to citizens advice bureaux mean that in the coalition’s big society a consumer and a citizen are one and the same thing?
Stephen Barclay (North East Cambridgeshire) (Con)
Current legislation requires Departments to get the best possible price for Government assets such as furniture, computers and other items. As part of the big society agenda, will the Minister consider whether donations could be made or other disposal routes used to support voluntary organisations, charities and other bodies that are being squeezed at the moment and could make good use of those resources?
Madam Deputy Speaker (Dawn Primarolo)
I thank hon. Members and Ministers. A great many Members managed to ask short pithy questions on the statement and the answers were also short.