HBOS Reading: Independent Review

Lord Vaizey of Didcot Excerpts

Tuesday 18th December 2018 Westminster Hall

[Kevin Hollinrake]

My hon. Friend is absolutely right. It is completely one-sided. It means there is a complete imbalance of power in what is supposed to be an independent review, because the bank itself has phalanxes of advisers, whereas the victims clearly cannot afford to provide for the same number or calibre of advisers.

Offers are not made on an open basis; it is a take-it-or-leave-it offer. Imagine, Sir Christopher, that you have been stripped of all your assets over a period of 10 years. You are desperately trying to seek justice, and finally somebody offers you a cheque. Your only other option is to go to the court. What do you do? It is a take-it-or-leave-it offer. If you say, “Actually, I don’t think that is enough,” you get a secondary meeting, but there is no interrogation of the facts; it is simply take it or leave it. That is the nature of the review.

[Mr Edward Vaizey (Wantage) (Con)]

I am grateful to my hon. Friend for calling this debate. In fact, I called a debate on this very subject 10 years ago, when my constituents Justin Riggs and Karl Capp told me how they were being treated by their bank. This is one of the biggest frauds to hit many hard-working small business people in this country. The simple point is that the bank, rather than hiding behind regulations and technicalities, should be giving generous and quick compensation to many people who have lost their businesses, because of a fraud that was covered up and hidden for years by senior members of that bank.

[Kevin Hollinrake]

My right hon. Friend is absolutely right. The levels of compensation should be determined by an independent third party, not by the bank itself, because there is no methodology. Nobody can contest the findings of Professor Griggs. There is no way of interrogating how he has arrived at a number. They simply say—I have heard this so many times from Lloyds directors—“Well, we settled most of the claims,” as if that is somehow an endorsement of the process. The fact is that the victims had no other option—no appeal process—other than going to court, which would have cost millions of pounds.

Victims cannot even get access to the evidence. In a normal court process there would be disclosure of evidence, so that they could see the evidence they are being judged against. There was no disclosure of evidence. Lloyds has found a better way, according to a letter it sent me on 20 September. It said it had “created an alternative approach” to disclosure, “to protect customers interests”. That is its approach. It is complete obfuscation.

Eligibility is determined by the bank itself. It decides who is eligible for the review and who is not by invitation only. Only directors get to decide, not shareholders or suppliers, nor Her Majesty’s Treasury, which must have lost a lot of money through this process in respect of tax. It only dealt directly with the individuals who were convicted, not their deputies or other people who may well have been involved in the fraud. This is not an independent review. Professor Griggs is paid by the bank. His remit is determined by the bank. I have seen evidence that determinations he has made have been overruled by the bank.

This is in no way an independent process. Of course, everybody who goes to it is subject to a gagging order. The bank provided us with confirmation that clause 4 in its settlement agreements does not prevent victims talking to it or to the press. However, I have seen another agreement, completely different from the one the bank provided to the Treasury Committee, which contains extra clauses that do prevent these victims speaking to the press or to the authorities. Justice must be seen to be done. Lloyds bank is the judge, jury and executioner. The all-party parliamentary group on fair business banking and finance, of which I am now co-chair, said right from the start that this is the wrong way to deal with the process, but Lloyds pushed on anyway.

Moving on to a solution to these problems, the APPG believes that all cases—anybody who has been subject to the Griggs review—should be re-examined through a completely independent process. The APPG has recommended a financial services tribunal, which would judge cases based on a fair and reasonable test, with one-way cost shifting, so the banks cannot simply keep people out of court by writing huge cheques out to their own lawyer. That would mean that people would get an independent examination of their case. Victims can then get compensation and move on.

We believe that a tribunal is required, with an arbitration process for past claims. There have been four different reviews this year of how we can fill this gap, make this process fairer and get back to a more balanced situation, with restitution and redress. Three of those reviews recommended a financial services tribunal, as we do. The one report that did not was sponsored by the banking industry itself and it simply says that we should increase the powers, remit and jurisdiction of the ombudsman schemes. While that is a good step forward, we do not feel that it is enough.

That addresses compensation, but we need to go further. We need to change the culture in the whole sector, as the hon. Member for Ogmore (Chris Elmore) said. In terms of the Lloyds management, I do not see how the position of the chief executive, António Horta-Osório, is tenable. Given the way that the effective whistleblower has been treated, the way this has been covered up and the way that the process has been deliberately partial, I do not see how the Lloyds management have been consistent with the behaviour required under the senior managers regime. I think António Horta-Osório should resign. I also think he should face investigation under the senior managers regime.

Finally, the Financial Conduct Authority itself—our regulator—has many questions to answer. Why did it approve the scheme? Did it approve the scheme? We have heard conflicting evidence on that. It is a national disgrace that Lloyds has been allowed to operate this sham of a review process. Andrew Bailey himself has questions to answer. Why did he allow the process to continue? Why was he not aware of the patent defects in the process? Nevertheless, the FCA should take charge and undertake an investigation of the senior management under the senior managers regime.

We in this place are defenders of free markets. For me, this is the most important issue that any of us will ever deal with. Certainly, as far as I am concerned, I cannot rest until the matter is settled. My life has been transformed through the opportunities of free markets. In the main, the bankers I have dealt with over 25 years have done a tremendous job—a fair job—to help my business to thrive through some difficulties. I was one of the lucky ones. Not all bankers are the same. Most people in the industry are decent people trying to do the right thing, so it is even more important to hold those who are not to account. We have to make sure that everyone has the opportunities that I have had—that we have had—including all our children and grandchildren. We must all demand, for the sake of the victims, that justice is done and is seen to be done.

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[The Economic Secretary to the Treasury (John Glen)]

It is a pleasure to serve under your chairmanship, Sir Christopher. I acknowledge the work of my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) in securing this debate and making an excellent speech, as he has done on several occasions this year in this place, and setting out a case that was well reasoned in many elements. I also pay tribute to the hon. Members for Strangford (Jim Shannon) and for East Lothian (Martin Whitfield), who made fine contributions to the debate.

As we have heard today and in previous debates this year, incidents of banking misconduct and fraud have had a severe impact on some small and medium-sized enterprises. It has been and remains a top priority of mine in office to face up to the issues that have been generated by the cases that have been raised. I am conscious that many of the eight Back-Bench Members who have taken part in this debate will have heard sad and unfortunate stories from their constituents about how the actions of banks have affected them and their businesses. That includes not only the events at HBOS Reading, but the actions of the RBS Global Restructuring Group and the mis-selling of interest rate hedging products.

I begin by reminding Members that we expect the highest standards of behaviour across the financial sector. That is why the Government have introduced a number of necessary changes to restore public trust in financial services, such as the senior managers and certification regime. Before I address the substance of today’s debate, it is important that we pause for a moment to recognise the contribution that banks make to both the UK economy and our society. As the hon. Member for Aberdeen North (Kirsty Blackman) rightly said, it is necessary for banks to lend to SMEs. Lloyds Banking Group has, for example, increased its net lending to SMEs by £3 billion since 2014 and plans to triple that by 2020. Lloyds is the market leader in providing basic bank accounts, which help vulnerable customers, and its “Helping Britain Prosper” plan sets out a number of commitments on behaviour, diversity and charitable support.

However, I recognise that there has been a great deal of justified anger, within Parliament and beyond, regarding the fraud that was perpetrated against small businesses through the actions of individuals at the HBOS Reading branch. It is important to remember that the events at HBOS Reading constituted criminal activity. As such, it was right that those responsible were brought to justice, as my hon. Friend the Member for Thirsk and Malton pointed out. The FCA continues to conduct an enforcement investigation into the events surrounding the discovery of misconduct at HBOS Reading, resuming an investigation placed on hold at the request of Thames Valley police. I will be keenly following the progress and outcome of the investigation.

In addition, Lloyds Banking Group has appointed Dame Linda Dobbs, a retired High Court judge, as an independent legal expert to consider whether issues relating to HBOS Reading were investigated and appropriately reported to authorities at the time by Lloyds Banking Group, following its acquisition of HBOS. It will consider issues raised by the Project Lord Turnbull report referred to by my hon. Friend. Dame Linda’s findings will then be shared with the FCA.

It is right that Lloyds set up a compensation scheme for businesses affected by the events at HBOS Reading, overseen by Professor Russel Griggs. That scheme has seen offers made to all customers within its scope, with 90% of customers accepting the offer. However, I acknowledge the concerns that Members have raised about the Griggs scheme. Those concerns have certainly been heard, and I am pleased to announce that Lloyds has agreed with the FCA that Lloyds will commission a post-completion review to quality-assure the methodology and process of the Griggs scheme. [Interruption.]

Overseen by an independent person, that review will go above and beyond a normal lessons-learned exercise. The independence of the person appointed to lead the review is vital. In particular, I would expect that person not to have been employed by Lloyds in any way, and to be able to demonstrate complete operational independence from Lloyds. I am pleased that Lloyds has committed to publishing the review once it has concluded, and I welcome Lloyds’ commitment to implementing any recommendations it produces. I have been consistently clear that it is vital that we get the right processes and procedures in place, to ensure that SMEs can obtain fair redress and resolve disputes with their banks.

[Mr Vaizey]

I know that my hon. Friend the Member for Thirsk and Malton (Kevin Hollinrake) will wind up the debate, so I feel a bit premature intervening on the Minister, who is a good friend. However, he will have heard the reaction in the Gallery to his announcement. It seems to me that it is just a re-wrapping of the current problem. Perhaps he will meet some of the Members in the Chamber, and some of the business owners affected, to hear and see what has actually been going on.

[John Glen]

I will happily meet my right hon. Friend—a distinguished former Minister who has been fighting on these matters for many years—and my hon. Friend the Member for Thirsk and Malton. Of course I acknowledge the cynicism and concern of those present about the independence of this mechanism, but, as I said, Lloyds has committed to publishing the independent review once it is concluded and implementing any recommendations that it produces. My officials have been working with the FCA to ensure that that comes to pass. I take the concerns about how it progresses very seriously, and will happily meet Members to discuss them.

In the recent Budget, the Chancellor stated the Government’s support for the FCA’s plans to expand eligibility to complain to the Financial Ombudsman Service to small businesses as well as micro-enterprises. Expanding the remit of the FOS will ensure that from 1 April 2019 well over 99% of all UK businesses will have access to fast, free and fair dispute resolution. I am aware that concerns have been raised about the capability of the FOS to adjudicate effectively in such cases, and I discussed those concerns with the Chair of the Treasury Committee just last week.

The FOS has announced its plans to create a ring-fenced, specialist unit to take on the additional cases, and for that unit to be supported by a panel of external SME experts. I welcome those plans, and I will visit the FOS early in the new year to check on how they are progressing. The FCA has also committed to reviewing the expansion of the FOS remit within two years of its coming into force, in addition to its usual oversight processes. I trust that that will reassure some hon. Members who have voiced concerns about the capability of the FOS.

I have also been clear that banks need to work hard to restore businesses’ trust in their institutions. That is why I welcome the banking industry’s recent commitment to establishing two independent voluntary ombudsman schemes, in response to Simon Walker’s review of dispute resolution for SMEs. One of those schemes will address complaints from SMEs with a turnover of £6.5 million to £10 million. The other will address unresolved historical complaints from SMEs that have not already been through a formal process.

I am pleased that the banking industry has set out the key principles for the operation of the scheme to address unresolved historical complaints. Independence, expertise, transparency and the right to an appeal are all hallmarks of a fair and robust process, and it is right that they underpin any approach to dispute resolution. I welcome the banking industry’s commitment to having those schemes up and running by September 2019. I look forward to seeing progress on establishing the implementation steering group very soon, and I am pleased that representatives from the all-party parliamentary group will have a role in that process.

The benefits of an ombudsman-style approach are clear, but I recognise that some hon. Members have advocated again today for the establishment of a tribunal to resolve disputes between banks and SMEs. An ombudsman-style approach can deliver fast, free and fair dispute resolution for SMEs, making decisions based on what is fair and reasonable. I believe that a tribunal, on the other hand, would need the regulation of SME lending, potentially restricting SMEs’ access to credit. It would still require SMEs to pay for expensive legal expertise, and it could make decisions only on a strict legal basis. That is why I believe that an expanded FOS remit, alongside the establishment of further independent ombudsman schemes as announced by UK Finance, will ensure the best outcomes for SMEs.

I highlight again that the Government, financial regulators and industry have done considerable work to tackle bad practice and to ensure that SMEs have access to appropriate dispute resolution and redress mechanisms. The all-party group on fair business banking and finance has been a key part of that work, and I sincerely commend its determination in the work that it has undertaken to ensure that SMEs are fairly treated.

The events at HBOS Reading constituted criminal activity. As such, it was right that those responsible were brought to justice. However, more clearly needs to be done to restore SMEs’ trust in the financial services industry. From the numerous meetings that I have had this year with a wide range of stakeholders, it is clear that we are all determined to deliver the best outcomes for SMEs.

I will closely follow the review of the Griggs scheme. I understand the concerns, but it is a significant step forward that that review will take place, and I will monitor the implementation of both the expanded FOS remit and the industry’s independent voluntary ombudsman schemes. I am confident that we have the right regulatory regime and dispute resolution mechanisms in place for the future. Events similar to those at HBOS Reading should not occur again, and I will do everything in my power in office to ensure that we learn the lessons from those appalling incidents years ago.

Taxation (Cross-border Trade) Bill

Lord Vaizey of Didcot Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Monday 16th July 2018 Commons Chamber

[Mr Edward Vaizey (Wantage) (Con)]

That’s your career over, Mel.

[Anna Soubry]

For the record, that was said by my hon. Friend the Member for Huntingdon (Mr Djanogly). If anyone else had said it, I would have been very rude. [Interruption.] Sorry. Scrub that; it was my right hon. Friend the Member for Wantage (Mr Vaizey)—ever the trouble maker.

This is really serious. I told the Minister that I would not press my amendments to a vote. That is not because I lack courage—in fact, given events, I would like to think I have a bit of courage. Some say I do not have a fear gene at all. Just to remind hon. Members, three people have received custodial sentences for the death threats I have received. I am getting a bit tired of being called a traitor. Certain people on these Benches support a newspaper that, disgracefully, had the temerity to suggest that the Prime Minister of our country might in some way have committed treason by the production of this White Paper. That is outrageous. Right hon. and hon. Members on these Benches really need a bit of a reality check, not just on Brexit but on the way this party is conducting itself and on who they choose to call their friends.

Let me return to why I will not press my amendments to a vote.

Customs and Borders

Lord Vaizey of Didcot Excerpts

Thursday 26th April 2018 Commons Chamber

[Matt Warman]

I would like to agree with my hon. Friend, in the sense that if the European Union were to offer an option that said, “Remain in the customs union and remain in the single market, but you don’t have to have freedom of movement and you do have the ability to go and strike your own trade deals”, then a lot of us would think that that was a very attractive move. However, that would make it a better deal to be outside the EU than to be in it.

I simply do not see how it is a sustainable, coherent position to think that the European Union would offer us that sort of compromise, so we have to live, as Opposition Members have so often said, in the real world. That requires us to say that people did not vote for the European Court of Justice to continue to have its rulings being valid in this country when we play no part in that organisation, and people did not vote for us to have no remedies on our trade policy. What people voted for, whether some in this place like it or not, is a clean break, because that is what allows us to have the control that they wanted. Many Conservative Members accuse the Opposition of trying by subterfuge to force us to remain in the European Union. However, the more we pursue the line that we can remain in the customs union but also do our own trade deals, the more we not only undermine faith in the referendum result overall but undermine faith in democracy as a whole, and we have to preserve that above all else.

[Mr Edward Vaizey (Wantage) (Con)]

Rubbish!

[Matt Warman]

My right hon. Friend proclaims, “Rubbish!”, from a sedentary position. I think he knows me well enough to know that I am not an ideological hard Brexiteer, by any means. However, surely we all have to accept that we should be ideological about preserving the primacy of democracy. If we in this place are not all democrats, then we have a real problem.

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[Mr Edward Vaizey (Wantage) (Con)]

I see that a Treasury Minister is responding to this debate, not a Trade Minister. This is a new phenomenon: when the Government are in trouble, they no longer uncork the Gauke; they un-shell the Mel.

I do not know about the emperor’s new clothes, but I feel I am living in an Alice in Wonderland world. I am learning more and more about Brexit every day. I have learned that we can be out of the EU but in the single market; that we can be out of the EU but in the customs union; that we can be in the EU and have a blue passport made by a British company; that we can be out of the EU and have a blue passport made by a French company; that the Windrush scandal is the Europeans’ fault because they are in favour of people presenting papers, and that Brexiteers are very pro-immigration; that there will no longer be a bonfire of EU regulations—but it’s all right because we are going to adopt them all; that we are not trading enough with the EU so we are going to make it more difficult to trade with the EU; and that the Good Friday agreement is a waste of time and we are to have a hard border with Northern Ireland because of Brexit; and I have heard that anything I do to contradict anyone who supports Brexit is undermining the will of the people, even though during the referendum, as far as I am aware, there was a clear question—“Do you want to leave the EU?”—but no clear proposition about what that meant, which has left it to Parliament to decide what leaving means, or at least to guide and engage with the Government.

[George Freeman (Mid Norfolk) (Con)]

In Mid Norfolk, where my constituents voted to leave, the majority opinion on the doorstep was: “Mr Freeman, I wanted to be in the single market, not in a political union. It was Mrs Thatcher who took us into the single market. I want to be in the single market, not in the political union.” Does my right hon. Friend agree with my constituents?

[Mr Vaizey]

That is absolutely right. My right hon. Friend the Member for West Dorset (Sir Oliver Letwin), in his excellent memoirs, says he parted company with the Brexiteers, having been a Eurosceptic, because he supported a free trade arrangement with the EU but did not want to leave the EU in order to cause damage to our economy—I have not put that very well, but the key point is that, if we are to leave the EU, which we are, and we are a free and sovereign nation, we can then make decisions in the interests of our economy; and if it is in the interests of our economy to be a member of a customs union, it should be possible for Parliament to debate that and make that decision without being accused of betraying the will of the British people. The people who are passionate about Brexit have tipped over into an ideological fervour where anything that involves Europe in any shape or form is wrong.

I have come here to ask un-shelled Mel some questions to educate myself, because I want to make the decision that is best for my country. I am one of the Prime Minister’s trade envoys to Vietnam, so I know a tiny bit about trade. If it is best to leave the customs union and make up for the economic impact of doing so by means of free trade deals, can my right hon. Friend the Financial Secretary to the Treasury tell me when we are planning to sign these new trade deals, who we are planning to sign them with, what their value to our economy will be and what the related issues will be? For example, I have read in the newspapers that one aspect of trade deals with countries such as India and Australia—they are both countries that I love—will be more relaxed immigration and visa rules. I do not have a particular problem with that, but is my right hon. Friend aware of that issue, and how does he think it will go down with the public?

When it comes to regulatory standards, I agree with my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke), although I do not have a problem with food standards in America or Australia; we do not see a lot of Australians or Americans dropping down with food poisoning. Given that food standards in those countries are different from ours, are the Government content to sign up to them? Let us face it; one of the reasons we have tariffs is that there is an element of protectionism in every economy. What will be the reaction of sectors of our economy, such as agriculture, when we sign these trade deals?

I would like to know the Government’s view on the cost of leaving the customs union, and the impact of doing so on sectors that are important to our economy, such as cars, agriculture, pharmaceuticals and chemicals. The hon. Member for Leeds West (Rachel Reeves)—the excellent Chair of the Business, Energy and Industrial Strategy Committee—has done a lot of this work for the Government. Perhaps the Minister could help me, as a bear of little brain, with something else. As far as I am aware, staying in the customs union will allow us to export goods to the European Union without tariffs, but it should leave us free to negotiate free trade deals outside of those goods. It should, indeed—this is particularly important given that services now account for 80% of our economy—allow global Britain to negotiate service agreements with the US, as my right hon. and learned Friend the Member for Rushcliffe pointed out.

The Minister could perhaps help to explain the paradox of how Germany, which is a member of the customs union, has managed to increase its exports to China so significantly while it has been anchored and shackled to this protectionist racket. Why is Germany exporting five times as much to China as Britain is doing? Is it simply that Germany makes a hell of a lot of effort to export goods? If we made a hell of a lot of effort while we were still in the customs union, perhaps we could continue to increase our exports to China.

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[Mel Stride]

As the hon. Lady knows, we are currently working on transferring the EU’s agreements with third-world countries. Of course, in future we will be free to strike our own FTAs with other countries, which we are currently prohibited from doing.

It is good to hear the hon. Member for Bootle (Peter Dowd) agree with Margaret Thatcher at long last. She stood for free markets, free trade and fiscal responsibility, and I look forward to hearing more of that from him in the years to come.

I have just been informed that I must leave two minutes for the right hon. Member for Normanton, Pontefract and Castleford, which I will endeavour to do—[Interruption]— although she is generously saying that one minute will be enough.

The hon. Member for Bootle suggested that the Government’s position is confused, although I am not sure whether he was thinking of his own position when he said that. The reality is that the Labour party has a classic fudge on the customs union. It wants to tell everybody that we can somehow be in the customs union while not being a rule taker—that we can somehow negotiate to be in the room when FTAs between the EU and other countries are negotiated. The Labour party accuses us of seeking to cherry-pick, but by its own logic, it is quite clear that this is just not a realistic possibility.

The hon. Gentleman specifically mentioned clause 31 of the Taxation (Cross-border Trade) Bill, which will indeed permit the UK to enter into a customs union with another customs union or territory. That is something we will almost certainly wish to do with our Crown dependencies. The clause will therefore not be relevant to the European Union after our departure. The Government are therefore clear that when we leave the European Union we will leave its customs union. That is a matter of fact. The Government have also been clear that forming a new customs union with the EU is not compatible with a meaningful independent trade policy, so we will not be doing that. Outside the EU and a customs union, the UK will be able to sign its own trade deals with our partners around the world.

[Mr Vaizey]

Now that the Minister has been un-shelled—he is doing very well—could he name one trade deal and tell us when it will be signed?

[Mel Stride]

An ingenious question; I would expect no less. As my right hon. Friend will know, we are not able to enter into and sign such deals until we have left the EU and, indeed, we are beyond the implementation period. Of course we are working actively on these deals, but saying that does not mean that we will no longer need a deep and special partnership with our nearest trading partner. The EU is still and will remain a significant marketplace for us. Our markets are deeply interconnected, and that will remain the case for the future. That is why the Prime Minister set out the Government’s intention to negotiate the broadest and deepest possible economic partnership covering more sectors and co-operating more fully than any free trade agreement anywhere in the world and recognising the point of deep convergence from which both sides begin.

In leaving the EU customs union, we will be guided by what delivers the greatest economic advantage to the UK, framed by three strategic objectives. The first is continued UK-EU trade that is as frictionless as possible. The second is avoiding a hard border on the island of Ireland. The third is establishing an independent international trade policy.

The Government have already set out two options for our future customs arrangements with the EU that most closely meet these objectives. One is a new customs partnership. In this model, the UK would mirror the EU’s requirements at our border for imports from the rest of the world with a final destination in the EU. This would mean applying the same tariffs and rules of origin as the EU for those goods. By following this approach, we would know that all goods entering the EU via the UK pay the right EU duties, removing the need for customs processes at the UK-EU border.

The other option is a highly streamlined customs arrangement. This approach would involve the introduction of formal customs processes between the UK and the EU, driven by technology, to streamline and enable this model. However, the UK would look to implement a range of measures—both negotiated and unilateral—to minimise friction, together with specific provisions for Northern Ireland. The precise form of any new customs arrangements will of course be subject to negotiation, and we are pursuing both approaches vigorously with our European friends. I look forward to further progress in these talks.

For the reasons I have given, the Government cannot support the motion before us today. As we prepare to leave the European Union, a significant opportunity awaits us—the opportunity to promote our national interest above all else and the opportunity to shape our future trading policy—because when the people of this country voted to leave the European Union, they voted for democratic self-government and to take control of our future trading arrangements. Moving forward, we will seek to maximise our trade, across all countries and markets as we prepare for the challenges and the exciting opportunities ahead, confident as an independent trading nation and proud of our long history as a global champion of free trade.

Telecommunications Infrastructure (Relief from Non-Domestic Rates) Bill

Lord Vaizey of Didcot Excerpts

3rd reading: House of Commons & Committee: 1st sitting: House of Commons & Report stage: House of Commons
Tuesday 5th September 2017 Commons Chamber

[The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Marcus Jones)]

The Government are committed to supporting full-fibre telecommunication infrastructure and the roll-out of 5G. This will deliver a step change in the speed, service quality and reliability of broadband and mobile services. Independent research suggests that increased broadband speed alone could add £17 billion to UK output by 2024, so this is a vital measure for the whole economy. The Bill will provide the powers we need to implement an important part of that strategy.

At the 2016 autumn statement, the Government announced 100% rate relief for new full-fibre infrastructure in England. The clauses in the Bill will allow us to deliver that relief with retrospective effect to 1 April 2017. We have already published draft regulations that illustrate how we will use these powers to implement the relief. The draft regulations have been prepared in consultation with telecoms experts in the Government, Ofcom and telecoms providers. Business rates and telecoms are technical fields so there is considerable scope for complexity where they meet. However, I am glad to say that through our work with the sector, we believe that we have found a clear approach to allow the valuation officer to identify, capture and quantify new fibre.

[Mr Edward Vaizey (Wantage) (Con)]

I refer the Committee to my entry in the Register of Members’ Financial Interests. Is my hon. Friend aware of some concerns in the telecoms sector that the tax relief could be gamed? People could switch off lit fibre and light dark fibre in order to take advantage of the tax relief. Some have suggested that a better way of implementing may be simply to limit the quantum of business rates paid by telecoms companies. Will my hon. Friend comment on those concerns, which I have heard from a number of providers?

[Mr Jones]

I understand the concerns raised by my right hon. Friend, and I have great respect for his considerable knowledge of the matter. I reassure him and the various bodies that hold concerns that the relief is not a measure to support the relighting of fibre that has been turned off. Indeed, it is to support the laying of new fibre in the ground. This technical matter is laid out in the draft regulations and explained in the accompanying consultation document published by my Department last week. Consultation will ensure that the proposal reaches the right audience in the telecoms sector. With business rates experts, we will ensure that the relief will work as planned. The consultation will also allow us to move quickly to implement the relief once the Bill has passed and ensure that support is available for new fibre.

[Mr Jones]

My hon. Friend is right that this is an investment in the infrastructure of the country. Indeed, it is a relief that is time-limited for five years. After that five-year period, that fibre will attract its own income into the business rates pool, whether on the local list or on the central list.

[Mr Vaizey]

I hope the Minister will forgive me for interrupting his eloquent speech, but I was spurred into action by my hon. Friend the Member for North West Hampshire (Kit Malthouse), who is a newly elected member of the Treasury Committee—I congratulate him—and who displays the forensic skill we will see in many hearings in months to come. It behoves me to clarify that it is possible under the current regulations for a telecoms provider simply to lay new fibre in existing ducts, turn it on and take advantage of the tax relief, even though there is already fibre in those ducts. That would be seen as gaming the system—taking advantage of the tax reliefs without building the new infrastructure my hon. Friend the Member for North West Hampshire has campaigned for so vigorously. That is simply the warning light that I put up, and it may be that my hon. Friend will drive future Treasury Committee hearings towards that subject.

[Mr Jones]

By definition, full fibre is fibre that goes all the way from an exchange to the particular business or residential property that it individually serves. Therefore, by definition, even if an existing set of ducting was used, the new fibre would be an expansion of the network, because it would serve a different property from the current fibre. I therefore hope that my right hon. Friend is reassured.

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[Mr Jones]

I thank my hon. Friend for that comment. He is absolutely right that it is extremely important that new housing developments serve well the people who purchase the properties in relation to superfast broadband. He is right that it is a requirement for developments of under 30 dwellings to have a broadband connection and for developments of over 30 properties to have a superfast broadband connection. In bringing forward those requirements, which started this January, the Government had to make a very challenging decision in getting the balance right between making sure that people are properly served with the latest technology and that we build the homes required to deal with the housing shortage in our country.

[Mr Vaizey]

I am very grateful to hear my hon. Friend talk about these issues. In my constituency, the developer Linden Homes built a housing development with houses selling for hundreds of thousands of pounds, and for the mere price of £6,000 to deliver broadband, refused to stump up that money. It is this kind of behaviour by developers that brings them into disrepute. I congratulate the Government on making great progress, because no new home should be built without superfast broadband.

[Mr Jones]

My right hon. Friend is quite right. Developers who are not necessarily compelled to provide superfast broadband should think to themselves how the installation of superfast broadband could become a selling point for the property. The provision of superfast broadband is becoming more and more important, particularly as more and more people work from home.

Oral Answers to Questions

Lord Vaizey of Didcot Excerpts

Thursday 9th June 2016 Commons Chamber

[Huw Merriman (Bexhill and Battle) (Con)]

6. What steps his Department is taking to accelerate the roll-out of broadband in (a) rural and (b) urban areas.

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

I am very pleased to tell you once again, Mr Speaker, how well the rural broadband programme is going. We have reached our target of 90%, with 4 million homes passed, and we will reach our target of 95% by the end of 2017.

[Huw Merriman]

My constituents in the parishes of Dallington, Brightling, Mountfield, Ashburton and Penshurst will welcome the Government’s new legal right to fast broadband. May I ask the Minister whether the reasonable cost test will be benchmarked against, first, the realistic cost to install in rural areas that are not currently connected to fast broadband and, secondly, the cheapest cost that any provider would charge rather than the cost that BT Openreach may calculate?

[Mr Vaizey]

We will certainly consult on the reasonable cost test, and it may well be that a number of providers do provide the universal service obligation, which will potentially provide welcome competition. That will be open for consultation once we have passed legislation, which I know will have the support of the whole House.

[Sue Hayman (Workington) (Lab)]

Earlier this week, I received an email from the Minister, which helpfully informed me that 3,198 premises in my constituency—that is 8% or nearly one in 12—are not currently planned to be connected to superfast broadband. What has the Minister got to say to the sizeable number of my constituents who face the prospect of never being able to access an adequate broadband connection?

[Mr Vaizey]

I would say to her constituents that we said that we would get to 90% by the end of last year, which we achieved, and that we would get to 95% by the end of 2017, so we have been completely transparent about what we are planning to do. We are now consulting on a USO precisely to help those constituents of the hon. Lady who are not in the rural broadband programme. We are bringing in important changes to planning in the digital economy Bill, which I hope will have the support of the Opposition Front Bench team. She should congratulate the Government because the way the contracts have been constructed means that almost £300 million is coming back, so we are going to go further than 95% and reach more of her constituents. She should be telling them that rather than complaining.

[Tom Pursglove (Corby) (Con)]

Residents in Denford are extremely frustrated at the lack of progress in securing superfast broadband. Will the Minister encourage Superfast Northamptonshire and BT to redouble their efforts to get Denford connected?

[Mr Vaizey]

I will certainly do that.

[Albert Owen (Ynys Môn) (Lab)]

What discussions are the Minister and his officials having with Welsh Government Ministers and officials about the universal service obligation to ensure that we can have joined-up thinking when the Bills, which I support, come through? To cement this relationship between the Welsh Government and the UK Government, may I repeat my offer of Ynys Môn as the location for a pilot scheme?

[Mr Vaizey]

I would happily work with the hon. Gentleman and the Welsh Government. I have always found him and the Welsh Government to be congenial colleagues in regard to the roll-out of superfast broadband.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

We know that the Secretary of State wants to leave the European Union, but his Minister appears already to have left the United Kingdom to inhabit some fantasy “Broadbandia” in which everything is, in his words, an “unadulterated success”. For the rest of us in the 21st century United Kingdom, however, the reality is different. One in five broadband users still has less than half the speed that Ofcom classes as acceptable, and 70% of smartphone users in rural areas have zero access to 4G. Rather than living in “Broadbandia”, the rest of us are living in “Broadbadia“. Will the Minister stop fantasising and acknowledge the view of the Countryside Alliance:

“This rural broadband betrayal is devastating”?

[Mr Vaizey]

I know that the hon. Lady will want to join me in commemorating this important day, which is the 33rd anniversary of Margaret Thatcher’s landslide election victory in 1983. In that year, there was no broadband and the Minister you see before you was sitting his O-levels. The Secretary of State, however, was on the great lady’s battle bus.

The hon. Lady might quote the Countryside Alliance, but the gardener Robin Lane Fox wrote an article in the Financial Times, which I know she reads, in which he talked about a move to the rural arcadia brought about by our broadband roll-out programme. He said that, like Falstaff, he was looking forward to dying babbling of green fields because he could live in the countryside with a superfast connection. Let us remind ourselves that Labour had a pathetic megabit policy, and that is still its policy. Let us also remind ourselves that we are two years ahead of where Labour would have been, and let us talk up the success of this programme instead of constantly talking down great broadband Britain.

[Mr Speaker]

I am sure that the hon. Gentleman’s performance is greatly enjoyed, not least by the hon. Gentleman.

[Stephen Timms (East Ham) (Lab)]

7. What assessment he has made of the potential benefits for the UK digital economy of completing the EU digital single market.

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

As I was saying, we have a great broadband Britain in a great European Union. Britain sits at the centre of the digital single market, which, if it is implemented, will increase GDP for Europe by 3%, or some £300 billion.

[Stephen Timms]

This time, I think the Minister is on to something. The UK is Europe’s leading digital economy, and we have the most to gain from the digital single market. That is why 70% of techUK members and 96% of the members of the Creative Industries Federation want us to remain in the European Union. Will the Minister have a go at persuading his right hon. Friend the Secretary of State how damaging it would be for digital jobs in the UK if we left the EU?

[Mr Vaizey]

My right hon. Friend the Secretary of State has a mind of his own, and he quite rightly often takes the view that it is not worth listening to me, which is probably why he is such a successful Secretary of State. I do wish he would listen to me on this issue, however, because tech and digital companies do benefit from our membership of the European Union and they will continue to thrive if we stay in the EU.

[Mr David Nuttall (Bury North) (Con)]

Does the Minister agree that the internet has been a huge source of economic growth in this country and that the last thing it needs is to be stifled by the Brussels bureaucrats, which is exactly what will happen under the proposals in the EU’s single digital market strategy?

[Mr Vaizey]

That intervention reminds me that this is the 41st anniversary of the first radio transmission from the House of Commons, and quality interventions such as that keep the British public listening to and watching our proceedings. However, I do not think that the Brussels bureaucracy is stifling. In fact, 500 broadcast companies are based in Britain precisely because of European regulations.

[John Howell (Henley) (Con)]

8. What steps his Department is taking to support the protection of cultural heritage in conflict zones overseas.

--- Later in debate ---

[Mr David Hanson (Delyn) (Lab)]

T4. What protections can my constituents and others expect on mobile phone roaming charges in Europe in the event of an exit on 24 June?

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

That is a very good question. Britain was at the forefront of negotiating the reduction in roaming charges, working with our European partners, and it is yet another example of the benefit to consumers and citizens of being a member of the European Union.

[Mr Robin Walker (Worcester) (Con)]

After the huge success of the London Paralympics, we all saw how Paralympic sport can inspire. Will the Secretary of State join me in congratulating my six Worcester constituents, who have been selected to represent ParalympicsGB in the wheelchair basketball at the Rio Paralympics?

[Gavin Newlands (Paisley and Renfrewshire North) (SNP)]

T2. On Tuesday I met Jean Cameron, the project director for the Paisley 2021 bid for UK City of Culture, for the third time. Despite my asking the Deputy Leader of the House a few weeks ago to give the Secretary of State a nudge, the bidding cities for 2021 are still none the wiser about the dates involved in the process. May I encourage the Secretary of State to get on with it and allow them to plan appropriately?

[Mr Vaizey]

I certainly take the hon. Gentleman’s points on board. We will make sure that the bidding process is as transparent and clear as possible and we will make the rules as clear as possible. While we are talking about culture, it is important to mark today as the anniversary of the publication of the first Book of Common Prayer by Archbishop Cranmer on 9 June 1569, following the Anglican Church’s break with Europe—I mean Rome!

[Dr Andrew Murrison (South West Wiltshire) (Con)]

I thank the Minister for his email on Monday about superfast broadband which I am sending out to my parishes. May I raise with him the problem of not spots in rural areas? What is being done following the cessation of the mobile infrastructure project run by Arqiva?

[Mr Vaizey]

You will be pleased to know, Mr Speaker, that I have run out of anniversaries.

The mobile infrastructure project was a fantastic success, with 75 sites established, but it has been overtaken by the emergency services programme, where the plan is to build 300 sites to complete the network cover—5,000 km of roads. I hope my hon. Friend’s constituents will benefit. In the next few months we will have a clearer idea of where those masts are going and which not spots they are tackling, and I will keep him informed.

[Tom Brake (Carshalton and Wallington) (LD)]

There has been much discussion in the House in recent days about world war three. There is a real risk that world war three will start in my constituency between residents and a local school on the subject of footballs that keep falling into residents’ gardens. Can one of the Ministers advise whether there might be grants available that would help stop this problem?

Mobile Phone Signal (Fownhope)

Lord Vaizey of Didcot Excerpts

Tuesday 6th January 2015 Commons Chamber

[The Minister for Culture and the Digital Economy (Mr Edward Vaizey)]

What a welcome addition to this debate you are, Mr Speaker. The seamless transition from Mr Deputy Speaker to Mr Speaker perhaps reflects the growing importance of this debate.

May I congratulate my hon. Friend the Member for North Herefordshire (Bill Wiggin) on securing this debate. If the people who watch our debates in this House are sometimes sceptical about politicians and their commitment to their constituents, in the past half hour they will have seen a masterclass in how a constituency MP goes about pressing a case for his constituents. Concerned as he is about their broadband and mobile phone coverage, he has met the Secretary of State; he has met and communicated with all the mobile operators; he has met the regulator, Ofcom; and he has invited colleagues, such as my hon. Friend the Member for Windsor (Adam Afriyie), to visit his constituency to test the mobile signal for themselves. He has covered all the bases and listed for our benefit, and that of Hansard, the number of villages where coverage is poor. He is the definition of a constituency champion, and his constituents will recognise his hard work.

My hon. Friend is knocking at an open door as far as the Government are concerned, and he has already achieved one success—no doubt working with his constituency—because the village of Fownhope will now receive the rural open sure signal project. To be clear that I cannot pull any strings in my area as telecoms Minister, I encouraged villages in my constituency to apply to that project, but as yet I am unaware whether any have achieved success because Vodafone has not chosen to share that data with me.

I met Vodafone today and, to add to the range of ideas put forward by my hon. Friend, I stressed that in my experience as telecoms Minister a lot of rural communities are keen to help themselves. Were Vodafone to offer a tariff to rural communities such as parish councils to provide an open sure signal, at a cost, once its effectiveness has been tested—I understand that Vodafone will meet the costs for the 100 villages networking under the pilot programme—I am sure that a lot of parish councils would look keenly at effectively buying an upgrade for their mobile service on behalf of their parishioners. I have stressed that point to other mobile operators as well.

I am also keen to stress that Openreach should have a tariff—I have been pushing this point for many months—so that it can go to a community and say, “You’re not part of the programme. We have been open in saying that the programme does not yet have 100% coverage, but we will work with you and provide you with a tariff. Crucially, we will work with you physically so that you can undertake some of the infrastructure work.” Openreach is represented in rural communities with many keen farmers with their own equipment who could help, and that would make a huge difference.

[Bill Wiggin]

I should perhaps have mentioned this during my speech, but is the Minister aware that DEFRA has changed the rules for most farmers, so that all their single farm payments will now be made electronically online? Those people cannot always get a signal, so perhaps money could be made available from DEFRA to help with that project, which I welcome.

[Mr Vaizey]

I agree with my hon. Friend. DEFRA put up £10 million at the beginning of this Parliament, which DCMS matched, to help smaller rural and community broadband providers to provide broadband in areas that were not part of the national programme. DEFRA is and will continue to be an effective partner in our broadband roll-out programme, which is developing all the time. I do not want to give the impression that we are doing that on the back of an envelope, because we have a clear programme. It is right for my hon. Friend to highlight the difficulties faced by him, his constituents, and indeed the Prime Minister, but it is also worth stating —perhaps I can turn to the glass-half-full element of the debate—that we are making significant progress.

As my hon. Friend is aware, phase 1 of our rural broadband programme involved a £500 million fund from the Government matched by local authorities and Openreach, to enable up to 90% of premises nationwide to get superfast broadband speeds of at least 24 megabits a second. That programme has already gone out to more than 1.2 million homes. We expect soon to announce the milestone of 1.5 million homes, and we are on course to reach 4 million homes under that programme in good speed. Indeed, in many areas the project is ahead of schedule. As my hon. Friend is aware, in his area about £35 million went into phase 1 of the Hereford and Gloucestershire Fastershire project, covering some 113,000 premises. Latest figures suggest that the programme has already reached 35,000 homes. That figure will be higher by now. The vast majority of those 110,000 premises will be reached this year, although some will be reached in the year after.

My hon. Friend will also be aware of phase 2. We secured an additional fund of £250 million, which was again matched by Openreach and local authorities. In the Fastershire area of Herefordshire and Gloucestershire, that amounts to almost £20 million to target a further 33,000 premises; so, just under 150,000 premises all told in phase 1 and 2, reaching coverage of approximately 93% of all premises in Herefordshire and Gloucestershire.

One important point to make is that, when we have these debates, my hon. Friends and other hon. Members will, understandably, point to where things are not going as well as anticipated and where the problems are in order to highlight those problems. As I say to them again and again, however, we are on the same page. These funds have not come from nowhere. They have not been magicked out of the air in the past week. We recognised, in the very first weeks after the election, that rural coverage for broadband was a big problem. We were not prepared to accept the previous Government’s commitment to provide speeds of 2 megabits under a rural broadband programme. We recognised immediately that by the time the programme rolled out people would be demanding faster speeds. We set a target of 24 megabits, which is more than adequate. Most people nowadays would expect, if they think about how they use broadband—accessing iPlayer, or indeed receiving payments from the rural payments agency—speeds of about 7 megabits or 8 megabits to be more than adequate. We have recognised absolutely the need to provide broadband for rural areas. The programme is, despite some of the critiques that have been levelled at it, going extremely well. We will see even more of a step change this year than there was last year.

The other element of the equation is phase 3—I am still dealing here with fibre broadband, but as my hon. Friend pointed out that is very relevant for mobile broadband coverage—where we have set aside £10 million to test out different technologies. Critics of Openreach will be delighted to know that a number of smaller providers have secured those funds to test out new technologies to reach the very hardest-to-reach premises. When we talk about hard-to-reach premises, we are talking about perhaps a house at the end of a long track, where it would cost £20,000 to £25,000 to provide a superfast broadband connection. In terms of value for money, one could argue whether that is an effective use of taxpayers’ money. If we can find new technologies that would bring down that cost substantially, it is incumbent on us to examine them. Those programmes are under way. We will evaluate them and come up with a sum that we think is adequate to get to our often-stated target of reaching 100%. We have not been specific about when or how much money, but that is our ambition.

[Nigel Adams]

Is the Minister able to enlighten us on possible time scales for the evaluation of those new technologies, which are so important for constituents not just in Herefordshire but north Yorkshire?

[Mr Vaizey]

We are evaluating them at the moment. I hope, certainly by March, that we shall have an indicative assessment of how effective those programmes have been. My hon. Friend took part in the Westminster Hall debate that we held shortly before this debate and compared the area he represents to Herefordshire in terms of rurality. It is also comparable to Herefordshire in being one of the first counties out of the blocks in relation to rural broadband. I am pleased to say that he is doing extremely well, because, in effect, £28 million has been spent in north Yorkshire to bring broadband to his constituents and others, covering 130,000 premises. That programme has ended, as far as I am aware, and we have in fact covered more premises than we targeted—about 141,000 premises have been covered. Another important point to make is that not only is the programme, when it is on the ground and up and running, often going faster than we expect, we often end up covering more premises than we originally targeted. As my hon. Friend the Member for North Herefordshire hinted, there is a difference between desktop research and actually having boots on the ground. I am delighted as well that in north Yorkshire more than £8.5 million is going in to cover a further 20,000 premises.

[Nigel Adams]

I was talking about the last 10%.

[Mr Vaizey]

My hon. Friend knows that even when that programme is complete, given the rurality of his area we will have covered about 92% of the county. We therefore need to find a cost-effective way to reach the last 8%. They are not forgotten; and no premise will be left behind.

I have covered the Government’s position on rolling out rural fibre broadband. As my hon. Friend the Member for North Herefordshire said in his excellent and comprehensive speech, which covered very fairly the Government’s approach to broadband, fibre broadband is essential for mobile coverage, which is why I have spent so much time talking about it. However, we are also focusing on mobile coverage—an issue that has become more and more pressing over the past couple of years.

I can remember getting my first mobile phone. It was actually politics that brought me into the world of mobile phones. When I was selected as the candidate for Bristol, East, I realised I would need a mobile phone to carry out my duties effectively. I do not know whether it was the mobile coverage or my own abilities that saw me turn a 5,000 Labour majority into a 17,000 Labour majority in Bristol, East in the 1997 election, but I remember getting a mobile phone and thinking it was the most extraordinary piece of technology I had ever come across.

The 18 years since have passed in a blur—it is hard to think it is almost two decades since I first dipped my toe in the political waters—and now being without one’s mobile phone is almost like being without one’s left or right arm. Smartphones and tablets—my hon. Friend talked about the tablet Bill Gates introduced 15 years ago—now have the sort of computing power one would have found in a large warehouse computer 40 years ago—somewhere such as the UK Atomic Energy Authority in Harwell in my constituency.

Mobile phones are essential pieces of equipment, and there is no reason why people living in rural areas should not have the same decent service that people get in city areas. However, it is worth inserting a caveat. We must remember that mobile phone companies are private companies. Government Members—and there are only Government Members here today, so we can have a private conversation in which free-market thinking prevails and without anyone taking us on—should applaud this private investment rolling out national networks. It is a highly competitive environment providing low costs for consumers. Indeed, the Government and the taxpayer benefit from the spectrum payments made by mobile phone companies.

A lot of obstacles are put in the way of mobile phone companies rolling out their networks: they have to pay high rents to landlords, they have to get planning permission, and the equipment is expensive. My hon. Friend referred to some of those issues. In particular, he mentioned the electronic communications code, which governs the ability of mobile operators to put up and access masts, and we are keen to press ahead with changes to the code as soon as possible—before the Dissolution of Parliament, I hope.

I would always advise hon. Friends in rural constituencies to work with mobile operators, as my hon. Friend indicated he has done. Sometimes an operator wanting to put up a mast will meet with objection from the local community, and sometimes the landlord will demand a very high rent. I know of one project in the mobile infrastructure project, to which I shall turn in a moment, that was stopped because the community itself objected to a mast, and of another that was stopped because the landlord asked for a sky-high rent. A lot of my hon. Friends can work with their local landowners to ensure, where coverage is bad, that sites could be provided at low cost to the operators, although I am obviously not asking them to give away the value of their land as they are commercial people, just as the operators are.

I shall deal shortly with Fownhope, but as I said earlier, the issue of coverage for mobile phones has become more and more pressing as mobile phones become more and more essential. There is no secret at all here: the Prime Minister was recently moved to comment on the poverty of his mobile phone connection when he was visiting some of the more rural parts of this great country of ours. Hitherto, mobile phone coverage has always been assessed in relation to its coverage of premises, and I am pleased to say that, following the successful 4G auction, all the operators are effectively committed to providing coverage to premises of 98%. Even better news is that while the licence stipulates that such coverage should be completed by the end of 2017, because of the competitive nature of our mobile phone companies, they will all have covered 98% of premises with 4G by the end of 2015—some two years ahead of schedule. In fact, it is safe to say that we have one of the fastest roll-outs of 4G anywhere in the world, and certainly one of the fastest take-ups of 4G.

Premises, of course, are not the same as geography. When my hon. Friend refers to the green, orange and red dots, he means that people are driving around his constituency or indeed walking around it and seeing dropped calls or no coverage at all. That is why, following his meeting with the Secretary of State, the latter was keen to press the mobile phone companies to improve their coverage. In my humble opinion as his junior Minister, I believe my right hon. Friend has secured a landmark deal, which will secure 90% geographic coverage of the UK by the end of 2017. My understanding is that that will get rid of two thirds of not spots, which are what we are talking about when we discuss mobile phone coverage and no operator signal is present.

[Nigel Adams]

The Minister is generous in giving way. This is an incredibly timely debate. Will the Minister remark in his summing up on the fact that 30 years ago last week we had the first ever mobile phone call on a commercial network in the UK? Would it not be nice to think that 30 years on, we would have that 90% or perhaps even more coverage in the UK, given that the technology was rolled out three decades ago?

[Mr Vaizey]

I hear what my hon. Friend says. It is important to note that when the first mobile phone call was made, it was done with a device that was the size of a small brick. Now we have devices that can slip easily into one’s inside pocket and, as I say, they have astonishing computing power. We should be alive to what my hon. Friend says. For example, some people who might have a faux retro nod to the past are keen to go on eBay and buy some old phones such as Nokia ones. They do so for two reasons: one is battery life, but the other is voice coverage. The more sophisticated some phones get, the worse their aerials become. The iPhone that we all have to look cool with and do our e-mails on has a pretty poor aerial, and sometimes the voice coverage we get from our smartphones is not as good as that from a phone that might have been in our pockets 10 years ago.

I hasten to say that I do not want people to take what I just said and run away with it, as I am not recommending that people walk around with a smartphone and a retro phone to cover all the bases, but it is worth noting that sometimes poor coverage, whether it be in using a smartphone or making a call inside an armour-plated Daimler, can be affected by factors other than the proximity of a mobile phone mast.

[Nigel Adams]

I echo what the Minister says, because the best phone I ever had for making phone calls—after all, that is why we bought the things in the first place—was a P3 Nokia phone. I am not sure whether the Minister is old enough to remember the P3.

[Nigel Adams]

We certainly do not still supply them, but I concur with everything the Minister has said.

[Mr Vaizey]

Of course we all fondly remember the old P3 Nokia, and there may well be a market for new retro phones that simply provide good voice coverage.

It is interesting to note the way in which the etiquette of using a mobile phone has changed. Not only am I old enough to remember buying my first mobile phone, but I remember when a previous Conservative Chancellor thought that it was a good idea to levy a tax on mobile phones. As a new technology, they were seen as a scourge, particularly when one was trying to have a quiet dinner in a lovely restaurant and someone was talking on a phone. Now, of course, the etiquette problems are different. There may be a lack of communication between a husband and wife when one of them is using a tablet, or people may be reading e-mails during a meeting when others are trying to have a discussion. Personally, I have moved on from making voice calls. I tend only to text or e-mail, and it is very rare for me to make a call. Perhaps there will not be a market for the retro phone after all.

[Bill Wiggin]

The Minister is lucky to be able to make voice calls, and, indeed, to text. He would not be able to do that if he lived in Fownhope. The biggest robbery of the mobile phone industry resulted from the extortionate 2G and 3G licences that were levied under the last Government, which I believe led to the lack of investment with which we are miserably trying to deal by means of this debate.

[Mr Vaizey]

I hope that I do not become a hostage to fortune when I say that I concur with my hon. Friend. With hindsight, I think that £22 billion was an astonishing amount of money, and the last Government did not use it to invest in digital infrastructure. A much more realistic price was paid for the 4G spectrum that we auctioned recently.

Let me now deal with some of the specific points raised by my hon. Friend. He mentioned, in passing, the mobile infrastructure project. We invested £150 million as a first stab at recognising the problem of poor coverage and not spots. As I have said, both in Westminster Hall and during today’s debate, it has not been smooth running. This is the first time that the Government have been involved in a subsidised project with the mobile phone operators. As 4G was about to be rolled out, we made a 2G project into, effectively, a 4G project. As the case of Fownhope illustrates, another reason for the bumps in the road has been the difficulty of measuring mobile phone coverage objectively.

The aim of the project is to provide coverage for the small percentage of people—0.3% or 0.4%—who currently have none at all. Let me return to my definition of a complete not spot as a place where it is impossible to obtain a signal from any operator. In a partial not spot, coverage can be obtained from one operator, or perhaps two, but not from all of them. The first mast went up in Weaverthorpe, North Yorkshire, in 2013, and we have recently put one up in north Molton, in Devon. In order to assess the not spot data locations, we had to update our original radio plan so that MIP could target true not spot areas. Negotiations are taking place with landlords on 120 sites, and so planning applications have been submitted.

In Fownhope, however, there has been a problem. Ten sites in Herefordshire, four of them in my hon. Friend’s constituency, are at various stages of delivery, including the carrying out of site searches. The mobile infrastructure project had been intended to include the building of a mast to provide coverage for the area, and the delivery contractor, Arqiva, had begun discussions with the planning authority. As my hon. Friend explained, the revised data showed that coverage in Fownhope had improved, although it is not great. There is a handful of not spots on the outskirts of the area, but owing to the small number of premises in a total not spot, it does not qualify for inclusion in the MIP. I know that is disappointing news, as my hon. Friend has made clear, for residents in Fownhope. As I mentioned earlier, mobile phone coverage is a key issue for us. That is why I was so pleased that my right hon. Friend the Secretary of State for Culture, Media and Sport was able to negotiate the deal he negotiated with the operators just before Christmas. That will lead to some £5 billion of investment in mobile infrastructure. Mobile services will come to many areas in the UK for the first time. I also mentioned our planned reforms of the electronic infrastructure code.

Our most recent data estimate that about a quarter of Herefordshire is affected by partial not spots and only a small percentage has no coverage at all. We think that, as a result of that deal, complete not spots in Herefordshire will be eliminated all together, and only 5% will remain in partial not spots. Those improvements should happen over the next three years. Therefore, 95% of Herefordshire should have coverage from all four operators. I hope that my hon. Friend will agree that that is a significant improvement.

My hon. Friend mentioned in passing—he did not dwell on the point—that Ministry of Defence infrastructure exists in his constituency. That point was music to my ears. It reminded me of that well worn phrase “Great minds think alike.” For two or three years, I have been mildly obsessed with the fact that in this country a great deal of digital infrastructure is not joined up. I have finally persuaded the Government to put together a digital taskforce, chaired by my right hon. Friend the Minister for the Cabinet Office. Working with me and some very able officials, he has discovered about 23 different digital projects that the Government are nominally responsible for. We are already making significant savings for the taxpayer, running into hundreds of millions of pounds. More importantly, to address the point that my hon. Friend made, we are joining up those projects—I am not saying we can do this overnight or that the infrastructure in his constituency would be relevant—so that we can use existing infrastructure to upgrade the digital capability of an area. His point is therefore extremely well made and we are looking at the issue.

As for the trial period for mobile phones, it is a good point to make to mobile phone operators—they should give people the chance to try out a phone for a period. There may be commercial reasons why that proves difficult. It may be difficult, if people return a phone, to sell it to another customer. There may be an attrition rate for people who take a phone on a trial period and do not return it. There may be costs associated with trying to track down people who inadvertently do not return the phone.

[Bill Wiggin]

It is not necessarily essential that those people should try the phone. It is the signal that is key, so only a SIM card is required.

--- Later in debate ---

[Mr Vaizey]

I hear what my hon. Friend says. Often people underestimate the ingenuity and entrepreneurship that exist in the House. Perhaps we could together propose to mobile phone companies a SIM card that simply expires after seven days so that people could fit it in their phone to check whether it worked. It should be possible to go on a website provided by the relevant operator to at least have some assessment of whether the area receives coverage from that operator.

Speaking off the top of my head, having a lower tariff in areas with poor coverage strikes me as somewhat problematic. I would not want to be too cynical, but people might suddenly arrive as potential lodgers in rural areas to take advantage of the lower tariff and then merrily use their phone in London for extended periods, so that may be difficult. However, my hon. Friend has an answer to that point.

[Bill Wiggin]

The Minister has just created the most marvellous whip with which to beat the mobile phone operating companies so that people do not do that, because the signal will be just as good in the rural areas. I congratulate him on that brilliant suggestion.

[Mr Vaizey]

I am not sure that that would be the answer that the mobile phone operators wish to receive, but as a former Whip my hon. Friend is keen on whipping the mobile phone operators into shape. He has already done that most effectively with this timely Adjournment debate.

May I conclude by offering a metaphorical hand across the Chamber? I often find myself, both in this Chamber and Westminster Hall, hearing the concerns of both hon. Friends and other Members. My message to them again and again is that the Government have heard these concerns, and what we are debating is not the principle that rural areas deserve better broadband coverage and better mobile phone coverage, but the detail of the implementation. The spirit is always willing, but it is, I am afraid, sometimes the case that the flesh is weak.

Question put and agreed to.

Oral Answers to Questions

Lord Vaizey of Didcot Excerpts

Thursday 3rd July 2014 Commons Chamber

[Miss Anne McIntosh (Thirsk and Malton) (Con)]

6. What comparative assessment he has made of the extent of broadband coverage in the UK and other EU member states.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

As the House has already heard from my right hon. Friend the Secretary of State, the UK’s broadband coverage is among the best in Europe: 73% of premises can access superfast broadband compared with just 45% in 2010. Government investment will drive superfast coverage up to 95% by 2017.

[Miss McIntosh]

Sadly, rural areas will be left behind. I understand from NYnet that Thirsk, Malton and Filey will have only 78% coverage by 2015-16. Given that farmers will have to apply digitally for farm payments from 2015, they will be grossly disadvantaged. Will the Government please make it a top priority to ensure that those who have the weakest coverage will be fast-tracked to superfast broadband?

[Mr Vaizey]

We certainly will. NYnet is one of our most effective programmes and I praise the county council for its effective work. We have already passed 120,000 premises under this programme. We will have reached 170,000 by next spring and we have allocated further millions to take coverage even further.

[Mr Dennis Skinner (Bolsover) (Lab)]

The EU is a very big area, but Bridle road in Stanfree in Bolsover is relatively small. They told me to ask the appropriate Minister to sort out the broadband that they have been messing about with for four years in that Bridle road, Stanfree area. They must have a letter—get it sorted.

[Mr Vaizey]

After a question such as that, it beggars belief that the Labour party would not have such a man on its national executive committee. On this side of the House, when the hon. Gentleman speaks, we act.

[Mr David Heath (Somerton and Frome) (LD)]

I am tempted to just say to the Minister, “Somerset—get it sorted.” The good news is that two more communities in my constituency—Fivehead and Milborne Port—will be connected over the next few months, but there are a lot of villages in exactly the position described by the hon. Member for Thirsk and Malton (Miss McIntosh) that will not be connected. Does the Minister recognise how critical Somerset’s bid to the superfast extension fund is in filling in some of those gaps and getting broadband to the rural areas that desperately need it?

[Mr Vaizey]

Yes, I do. The whole point of all the completely justified questions that have been asked is that people want broadband. That is why we are putting £1.2 billion into rolling out rural broadband and why total funding of something like £70 million from BT, European funding and Broadband Delivery UK is going into connecting Devon and Somerset. More than 250,000 premises are planned to be networked and we have allocated a provisional £22 million for the next phase.

[Julie Hilling (Bolton West) (Lab)]

This issue is not just a rural problem. At my recent business event, companies told me how lack of access to fast broadband is seriously hampering their businesses. How will the Minister ensure that areas on the edge of major urban centres also get superfast broadband?

[Mr Vaizey]

The whole point of the rural broadband programme is to help the areas she speaks about. Local councils are in charge of the roll-out, so they should know best where the money should go first for the most impact. As I say, we have had phase 1 to get to 90%; we now have phase 2 to get to 95%; and the money we have allocated for new technologies will give us the figure we need to get to 100%.

[Mr David Nuttall (Bury North) (Con)]

In some cases, the only way to improve broadband speeds is to install a new cabinet. Will my hon. Friend confirm that the cost of such installation is within the scope of the Government’s assistance scheme?

[Mr Vaizey]

My understanding is that, where appropriate, new cabinets can be installed under the scheme. Much of the scheme will be for funding the upgrade of existing cabinets, but occasionally it can be for a new cabinet.

[Sir Peter Luff (Mid Worcestershire) (Con)]

9. What steps he is taking to ensure that Commonwealth countries are included in the commemorative events planned for the first world war centenary.

--- Later in debate ---

[Robert Jenrick (Newark) (Con)]

11. What steps his Department is taking to encourage (a) national collections and (b) the royal collection to loan works of art to regional museums and galleries.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

First, may I welcome my hon. Friend to the Chamber? This is the first opportunity I have had the chance to welcome him to the House.

In 2012-13, national museums sponsored by the Department for Culture, Media and Sport lent objects to more than 1,500 museums around the country through touring exhibitions, star object loans, loans of local significance and long-term loans.

[Robert Jenrick]

Regional museums would benefit from a much more active programme of loans from national museums, which are sitting on hundreds of thousands if not millions of works of art that are rarely if ever seen by the general public. The Secretary of State recently viewed the site of the new Newark national civil war museum, which is a perfect example of a regional museum that would benefit from active loans from national institutions. What can the Department do to encourage national museums to review their civil war collections and to loan them to our museum in Newark?

[Mr Vaizey]

I know for a fact that the Secretary of State thoroughly enjoyed his visit to the new National Civil War centre, which was awarded a grant by the Heritage Lottery Fund of £3.5 million in 2012, and we look forward to its opening next year. I am certainly happy to meet my hon. Friend to discuss what we can do to encourage loans of civil war objects from national museums, but it is important for the House to remember that national museums are of course independent and do not simply do what the Government tell them.

[Guto Bebb (Aberconwy) (Con)]

12. What assessment he has made of the success of the broadband roll-out programme in Wales and that programme’s effect on the tourism industry in Wales.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

Independent research estimates that the Government’s investment will generate £20 for every £1 by 2024. Wales has received almost £70 million from the UK Government for the roll-out of superfast broadband. We are confident that this will benefit the Welsh tourist industry, as well as the Welsh economy more generally.

[Guto Bebb]

My hon. Friend will be aware that I consider his Department’s decision to allocate funding for rural broadband to the Welsh Government to be a mistake. A total of £120 million has now been allocated from taxpayer funds for the roll-out of broadband in rural Wales, yet my constituents and businesses in the tourist sector in my constituency are no nearer to getting any answers from the Welsh Government about when and where they will have roll-outs. Does my hon. Friend agree that transparency is crucial when £120 million of taxpayer funding is being spent?

[Mr Vaizey]

It is important that roll-out is as transparent as possible—people need to know when broadband is coming to their area. More than 160,000 premises have been passed but I am sure that Opposition Members will have a word with their Labour colleagues in Wales to encourage them to be more transparent with my hon. Friend.

[Hugh Bayley (York Central) (Lab)]

13. What long-term cycling legacy he expects from the Tour de France Grand Départ in Yorkshire.

--- Later in debate ---

[Eric Ollerenshaw (Lancaster and Fleetwood) (Con)]

T2. Given BT’s virtual monopoly in contracts for superfast broadband and the problems with that company that have been raised by hon. Members today and previously, is it not about time that the Government held an inquiry into its performance, or would that be better done by the competition authorities?

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

The National Audit Office conducted an inquiry. I am confident that BT is doing its job incredibly effectively. We are passing a total of 20,000 premises a week with broadband, and that figure will soon be up to 40,000 a week. More than £60 million has been allocated to Lancashire and more than 130,000 homes there will get superfast broadband as a result.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

The evidence before the Leveson inquiry laid bare the pain and suffering caused to victims of press abuse. The press felt they could act with impunity as there was no proper complaints system, and all parties in both Houses agreed to a new system of independent self-regulation for the press. Will the Secretary of State join me in welcoming the appointment of David Wolfe as chair of the recognition board for the new press complaints system? Does he agree that the rest of the board should be appointed as soon as possible, and will he join me in encouraging the press to establish and put forward for recognition a Leveson-compliant, independent regulator so that there is an effective complaints system that is independent of both politicians and the press?

--- Later in debate ---

[Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)]

T4. Will the Minister join me in congratulating the excellent Tyne and Wear Archives and Museums and other arts organisations based in Newcastle upon Tyne on their successful Arts Council bids? In doing so, will he acknowledge that there is still a problem with the disproportionate amount of private sector arts funding—the figure is 82%—that is drawn into the capital and not to the regions of England, and consider the remedy that is set out in “Rebalancing Our Cultural Capital”? If he has not read that report, I commend it to him.

[Mr Vaizey]

I am very happy to join the right hon. Gentleman in congratulating Tyne and Wear Archives and Museums—it is a fantastic place that I have visited on at least one occasion. I am pleased that following the Arts Council settlement the balance between London and the regions has shifted in favour of the regions. As he knows, I believe that every arts organisation around the country is capable of raising private funding and should be doing so.

[Iain Stewart (Milton Keynes South) (Con)]

T5. I thank the Minister for the assistance that he and Ofcom have given the community radio station in my constituency, MKFM, in its bid for a permanent FM licence. Will he assure me that he will continue to do all he can to assist such community radio stations to expand the vital service they provide to local communities?

[Mr Vaizey]

My hon. Friend has made an excellent case for MKFM—his excellent local community radio station. I am very pleased that the independent regulator, Ofcom, listened and included MKFM on its timetable for early consideration for an FM licence.

[Andrew Gwynne (Denton and Reddish) (Lab)]

T6. Ministers will know that cyber-bullying is a growing problem, particularly among teenagers, but the offences fall, confusingly, between five different Acts. Is it not time for Ministers to talk to their colleagues in other Departments to bring about a specific offence of cyber-bullying that mirrors the offence of harassment in the real world?

[Mr Vaizey]

I hear what the hon. Gentleman says. I work closely with the Minister for Policing, Criminal Justice and Victims and the Under-Secretary of State for Education, my hon. Friend the Member for Crewe and Nantwich (Mr Timpson), on the UK Council for Child Internet Safety. I am sure that the hon. Gentleman’s representations have been heard and they will be considered in the usual way.

[Mr Philip Hollobone (Kettering) (Con)]

T9. Will the libraries Minister join me in congratulating Northamptonshire county council’s library and information service on being named the best council services team at this year’s Municipal Journal awards? Whereas other local authorities are closing libraries and cutting opening times, the Conservative council in Northamptonshire is extending opening to seven days a week and extending the range of services on offer, and has recruited more than 600 library volunteers.

[Mr Vaizey]

Libraries are funded and run by local authorities, and it does not surprise me that an excellent Conservative local authority is investing in its libraries.

[Keith Vaz (Leicester East) (Lab)]

T7. I congratulate the Minister for creative industries on his outstanding work in encouraging international film makers, especially from Bollywood, to come and make their films in the United Kingdom. Does he agree that it is important that that helps with jobs, growth and the diversity of UK film making?

[Mr Vaizey]

I am very pleased to have that question from the right hon. Gentleman. Although we obviously welcome investment from the west coast of America, particularly yesterday’s announcement by Warner Bros. that it will be filming J. K. Rowling’s “Fantastic Beasts”, it is important to remember that Bollywood is bigger than Hollywood, and we need also to encourage Indian film makers to make films in this country with our excellent crew and casts.

[Neil Carmichael (Stroud) (Con)]

T10. To reinforce points already made this morning, what assurance can the Minister give my constituents in Stroud valleys and vale that they will have access to broadband so that their businesses and lifestyles can thrive?

[Mr Vaizey]

We are putting more than £1 billion into broadband roll-out. We continue to invest to take it to 95%. I will happily work with any Member to ensure that the broadband rural programme goes smoothly in their constituency.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

T8. The theme of much of this morning’s exchanges has been broadband and mobile coverage. Will the Minister meet me and other interested rural and island Members of Parliament to discuss how proper 4G coverage on a Swedish or Finnish model may help the aims of comprehensive mobile and fast broadband coverage in the years to come?

[Mr Vaizey]

Broadband is going extremely well in the UK, mainly because we are better together. We are working with Scotland and Wales to roll out broadband and 4G coverage. The hon. Gentleman should not be so modest: we have outstripped a lot of the Scandinavian countries. We have just laid 400 km of undersea cable to the highlands and islands. That could not have been done without the UK Government working with the devolved Government to bring broadband to our rural areas. We are better together.

[Sir Bob Russell (Colchester) (LD)]

Tourism is a major economic generator in Colchester. Does the Minister agree that the best way to support tourism is by reducing VAT on tourism to 5%? Will he have a chat with the Chancellor, please?

--- Later in debate ---

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The Minister will no doubt be aware that Northern Stage’s excellent adaptation of Joseph Heller’s “Catch-22” closed at the weekend at Richmond, following a successful nationwide run. What is the Minister doing to ensure that regions outside the north-east benefit from the excellent cultural talent that we produce?

[Mr Vaizey]

The latest round of Arts Council funding has pushed more money out to the regions, and I am particularly pleased about the new £15 million fund it has set up specifically to support talent outside London, and to keep people outside London working in our regional theatres and doing innovative work.

[Mr Speaker]

With extreme brevity please, Mr Philip Davies.

--- Later in debate ---

[Peter Aldous (Waveney) (Con)]

There is concern that the Government’s approach to allocating funding for the superfast broadband extension programme will leave most rural areas at a disadvantage. What help and assurances will the Minister give to constituents in the villages of Rumburgh, St James and Ringsfield that they will not be penalised?

[Mr Vaizey]

The principle behind the programme is that we allocate funding in order to get to 95% coverage. We expect local authorities to match that, and we will then work with them to target the areas where it is needed most. I am happy to meet my hon. Friend to discuss the best way forward.

The Ministers for Women and Equalities were asked—

Oral Answers to Questions

Lord Vaizey of Didcot Excerpts

Thursday 1st May 2014 Commons Chamber

[Michael Connarty (Linlithgow and East Falkirk) (Lab)]

11. What recent discussions he has had with Digital UK and Ofcom on the re-allocation of the television spectrum to be vacated by BBC Three.

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

The BBC Trust is currently considering the proposal to stop broadcasting BBC Three. I have not yet discussed what may happen to BBC Three’s Freeview channel number with either Digital UK or Ofcom.

[Michael Connarty]

I know that the Minister is very conscious of the concern felt by people in Scotland about Scottish Television’s proposals to introduce local television. Is it not a problem—I have spoken to Ofcom about this—that the BBC seems to think that it can keep the BBC Three channel and invent BBC One plus one, even though it is currently failing to use the channel properly? Is it not important for the BBC not to have a monopoly, and for the channel to be available to other public broadcasters?

[Mr Vaizey]

I know that the hon. Gentleman met Ofcom this week, and that he has raised this subject in the House and led a debate on it. The BBC Trust will make the final decision on whether the BBC Three channel should go to an online service, but I understand that Digital UK will allocate the channel in the normal way, taking account of the due prominence rules in the public service broadcasting guidelines. However, I have noted the hon. Gentleman’s point, and will follow it up.

[Martin Vickers (Cleethorpes) (Con)]

It is two years since Digital UK completed the changeover from analogue and a large number of households were persuaded to buy Freeview boxes. There have been reports that Freeview is now under threat. Given that many households in my constituency rely on it rather than on cable and satellite, which are more expensive, can the Minister assure them that Freeview will continue?

[Mr Vaizey]

I was pleased to visit my hon. Friend’s constituency and see how well local television is doing in his part of the world. I can assure him that Freeview and free-to-air television is very important, and the Government will continue to support it.

[Graham Jones (Hyndburn) (Lab)]

13. What recent discussions he has had with gambling addiction charities on funding for research into fixed odds betting terminals.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

Commercial radio is vitally important both locally and nationally. Some 35 million people listen to commercial radio every week, and UK radio revenues continue to increase. We have seen the launch of the first national talk radio station, LBC, and digital radio is vital to commercial radio’s future. I know that the Secretary of State is keen to meet commercial radio operators as soon as possible.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

I add my congratulations to the right hon. Member for Bromsgrove (Sajid Javid) on his promotion. His elevation to a seat at the Cabinet table sends out a strong signal that in this country, our politics must be for people from all communities, all ethnicities and all walks of life, and I wish him well in his job.

As the right hon. Gentleman takes over leadership of this important Department, we will be urging him to fight hard for the arts and to promote the crucial role that the BBC plays in the cultural life of this country. I want to ask him about young people and music. Creativity is being squeezed out of the curriculum; fewer pupils are taking music at GCSE and A-level; music services have been cut by almost 30%; and now the Department for Education wants to cut a further 12% of music resources available to schools through the education services grant. Will he intervene with the Education Secretary and make the case for music in schools?

[Simon Hart (Carmarthen West and South Pembrokeshire) (Con)]

T4. Mobile phone coverage in parts of Wales is as bad as coverage in places in Africa, Kazakhstan and the Alps. Does the Minister have a view on when we can expect a 20th-century service in Wales, let alone a 21st-century one?

[Mr Vaizey]

I am pleased to say that a 21st-century service is well on its way. We have the greatest roll-out of 4G technology anywhere in the world and the major mobile providers will complete their 4G mobile coverage two years ahead of schedule. We will then take a look at how effective that is and we will continue to work with mobile operators to improve mobile coverage.

[Mark Lazarowicz (Edinburgh North and Leith) (Lab/Co-op)]

T3. What is the Government’s current position on net neutrality, particularly given recent discussions and decisions in both Europe and the United States?

[Mr Vaizey]

I like to think that we were ahead of the curve in putting together a code of conduct, to which the major internet service providers and mobile phone companies have subscribed, under which they agreed that they would not block traffic for anti-competitive reasons. Obviously, we are carefully examining the telecoms package that the European Commission has proposed, which includes a potential regulation on net neutrality.

[Pauline Latham (Mid Derbyshire) (Con)]

T5. Between 18 April and 31 May, Belper, a town in my constituency, is holding its annual arts festival, throughout which 179 events in 99 different venues will be drawing in the region of 16,000 visitors to the local area. Will the Minister join me in congratulating Belper, led by volunteer George Gunby, and other towns and villages that are holding similar events? What is the Minister doing to support such initiatives?

[Mr Vaizey]

I congratulate my hon. Friend on the amazing work she does to promote Derbyshire in this House, She has so effectively led the Derbyshire embassy, which I was delighted to attend. The Belper arts festival is putting together a fantastic and enticing programme. I am also pleased to see that the Arts Council is supporting the Red Earth theatre in Belper, the Buxton arts festival and the Wirksworth festival in Derbyshire.

[Mrs Sharon Hodgson (Washington and Sunderland West) (Lab)]

T7. I am sorry that the sports Minister, the hon. Member for Maidstone and The Weald (Mrs Grant) and indeed the Secretary of State were not able to attend the all-party group on basketball event yesterday on Speaker’s Green, where Opposition Members were able to out-dunk Government Members by 56 to 33. The Minister will, however, be aware of the deep concern across the House about the future of our national basketball teams after UK Sport withdraw all their elite-level funding. What consideration has she given to providing elite-level development funding for accessible team sports such as basketball which fall foul of the no-compromise model of UK sport?

--- Later in debate ---

[Julie Hilling (Bolton West) (Lab)]

Lowton girls group came to talk to me about its concerns that music videos portraying sex and violence are being watched by children and young people. Why will the Government not legislate for age ratings for music videos online?

[Mr Vaizey]

Parents tell us that they want age ratings on music videos that are unsuitable for younger children. We consulted on legislation to introduce the British Board of Film Classification age ratings for music DVDs. We will introduce legislation to Parliament within the coming months, and we will bring into force new age rating requirements as soon as possible. I am also working with the music industry to get age ratings for online music videos as well.

[Mr Tobias Ellwood (Bournemouth East) (Con)]

T8. I join others in welcoming my right hon. Friend the Secretary of State to his new position and invite him to visit Bournemouth, the UK’s premier seaside resort, at the end of this month when it is organising its first free wheels festival, which will include historic classic cars, monster trucks and supercar demonstrations on the sea front. Does that not illustrate how the experience offered to visitors is just as important as good accommodation and a picturesque location?

[Diana Johnson (Kingston upon Hull North) (Lab)]

People whose homes and businesses were recently flooded will know, as we did in Hull in 2007, of the benefit of having local BBC radio stations. Those radio stations are often seen as the extra emergency service in times of crisis. Will the Minister confirm that, in any future negotiations on funding for the BBC, protection is given to local radio services?

[Mr Vaizey]

Absolutely. I echo what the hon. Lady says. During the severe floods in Oxfordshire in 2007, BBC Radio Oxford certainly played an invaluable role. I can assure her that the value of all BBC services, including local and regional services, will be considered as part of the review of the BBC’s charter. We have not yet announced the timing, scope and process of the charter review, so it would be premature of me to say anything further at this point.

[Neil Parish (Tiverton and Honiton) (Con)]

May I also add my congratulations to the Secretary of State on his appointment? The Blackdown hills and villages such as Upottery, Clayhidon and Rousdon are finding it difficult to get broadband. We welcome the Government’s money, but BT is finding things difficult and there is secrecy about where the broadband will be delivered throughout the constituency. Will the Secretary of State meet me and local representatives to discuss the way in which we can roll out this broadband in a much better way?

[Mr Vaizey]

Absolutely. It is important to point out that the progress of rural broadband is really picking up pace, with 20,000 homes passed every week, but we must get out the information to local residents. I am sure that the Secretary of State will meet my hon. Friend at the earliest opportunity to discuss his points.

[Ian Lavery (Wansbeck) (Lab)]

When imposing the changes to the betting and gaming industry, did the Government consider conducting an impact assessment on the potential job losses? Before yesterday, William Hill had already announced 109 betting shop closures, with the loss of 420 jobs, which mainly affect young women between the ages of 18 and 24.

Mix 96 (Digital Radio Switchover)

Lord Vaizey of Didcot Excerpts

Thursday 28th November 2013 Commons Chamber

[Sarah Newton (Truro and Falmouth) (Con)]

My hon. Friend is making an excellent case. She is right that many of our colleagues would like to be here to contribute but cannot because they are driving to their constituencies. Does she agree that it would be great if the Minister could agree to meet a wider group of colleagues who would like to stick up for stations such as—

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

Name your station!

[Sarah Newton]

Pirate FM.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Culture, Media and Sport (Mr Edward Vaizey)]

I am grateful for the chance to respond to my right hon. Friend the Member for Chesham and Amersham (Mrs Gillan). It is good to see you in the Chair, Mr Speaker, given your strong interest in Mix 96, and as we are debating a digital subject, I hope you will not take it amiss if I say how brilliant your speech was yesterday to the Hansard Society in your approach to digital politics in the 21st century. I also welcome to the Front Bench the Minister for Europe, my right hon. Friend the Member for Aylesbury (Mr Lidington), who also represents Mix 96. Sadly, he must remain silent, but I suspect, were he able to speak, he would echo many of the views of my right hon. Friend the Member for Chesham and Amersham.

I thank others who have contributed: my hon. Friend the Member for York Outer (Julian Sturdy),representing Minster FM; my hon. Friend the Member for North West Norfolk (Mr Bellingham), representing KLFM; my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), representing Splash FM; my hon. Friend the Member for Truro and Falmouth (Sarah Newton), representing Pirate FM; the hon. Member for Washington and Sunderland West (Mrs Hodgson), representing Sun FM; my hon. Friend the Member for High Peak (Andrew Bingham), representing High Peak radio; my hon. Friend the Member for Milton Keynes South (Iain Stewart), representing MKFM; and my hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw), representing The Bay and Radio Wave; and me, representing Jack FM.

I am delighted to be here talking about this subject. Whenever we debate local newspapers, hon. Members get a chance to plug theirs, and I suspect that this debate will be played on local radio stations up and down the land. I think, however, that my right hon. Friend slightly missed a trick. I thought she was going to suggest that we scrap High Speed 2 and spend all the money on rolling out digital radio, but I am pleased—

[Mrs Gillan]

rose—

[Mr Vaizey]

Wait, the joke’s coming. I am pleased that I am not the Minister for HS2, because I found my right hon. Friend’s argument on digital radio so persuasive that were I that Minister, I would probably collapse in the face of this Adjournment debate.

[Mrs Gillan]

I encourage the Minister for Europe, my right hon. Friend the Member for Aylesbury (Mr Lidington), not to remain silent on the subject of HS2, but to inform the Minister of our views in Buckinghamshire about that particular project. Nevertheless, I thank my hon. Friend for his courtesy and for taking this matter very seriously, because these radio stations are close to all our hearts.

--- Later in debate ---

[Mr Vaizey]

And let me continue in that vein by mentioning another silent hon. Friend, our Whip, who represents Spike FM.

[Claire Perry (Devizes) (Con)]

Spire FM.

[Mr Vaizey]

I am so sorry. Her writing is appalling, Mr Speaker.

[Tracey Crouch (Chatham and Aylesford) (Con)]

The Minister briefly mentioned local newspapers, and I would like to add that KMFM, run by the Kent Messenger Group, is incredibly concerned about these proposals, not least with its relationships with advertisers and commercial interests being as difficult as they are.

[Mr Vaizey]

The point is taken.

I take this issue very seriously, being a passionate radio listener myself. We have 1 billion hours of radio listening a week, and it was clear to me when I became Minister that people took their radio listening very seriously; they are passionate about it. The last Government left us with an intent to get to radio switchover, but no plan to reach it. The key criterion was that digital radio’s share of the listening figures should be at least 50% before we set out the timetable for switchover. I made it clear in my first speech on this subject as Minister that I would be led by the consumer, and that is what I mean when I say I agree with the critique of digital radio by my right hon. Friend the Member for Chesham and Amersham. I will do nothing on switchover unless I am bringing radio listeners with me.

To get to a stage where we can consider switchover, we have put together a digital radio action plan, ably led by Digital Radio UK and its superb chief executive, Ford Ennals, and his team, including, in particular, Jane Ostler and Laurence Harrison. Substantial progress has been made. I note what my right hon. Friend said about wanting not to scrap digital radio, but to support its roll-out, while also securing a future for local radio stations. I will come to local radio in a moment, but first I will update her on our progress.

We have taken local radio coverage, be it for local BBC stations or commercial stations, to about 72% and national coverage—effectively BBC radio stations 1 to 5—up to 94%, and this year we launched commercial radio digital services in Northern Ireland. Furthermore, roughly half of all new cars, which are vital to this, have digital installed as standard, and in the last year almost 900,000 cars sold had digital radio in them.

This is a good news story for the UK economy, too. We account for about 50% of the global digital radio market. That means real opportunities for British businesses such as Roberts, Revo and Pure—in Kings Langley, not far from my right hon. Friend’s constituency.

It is worth pointing out that we are not alone, and the Minister for Europe will take an interest in what I have to say. Norway and Denmark have already set dates for switchover—2017 and 2019 respectively—and there has been more progress following the launch of national digital services in Germany in 2011 and the Netherlands this year, which has a target switchover date of 2023. Other European markets, including Italy, France, Poland, Sweden, Austria and the Czech Republic are also looking into it. Digital radio is now reaching the Asia Pacific region, where Australia is taking a lead and DAB penetration has already reached 16%.

[Andrew Bingham]

As chairman of the all-party group on commercial radio, I am greatly interested in this debate and to hear about digital radio being extended to all the good burghers of Europe, but I would like to make a plea to have it in High Peak, which has very little in the way of a digital radio signal at all.

[Mr Vaizey]

That brings me neatly on to my next point. I am due to make a major speech about the future of digital radio in the middle of December, when I hope to address particular concerns about coverage. Let me repeat, however, that when it comes to the timetable and the setting of dates, we have always been clear that these will be led by the radio listener. There will be no switchover until the majority of listening is digital. It is clear that we are not there yet, and it will certainly not happen within the time frame that concerns my right hon. Friend. While good progress has been made, with the number of adults with access to a DAB digital radio up 10% year on year and places like London reaching 40%, we need to make more progress.

Let me deal with what my right hon. Friend said about Mix 96 and what other hon. Members have said about their own local commercial and community stations. I am a huge fan of local commercial and community radio. In fact, community radio was brought into being by the last Government; I think it has been a massive success story, as are independent local radio stations. Ofcom’s research shows that local radio still holds value for listeners: it is important and valued. Although some measures have allowed greater networking between local radio stations, we still require local programming both at peak time and outside it. Mix 96 is part of the larger radio group. In fact, it is listed as one of the100 best companies to work for by The Sunday Times. Its concerns are well known to us, and they come not just from UKRD, but from UTV and others.

As for securing a digital future for local commercial and community stations, let me first make it clear that we have never said that we require small stations to go over to digital. We have always said that if and when there is a switchover, we would maintain their presence on FM. It is also true that FM can work in tandem with DAB, as AM has with FM for many years. Many of the manufacturers of DAB radios have agreed a minimum specification, which includes FM. However, I take on board the point—I think it was made by my hon. Friend the Member for High Peak (Andrew Bingham), who talked about remote-controlled radios—that even where we have an FM-DAB station, switching between FM and DAB can be complicated. We are going to see more sets that switch seamlessly as the FM and DAB buttons are pressed, but that does not mean that we do not have to look for a potential solution for local commercial radio to get on to DAB at a cost it can afford.

[Mrs Hodgson]

The Minister mentioned that about 50% of new cars have DAB digital radios fitted as standard. Is he aware, however, that the figure for cars currently on the road is only about 5%? Irrespective of whether the facility for switching between DAB and FM happens, it would not help any of the cars currently on the road.

[Mr Vaizey]

I totally understand the hon. Lady’s point. First, as the timetable moves towards full coverage of digital radio, we will see what is known as the car park being refreshed over a number of years. It is also the case that the ability to convert an FM radio in a car with a digital converter is becoming much easier and cheaper. Technology will have a solution, but I take her point.

Let me say something about the business of transferring community and local commercial radio to DAB. I said to my officials, and to Ofcom, that I wanted to find a cost-effective route to digital broadcasting for our local stations. Ofcom has made progress—to which my right hon. Friend alluded, although she rightly pointed out that this was an early initiative and that more work needed to be done. It has developed a new approach to small-scale, low-power digital transmission, using open-source software which makes it possible to get on to the local multiplex using an existing FM antenna. That approach was developed initially by Rashid Mustapha, an engineer working at Ofcom, and it must be a brilliant solution, because I do not normally have an opportunity to name people who work at Ofcom during a debate. It has been tested in Brighton with the support of Daniel Nathan of Juice FM. The initial results are promising, and I hope that smaller stations that are enthusiastic about digital will get behind the work.

[Mrs Gillan]

As the Minister knows, we now use new technology even in the Chamber. I have just received a tweet which says:

“Please mention community radio who have no chance of affording digital transmission costs…never mind the listener.”

Perhaps the Minister could take up that point.

[Mr Vaizey]

This is almost unheard of, but I have left my mobile phone in my office, so I have not been able to keep up with those who have been tweeting on the debate. However, I advise the tweeter who tweeted to use a piece of old technology called the ear to listen to what I have to say.

I have already mentioned community radio about eight times today. I have said again and again that I am a fan of both community and local independent commercial radio. It is incredibly difficult to run a successful local independent radio station. The people who run them are not rolling in money, or printing money; even those who run local commercial stations are almost running a community service. I met a man who runs one of those stations in Manchester, and he said that he found it tough going. I recently visited a community radio station in Swindon, which is supported by hundreds of volunteers and which makes a huge and vital contribution to the community there. I give equal weight to community radio and local commercial radio in my search for a solution.The key is the FM antenna, which those radio stations will have because they broadcast on FM, along with the ability to use software to convert it to a digital antenna.

I have taken the debate at a gallop because I was not sure whether I would have enough time both to get my jokes in and to respond to the points made by my right hon. Friend. Let me now take up the offer from my hon. Friend the Member for Truro and Falmouth. If the meeting that she proposes will be as good-natured and well informed as this debate, I relish the prospect. We might even find time to meet—along with Members in all parts of the House, I should add—on a Friday, when the House is debating European matters.

I am a fan of digital radio, and I think that it is the future, but my criteria have always been about coverage. We want digital radio to have the same coverage as FM. This is about the consumer, otherwise known as the radio listener. I want to bring the listeners with us, so that they will effectively have converted themselves to digital radio. That means cheap digital radios, which are now on the market. It means cheap car conversions, which are becoming cheaper all the time. It means digital radios being fitted as standard in new cars. It means good content, like that of Radio 6 Music, the first digital radio station to reach more than 1 million listeners. Those are our criteria.

We will not be pushed into a switchover date; we will not get ahead of the radio listener; and we will continue to listen to well-informed, passionate colleagues such as my right hon. Friend, to whom I am grateful for calling this excellent debate.

Question put and agreed to.

Amendment of the Law

Lord Vaizey of Didcot Excerpts

Monday 26th March 2012 Commons Chamber

[The Parliamentary Under-Secretary of State for Culture, Olympics, Media and Sport (Mr Edward Vaizey)]

Your instructions have been noted, Mr Deputy Speaker.

May I begin by apologising to the House for the absence of my right hon. Friend the Secretary of State? As I am sure the House will know by now, his wife gave birth to a beautiful baby girl last week—appropriately enough, during Department for Culture, Media and Sport questions—and so he is enjoying his paternity leave. I am sure that the whole House will want to join me in passing on our good wishes to the whole family. I, for one, wish that the Secretary of State was here, because this is, I believe, the first time that DCMS, as a Department, has opened a Budget debate, and it is a testament to his skill and vision that he has put the Department at the heart of the Government’s strategy for growth. DCMS is now an important economic Department that is responsible for broadband and digital infrastructure, internet and media policy, and our world-beating creative industries. Policies pursued by this Department will contribute significantly to the growth of the UK economy.

I want to use today’s debate to remind the House of how well placed this country is to take advantage of the technology revolution. The Chancellor has set out our ambition to turn Britain into Europe’s leading technology hub, and we are well on course to achieving that. According to a Boston Consulting Group report published this month, the UK is the top internet economy in the G20; we purchase more online than Germany, the United States and South Korea. We have a huge range of successful technology companies in this country. It is worth reminding the House that BT, for example, is a global technology company with a presence in 170 countries. ARM supplies the chips for smartphones and tablets. Imagination Technology provides the graphics for Apple products. Ubiquisys in Swindon sells femtocells to the French and the Japanese. Neul, based in Cambridge, is developing new wireless network technology. In Tech City, we have a rapidly growing technology hub in the heart of London’s east end, which in just three years has grown from about 15 companies to more than 300.

My personal favourite is the motor sport industry, which is worth £5 billion a year and exports 70% of its products. I was particularly tickled by an anecdote—[Interruption.] I cannot believe that Opposition Members are groaning at an anecdote. I feel rather deflated. When a German Formula 1 company launched its German engine, branded by Mercedes-Benz, with Michael Schumacher, a German driver, I was told that it was designed and manufactured in the UK. [Hon. Members: “Hear, hear!”] I thank Government Members for approving of my anecdote.

[Andrea Leadsom (South Northamptonshire) (Con)]

I am delighted about that, because it was made in my constituency.

[Mr Vaizey]

Is it not a wonderful coincidence that I also get to suck up to one of the most important Back Benchers in the House?

Next week, a BDO report will say that telecoms, media and technology industries will be the success stories of 2012 in the UK, with software investment growing and investment last year at an all-time high. Innovations such as cloud computing are set to create more than 200,000 jobs in the UK in the next three years.

[Tristram Hunt (Stoke-on-Trent Central) (Lab)]

Is it because the Department for Culture, Media and Sport is no longer interested in art and culture that it has purged Dame Liz Forgan from the Arts Council?

[Mr Vaizey]

That gives me a chance to respond to one of the Labour party’s most important Back Benchers. If he thinks that we are not interested in art and culture, why is he never out of my office talking about art and culture and, in particular, our joint campaign to save the Wedgwood collection?

To support technology and innovation businesses we have protected the science budget and are funding new science capital projects, including £158 million for e-infrastructure. The total increase in capital funding since December 2010 is £495 million. I feel that point keenly because tomorrow is the 10th anniversary of the agreement between the previous Labour Government and the Wellcome Trust to build and site the Diamond synchrotron in my constituency. I must say, in a moment of cross-party unanimity, that the last Labour Government had two of the finest science Ministers we have seen in Lord Sainsbury of Turville and Lord Drayson. We have, of course, gone one better by appointing our own Minister for Universities and Science, who has two brains.

We will have increased the level of the small company research and development tax credit from 175% to 225% by April 2012. That is the largest programme of support for business innovation in the UK and will provide support of more than £1 billion a year. We have made it more attractive to invest in smaller high-risk companies by raising the tax relief available under the enterprise investment scheme. We have established 24 enterprise zones throughout England. We have introduced catapult centres, which will form a new elite national network to act as a bridge between academia and business. They will cover sectors such as high-value manufacturing, cell therapy and offshore renewable energy. The Technology Strategy Board is investing at least £200 million in the current spending review period to make that happen.

We need to build on that success and I am pleased to say that the Budget maintains the momentum. We are cutting taxes on patents through a 10% patent box corporation tax worth some £900 million, which will be introduced next year and phased in. We are extending enterprise zones to Scotland, Northern Ireland and Wales. We are investing £100 million, which will leverage a further £200 million, in new university research facilities. We are introducing transport systems and future cities catapult centres. In a country with the world’s second largest aerospace industry, we have announced an investment of £60 million in a new aerodynamics centre to encourage innovation in aerospace design and the commercialisation of new ideas. Those measures will ensure that our world-leading universities and innovative small businesses can come together with global companies to commercialise new technologies, ideas and inventions in a wide variety of sectors.

[Ian Lucas (Wrexham) (Lab)]

Will the hon. Gentleman tell the House where the aerodynamics centre is to be based?

[Mr Vaizey]

May I congratulate the hon. Gentleman on his iPad cover, which is the same colour as a ministerial red box? It looked like he was using his ministerial red box. That is a rather nice conceit for an ex-Minister.

[Ian Lucas]

It’s the Budget.

[Mr Vaizey]

Oh, it was the Budget book. It looked like an iPad cover. Forgive me; I keep mistaking the hon. Gentleman for somebody who is on top of new technology. We have not yet decided where the aviation centre will be sited, and it may not even be in one place. It may be sited in two or three different areas.

To become Europe’s technology hub, we need world-leading digital infrastructure. The average broadband speed in the UK is already 7.5 megabits a second. In Northern Ireland, almost all the population have superfast broadband, and in England almost two thirds of the population do. In England, Northern Ireland and Wales, roughly three quarters of the population now have broadband. UK broadband coverage is in fact almost universal, with 91% of the country having access to speeds above 2 megabits a second, putting us in the top 20 countries worldwide. We are far ahead of many countries, including Morocco, where only one in 10 of the population have access to fixed-line broadband.

We have come a long way, but we need to go further. We are already investing £530 million in rural broadband, which will deliver superfast broadband to 90% of the country by 2015, two years earlier than Labour planned. More than half of our local broadband projects have been approved, and all will be approved by the end of this year. Procurement for some projects will proceed in the next few months.

[Mrs Anne McGuire (Stirling) (Lab)]

Would the Minister like to come to the village of Balquhidder in my constituency and tell people that they might be better off living in Morocco? I see that the Chief Secretary is trying to tell him where Balquhidder is. In that village people still have dial-up, not even slow broadband, never mind fast or superfast broadband.

[Mr Vaizey]

First, that is why we are spending the money that we are, and secondly, we are working in partnership with the Scottish Government, so the right hon. Lady should have a word with them if she wants to put her constituency at the forefront of broadband roll-out in Scotland.

We will have provided universal coverage by 2015 without Labour’s telephone tax, which in any event would not have raised sufficient money to do the job. Not only do we have the most ambitious rural broadband programme, but the Chancellor announced in the Budget new measures to upgrade the coverage in our cities. The UK’s four capitals, Manchester, Birmingham, Bristol, Newcastle, Leeds and Bradford will share a £100 million pot to ensure that they are among the best-connected cities in the world.

[Jim Dowd (Lewisham West and Penge) (Lab)]

On that subject, will the Minister have a word with the London borough of Bromley—it is allegedly in London, although it is not—which is obstructing the implementation of superfast broadband simply because it is an out-of-London, Tory-controlled borough that does not know any better? Will he exhort it to wake up to the idea of tomorrow rather than living in yesterday as it always does?

[Mr Vaizey]

Without adopting the hon. Gentleman’s language—I would certainly never describe Bromley or its council as out of touch or living in the past—I accept that he makes an important point that is worth labouring. It is vital that local authorities work with broadband providers to ensure the roll-out of broadband, and we are providing the money and working with local councils. We understand why planning regulations are in place, but if they are used in a way that restricts broadband roll-out, councils will be denying their residents the opportunity to access a very important service. It is vital that local councils take a proactive approach and ask not how to apply the planning rules but how to make it as easy as possible to get broadband to as many of their residents as possible.

[Bob Blackman (Harrow East) (Con)]

Will the Minister elucidate further on the benefits to the whole of London of the roll-out of ultrafast broadband, which will happen much faster as a result of the new initiatives in the Budget?

[Mr Vaizey]

Ultrafast broadband will of course benefit London, and across the 10 cities that I mentioned, the Chancellor’s Budget means that 40,000 businesses and 200,000 households will get ultrafast broadband. London is also getting it through private sector providers, to which I will turn in a moment. It is also worth noting that Virgin Media will provide free wi-fi on the London underground during the Olympic games. Some 3 million people will be able to get access to high-speed wi-fi in the 10 best-connected cities. The Chancellor also announced in the Budget an additional £50 million, which will be available to ensure that ultrafast speeds are available to the UK’s smaller cities.

I said in reply to my hon. Friend that the private sector is doing a huge amount to speed broadband roll-out. I can announce that this week, Virgin Media, after £110 million of additional investment—investment over and above the £600 million it invests every year—will complete the upgrade of its network, so all 13 million premises covered by it, which is about half the premises in the UK, will be able to access speeds of up to 100 megabits a second. Average speeds are set to be around 40 megabits a second, which makes Virgin Media’s broadband network the fastest in the world. [Interruption.] From a sedentary position, an hon. Lady accuses Virgin Media of bribing me to say that. I am not sure she will say that outside the Chamber.

[Ian Lucas]

Virgin broadband is not available in north Wales. The problem, as the Minister will hear from Government Back Benchers, is access to universal broadband, which the Government delayed from 2012 to 2015. What will he do about increasing services to ensure that we have universal broadband, the absence of which is preventing businesses from making progress in large parts of the country?

[Mr Vaizey]

I first need to get the hon. Gentleman an iPad—[Interruption.] He has one. At last he has an iPad! We have given £10 million to north Wales to put in place superfast broadband. As he well knows, we will get superfast broadband to 90% of the country two years before the Labour Government promised. We are not going to impose Labour’s telephone tax, which would have hit consumers and businesses. We will have the best superfast broadband in Europe by 2015—[Interruption.] My colleagues are saying from sedentary positions that that sounds excellent; it is excellent.

Having praised Virgin Media, let me also say that BT is investing £2.5 billion in rolling out broadband. Indeed, it has accelerated its plans so that it will deliver fibre to two thirds of the UK by 2014, a year ahead of schedule. It has already delivered to 7 million premises, and is currently adding an additional 1 million premises—the equivalent of the number in Singapore—every three months.

[Alun Cairns (Vale of Glamorgan) (Con)]

Following the point made by the hon. Member for Wrexham (Ian Lucas), does my hon. Friend the Minister recognise the added complication because of the delays that the Welsh Government have introduced in the roll-out of superfast broadband, despite the money being made available swiftly by the UK Government?

[Mr Vaizey]

My hon. Friend makes a very good point. Because we believe in devolution and localism, the implementation of the plans is down to the Welsh and Scottish Governments. It is therefore up to them to roll them out as quickly as possible. I am sure the hon. Member for Wrexham (Ian Lucas) will send an e-mail from his iPad to the leader of the Welsh Assembly Government to tell him to pull his finger out.

Ten million premises will be covered by BT by the end of the year in one of the largest engineering projects the country has ever seen. Those areas will get speeds of up to 80 megabits a second.

Mobile broadband is becoming increasingly important, with more people purchasing smartphones. Last year, the Chancellor announced an additional £150 million to help with mobile broadband coverage. By 2015, that will extend mobile coverage to 60,000 rural homes that have no mobile connection whatever, including, perhaps, villages in the constituency of the right hon. Member for Stirling (Mrs McGuire), as well as along at least 10 key roads. We will also continue to look at how we can improve coverage on our railways.

At the end of this year, we will auction spectrum that will allow mobile companies significantly to increase their capacity, as well as offer faster speeds to their customers, and we continue to make progress on our plans to release some 500 MHz of the public sector spectrum.

World-leading digital infrastructure is the cornerstone of economic growth in the 21st century. Some estimates show that a 10% increase in broadband penetration can deliver a boost of up to 1.4% of gross domestic product. By the end of this Parliament, at least 90% of the country will have superfast broadband; our great cities will have ultrafast broadband; and 60,000 rural homes and businesses will have mobile coverage for the first time.

As the House knows, the UK has some of the most successful creative industries in the world. I know the whole House will wish to congratulate One Direction on topping the US charts with their debut album—a feat not matched by either the Rolling Stones or the Beatles. Adele’s “21” is the best-selling digital album of all time, and for the first time in 25 years, UK acts were at Nos. 1, 2 and 3 in the US charts. We have the second- biggest music exporting industry in the world, and our UK animation industry has a huge impact worldwide. In 2010, Peppa Pig’s UK licensing and merchandising sales were £200 million alone.

Last year saw the most UK film production activity ever—it grew by 7% to £1.16 billion. UK television formats dominate television schedules all across the globe, accounting for two in every five global programmes, and of course “Downton Abbey” has continued UK success at the Globes. Exports of UK television content are the second highest in the world, worth more than £1.3 billion per year, having grown by more than 20% a year for about the last decade. [Interruption.] The right hon. Member for South Shields (David Miliband) looks astounded by this success. I urge him to get out more and see what some of our successful creative industries are doing.

[David Miliband (South Shields) (Lab)]

I was actually wondering how many more pages of this drivel we had to sit through. The hon. Gentleman said that infrastructure is the seedcorn and the basis of future prosperity. How, then, does he explain the fact that 45% of the infrastructure investment that the Chancellor announced in the autumn statement will not happen until 2014-15?

[Mr Vaizey]

I have just spent two or three minutes talking about the success of the UK music, animation, film and television industries, and the right hon. Gentleman, who was meant to be the Labour leader, describes that as utter drivel. Let the message go out to the UK creative industries that one of the most senior members of the Labour party regards their success as drivel. And I make no apology for continuing to list some of those successes.

BBC Worldwide increased international sales by almost 10% last year. We are the European hub for the video games industry, with 35% of video games software sold in Europe being developed by UK studios, and almost half of the world’s top 100 development studios based in the UK, generating sales of almost £2 billion a year. The visual effects hub in Soho is home to four of the largest visual effects companies in the world. We have one of the most innovative and successful advertising industries in the world, and it is growing despite the recession. We have one of the most successful and creative fashion capitals anywhere in the world, with Burberry, a UK company, increasing its sales by a quarter. And, of course, our largest creative industry, the UK publishing sector, has a turnover of almost £20 billion.

We want to build on this success. We do not regard it as drivel. We regard it as vital to our economic success. That is why we will introduce a tax credit for our video games and animation industries and our high-end television production sector. We are confident that this will bring increased investment and growth in these sectors too.

[John Mann (Bassetlaw) (Lab)]

rose—

[Mr Vaizey]

I give way to an hon. Gentleman who normally does not spout drivel. I hope that will remain the case.

[John Mann]

I thank the Minister for generously giving way. I would not regard his speech as drivel at all. It is a superb enunciation of the successes of the last Labour Government. Given the lead time required for investment and innovation, I look forward to hearing what he predicts his legacy will be in two, three and four years. Will it be as good as that of my right hon. Friend the Member for Dulwich and West Norwood (Tessa Jowell) and her colleagues who worked in the Minister’s Department so assiduously over the past decade?

[Mr Vaizey]

They cannot make their minds up. On the one hand, the success of the UK’s creative industries is drivel; on the other, the success of Adele and her biggest-selling digital album in history is down to the Labour party. I would not claim that, but I would claim instead that we are putting in place the infrastructure for broadband investment to support high-tech innovation in this country. Through a series of initiatives, such as catapult centres, investment from the Technology Strategy Board, research and development tax credits and the patent box tax credit, we continue to support investment in our technology industries. Specifically through our tax break for video games, animation and high-end television production, we will support our creative industries and spur them on to greater success. I have already heard from some of the UK’s most successful animation companies. They are now planning to increase investment in their businesses, recruit more staff and make more programmes here in the UK. [Interruption.] Mr Deputy Speaker, there is a Labour Member standing next to you shouting at me. Could you encourage him to make a formal intervention at some point?

American studios are lining up to work with our talented production staff and amazing studios. British developers will be able to take advantage of the 8% growth in the worldwide video games industry.

[Jim Dowd]

I am not sure whether my hon. Friend the Member for Middlesbrough South and East Cleveland (Tom Blenkinsop)—to whom the Minister refers—wants to intervene, but if so, I am taking his slot. I do not want to make a partisan point, because although our understanding of the importance of the creative industries to this country and this economy, starting under the last Government, is well established, I congratulate the current Government on continuing that process, with the patent box and all the benefits that it will create. However, will the Minister prevail upon the Secretary of State for Business, Innovation and Skills and his colleagues to understand just how important creativeness and ingenuity are to this economy? In the light of the Hargreaves review and the role played by the Intellectual Property Office, it is not just product being made available free to consumers that is important, but ensuring that those who create and innovate get the best deal possible. That is a supreme role for this Government to perform.

[Mr Vaizey]

I thank the hon. Gentleman for that intervention—I hesitate to say that it is good to hear from somebody who knows what they are talking about, in case he makes a hostile intervention in a minute. I absolutely hear the point he makes. The protection of intellectual property is paramount. We need to bring the intellectual property regime up to date, but I for one do not want to rob Peter to pay Paul. It is absolutely right that content creators are paid for what they create.

Let me say something at which the whole House will rejoice: I am coming to the end of my remarks. However, if all those who said that they wanted to make an intervention still want to, they have a small window, as I perorate towards my conclusions.

[Sarah Newton (Truro and Falmouth) (Con)]

I am grateful for my hon. Friend’s cue. Creative industries are vital to Cornwall, but so is creating high-quality food products. There is growing concern throughout Cornwall about the possible unintended consequences of the Budget and about the undoubtedly real threat to the Cornish pasty of the pasty tax. May I seek my hon. Friend’s reassurance that the concerns of pasty makers in my constituency are being listened to and that a solution can be found?

[Mr Vaizey]

I thank my hon. Friend for that intervention, which I know the Chief Secretary to the Treasury will respond to fully when he winds up. I congratulate her county on receiving the award for being Britain’s best tourist destination for the third year, and I congratulate her on the extraordinary energy with which she represents her constituency. She and I have had many meetings to discuss various issues in her constituency. [Interruption.] You are looking at the clock, Mr Deputy Speaker, so I shall wrap up; however, let me tell my hon. Friend that I hear what she says about the Cornish pasty issue, and I am assured that the Treasury is looking at it seriously.

With a Budget that introduced the largest ever increase in personal allowances, so as to reward work, the lowest corporation tax rate in the G7, so that Britain is open for business, tax reliefs for our creative industries, increased investment in science and technology, and plans to create the best broadband network in Europe, we are well placed to realise the Chancellor’s ambition of making Britain the technology hub of the UK. I do not think that our success to date is “drivel”; I think that Britain is known around the world for its creativity and the success of its creative industries. We on this side of the House intend to ensure that we maintain and increase that success.

[Ms Harriet Harman (Camberwell and Peckham) (Lab)]

Let me begin with a double congratulation: to the Secretary of State and Lucia on the birth of their daughter, and to the shadow arts Minister and Rachel on the birth of their daughter. I congratulate both Members on their new babies, and also on taking paternity leave, which is a thoroughly good thing—mind you, I imagine that the Secretary of State feels well out of the debate today. Clearing up after a baby is much easier than clearing up after the mess of this Budget.

This is a Tory Budget, backed by the colluding Lib Dems—two parties that told us they were coming together in the national interest. How can it be in the national interest to fail on jobs, to fail on growth and to fail on fairness? Let us tell it how it really is: two parties coming together to give a tax bonanza to millionaires and a kick in the teeth to pensioners.

This is a Budget built on economic failure, with more than 1 million young people looking for work, economic growth at just half what can be seen in the US and the Government set to borrow £150 billion more than planned. What was needed was for the Government to come up with a Budget for jobs and growth, and they have failed.

It is good that today’s debate is focused on the creative industries, because they must be at the heart of economic growth in the future. We are good at them; they put Britain on the map; we are renowned for our arts and our culture, our film, TV and video games and our music, design and fashion. There is huge potential for growth there—growth in jobs, in exports and in contributions to gross domestic product. We needed the Government to come up with a plan for jobs and growth in the creative economy, but they have not.

The Government announced a tax break for high-end television, animation and video games, but these measures are strangely familiar. As my hon. Friend the Member for Bassetlaw (John Mann) said, it is something of an “homage” to the policies of the last Labour Government. It was, of course, the Labour Government who introduced the first tax breaks for the creative industries with our film tax relief, which has been hugely important for getting films made in Britain, helping our pioneering special effects industry and backing our studios such as Pinewood and Shepperton. The only original film policy this Government have come up with is axing the Film Council.

As for the tax break for video games, who first proposed this for the games industry? It was Labour.

[Mr Vaizey]

To continue the “homage” theme, it was the policy of the last Labour Government to merge the Film Council with the British Film Institute.

[Ms Harman]

But certainly not to do what this Government have done—without any consultation or any discussion at all. We certainly promoted the film industry.

To return to the tax break for video games, we first proposed a tax break for the games industry, and we put it in our Budget in 2010, but what did the Tory Chancellor say in his very first Budget? He said that

“we will not go ahead with the poorly targeted tax relief for the video games industry.”—[Official Report, 22 June 2010; Vol. 512, c. 175.]

And what did he do? He axed it. For the UK games industry, it could have been game over. He is introducing the tax relief now, but this misjudgment and delay have come at a price. Our video games industry was the third biggest in the world and has now fallen to the sixth. Many jobs have been lost, with nearly half going abroad to countries such as Canada, lured by its tax relief.

This policy, then, is not an original; it is a cover version—and like most cover versions, just not as good as the original. Although tax credits are worth while on their own, they are not enough to ensure that Britain fulfils its potential as a global hub for the creative industries. Just as this Government do not have a plan for jobs and growth in the economy, they do not have a plan for jobs and growth in the creative industries.

Where is the long-awaited communications Green Paper? The Minister did not say a word about it—not one word. Perhaps it is still waiting for some high-level policy input from a premier league Tory donor.

Where, too, is the action on protecting intellectual property? This is a fundamental issue for the creative industries—the bedrock of the knowledge economy. A tax break helps to boost investment, but more investors would be more confident if they knew that the product to which they were committing was not vulnerable to theft on an industrial scale. If an industry has been given a tax break, it makes it even less sensible to stand by and watch any of the value drain away through IP theft. The last Labour Government recognised that, which is why in 2010, we passed the Digital Economy Act with cross-party support. It needs to be implemented now. We already have the Digital Economy Act; it would be good to go with it. Professor Hargreaves has conducted another review of the same issue, but what the industry and economy are crying out for is action.