Scotland Bill
David Mundell Excerpts(12 years ago)
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I beg to move, That this House agrees with Lords amendment 1.
Mr Deputy Speaker (Mr Lindsay Hoyle)
With this we may take Lords amendments 7, 8, 10 and 11.
David Mundell
Along with the redoubtable Wendy Alexander, Annabel Goldie, Lord Browne of Ladyton, Lord Stephen and my right hon. Friend the Member for Orkney and Shetland (Mr Carmichael), I took part in the very first meeting that led to the establishment of the Calman commission. I am pleased and proud today to be part of what I hope will be the successful conclusion of the commission’s work. The return of the Scotland Bill to this House comes after the other place has given the Bill a great deal of detailed scrutiny and consideration for many months. Indeed, in handling the Bill in the Lords, Lord Wallace of Tankerness was compared to Kate Adie. That comparison is not correct: he was more like General Montgomery, because he was at the forefront of the action rather than a mere commentator.
Since the Bill was last in this House, there have been two very significant developments. The Scottish Government have changed their position from one of opposition to one of support for the Bill, including many of the amendments we will consider today. On 21 March, the Secretary of State confirmed in a written ministerial statement the terms on which agreement had been reached with the Scottish Government on the Bill, and on 18 April the Scottish Parliament passed the legislative consent motion for the Bill unanimously.
When the Bill was last in this House, it appeared that the Scottish National party would never join the consensus that has been shared throughout both the Calman commission process and the parliamentary process on the Bill.
Stewart Hosie (Dundee East) (SNP)
I know that the Minister wants to pretend that this Bill is incredibly important, but in fact it is a rather modest Bill. If I may correct him—I know that he sometimes struggles with detail—he will remember that on Second Reading, I made it clear that we would not stand in the way of the Bill. I welcome the changes that the UK Government have made, in particular to remove some of the re-reservations, and I hope that we can now get on and pass this modest little measure.
David Mundell
I also remember the occasion on which the Scottish National party voted against the Bill, as we will detail in respect of the specific amendments that come forward. Several changes have been made to the Bill, but all of them have been on the basis of assurances provided by the Scottish Government as to how the matters will be conducted.
Mrs Anne McGuire (Stirling) (Lab)
Except sometimes the right hand of the Scottish National party does not know what the left hand is doing. While down here it was being conciliatory, it was initially prepared to stand in the way of this extensive devolution of powers.
David Mundell
The right hon. Lady may recall that during previous consideration of the Bill, I identified London SNP as a quite different body from the Scotland-based SNP. At the same time as the SNP in London opposed the Bill, more sensible forces in the Scottish Parliament were looking to bring forward what will be a significant package of measures that will strengthen devolution by increasing the financial accountability and responsibility of the Scottish Parliament.
Stewart Hosie
Instead of misrepresenting me, why does not the junior Minister understand that the only reason the Scottish Parliament was able to agree the legislative consent motion was because the UK Government agreed to remove the idiotic re-reservations that they had planned; agreed to take out some of the significant and damaging things that they had intended with the Supreme Court; and, fundamentally and very sensibly, agreed proper commencement procedures, about which I will say more later?
David Mundell
I am sure that the SNP at Westminster group leader’s substitute will recognise that when this Bill was previously debated in this Parliament, the Scottish National party indicated that it had six demands that it required to be reflected on the face of the Bill before it would support it. None of those six demands is in the Bill as we debate it today or as it was debated in the Scottish Parliament, where it received unanimous support—including that of all members of the Scottish National party present.
Bob Stewart (Beckenham) (Con)
I do not really like the Bill being called modest by the Scottish National party when the Office for Budget Responsibility says that the Scottish Parliament will be able to have over £500 million of income tax in 2015-16. That is hardly modest.
David Mundell
I could not agree more with my hon. Friend. This is a significant measure which will lead to the largest transfer of fiscal powers between Westminster and Scotland in 300 years, and it should be welcomed by all parties. My hon. Friend may be aware that yesterday that the First Minister apparently told the Institute of Directors that he planned to align taxes in Scotland with the rest of the UK, so the Scottish National party may now regard the actual requirement for tax-varying powers as insignificant.
Lords amendment 1 seeks to improve the drafting of clause 3. Section 113 of the Scotland Act 1998 makes provision about the scope of subordinate legislation powers in that Act. Clause 3(1) amends section 113 of the Scotland Act so that the supplementary powers contained in section 113 also apply to Scottish Ministers’ new power to make subordinate legislation about the administration of Scottish Parliament elections under section 12 of the 1998 Act.
Lords amendment 1 would replace clause 3(1) with new provision having the same effect. The amendment would have the effect of restructuring section 113 and this would make it easier for provisions in this Bill or future legislation to provide that the supplementary powers contained in section 113 apply in relation to other powers that may be conferred on the Scottish Ministers.
Clause 15 changes the name of the Scottish Executive to the Scottish Government. Lords amendments 7 and 8 are minor technical amendments that would ensure that all the references to “Scottish Executive” in section 44 of the Scotland Act are amended to “Scottish Government”.
Clause 22 makes provision for there to be a Crown Estate Commissioner who knows about conditions in Scotland. Lords amendments 10 and 11 would change the name of this Commissioner from the “Scottish Crown Estate Commissioner”, to the “Crown Estate Commissioner with special responsibility for Scotland”. I can confirm that the original title for the commissioner included in the Bill was taken from the Calman commission’s own proposals and discussed with the Crown Estate. However, it is accepted that the amendments to the commissioner’s title will properly reflect the role that the commissioner will play.
Stewart Hosie
The Minister will concede, I hope, that notwithstanding this change there is no material difference between the Bill as it was and the amendment to the title of the Crown Estate Commissioner?
David Mundell
The amendment changes the title. If the hon. Gentleman is alluding to whether the Scottish Government, in their discussions on the Bill, put forward a requirement for further devolution of the Crown Estate, I can tell him that they did not. It was not a red line for the Scottish Government.
Mr Frank Roy (Motherwell and Wishaw) (Lab)
Are any costs associated with the name change?
David Mundell
As far as I am aware, no costs are associated with changing the name from that proposed in the original Bill to the revised one.
Anas Sarwar (Glasgow Central) (Lab)
Will the title of First Minister be changed to “Secretary of State for Rupert Murdoch”?
David Mundell
I am sure that that is a matter on which the hon. Gentleman and many others hold a view but on which the Government do not.
The Select Committee on Scottish Affairs has produced an interesting report on the future of the Crown Estate in Scotland. Obviously, the Government welcome the assiduous work carried out in preparing the report. I am surprised that its Chairman, the hon. Member for Glasgow South West (Mr Davidson), who usually plays a robust part in these deliberations, is not present. I had anticipated his having something to say about his report. However, the Government will consider it in due course. I understand that it has been debated in the Scottish Parliament, where the devolution of Crown Estate activities directly to local communities found support, at least among opposition parties there.
On that basis, I hope that the House will agree with the Lords amendments.
Mr William Bain (Glasgow North East) (Lab)
As we begin debating the Lords amendments, I hope the House will consider it appropriate for the Opposition to mark the significance of what is likely to be our final consideration of the Scotland Bill. If it receives Royal Assent in the coming days, the Bill will represent the largest devolution of financial powers to Scotland in 300 years; will make decisions on spending and taxation more transparently accountable to the Scottish Parliament than at any time since 1999; and create new borrowing powers with the potential to boost economic growth significantly.
This enhancement of devolution is the culmination of a four-year process of cross-party and cross-societal constitutional reform through the Calman commission, which was established by Wendy Alexander and other pro-devolution party leaders in Scotland. Its outcome was accepted in a White Paper by my right hon. Friend the Member for East Renfrewshire (Mr Murphy); was assisted by my hon. Friends the Members for Glasgow North (Ann McKechin) and for Rutherglen and Hamilton West (Tom Greatrex) in various capacities; and has been implemented with cross-party support by the coalition Government.
It is also welcome that the Scottish Government have finally indicated their assent, if not warm-hearted approval, for the Bill, after a significantly longer and more circuitous journey to reach that position than that undergone by Scotland’s other political parties.
Pete Wishart
I have a choice between the two Front Benches. I will give way to the Minister first.
David Mundell
We would not want the hon. Gentleman to mislead the House. The UK Government have not agreed with the Scottish Government on dual commencement. What we have said is that it is desirable and that we will work with the Scottish Government to achieve it, but it has not been agreed on at this stage. I say this just so that right hon. and hon. Members are not misled.
Pete Wishart
I am grateful to the Minister for clarifying that. It is good that he agrees with the Scottish Government that joint commencement is a good idea and I welcome the fact that there will be a veto for the Scottish Parliament in regard to the commencement of potentially damaging tax powers.
The Bill does not meet the aspirations of the Scottish people. It does not meet the aspirations of the anti-independence parties either. They have all moved on as well, and decided that these provisions are not enough. The Conservative-led Unionist alliance and what accounts for their think-tanks are all now considering the next stages of devolution as they move forward. They, as well as the Scottish Parliament and the Scottish people, have passed the Bill by. The Bill is finished, it is dead, it is something that belongs to another day and another era.
David Mundell
I shall make a few points on the issues pertaining to this group of amendments. I can assure the right hon. Member for Stirling (Mrs McGuire) that we on the Government Benches always listen to her wise counsel. I will deal with the specific points she raised, which are important—regardless of when or where they are raised.
As the matter was raised by the hon. Member for Perth and North Perthshire (Pete Wishart), let me be clear about the position on joint commencement. The Scottish Government sought a specific provision for joint commencement in this Bill. The request was refused, as it was unworkable—like so many proposals advanced either by the SNP in London or the Scottish Government. Instead, we focused on delivering this Bill. At last, that objective is shared by the Scottish Government.
Of course we want to achieve circumstances in which joint commencement can take place. I shall quote from a letter sent by the Secretary of State on 20 March to Bruce Crawford and John Swinney:
“Consistent with the principle of consent, our two governments should reach agreement on implementation issues, including adjustments to the block grant, to take account of the Scottish Parliament’s new fiscal powers.”
That is the Government’s position.
Let me respond to a point made by hon. Member for Dundee East (Stewart Hosie). He seemed to suggest that evidence had been produced to support the Scottish Government’s and indeed the Scottish National party’s suggestion that corporation tax should be devolved. Again, I am sure that he would not wish to mislead the House into thinking that actual evidence had been produced to support that proposition. Indeed, it was not.
Stewart Hosie
The Minister’s memory is appalling. I intervened on the Labour Front-Bench spokesman to ask the Labour party’s position on corporation tax. I said no such thing about evidence being provided to the UK Government. I am sure Hansard will bear that out. If, however, the Minister wants to carry on and embarrass himself further, I will be delighted to listen.
Mr Deputy Speaker (Mr Lindsay Hoyle)
Order. I would obviously not allow the Opposition Front-Bench team to respond. I am sure that, as we go through the further provisions, everyone will be able to discuss the issues about taxation that they wish to raise.
David Mundell
Thank you, Mr Deputy Speaker. I shall not use the same tone as the hon. Gentleman, although I think his remarks confirmed that no evidence had been produced at all or in any form to support the proposition of devolving corporation tax. That is why it is not being devolved in this Bill and is not the subject of these or any other amendments brought forward in the House of Lords. I support the amendment on that basis.
Lords amendment 1 agreed to.
Clause 7
Partial suspension of Acts subject to scrutiny by Supreme Court
Mr Deputy Speaker (Mr Lindsay Hoyle)
With this we may take Lords amendments 5, 6, 17, 18 and 26.
David Mundell
As I have already explained, on 21 March the Government announced a package of measures in the Bill, and supporting non-legislative arrangements, to ensure that the Bill would operate in a fair and sustainable way to benefit Scotland and the rest of the United Kingdom. That announcement followed productive discussions with the Scottish Government.
I hope that it does not prove career-limiting for him if I pay tribute to Bruce Crawford MSP, the Cabinet Secretary for Parliamentary Business and Government Strategy in the Scottish Government, who has worked closely with me and with the Secretary of State on the dialogue that has been taking place about the Bill. Mr Crawford and his officials have always engaged constructively in discussions on the Bill, and, even on occasions when we have not agreed, we have always conducted those discussions in an orderly and proper fashion. I am most grateful to Mr Crawford for the way in which he dealt with the legislative consent motion in the Scottish Parliament, securing a unanimous outcome. There was no dissent from any member of the Scottish National party.
Following the agreement announced on 21 March, changes were made to both the finance and non-finance provisions in the Bill. Since its introduction in November 2010, it has been subjected to detailed scrutiny in the United Kingdom and Scottish Parliaments. In Westminster, it has passed successfully through its Commons and Lords stages, and has returned to the Commons today for further consideration. In Holyrood, not one but two Scotland Bill Committees have taken evidence and reported to the Scottish Parliament. I pay tribute to my colleague David McLetchie MSP, who experienced the pleasure of serving on both those Committees. I think that his expertise could rightly be said to be beyond that of Members of this House and the other place, in that he has a true understanding of the Bill and all its ramifications. I also pay tribute to the other MSPs who served on both Committees for their work in dealing with the reports, and subsequently passing the legislative consent motion tabled by the Scottish Government in favour of the Bill.
We have gone further than ever before in working with parties in Scotland and across the United Kingdom to deliver a Bill built on cross-party consensus. We have carefully considered and, when appropriate—that is, when a case based on evidence has been properly made—taken on board the views of the Scottish Government and the Scottish Parliament. We are pleased that we have reached agreement and can make progress with the Bill.
The package of measures announced on 21 March meets the tests that the Government set for changes in the Bill package. They are based on evidence, maintain the cross-party consensus that supports the Bill, and will benefit Scotland without detriment to the rest of the United Kingdom. The amendments in this group are part of those changes. Lords amendments 2, 5, 6, 17 and 26 would remove clause 7, clause 12, schedule 2, clause 13 and clause 26.
Lords amendment 2 would remove clause 7. As it stands, section 33 of the Scotland Act 1998 allows for only a Bill, rather than a single provision of a Bill, in the Scottish Parliament to be referred to the Supreme Court in its entirety on questions of legislative competence. That means that implementation of the whole Bill would be delayed if the matter were referred to the Supreme Court pending a decision of that court. The Government’s intention in pursuing the limited reference procedure contained in clause 7 was to prevent unnecessary delays on Bills the majority of whose provisions were considered to be within the legislative competence of the Scottish Parliament.
The Scottish Government expressed the fear that the clause could have the potential to introduce unintended consequences and delay to the enactment of legislation in the Scottish Parliament. As a result of our discussions with the Scottish Government, we agreed that the clause could be removed. The Scottish Government accept that that will mean that in future, as at present, only a full Act of the Scottish Parliament can be referred to the Supreme Court, even if only a single provision raises competence issues. I should make clear that the provision in the original Bill was intended to be helpful to the Scottish Government. However, they decided that they did not want that helpful measure to be included, and as a result we agreed to remove it.
Lords amendments 5 and 26 would remove the clause on insolvency and the related provision in schedule 2. Clause 12 would return exclusive legislative competence to the UK Parliament in relation to all aspects of the winding up of business associations. It is intended to ensure that the rules on corporate insolvency are consistent on both sides of the border. The UK Government continue to believe that it is important to take into account the view of stakeholders that, when appropriate, Scottish insolvency procedures should be in step with those in the rest of the UK. Our discussions with the Scottish Government have provided us with assurances that we can address those concerns without amending the devolution settlement in this respect.
Let me make clear to Scottish National party Members that the UK Government have removed the clause on the understanding that the Scottish Government will consider the modernisation measures for the devolved areas of winding up in Scotland that were introduced into the reserved insolvency procedures in 2009 and 2010, and have provided assurances that future changes made by the UK Parliament or Ministers in that area will be considered in a timely fashion by the Scottish Government in their area of competence.
Lords amendment 6 seeks to remove clause 13. The clause deals with the regulation of health professionals, to which the right hon. Member for Stirling (Mrs McGuire) has already alluded. Since Royal Assent to the Scotland Act 1998, the regulation of any health professionals not regulated by the legislation listed in schedule 5 has fallen within the legislative competence of the Scottish Parliament, but although the Scottish Parliament has had the power to introduce separate legislation in respect of the regulation of health professionals, it has chosen not to do so.
During our discussions with the Scottish Government, they raised some concerns about the clause. They pointed out that the delivery of health care is, on the whole, devolved to Scotland. However, they gave us clear assurances that they would work closely with us to ensure that consistent regulatory regimes apply to all health professionals. I assure the right hon. Member for Stirling that it is on the basis of those assurances that the UK Government are content to continue to develop policy in relation to the regulation of health professionals with the Scottish Government.
Mr Frank Roy
Does this not prove that some things should be done on a UK-wide basis rather than on the basis of a separate Scotland?
David Mundell
During consideration of the Bill in the House of Commons and by the Committees of the Scottish Parliament, I was not aware of a single piece of evidence suggesting that the regulation of health professionals would benefit from not being carried out on a UK-wide basis. In fact, it has been pointed out that health professionals are a relatively mobile group who may want to move to and from jobs in Scotland and England, and who would therefore not benefit from separate regulation.
David Mundell
As I said earlier, the Scottish Government have given assurances that although there will not be a relevant clause in the Bill, they will work with the UK Government to ensure that there is a uniform approach to the regulation of health professionals. I think that those remarks are consistent with the First Minister’s statement yesterday that he intended to align taxes in Scotland with those in the rest of the United Kingdom if Scotland became independent. In fact, if Scotland became independent, there would be no difference on virtually any matter.
Lords amendment 17 would remove clause 27. The Government included that clause to provide UK Ministers, concurrently with Scottish Ministers, with a power to implement international obligations in devolved areas. That would have allowed UK Ministers to implement international obligations on a UK basis, where it would be more convenient to do so. Both Governments acknowledge the importance of ensuring that all of the UK’s international obligations are fully implemented across the UK in a timely fashion. The UK Government are willing to remove this clause on the understanding that Scottish Ministers will ensure that any international obligations that fall within their responsibility are implemented on time. We have made clear to Scottish Ministers that the Government would be prepared to use their existing powers of direction under section 58(2) of the Scotland Act 1998 if we were to have concerns about the implementation of international obligations within the remit of Scottish Ministers.
Let me make it absolutely clear that the Government have not conceded on the principle of re-reservation, as the Scottish National party suggested during our earlier debates on this Bill. The Bill does not make devolution a one-way street. Clause 14 re-reserves the regulation of activities in Antarctica.
Pete Wishart
If it is not a one-way street, which powers are now coming back to this House apart from those on Antarctica?
David Mundell
The hon. Gentleman forgets that he and his colleagues moved an amendment to remove the clause re-reserving activities in Antarctica. They were defeated in this House, and the Scottish Government have accepted that the regulation of activities in Antarctica should be re-reserved. I fail to understand the SNP negotiating position, because it appears that the regulation of dental hygienists—important though that is, as the right hon. Member for Stirling said—cannot be re-reserved, yet matters such as the administration of the Crown Estate, corporation tax, excise duties and further broadcasting powers were not red lines for the SNP in its discussions on this Bill.
Pete Wishart
To ensure that the Minister does not mischaracterise the approach of the Scottish Government, let me state that we are not for any re-reservations of powers now. That is why the Bill is now more acceptable to the SNP and the Scottish Government.
David Mundell
Again, I would not want the hon. Gentleman to mislead the House. The regulation of activities in Antarctica are re-reserved to this House.
Mr Deputy Speaker (Mr Lindsay Hoyle)
And I know that no Member would mislead this House.
David Mundell
This re-reservation—which some Members on the Opposition Benches sought to remove at an earlier stage—is a sensible measure.
We have removed provisions from the Bill where we have been given necessary assurances that their effect will be achieved by other means, or where we now take the view that we can sufficiently rely on existing powers.
Finally, let me turn to the proposed new clause under Lords amendment 18. Its purpose is to provide information to both Houses in the UK Parliament on the implementation and operation of the financial powers in this Bill. It requires the Secretary of State for Scotland to publish an annual report to both Houses of Parliament within one year of the Scotland Bill becoming an Act and until a year after the tax and borrowing powers are fully transferred to the Scottish Parliament. The last report is therefore expected to be published in 2020. The Secretary of State will send a copy of his report to Scottish Ministers, who will lay a copy of it before the Scottish Parliament. The proposed new clause also requires Scottish Ministers to lay a report of the same title to the Scottish Parliament on an annual basis and to provide a copy to lay before both Houses of the UK Parliament.
This amendment was proposed by the Government during discussions with the Scottish Government. The new provision will ensure that there is a transparent mechanism of reporting to both Parliaments on implementation. Passing the Bill is just one part of the process to ensure that these new powers are delivered and the accountability and responsibility of the Scottish Parliament are increased. The important implementation work that both Governments need to undertake to ensure that the financial measures operate successfully will now begin in earnest. This amendment will ensure that both Parliaments are kept properly informed of progress on implementation by both the Secretary of State for Scotland and the Scottish Government.
Stewart Hosie
I want to say only a few words about this group of amendments. They are very welcome, particularly the scratching out of some of the re-reservations. We tabled amendments, of course, to remove the re-reservation of insolvency and health professional regulation matters in a previous stage, but the Government rejected them at that point, as did the British Labour party. I am delighted that there is now unanimity that those re-reservations should be removed.
David Mundell
Will the hon. Gentleman confirm that he also tabled an amendment at an earlier stage to remove the re-reservation of Antarctica and that the re-reservation of Antarctica remains in the Bill?
Stewart Hosie
Indeed it does. We can safely say that we have no territorial claims on Antarctica. This is a Scotland Bill, and the re-reservation removal is sensible.
Lords amendment 18 deals with reports on the implementation and operation of financial measures in the Bill. That is a sensible provision, and it is linked closely to the commencement of those financial provisions. We made that point repeatedly throughout debates on the Bill. In the Committee of the whole House, on the second day of debate, we discussed commencement powers to ensure that things were done at the correct time. We had a good debate on six separate commencement provisions for various financial measures. We said:
“If the commencement arrangements are left unchanged, many of the most important questions about the Bill will be left unanswered.”—[Official Report, 14 March 2011; Vol. 525, c. 89.]
On Third Reading, we said that the amendments that we had tabled on commencement would ensure that the tax provisions could not
“be brought into effect unless the Scottish Parliament...specifically consented.”—[Official Report, 21 June 2011; Vol. 530, c. 248.]
That was not just a point of principle—matters that affect the Scottish Parliament should be decided by the Scottish Parliament—but concerned some practical, technical issues. If a number of fiscal measures were introduced at the wrong time in the economic cycle that could be detrimental economically. Several Labour Members understood that point, and did so very clearly indeed, and it was interesting that Labour abstained from decisions on commencement—the party did not object to it, and I am glad that it welcomes what we have at the moment.
I want to take the opportunity, unusually, to be generous to the Secretary of State. The discussions and negotiations between his team and Bruce Crawford, the Cabinet Secretary for Parliamentary Business and Cabinet Strategy, and the letter that the Secretary of State sent to Bruce and to the Cabinet Secretary for Finance, Employment and Sustainable Growth, John Swinney, were extremely helpful, particularly the part of the letter that said:
“Consistent with the principle of consent”—
which was what we were determined to deliver—
“our two governments should reach agreement on implementation issues, including adjustments to the block grant…Each government should also provide assurance to its Parliament before the relevant provisions of the Bill are brought into force and before implementation arrangements are brought into effect.”
That agreement on the requirement properly to engage the Parliaments, and the principle of consent, were what we were trying to achieve. For the avoidance of doubt—and I have said this to the Secretary of State for Scotland, so it is not a surprise to him—of course there will be a bun fight about the contents of the Bill. Of course the matters that are being devolved do not go far enough for the Scottish National party—that is not a huge surprise—but making sure that we avoid the dangers of the financial provisions commencing at the wrong time was always the key thing that we needed to change. The Secretary of State knows that, so I very much welcome that exchange of letters to ensure that commencement is done properly on the basis of consent.
Pete Wishart
It is a pleasure to follow the hon. Member for Congleton (Fiona Bruce). The Scottish people are always pleased at the interest and indulgence of English Members of Parliament in our affairs and business. We are all grateful for that.
It is a pity that the hon. Member for Penrith and The Border (Rory Stewart) has left the Chamber. I did not know whether to reach first for my horned helmet or my longboat during his comments about Vikings. I do not know how many people in Denmark are rushing to join a greater union with Germany—certainly I have never come across a Dane who has been keen to be part of that particular union.
The most notable thing about these Lords amendments is how little they were discussed in the Lords. I do not know whether other Members spent any time looking at the debates in the House of Lords, but I did, and “interminable” would not be the word to describe some of them. At times it seemed like the Michael Forsyth show—he was on his feet all the time. Such is his pre-eminent place in the Tory-led cross-Unionist alliance that people like him are leading the debate just now.
David Mundell
Does the hon. Gentleman recognise that, unlike the Scottish National party, Lord Forsyth achieved extra devolution to Scotland in the Bill? Lord Forsyth introduced amendments that extended the Scottish Parliament’s powers, which were accepted in the House of Lords and will be proposed in this Chamber. The Scottish National party has failed—
Madam Deputy Speaker (Dawn Primarolo)
Order. I would like both the Minister and the hon. Member for Perth and North Perthshire (Pete Wishart) to return to the subject of the amendments. We should talk about the subject, not what debates went on elsewhere. I am sure, Mr Wishart, you will do so immediately.
Pete Wishart
I am grateful, Madam Deputy Speaker.
We have effectively ensured that there will no longer be re-reservations of health professionals because the clause was dropped, but the point I was trying to make was on how we managed to get to that point. I remember the debate and the passionate case that was put for the re-reservation of health professionals. The right hon. Member for Stirling (Mrs McGuire) does not agree with that, but I do not know whether Labour Front Benchers take that position or whether they believe that re-reservation is no longer required. I would be interested to find out how we got to this position.
David Mundell
Perhaps the hon. Gentleman did not hear what I said earlier. The Government reached this position because the Scottish Government gave assurances that they would work with the UK Government to ensure that the regulation of health professionals was the same across the UK. On the basis of those assurances, which I understand still hold good, the UK Government agreed that we would not put that clause in the Bill, hence the amendment. We have acted on the basis of assurances given by the SNP Government. I do not expect that they will renege on those assurances, and I hope the hon. Gentleman is not suggesting they will.
Pete Wishart
That sort of clarifies things, but I do not understand why the Minister did not accept the amendments when they were debated in the House in March last year. We know the right hon. Member for Stirling does not like the amendments and that the Minister has grudgingly given the re-reservation away, but we do not know the position of Labour Front Benchers.
David Mundell
With the leave of the House, I shall respond specifically to the points raised by my hon. Friend the Member for Warrington South (David Mowat), because I understood all the other Members who have spoken to be expressing support for the amendments, some more grudgingly than others.
I do not wish to question the accuracy of my hon. Friend’s analysis of the debates that have taken place in the House of Lords and the Scottish Parliament, but according to my reading of Bruce Crawford’s contribution to the Scottish debate, he made no reference to the no-detriment principle. He did, however, refer to the Holtham approach. There are two separate issues in play. The Holtham approach is about the adjustment of the block grant.
Lindsay Roy (Glenrothes) (Lab)
Can the Minister confirm that the same Bruce Crawford did not describe the Bill as a poison pill, a dog’s breakfast, and dangerous?
David Mundell
I accept the hon. Gentleman’s recollection of what Mr Crawford may have said about the Bill on previous occasions, but as I said earlier, I welcomed his constructive approach in his dealings with me, with the Secretary of State and with the UK Government in taking the Bill through the Scottish Parliament by way of a unanimously expressed legislative consent motion.
During the debate in that Parliament, Mr Crawford referred to the Holtham approach, which, as I said a moment ago, relates to the adjustment of the block grant and is separate from the no-detriment principle. The Government have accepted that, as in relation to Wales, the Holtham methodology should apply for calculating block grant adjustments. That is the basis on which we will move forward. I do not accept that over the past 12 years or so the Scottish Parliament and Government have been deprived of funds. As others have said, no matter how much money is allocated to the current Scottish Government under whatever mechanism, it would never be enough.
The no-detriment principle refers to how the financial system will operate after the Scottish rate of income tax comes into force. Under that principle, the UK Government would either compensate the Scottish budget for the costs of their policy change on the devolved tax base through the block grant, or receive funds back if the Scottish budget benefits from the policy change in raised receipts. The cost or benefit to the UK from decisions taken on the income tax structure is therefore exactly the same as it would have been before this Bill devolved 10p on income tax to Scotland, and the Scottish budget would be no better or worse off.
The Office for Budget Responsibility will forecast the impact of UK decisions on the Scottish rate of income tax, and we will take steps to ensure that the Scottish budget is compensated. There is therefore a principle of reciprocity. Where one Administration either gains or loses as a result of decisions taken by the other Administration, across the shared income tax there are measures in place to compensate for that loss or gain. This is simply a matter of common sense. It is based on the principle of accountability, which lies at the heart of the statement of funding policy.
I assure my hon. Friend the Member for Warrington South that where decisions taken by any of the devolved Administrations have financial implications for UK Departments, or where UK decisions lead to additional costs for any of the devolved Administrations, the body whose decision leads to the additional cost will meet that cost.
Lords amendment 2 agreed to.
Clause 10
Continued effect of provisions where legislative competence conferred for limited period
Madam Deputy Speaker (Dawn Primarolo)
With this we may take Lords amendment 4.
David Mundell
Lords amendment 3 would remove clause 10, and Lords amendment 4 would replace it with a new clause making similar, but expanded, provision.
Clause 10 makes provision regarding the status of the Acts of the Scottish Parliament after temporary changes to legislative competence following an order under section 30 of the Scotland Act 1998. There is widespread recognition that clarity is required on the status of Acts of the Scottish Parliament in the event that its legislative competence is reduced. The Government introduced these amendments in the other place to provide clarity following comments from the previous Scottish Parliament Scotland Bill Committee and the Law Society of Scotland.
Lords amendment 4 would ensure that Acts of the Scottish Parliament that have been validly made within the legislative competence that existed at the time do not cease to have effect purely because of changes to the boundaries of competence. Therefore, provisions contained in Acts of the Scottish Parliament will not automatically fall following an alteration of legislative competence, and no gaps in the law will inadvertently be created as a result. Such provisions would cease to have effect only if explicitly provided for in an enactment.
I hope the House will agree that Lords amendment 4 is sensible and will strengthen the provision originally contained in clause 10, and that Lords amendments 3 and 4 will be agreed to.
Mr Bain
Lords amendment 3 removes clause 10, and Lords amendment 4 inserts a new clause before clause 11 on the matter of provisions ceasing to be within the legislative competence of the Scottish Parliament.
Clause 10 would have permitted laws passed by the Scottish Parliament under a temporary transfer of powers—such as under a section 30 order—to remain in force after that transfer had come to an end. We note that the new clause widens the scope of the transfer, with the effect that any such laws, whether in the form of an Act of the Scottish Parliament or subordinate legislation, would have effect even where the competence of the Scottish Parliament to legislate had been removed, irrespective of whether this had been granted on a short or longer-term basis. We consider the new clause to remove any potential future ambiguities, and on that basis we are content to support Lords amendment 3.
Lords amendment 3 agreed to.
Lords amendments 4 to 8 agreed to.
Clause 17
The Lord Advocate: Convention rights and Community law
Madam Deputy Speaker (Dawn Primarolo)
With this it will be convenient to take Lords amendments 19 to 25.
David Mundell
There has been much debate about the role of the Lord Advocate and the Supreme Court in Scottish criminal proceedings. That debate has come a long way, and there is now agreement that the Supreme Court should have a role in relation to the European convention on human rights and EU law issues arising in Scottish criminal appeals.
The amendments tabled by the Government in the Lords took account of the many views expressed on these issues, including those of the expert group set up by the Advocate-General for Scotland. It would be appropriate at this point to remark on the passing of Paul McBride QC, who served on the expert group. Paul McBride was a well respected lawyer in Scotland and a highly regarded member of civic Scotland, and he is greatly missed by all who knew him and by the wider legal community. The amendments also took account of the views of the review group led by the noble and learned Lord McCluskey. On Report in the other place, he commented on the Government’s amendments. The end result of that process is something that even I could agree to about 98% of—which for anyone, never mind a lawyer, is a pretty good outcome, given where the debate started. In addition, the amendments tabled by the Government reflected the agreement that was reached with the Scottish Government to ensure that the legislative consent motion in support of the Bill was passed in the Scottish Parliament.
Lords amendments 9 and 19 to 22 replace clause 17 and make further provision about Scottish criminal proceedings. Subsection (2) of the new clause inserted by Lords amendment 21 would make the same provision as provided for by clause 17(2). That would mean that acts or failures to act by the Lord Advocate in prosecuting any offence, or as head of the system of criminal prosecutions and investigations into death in Scotland, would not be ultra vires should those acts be incompatible with the European convention on human rights or EU law. However, it will still be possible for acts of the Lord Advocate to be unlawful under section 6(1) of the Human Rights Act 1998 if the Lord Advocate acts in a way that is incompatible with the convention.
Lords amendments 19 to 21 provide for a new route of appeal to the Supreme Court for compatibility issues—questions raised in criminal proceedings about convention and EU law issues. Those issues would no longer be able to be raised as devolution issues. Lords amendment 21 would provide a right to appeal a compatibility issue from the High Court, acting as an appeal court, to the Supreme Court. The permission of the High Court or the Supreme Court would be needed for most appeals. An application for permission to appeal would have to be made within specified time limits, which could be extended if the Court considered that equitable.
Lords amendment 21 provides that the Supreme Court would only be able to determine a compatibility issue and would then have to remit the case back to the High Court. The High Court would then decide what steps needed to be taken in the light of the Supreme Court’s decision. For example, the Supreme Court would not be able to decide to overturn an accused’s conviction; that would be for the High Court to decide.
Stewart Hosie
I welcome that part of the group, but will the Minister make it absolutely clear—I believe he is just about to do so—that what we are seeing with these changes is an ending of the Supreme Court’s ability to substitute its decision for that of the High Court?
David Mundell
On this occasion, I am able to welcome the hon. Gentleman’s welcome. The provisions in the Bill, if these amendments are approved, will mean exactly that: the Supreme Court will not be able to substitute its own judgment for that of the High Court.
Sir Menzies Campbell (North East Fife) (LD)
Many of us in the House would wish to associate ourselves with the very generous and entirely appropriate remarks that the Minister made about Paul McBride. May I put it to the Minister that these amendments are an entirely effective antidote to the ill judged and ill informed comments made about the Supreme Court and its members by Scottish Ministers last summer?
David Mundell
I absolutely agree with my right hon. and learned Friend. The remarks made by the First Minister about members of the Supreme Court were beneath him; they demeaned his office and were wholly inappropriate.
Mr Davidson
Just for clarification, were the First Minister’s comments successful, in that his criticisms resulted in these amendments? If so, we would obviously take note of that. If not, that deserves to be spelt out.
David Mundell
I am happy to make it clear to the hon. Gentleman that views expressed by the First Minister about the Supreme Court played no part in these amendments or the completion of the Scotland Bill. Indeed, in dialogue involving the Scottish Government and Lord Advocate a much more moderate and sensible tone was adopted in relation to these matters, hence the ability to agree on what I would regard as a sensible and fair set of provisions that deal with the matters at hand.
Mr Davidson
Leaving aside the vehemence of the language used by the First Minister, was the substance of his comments the cause of the changes being introduced?
David Mundell
No. The changes being introduced today are a result of a process that was instigated by the Advocate-General for Scotland.
Sir Menzies Campbell
The Minister will recall that the attitude taken, to which both of us have referred, was to suggest that there should be no role of any kind for the Supreme Court in relation to any criminal issue arising out of Scotland. The proposals that he is now arguing for so eloquently represent an effective and entirely acceptable compromise.
David Mundell
I thank my right hon. and learned Friend for his comments. The proposals that form part of these amendments were part of the legislative consent motion that went before the Scottish Parliament and received unanimous support of that Parliament. Indeed, they were not opposed or spoken against by any Member of the Scottish National party, including the First Minister.
Lords amendment 20 would provide powers for compatibility issues to be referred to the High Court and the Supreme Court. That will enable such issues to be dealt with more quickly, where appropriate, which will be useful when a compatibility issue has implications for other cases. There are currently no time limits for appealing devolution issues in criminal proceedings to the Supreme Court. It is important that there is finality and certainty, especially for victims, in relation to criminal proceedings. Lords amendment 22 would impose time limits for seeking permission to appeal devolution issues from the High Court to the Supreme Court for devolution issues raised in Scottish criminal proceedings. The time limits are the same as those that will apply to compatibility issues.
Lords amendment 23 makes provision for a review to be arranged by the Secretary of State of the new compatibility issue procedure and of the introduction of time limits for certain devolution issue appeals. The review is to be carried out as soon as practicable after the provisions have been in force for three years. The review may be carried out earlier if that is considered appropriate. It will be wide ranging and will look at all aspects of the provisions and consider whether changes should be made. The UK Government and the Scottish Government have agreed that the review will be chaired by the Lord Justice General.
Lords amendments 24 and 25 make consequential amendments to clause 41.
Mr Bain
First, let me associate the official Opposition with the Minister’s remarks about Paul McBride. I also thank the right hon. and learned Member for North East Fife (Sir Menzies Campbell) for reminding the House of the importance of the Supreme Court in ensuring that institutions of government are exercised in accordance with the rule of law. That is a vital element of our constitution and one that must not go unheard in the House today.
Lords amendments 9 and 19 to 25 collectively omit clause 17 from the Bill and add new clauses before clauses 38 and 41 in respect of the relationship between the Supreme Court and the functions of the Lord Advocate in criminal prosecutions in Scotland, Acts of the Scottish Parliament thereby affected, and the role of the Advocate-General for Scotland.
Lords amendment 19 amends the Criminal Procedure (Scotland) Act 1995 to provide that the Advocate-General may take part as a party in criminal proceedings in Scotland in so far as they relate to a compatibility issue over the actions or omissions of a public authority relating to convention rights or EU law or over whether an Act of the Scottish Parliament or any provision thereof raises issues of compatibility with EU law or convention rights in Scottish criminal proceedings.
Lords amendment 20 makes further amendment to the 1995 Act to provide that when a compatibility issue arises in criminal proceedings in a court, other than any High Court of Justiciary proceeding heard before two or more judges, compatibility issues may be referred to the High Court of Justiciary. That may be required by the Lord Advocate or by the Advocate-General, if he is a party to the proceedings. In turn, the High Court of Justiciary may refer a compatibility issue to the Supreme Court, and may be required to do so by the Lord Advocate or by the Advocate-General, if he or she is a party to the proceedings.
Lords amendment 20 makes it clear that the role of the Supreme Court is restricted to determining the compatibility issue, whereby the case is then remitted back to the High Court of Justiciary for determination in the light of the Supreme Court ruling on the compatibility issues. That amends the relationship between the two courts, and while it preserves the ability of the Supreme Court to make entirely authoritative and decisive rulings on questions of the compatibility of the decisions of the Lord Advocate in relation to Scottish criminal proceedings and the prosecution system, it also ensures that the High Court of Justiciary is the judicial forum in which any convictions required to be reduced in the light of such a compatibility ruling are reduced.
Lords amendment 22 introduces a new clause that creates a time limit for application to the High Court of Justiciary in some cases, and to the Supreme Court in more serious criminal cases, of 28 days following the initial decision or, in the latter case, against the refusal to give permission for a compatibility reference. However, as the Minister suggested, that time limit can be extended by either court on the ground of equity.
Mr Bain
I entirely agree with the right hon. and learned Gentleman. One of the strengths of the devolution settlement is that it allows a court of the seniority of the Supreme Court to make these determinations. It would have been wholly irresponsible to remove these basic protections from people in criminal cases in the way that other politicians in the Scottish Parliament sought to achieve.
We are content with the amendments that have been made by the Lords and we will support them in the Chamber today.
Lords amendment 9 agreed to.
Lords amendments 10 and 11 agreed to.
Clause 25
Speed limits
Madam Deputy Speaker (Dawn Primarolo)
With this it will be convenient to consider Lords amendments 13 to 16.
David Mundell
Clause 25 allowed the Scottish Ministers to determine the national speed limit on roads in Scotland and to make regulations to specify traffic signs to indicate that limit. Clause 25 limited these powers to cars, motorcycles and vans under 3.5 tonnes.
We listened carefully to the arguments presented by noble Lords, together with the case made by the Scottish Parliament and Scottish Government for the Bill to provide for the devolution of powers to set different speed limits for different classes of vehicles—for example, cars towing caravans or goods vehicles. Lords amendments 12 to 16 would give the Scottish Ministers the power to make regulations regulating the speed of all classes of vehicle on roads in Scotland.
Mr Davidson
Will there be any restrictions under the Bill on the speed with which Scottish Government Ministers can change policy on issues such as income tax for a separate Scotland?
David Mundell
As the hon. Gentleman knows, in the devolution of powers such as speed limits, which are devolved in the clauses to which the amendments relate, it is entirely a matter for the Scottish Parliament and Scottish Government to determine how they use those powers and whether they apply them to themselves as they would to others.
John Stevenson
Although I fully support the Bill and what we are trying to achieve by devolving power to the Scottish Parliament, with regard to the road traffic regulations I have one concern, being the Member of Parliament for Carlisle, which is on the border—that is, that we ensure that there are sufficiently sensible signs on the border to indicate whether we should be speeding up or reducing our speed as we cross the border. I hope my right hon. Friend will ensure that the Scottish Parliament makes sure that that happens.
David Mundell
I am responsible for many things, but I am not responsible for the Scottish Government acting in a sensible manner. We are seeking to devolve these powers, which apply not just to the setting of limits, but to the signage. I am a Member of Parliament for a border constituency, as is the Secretary of State. We want to ensure that appropriate measures are in place so that people know what the law is on both sides of the border. As my hon. Friend pointed out on Second Reading, there are numerous legal differences between Scotland and England, which our respective constituents have managed to cope with over many years, not least the licensing laws.
Mr Davidson
Is it not the case that the Scottish Government want these powers in order to keep the speed limits the same? Just as with the monarchy, tax, the currency and NATO membership, they want the power to decide themselves that there will be no change.
David Mundell
I do not disagree with the hon. Gentleman. I took part in a radio programme with a member of the Scottish National party to debate the currency, and her principal argument was not over which currency Scotland should have, but about the fact that she should have the right to choose which currency; she suggested the Chinese renminbi, but I did not think that that would go down too well with the Politburo.
Lords amendments 12 to 16 would give Scottish Ministers the power to make regulations regulating the speed of all classes of vehicle on roads in Scotland and some consequential amendments. Together with the existing provisions in clause 25, that would enable them to set a national speed limit that is different for different classes of vehicle and the power to make regulations to specify traffic signs that indicate that limit. We think that that is a sensible addition to the Bill and, as right hon. and hon. Members might know, it was promoted in the House of Lords by my noble Friend Lord Forsyth, no less.
Mark Lazarowicz
These are sensible measures and I am sure that Scottish Governments of whatever political colour will use the powers sensibly. If a significant divergence was to develop between practice in England and practice in Scotland in relation to road signage and speed limits, what steps could be taken to make the necessary changes to the Highway Code, the driving test and more generally to inform drivers on both sides of the border?
David Mundell
It will obviously be for the Scottish Government to advise on changes to signage, among other things, that they make. Changes that are specific to Scotland can be included in the Highway Code, and we currently have differential traffic regulations in different parts of the United Kingdom. I am sure that the hon. Gentleman, like me, will have constituents who have fallen foul of the congestion charge that applies in London but nowhere else in the United Kingdom. There are differential traffic regulations in place at the moment, and these are well advertised.
Mr Russell Brown (Dumfries and Galloway) (Lab)
What discussions were held when it was decided that it would be the right thing to devolve the power that would allow the Scottish Government to determine what traffic should be flowing and at what speed? Was there any sense behind the decision that, for example, heavy goods vehicles should be allowed to travel at 60 mph on single track roads?
David Mundell
I share the hon. Gentlemen’s concerns about traffic speeds in our part of Scotland, Dumfries and Galloway, particularly on the A75. I hope that these powers will allow the Scottish Government for once to focus on Dumfries and Galloway and address such issues. They will have the powers and it will be for them to make the decisions. I commend my noble Friend Lord Forsyth for achieving this significant amendment to the Bill. It is the only amendment made during the passage of the Bill that will ensure that the powers of the Scottish Parliament are increased, and I do not think that the irony of that was lost on him.
Mr Davidson
Given that speed is a product of both distance and time, has there been any further submission from the nationalists on their ambition to have Scotland in a separate time zone, because it is obvious that if it was in a separate time zone—
David Mundell
Before the debate becomes any more raucous, I should recognise that this is possibly my final opportunity to speak to the Bill, so I should like to use it principally to thank the officials in the Scotland Office who have worked so hard to deliver it. We are often the subject of scrutiny, but we are a very small Department and we, along with the Treasury and, indeed, Scottish officials, have worked to deliver this major piece of constitutional legislation. I thank all those who have participated in that process. As I said at the very start of our proceedings, I participated at the beginning of the process that led to the Bill, and I am very proud to be here at the end.
Oral Answers to Questions
David Mundell Excerpts(12 years, 1 month ago)
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David Mowat (Warrington South) (Con)
3. What discussions he has had with the Chancellor of the Exchequer on the funding formula for Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The Government are aware of the concerns that have been expressed about the current system of devolution funding, whereby changes to the block grant are calculated according to the Barnett formula. Owing to the unprecedented deficit that we inherited, our immediate priority is to reduce the deficit, and we have no plans to change the present arrangements before the public finances have been stabilised.
David Mowat
Given that the Government have no plans to replace the current formula with a formula based on need, and given the requirement for clarity so that the people of Scotland know what proportion of the national debt they will inherit before they vote, does my hon. Friend agree that the Barnett multiplier would provide a good solution?
David Mundell
I believe that we need to move on from the discussion of issues of process relating to the referendum, and engage in a substantive debate on the issues that would affect Scotland if it became independent. Having, it would appear, campaigned relentlessly for independence, the SNP now seems to want to delay the question and the issues for as long as possible.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
Does the Minister agree that the high price of fuel is creating major problems in Scotland, and that, at a stroke, cutting VAT, which is perhaps the unfairest tax in the country, would help Scottish families, who are suffering greatly as a result of the Budget.
Mr Speaker
Order. I hope that the answer will refer to the funding formula for Scotland, as the question should have done.
David Mundell
The funding formula for Scotland is calculated on the basis of a basket of taxes raised by the United Kingdom Government. Scots would be much worse off if fuel duty were 10p higher, as it would have been if Labour were in power.
Mr David Evennett (Bexleyheath and Crayford) (Con)
Does my hon. Friend agree that it is vital to maintain the Union in the interests of both England and Scotland, but that the funding formula should be fair to both countries?
David Mundell
I agree absolutely with my hon. Friend’s sentiments, but as he and many other Members are aware, this Government inherited the worst deficit in peacetime history from the Labour Government, and stabilising our nation’s finances must be the focus of their efforts.
Gordon Banks (Ochil and South Perthshire) (Lab)
My question relates directly to the question from the hon. Member for Bexleyheath and Crayford (Mr Evennett) and the Minister’s answer to it. Does the Minister agree that the Scotland Bill will increase the amount of revenue gathered in Scotland to about a third of its spend, and will thus decrease dependency on a block grant?
David Mundell
I agree that the Scotland Bill represents a radical, historic and significant change to Scotland’s financing. More than a third of spending by the Scottish Parliament will result from funding from taxes that it determines and raises. That is a major step forward in terms of devolution and accountability, and should be welcomed by all Members.
Gregg McClymont (Cumbernauld, Kilsyth and Kirkintilloch East) (Lab)
13. How many pensioners in Scotland will be affected by the Chancellor of the Exchequer’s decision on age-related personal allowances.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
Three hundred and sixty-seven thousand.
Michael Connarty
Will the Government not admit that the figures do not reveal the fact that this is an attack on people who have put away money for their retirement? The amount involved is up to £30,000 a year. This is an attack on middle-class people. There is also an attack on single people, who will lose income through being hit by the bedroom tax. People cannot be elderly and they cannot be single—and it would appear they cannot be hungry either, as there is a tax on fish and chips.
David Mundell
It will not surprise the hon. Gentleman that I do not accept his analysis. He and others who scaremonger on this issue fail to point out that more than half of those in Scotland aged over 65 will not pay any tax at all.
Lindsay Roy
Is the Minister not ashamed of his Government’s decision to reduce tax for the wealthiest Scots while at the same time penalising pensioners with a tax grab, whereby they will lose up to £322 per annum?
David Mundell
I know that the hon. Gentleman was not a Member of this Parliament for most of the 13 years of the last Labour Government, but most of his colleagues from Scotland were, and I did not hear them calling at that time for an increase in the higher rate of income tax. He is wrong to say that there will be losers in relation to the age-related allowances; there will be no cash losers.
Sandra Osborne
If, as the Government say, this measure is about fairness and simplification, why did they not wait until the full £10,000 personal allowance was in place before imposing this stealth tax on pensioners?
David Mundell
I acknowledge that the hon. Lady is well known for speaking up both for the low-paid and for those on the minimum wage. That is why I would have thought that she would have welcomed the fact that the Government are raising the personal allowance to £10,000 during this course of this Parliament. [Interruption.]
Mr Speaker
Order. There are a lot of noisy private conversations taking place in the Chamber. I would like to hear the questions and the answers.
Gregg McClymont
What does it say about the priorities of this Government that they impose a granny tax on 367,000 Scots while giving a tax cut to the wealthiest 14,000 Scots?
David Mundell
What the hon. Gentleman and his colleagues fail to acknowledge is that this Government have delivered the largest pension rise in the last 30 years, whereas the last Government, which his party led, introduced a pension rise of 75p, so we are not going to take any lectures from Labour on the treatment of pensioners in Scotland.
Mr William Bain (Glasgow North East) (Lab)
Just how out of touch are this Government if they think that it is right or fair that almost 400,000 Scottish pensioners should pay on average £83 a year more in tax from next April just so that 16,000 top-rate taxpayers receive a tax cut of £10,000 a year on average? People retiring next April will face an annual tax hike of £322 a year because of the granny tax and the ending of the savings credit in 2017, on top of higher VAT and cuts in winter fuel allowance introduced by this Chancellor. With a record in government like that, surely it is no surprise to the Minister that Tory election strategists are gloomy about winning any seats at all in Scotland at the next general election.
David Mundell
What I think is fair is that half of pensioners over 65 in Scotland will not pay any tax at all; that those earning less than £10,000 will, by the end of this Parliament, be subject to a personal allowance of £10,000; and that this Government have delivered the largest increase in the pension—£270 compared with the 75p offered by the previous Government.
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
Those pension increases will, of course, be wiped out by this tax grab. People living on modest pension incomes have already paid a very high price for the financial crisis. They have lost the value of their savings and investments, and they are having to face inflation and extremely low interest rates. How can the Minister justify this tax grab on pensioners while taxes are being cut for millionaires?
David Mundell
I am afraid that I am not going to accept any lectures on economics from the hon. Lady. She is offering pensioners in Scotland the prospect of breaking up the United Kingdom, with no certainty as to where pension funding would come from.
Julian Smith (Skipton and Ripon) (Con)
6. What assessment his Department has made of the implications for the currency used in Scotland of a vote in favour of independence for Scotland.
Guy Opperman (Hexham) (Con)
7. What steps are being taken by the Government and the Office of Fair Trading to tackle fuel poverty in Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The Secretary of State chaired the first ever annual summit in Scotland on fuel poverty, bringing together the heads of the big six energy companies and Scottish consumer groups. That led to suppliers providing information to improve the application of key policies in Scotland, such as the warm home discount scheme. I am convening a follow-up meeting soon to review progress.
Guy Opperman
Does the Minister agree that the problem of a lack of competition in the availability and provision of heating oil in the Scottish border region needs addressing urgently?
David Mundell
I represent a large rural constituency in the Scottish borders, so I certainly share my hon. Friend’s concerns, although I understand that in his constituency there are some innovative initiatives whereby communities are coming together to purchase heating oil and are therefore able to negotiate better prices with suppliers.
Mr Mike Weir (Angus) (SNP)
As well as pressing the Office of Fair Trading, will the Minister press his own Cabinet colleagues to look at providing practical help, for example by bringing forward the pensioners’ winter fuel allowance for off-grid consumers to allow them to fill up their tanks before winter hits, when prices tend to be lower?
David Mundell
The off-grid issue is of concern in rural Scotland, as elsewhere, and I would be happy to meet the hon. Gentleman to discuss his concerns.
Mr Graham Allen (Nottingham North) (Lab)
11. What powers would be devolved to Scotland under devo-max.
Livingston New Town
David Mundell Excerpts(12 years, 2 months ago)
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I congratulate the hon. Member for Livingston (Graeme Morrice) on securing the debate, which marks a significant year in the history of the community of Livingston. He mentioned my constituency, which is one of the largest in Scotland and borders his, as it does many others. He also mentioned Bristow Muldoon, under whose convenorship of the Local Government and Transport Committee I was happy to serve when I had the privilege of being a Member of the Scottish Parliament.
The hon. Gentleman will be aware that it was a Conservative Secretary of State for Scotland, John Maclay, who backed the plans for the development of Livingston back in the early 1960s. Livingston was designated under the New Towns Act 1946 and the Local Government (Scotland) Act 1947 as one of the new towns to be built, as the hon. Gentleman said, to relieve overcrowding in Glasgow and other areas.
Scotland’s five new towns—East Kilbride, Glenrothes, Cumbernauld, Livingston and Irvine—have added much to the fabric of our country. Their development corporations may have come and gone, with their functions transferred to local authorities, but the towns themselves have put down enduring roots. They have proved to be pacesetters in Scotland’s economic transformation in recent decades, and that has most certainly been the story of Livingston.
The hon. Gentleman has enabled us to celebrate Livingston at 50. Like many of us, Scotland’s fourth new town has moved into middle age. However, it has a lot to celebrate and even more to look forward to. It has been an eventful half century, packed full of highs and a few lows, but freshly forged spirit and community have combined to drive the town onwards and upwards. The result is that, in 2012, Livingston is firmly fixed on the national and international map as a centre for business, innovation, education, health care and sport.
Livingston was also purposely planned, which brings me to a subject that the hon. Gentleman did not mention: roundabouts. Only after the winding up of the Livingston Development Corporation in 1997 did Livingston get its first traffic lights. Roundabouts have become synonymous with new towns both north and south of the border. Residents of Livingston have referred to their town as “Roundabout City”, but roundabouts in Livingston are a bit special. Landmark sculptures designed by David Wilson in the 1990s adorn the four major roundabouts. Built from reclaimed dyking stone, NORgate, Compass, Dyke Swarm and Chrysalis have been local landmarks in their own right for more than a decade.
Over five decades, Livingston has moved and progressed on many fronts. It has grown into a community of more than 50,000 residents and enhanced its connectivity to Scotland’s road and motorway network. Its proximity to Edinburgh airport is an added attraction for businesses seeking to locate or invest in the town. It is better connected with the two railway stations—Livingston South and Livingston North were established in the 1980s, offering direct links into Edinburgh and Glasgow.
Sport has also brought success and attention to the town. As the hon. Gentleman said, the 1990s witnessed the arrival of Livingston FC and the building of Almondvale stadium, home to a team that played in European competition and won the league cup in 2004. Of course, darker days followed with the club going into liquidation, but happily for the hon. Gentleman, Livingston FC is on the up again in the first division.
Livingston has always been a leader in business. For half a century, Livingston has been at the cutting edge of innovation and technology. High-tech and pharmaceutical firms were in the vanguard of the wave of light industry attracted to Livingston from the 1960s. Some of us remember the slogans—“Make it in Livingston” and “Build it in Livingston”—of the now-departed Livingston Development Corporation, to which the hon. Gentleman referred. Those slogans have become a reality down the years.
In the 1990s, Livingston was an important hub in Scotland’s silicon glen. While some companies such as Motorola and NEC have come and gone, an abundance of new businesses have arrived in their place. As well as multinational companies maintaining factories in the town, BSkyB’s main call centre is the largest private sector employer in West Lothian.
Livingston is equipped with a modern and diverse economy. Retail and business services co-exist alongside modern manufacturing. Livingston attracts people from across central Scotland to shop, with an array of established names operating out of state-of-the-art shopping centres, which the hon. Gentleman described in detail. Livingston is also a centre for significant public sector employment. The civic centre, West Lothian college of further education and St John’s hospital illustrate the town’s importance for public administration, education and health care.
We must today wrestle with the challenge of giving a new life to a mature new town. Livingston faces the same employment challenges that confront similar communities throughout Scotland, the UK and the western world, although as the hon. Gentleman will know, the jobseeker’s allowance claimant rate is below the national average. In a fiercely competitive global marketplace, Livingston is blessed with real advantages as it seeks to secure new investment and jobs.
The town’s location, transport links and highly skilled work force are beacons for business. Livingston is still at the cutting edge of Scotland’s future. It is equipped with a modern and diverse economy, including some of the most innovative businesses in Scotland. I would like to highlight the superb example of Cyberhawk Innovations, a Livingston company that has developed unmanned helicopters that allow engineers to inspect the inner workings of tall and inaccessible structures such as oil installations. Founded less than four years ago, it is now expanding and exporting overseas. It is a marvellous illustration of commercialisation from Scottish engineering excellence and inventiveness. Similarly, there is Touch Bionics, a spin-out from the NHS and a world-class leader in the design and manufacture of prosthetic limbs. That is why it is showcased in the UK Government GREAT campaign to promote investment in the UK during this diamond jubilee and Olympic year.
I know that Livingston is planning to mark its golden anniversary with style. The hon. Gentleman’s debate will be a significant part of that celebration. As well as a new logo designed by schoolchildren and new trees, plenty of events, exhibitions and activities are planned around the anniversary on 17 April. It is great to see that this anniversary will be marked with specials events, with arts, music and dance the centrepieces of the celebrations next month. As Livingston reaches its golden jubilee, it can reflect on a successful past. Officially, it has not been a new town for 15 years. It has matured into an established feature of the Scottish landscape. I hope that it can look forward to a great future as a significant centre at the forefront of the Scottish and UK economies. On behalf of the UK Government, I wish Livingston all the best for its second half century.
Question put and agreed to.
Supermarkets And Public Land (Scotland)
David Mundell Excerpts(12 years, 2 months ago)
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I congratulate the hon. Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann), my neighbouring MP in south Lanarkshire, on securing debating time tonight. Adjournment debates are an important opportunity for Members to put matters of concern on the record, and the hon. Gentleman has been able to do that.
The issues that have been set out have already been the subject of a great deal of investigation by the relevant authorities. I am conscious that a number of the issues raised are still under consideration by both the procurator fiscal and the civil courts, and therefore it would not be appropriate for me to comment on those. The issues raised also relate closely to the decision-making process for planning applications in Scotland and to economic development policy in Scotland. It is important to recognise that these matters in Scotland are devolved and are properly for the relevant local authorities, the Scottish Government and their agencies. I can therefore offer no comment on the merits or otherwise of the applications in question.
With regard to the responsibilities and accountability of civil servants, I understand the hon. Gentleman’s frustration. However, there are proper processes in place. The civil service code, first published in 1996, sets out the core civil service values and the standards of behaviour expected of civil servants in upholding these values. A Scottish Executive version of the civil service code was first published in 2006.
On 11 November 2010, the civil service provisions of the Constitutional Reform and Governance Act 2010 came into force, placing the civil service values on a statutory footing. Under the terms of the 2010 Act, a revised civil service code was laid before the UK Parliament on 11 November 2010 and is available on the Cabinet Office website, and a revised separate code of conduct governing civil servants who serve the Scottish Executive was laid before the UK Parliament and Scottish Parliament on 11 November 2010.
As the hon. Gentleman said, he pursued the matter also with the then head of the civil service, who fully investigated the matter.
Thomas Docherty (Dunfermline and West Fife) (Lab)
I am grateful for the opportunity to speak in the debate. Having worked in the property industry, I know that Mr Gallagher has something of a reputation for being what in Moffat would be called a wide boy. Is the Minister satisfied that the code covers the culture of behaviour, as well as the actions?
David Mundell
I am satisfied that the terms of the code are appropriate and are appropriately administered. As the hon. Gentleman knows, complaints regarding the Scottish Government and their agencies which have gone through those organisations’ own formal complaints procedure can also be raised with the Scottish public services ombudsman. It is for the public services ombudsman to deal with these matters, and it is right that the appropriate avenues are used. The Scotland Office does not have any locus in such matters and it would not be appropriate for us to take on any investigatory role in relation to these matters.
Mr McCann
Having served for a considerable time in my career as a full-time trade union official in the civil service, and having represented people who work in Scottish Enterprise, I know how the procedures operate. In the situation that I described, I made a formal complaint to the head of the civil service that someone, as I set out in my opening address, committed a serious disciplinary offence. No action was taken whatsoever, and he was allowed to leave the service with a handsome package paid for by the taxpayer. Those questions have never been answered. Therefore the question that I must put to the Minister is how am I to pursue such questions to a logical conclusion when all I got from the civil service was a brick wall constructed in front of me and my questions not being answered?
David Mundell
As I set out in my opening remarks, the hon. Gentleman has had the opportunity this evening to place all his concerns on the record. I undertake to ensure that a transcript of tonight’s proceedings is conveyed to all the relevant parties that have been discussed, including Scottish Enterprise, the Scottish Government, Sir Peter Housden, the Information Commissioner, and the current head of the civil service, Sir Bob Kerslake, so that everyone who has an interest in the matter can read the points that the hon. Gentleman has raised. However, the Scotland Office is unable to take forward further investigations. Indeed, it would be inappropriate to do so while a criminal investigation and civil court proceedings are taking place. As I have said, he has used the important opportunity of an Adjournment debate to place his concerns on the record.
Oral Answers to Questions
David Mundell Excerpts(12 years, 2 months ago)
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Michael Connarty (Linlithgow and East Falkirk) (Lab)
3. What steps he is taking to ensure that the findings of the Equality and Human Rights Commission’s inquiry into human trafficking in Scotland are discussed by the relevant officials in England and Wales.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The Government are considering the findings of the Equality and Human Rights Commission’s inquiry into human trafficking in Scotland, in line with the ongoing implementation of the human trafficking strategy we launched in July 2011.
Michael Connarty
If the Minister had read the inquiry report, he would have seen that its main recommendation is that there should be a new human trafficking Bill for Scotland. I suggest to him that that would solve the problem of implementing the EU human trafficking directive, which we have signed up to, across the UK. I invite him and other interested parties to attend the all-party group on human trafficking next Monday in Room 7 to hear the inquiry being reported on in the House and perhaps take some advice.
Fiona Bruce (Congleton) (Con)
Does my right hon. Friend agree that the field of human trafficking, where co-ordination between involved agencies is critical if we are to find real solutions, is yet another practical example of a policy area that is best tackled at UK level?
David Mundell
I absolutely agree with my hon. Friend that the UK can bring great weight to this issue on behalf of Scotland. It is also an issue where we have been able to work with the Scottish Government, demonstrating that the two Governments can work together on matters of great importance on a day-to-day basis.
Andrew Selous (South West Bedfordshire) (Con)
4. What recent discussions he has had with the Chancellor of the Exchequer on a credit rating for Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
Mr Speaker, you will be aware that the Chairman of the Work and Pensions Committee, the hon. Member for Aberdeen South (Dame Anne Begg), who is a regular attendee at Scotland questions, has suffered a fall. I am sure that we all wish her well in her recovery.
My right hon. Friend the Secretary of State for Scotland and I are in contact with Ministers in the Department for Work and Pensions on a range of issues concerning welfare reform.
Mark Menzies
Is it not clear that if the nationalist Government in Scotland had control of welfare policy, there would be no benefits cap in Scotland, despite widespread public support for it?
David Mundell
What is clear is that the Scottish National party is making a proposition for independence without explaining to people how benefits at current levels would be paid in future, or where the money would come from.
Mike Freer
With the average income in Scotland being £419 a week, does the Minister not agree that a benefit cap of £500 a week is a reasonable and sensible level?
David Mundell
I do agree that that is a reasonable and fair measure, and constituents in constituencies such as mine cannot understand how the Labour party and the nationalists can promote the idea that the benefit cap should be higher than £35,000.
Sheila Gilmore (Edinburgh East) (Lab)
Is not the truth about the benefit cap, however, that if such a household on £419 a week, as cited by the previous questioner, had six children—like some of my constituents do—who had to be cared for, they would also receive child benefit, and that therefore the comparison that has been made is not fair? What is going to happen when the discretionary housing payments to a council—that is the only answer from the Government—run out?
David Mundell
The hon. Lady should listen to her hon. Friend the Member for Leeds West (Rachel Reeves), when she says that if Labour is to be taken seriously on any issue it has to
“pass the test of fiscal credibility.”
On this issue, that is a very relevant point.
John Robertson (Glasgow North West) (Lab)
The right hon. Gentleman will not be aware that I have the highest percentage of single women in any constituency in the country. What is he doing to help those women—[Interruption.] This is not a joke. This is a serious point, and Government Members can laugh all they like, but there are single women in this country who are struggling. What is his party going to do to help them?
David Mundell
What this Government are doing is tidying up the mess that the hon. Gentleman’s Government left, which has placed single women and many other people in a perilous financial position.
Pamela Nash (Airdrie and Shotts) (Lab)
7. How many disabled children receive the severe disability premium in Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
As at 3 April 2011 in Scotland, there were 4,800 in-work families benefiting from the severely disabled child element and with child tax credit above the family limit. There are 5,000 severely disabled children in these families.
Pamela Nash
I thank the Minister for that answer. The Prime Minister told this House on 14 December and again on 23 January that his Government will not be cutting benefits for disabled children. Given that almost 8,000 children in Scotland will lose £1,400 a year through the child tax credit changes, does the Minister agree that the Prime Minister was plain wrong and clearly does not understand his own policy?
David Mundell
What I agree with is the fact that the Government are not making any savings at all from these changes. Savings from abolishing the adult disability premiums and changes to the child rate will not return to the Exchequer; those savings will be recycled into higher payments for more severely disabled people. [Interruption.]
Mr Speaker
Order. There are far too many noisy private conversations taking place in the Chamber. I know that the House will want to hear Mrs Eleanor Laing.
Mr Speaker
The Minister should answer with reference to the disability premium.
David Mundell
The severe disability premium and all other benefits are clearly set out by the United Kingdom Government. The Scottish National party has failed to set out how a single benefit in Scotland would be paid for post independence, if it were ever achieved.
Katy Clark (North Ayrshire and Arran) (Lab)
9. What discussions he has had with the Secretary of State for Defence on the future of DM Beith.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I spoke to the Under-Secretary of State for Defence, my hon. Friend the Member for Mid Worcestershire (Peter Luff), last week on this issue. As he confirmed on Monday, there are no current plans to change the status of DM Beith. There is a need to maintain Beith until the Spearfish torpedo has been converted to a single-fuel system, when the need for specialist facilities may lapse. The conversion programme is expected to be completed around 2018.
Katy Clark
Defence Munitions Beith is one of the largest employers in North Ayrshire and is wholly dependent on Ministry of Defence contracts. Will the Minister ensure that there is a ministerial visit to the facility from the Scotland Office to find out what more can be done with a view to ongoing representations for future contracts with the Ministry of Defence?
David Mundell
I am pleased to be able to confirm to the hon. Lady that the Secretary of State for Scotland will be pleased to visit that facility in her constituency.
Mary Macleod (Brentford and Isleworth) (Con)
11. What assessment his Department has made of the financial effect on Scotland of independence.
Female Employment (Scotland)
David Mundell Excerpts(12 years, 4 months ago)
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
It is a pleasure, Mr Hood, to serve under the chairmanship of a constituent. I congratulate the hon. Member for Glasgow North (Ann McKechin) on securing this debate about female employment trends in Scotland. It is one of a number of debates relating specifically to Scotland that have been held recently in both Westminster Hall and the main Chamber, and such debates are welcome. Following on from some of the hon. Lady’s remarks, I congratulate Johann Lamont on becoming the leader of the Scottish Labour party, which relates to the hon. Lady’s arguments. Moreover, at the end of last year, my colleague Ruth Davidson became the leader of the Scottish Conservative party, so the political process in Scotland has some female leadership. I am sure that both ladies will bring significant influence to bear in the months ahead.
The fight against unemployment is a priority for the UK Government. We are committed to getting Scots off benefits and into the workplace. Work remains the best and most sustainable route out of poverty. The UK Government have measures in place to support all claimants to find work. These measures are not gender specific. We want women and men to get the job opportunities that they need.
Nevertheless, this challenge must be set against the context of the UK recovering from the biggest financial crisis for generations and the deepest recession of almost all major economies. The uncertainty and instability in the eurozone area, where unemployment is higher than in the UK, continue to have a chilling effect on our economy.
Despite the difficult environment, we are still trying to help women. Many of the 90,000 Scots who have been lifted out of tax at the lowest end are women. The measures that we are taking on additional child care are helping women south of the border, with Barnett consequentials for Scotland. At the same time, our reforms of public service sector pensions will mean that lower-paid public sector employees, including many women, will get better pensions. On top of this, the UK Government have announced new support for women’s enterprise, with funding to provide 5,000 mentors for new and existing female entrepreneurs. Similarly, the establishment of the Women’s Business Council is geared towards helping the Government to maximise women’s contribution to future UK economic growth.
I recognise that there are concerns that women are being disproportionately affected by unemployment. Fears have been raised because of the predominance of women in the retail sector, in local government employment, in the NHS and in part-time work. However, as John Philpott, the chief economic adviser at the Chartered Institute of Personnel and Development said last month, it has been tough for both sexes in the 2011 jobs market. He commented:
“What we do know is that the relative position of women has not so far worsened as much as commonly perceived or as widely anticipated given the high concentration of women workers in the public sector and in part-time jobs more generally.”
Labour market analysis published last month by the Scottish Government shows the trend in Scotland over the past year is for women moving out of unemployment and inactivity into employment. As the Minister of State, Department for Work and Pensions, my right hon. Friend the Member for Epsom and Ewell (Chris Grayling), said today,
“The latest figures reflect the current challenging economic climate but also show more women entering the workforce.”
That was backed up by the Prime Minister, who told the House earlier this afternoon that 59,000 more women are now in the workplace than at the time of the 2010 general election.
Ann McKechin
Female unemployment in Scotland has increased by 25% in the last quarter, so would the right hon. Gentleman not acknowledge, given the statistics that he has just quoted, that there needs to be a much more thorough analysis, so that we can get to the root of the reason why there has been such a rapid increase, whether that is likely to be a permanent shift in the job market and what sectors will be particularly affected?
David Mundell
I agree with the hon. Lady that analysis is important to getting to a full understanding of what the situation is. I assure her that the Government are not complacent in that regard.
The Government also have an ambitious agenda to reform the benefit system and to support those who are able to go back into work. The increase in female jobseeker’s allowance claimants in Scotland can be partially attributed to the change in the rules for lone parents. Most lone parents with a youngest child aged seven or over are no longer entitled to income support purely on the grounds of being a lone parent. They must now claim jobseeker’s allowance or employment and support allowance or find work. There are plans to apply that rule to lone parents with a youngest child aged five or over from this year. Our policies for lone parents strike a balance between the right to benefit to support the family and wider responsibilities to support themselves and lift their children out of poverty when that is feasible.
We also understand the importance of flexible working. It is the Government’s intention that the law will better support families juggling work and life, and the businesses that employ them. We are currently developing our proposals for extending flexible working legislation and will be consulting with stakeholders on how best to implement them.
Ann McKechin
The right hon. Gentleman mentioned the fact that more lone parents are coming into the job market because of changes to regulations. Will he tell us what dialogue he has had with the Scottish Government about the fact that, in Scotland, child care costs are so high? Proper, affordable child care is absolutely vital if people, particularly those on lower incomes, are to get back into employment.
David Mundell
The Secretary of State and I have had ongoing discussions with the Scottish Government on employment and wider economic issues and on how we can dovetail our policies to ensure that they work in the best way for people in Scotland. The hon. Lady clearly highlights a significant issue, which I will take up again with the Scottish Government the next time I have the opportunity to do so. I appreciate the importance of the issue that she is raising.
The UK Government recognise the issue of child care and are implementing measures geared to helping more women into work. The hon. Lady will be aware that, following the autumn statement, the Scottish Government will receive more than £500 million in addition to the sums that they had anticipated they would receive. In relation to that funding, the Scottish Government will have the opportunity to invest more in child care and skills development.
Looking forward, the integration of child care into universal credit when it is introduced in 2013 will protect work initiatives and ensure that support is focused on low-earning families. As I have said, we know how important child care is in helping mothers into work. Child care costs will be supported through an additional element in the universal credit. Support for the costs of child care within the universal credit will be made available to all lone parents and couples, where both members are at work, regardless of the number of hours they work. On average, families with children are more likely to have a higher than a lower entitlement under the universal credit.
More broadly, the Department for Work and Pensions is taking a number of measures to assist all claimants into work. The advisory support in job centres across Scotland is tailored and personalised to the individual’s needs. Claimants of both genders have access to a range of “Get Britain Working” initiatives, including work clubs, enterprise clubs, the work together scheme, work experience, new enterprise allowance and sector-based work academies. Similarly, work trials allow employers and employees the chance to try out employment opportunities.
The Work programme is a key part of our reforms and, as the hon. Member for Glasgow North knows, it went live in June. We are also helping to break down the barriers to employment through the flexible support fund, which can assist with child care expenses, travel costs and clothing costs. It also targets support to particular groups of claimants. The DWP is looking at bids for grant funding from bodies that specifically support lone parents and women with special needs, such as mental health issues.
Across Scotland, there is huge concern about youth unemployment and, obviously, a significant number of the people affected by that are female. Youth unemployment has been rising since 2004.
Dr Whiteford
Does the Minister agree that the Scottish Government’s commitment to ensuring that every young person in Scotland between the age of 16 and 19 has an apprenticeship, college or university place or training opportunity is a good thing and that it is the right direction to be moving in to tackle youth unemployment?
David Mundell
I can certainly assure the hon. Lady that I accept that many things the Scottish Government do are good. What I do not accept is the often presented premise that, if the Scottish Government do something, it is a good thing, and if the UK Government do something, it is a bad thing. We need to work together, particularly on issues such as youth unemployment.
As I said, youth unemployment has been rising since 2004 and is an issue on which we all need to take an interest. That is why I am particularly pleased that John Swinney is going to join the Secretary of State and me at a national convention to consider the issue of youth unemployment, with all other relevant stakeholders from throughout Scotland. In terms of identifying issues and concerns, we have undertaken a number of very successful events in Irvine, Hawick and Falkirk to date, and a national event will take place in Dundee in March.
We have also announced the youth contract, which will bring an extra £1 billion of extra investment into supporting the young unemployed, whether through wage incentives, additional work experience and opportunities or money to the Scottish Government. There will also be the offer of a work experience place for every 18 to 24-year-old who wants one before they enter the Work programme.
The UK Government cannot solve the employment challenges facing Scotland alone. The Scottish Government have many policy levers, with important responsibilities for education, skills, business tax and enterprise, which can be used to improve the employment situation. Scotland’s two Governments must work together to achieve this.
Question put and agreed to.
Oral Answers to Questions
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John Robertson (Glasgow North West) (Lab)
2. What assessment he has made of the effect of the autumn statement on child tax credit payments in Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The welfare system must remain fair and affordable, while protecting the most vulnerable. Most working-age benefits, benefits for disabled people and the basic state pension will increase by 5.2% in April. In order to remain on course with the debt consolidation plan and meet their fiscal mandate, the Government will increase the child element of child tax credit by the rate of inflation.
John Robertson
According to the House of Commons Library, the Government’s decision not to proceed with the £110 increase in the child element of child tax credit will take £41 million away from nearly 400,000 children in Scotland alone. Worst hit in Scotland will be Glasgow city, where 44,000 children are set to miss out on £4.8 million. When will the Secretary of State stand up for the children of Scotland?
David Mundell
The Government are standing up for the children of Scotland. That is why our priority is sorting out the mess that the Labour Government made of our economy. The hon. Gentleman would do well to heed the words of the former Secretary of State for Scotland, the right hon. Member for East Renfrewshire (Mr Murphy):
“The truth is the Labour party would have to make cuts if we were in power.”
John Stevenson (Carlisle) (Con)
We all accept that these are difficult economic times, but does the Minister agree that one of the most effective ways of helping the lowest-paid families is raising the income tax threshold to £10,000 and beyond?
David Mundell
I entirely agree. The measure has had a significant impact in Scotland, and more than 2 million basic-rate taxpayers will benefit from it during the current Parliament.
Anas Sarwar (Glasgow Central) (Lab)
After another week that has been dominated by political debate and headlines relating to Scotland’s constitution, we must not ignore a report by End Child Poverty showing that 50% of local authority areas in Scotland contain wards in which 30% of children are living in poverty, and that in some wards in my constituency the figure is 50%. What action is the Secretary of State taking, along with the Scottish Government, to ensure that every child in Scotland is given the best start and opportunities in life?
David Mundell
The hon. Gentleman raises important issues, such as the fact that many of the levers relating to child poverty rest with the Scottish Government. As a result of the autumn statement, the Scottish Government received more than £500 million in additional revenue. I should have thought it would be better if they focused on how to deploy that revenue to deal with such problems as child poverty than to obsess about the constitution.
Alun Cairns (Vale of Glamorgan) (Con)
3. What steps he is taking to promote Scotland as a destination for international inward investment.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
My right hon. Friend the Secretary of State and I firmly believe that Scotland is the ideal destination for international inward investment, and we have taken a range of actions to promote such investment. My right hon. Friend recently led the largest ever Scottish trade delegation to Brazil to promote closer business links with a key emerging market for the Scottish economy.
Alun Cairns
Does my hon. Friend accept that, in an ever more competitive world, uncertainty about independence has not helped the cause of Scotland or any other part of the United Kingdom that is seeking to attract much-needed inward investment?
David Mundell
I entirely agree with my hon. Friend, which is why I believe it is better that a referendum on Scottish independence be held sooner rather than later.
Angus Robertson (Moray) (SNP)
In contrast to the previous intervention, will the Minister acknowledge that international companies investing in Scotland since the re-election of the Scottish National party Scottish Government include INEOS, PetroChina, Dell, Gamesa, Amazon, Hewlett Packard and Mitsubishi Power Systems? Does he acknowledge that and welcome the investment?
David Mundell
I acknowledge that those companies have invested in spite of the uncertainty. We should consider the level of investment that Scotland could achieve if there was not that uncertainty.
Angus Robertson
That is the usual mantra that we hear from Government Members. Will the Minister respond to Scotland’s leading entrepreneur, Jim McColl, who said on this very subject that business is “not concerned” about the
“independence referendum…What many of us in business are convinced about is that a productive and prosperous future for this country depends on securing real economic powers for the Parliament through constitutional change”?
Will the UK Government drop their foolish conditions, so that we can secure that change in the autumn of 2014?
David Mundell
I am sure the hon. Gentleman will agree that Mr McColl is entitled to his opinion, as is any other citizen of Scotland. I am sure you will encourage them, as your own party’s Scottish Government already have, to contribute to our consultation on the independence referendum.
Mr Philip Hollobone (Kettering) (Con)
Does my right hon. Friend believe that were Scotland to become separate from the United Kingdom, and were it to be forced to join the eurozone as a condition of re-entry into the European Union, that would hinder or help inward investment into Scotland?
David Mundell
Uncertainty over Scotland’s position in the EU, and uncertainty over which currency Scotland would use if it were ever to become independent, would certainly hinder inward investment into Scotland.
Mr Brian H. Donohoe (Central Ayrshire) (Lab)
4. How many young people are not in employment, training or education in Scotland.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
5. What assessment he has made of the effect of the autumn statement on levels of poverty in Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The Government took action at the autumn statement to build a stronger and more balanced economy. As a result, more than £500 million has been added to the existing Scottish budget by the UK Government, which provides the Scottish Government with additional resources in these uncertain times.
Cathy Jamieson
I thank the Minister for that answer. Does he agree that one of the most important ways of tackling poverty is ensuring full employment? Does he therefore share my concern that Mahle Engine Systems in my constituency seems set to remove jobs from an area hit by high unemployment, taking those jobs out of Scotland and out of the UK?
David Mundell
I would be very disappointed if that were the case. I know that the hon. Lady is a doughty campaigner for employment in her constituency. We must continue to stress the benefits of employers remaining in Scotland, which is why the current constitutional uncertainty is so damaging.
Mr Jim Hood (Lanark and Hamilton East) (Lab)
On Monday, when 700 of my constituents employed by WJ Harte Construction returned to work, they were told that the company had gone into administration, without any consultation whatsoever. I am told that Scottish Enterprise and the trade unions were not even aware of this. The MSP was not aware of it, and the MP certainly was not. The company was taken over by a venture capitalist more than two years ago, when it had a turnover of £100 million. It has now been run into the ground and the executives have run away with the money. Will the Minister meet me to discuss what we can do to save as many of these 700 jobs as possible? This is a disgraceful situation.
David Mundell
Obviously, as a fellow south Lanarkshire MP I am very disappointed to hear what the hon. Gentleman has to relate, and I should be very pleased to meet him to ensure that employment continues to be secured in south Lanarkshire.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
6. What discussions he has had with the Secretary of State for Work and Pensions on the work capability assessment in Scotland.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
My right hon. Friend the Secretary of State and I are in regular contact with Ministers from the Department for Work and Pensions on a range of issues concerning welfare reform. We also recently met Professor Malcolm Harrington to discuss his second review of the work capability assessment.
Tom Greatrex
I thank the Minister for that answer. I am sure he will be aware of a report published today by Citizens Advice entitled “Right First Time?”, which examines the high level of incorrect and inaccurate decisions made in the work capability assessment. Given the amount of money that Atos Healthcare receives from the public purse for undertaking these assessments, is it not now time for the Government to consider the report’s recommendation that financial penalties be imposed on Atos for a number of those incorrect assessments? [Interruption.]
David Mundell
This was one of the issues that the Secretary of State and I discussed with Professor Harrington, and as he prepares his further report, this is inevitably one of the issues he will address. [Interruption.]
Mr Speaker
Order. There are far too many noisy private conversations taking place in the Chamber. I would like to hear Dame Anne Begg.
Dame Anne Begg (Aberdeen South) (Lab)
Now that the move from incapacity benefit to employment and support allowance is well under way, anecdotally, it would appear that Atos is finding it very difficult to carry out the necessary work capability assessments, so there could be extra delays. Will the Minister please engage with his fellow Ministers in the DWP to make sure that Atos can deliver on the contract?
David Mundell
I can certainly assure the hon. Lady that I will pass on her concerns to the Department.
John Mann (Bassetlaw) (Lab)
12. What comparative assessment he has made of the level of subsidy from the public purse for postal, transport and health services in Scotland and the north of England.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
Health and large aspects of transport are devolved areas, and it is for the Parliament in Scotland to decide how to allocate its budget. The Government have provided an annual subsidy to Post Office Ltd of £150 million for the last financial year and £180 million for this financial year. The subsidy is not distributed by country or region.
David Mundell
I absolutely agree that the debate on the independence of Scotland should be based on facts and on the issues. That is why we need to move on from the process and get on with the referendum.
Andrew Percy (Brigg and Goole) (Con)
The question of the referendum on Scotland is not a matter just for the Scottish Government or for the Scottish people. How and when will my constituents in England be consulted on this important matter?
David Mundell
My hon. Friend’s constituents have the opportunity to be represented on these issues through him in this House.
Public Sector Pensions
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Hywel Williams (Arfon) (PC)
I beg to move,
That this House recognises and appreciates the valuable work done by public sector workers; believes that they should receive pensions which are affordable, sustainable and fair; further believes that the changes announced since June 2010 by the Government are primarily for the purposes of deficit reduction rather than a move to secure the long-term sustainability of public sector pensions; notes that these changes are unfair on public sector workers who will have to work longer, pay more and receive less in their pension when they retire; further notes the findings of the National Audit Office that the 2007-08 pensions re-negotiation changes will generate estimated savings of 14 per cent. by 2059-60 and the conclusions of the House of Commons Committee of Public Accounts’ Thirty-eighth Report of this Session on the Impact of the 2007-08 changes to public sector pensions (HC 833), that the cost of public service pensions has reduced substantially because of these changes; agrees with criticism in both reports of the failure to develop a long-term strategy for the role of pensions in recruitment and retention to the public sector; condemns the Government’s threat to cut devolved administrations’ budgets if they do not implement the Government’s immediate levy on pensions contributions; and calls on the Government to reverse its unfair changes to public sector pensions.
The motion stands in the names of my right hon. and hon. Friends from the Scottish National party and Plaid Cymru, and of Members from the Labour party and, I understand, from the Social Democratic and Labour party.
Last week, a day of action saw more than 2 million people across the UK join in protests against changes that will make those affected—mainly women—work longer, pay more and receive less when they retire. This year alone, bankers walked away with £7 billion in bonuses. As one constituent said to me last week:
“This is just a way of getting extra cash from public workers. And it is just not fair.”
We are proud to hold this debate on behalf of all those people across the UK who are directly or indirectly affected by the Government’s changes, and we note that despite having 36 Opposition day debates since the changes were announced in June 2010, the official Opposition have not seen fit to devote even one of those opportunities to debate the public sector pensions proposals. Whatever the evasions, the nods and the winks, and the ducking and diving of others, we are glad of the opportunity to show clearly where we stand.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
This is characterised as a joint debate between Plaid Cymru and the Scottish National party, yet last week we saw SNP Members of the Scottish Parliament cross the picket lines to ensure that the Scottish Parliament functioned, while Plaid Cymru Members of the Welsh Assembly refused to cross picket lines and the Welsh Assembly did not function. Where is the coherent position in that?
Hywel Williams
It has clearly escaped the right hon. Gentleman’s attention that the SNP are in government in Scotland, while in Wales—alas—we are not.
David Mundell
I am afraid that I do not find that a tenable explanation. All SNP Members of the Scottish Parliament are not in the Government, although they may act like it. Those people crossed the picket lines and spoke in a debate on this very subject.
Hywel Williams
Honestly, I think we need to move on to the subject of the debate. I am sure that the right hon. Gentleman will have time later to make those and other fatuous points.
Hywel Williams
My hon. Friend has anticipated a point that I was going to make, which will doubtless be made again by other nationalist party members. Anyone reading the popular press would imagine that public sector workers were driving around in this year’s model of car and enjoying two or three foreign holidays a year, but that is not, of course, the case.
We say “Let us have negotiations”, but is the 3.2% imposition itself negotiable? What the Government have announced today will merely shift the burden from one group of workers to another. They are trying to squeeze out some sort of deal, but we utterly reject that way of going about things.
David Mundell
I think it important for the hon. Gentleman to clarify whom he means by “we”. The Scottish National party is in government in Scotland, and a number of choices are available to it. For instance, there are funds that it could allocate to reduce pension contributions, but it has chosen not to do so.
Hywel Williams
Again, I do not want to go down that particular avenue—[Interruption.] I have some things to say that the Minister might like to listen to. My hon. Friends will be responding to his point later, but let me say now that the possibilities to which he alludes constitute a broad spectrum of theoretical options for consideration, and that the Scottish Government have expressed no preference. I am sure that others will say more about that later.
The Parliamentary Under-Secretary of State for Scotland (David Mundell)
The weather in Scotland today is very stormy, and our thoughts are with those who are having to endure the consequences of that. I do not know whether this debate will be equally stormy.
Sheila Gilmore (Edinburgh East) (Lab)
I hope the Minister will not think just about the people enduring travel disruptions, but will realise that the majority of those who will be working hard to resolve any problems that arise will be public sector workers.
David Mundell
I do realise that—and that may be the only point on which I agree with the hon. Lady.
I thank the hon. Member for Arfon (Hywel Williams) for opening the debate. He spoke for about 20 minutes, and in that time he at least said exactly the same about Scottish National party policy on this issue as was revealed in a two-and-a-half-hour debate in the Scottish Parliament last week, which was precisely nothing. I will return to that subject.
As the hon. Member for Edinburgh East (Sheila Gilmore) has already mentioned, no Member would disagree with the following sentiments in the motion:
“That this House recognises and appreciates the valuable work done by public sector workers”
and
“believes that they should receive pensions which are affordable, sustainable and fair”.
Indeed, those sentiments form the foundations of our reform of public service pensions. Our objective is to put in place new schemes that are affordable, sustainable and fair both to taxpayers and public service workers. Let us be clear: public service pension reform is needed. The costs have increased by a third in the last 10 years, to £32 billion, and the Office for Budget Responsibility forecasts that, without reform, spending on pensions will rise by almost £7 billion over the next five years.
Understandably, this is a contentious issue, but fairness remains the cornerstone of our approach. We believe that public service workers deserve a good pension in retirement, as a fair reward for a lifetime spent serving the public. We recognise the vital contributions made by teachers, nurses, council employees and civil servants to the well-being of our society now and in the future.
That is why in June 2010 my right hon. Friend the Chancellor commissioned Lord Hutton, a Work and Pensions Secretary in the previous Government, to take an unbiased and clear-headed look at public service pensions and make proposals for reform. His landmark report has set the parameters of the debate, and it has been rightly lauded for its depth and vision.
Lord Hutton set out an overwhelming case for reform. He said that
“the status quo is not tenable”,
that
“future costs are inherently uncertain”,
and that at present the public
“cannot be sure that schemes will remain sustainable in the future.”
In his interim report, he found that there was a clear justification, based on the past cost increases borne by the taxpayer, to increase contributions in the short term to ensure a fairer distribution of costs between taxpayers and members. We accepted that recommendation, and increases in member contributions will take place, starting next year. However, next year’s increase merely reflects the increase already planned by the previous Government. We remain committed to securing in full the overall savings of £2.3 billion in 2013-14 and £2.8 billion in 2014-15 that we announced at the 2010 spending review.
In his final report, Lord Hutton produced a blueprint for a new landscape of public service pensions. It is based on retaining defined-benefit schemes but moving to a fairer career-average basis, and increasing the retirement age in line with the state pension age to protect the taxpayer against future increases in life expectancy.
Jim McGovern (Dundee West) (Lab)
Presumably the Minister is talking about UK public sector pension schemes, whereas the motion seems to be specifically about devolved pension schemes. Does he agree that if there is a solution, it will be that the separatists in Edinburgh just say, “We won’t apply any changes”? Does he also agree that their excuse of continually saying, “The big bad boy in London did it” and then running away is wearing thin?
David Mundell
On that point, I can agree with the hon. Gentleman. The Scottish Government have considerable flexibility to make their own choices, but they have chosen not to do so.
Mr Weir
Will the Minister confirm that the Chief Secretary specifically said that if the Scottish Government did not accept these changes, he would fine them £8 million per month, which amounts to £100 million a year and half a billion pounds over the spending period? How are the Scottish Government supposed, effectively, to pay for this twice, and thereby pay £1 billion?
David Mundell
What I can make clear to the House is that as a result of last week’s autumn statement the Scottish Government will receive approximately £69 million extra in resource departmental expenditure limit funds, that as a result of the Budget they received an extra £112 million, and that between the Budget and the autumn statement they received an extra £90 million, which they had not budgeted for.
Mr Weir
However, will the Minister please explain what difference that makes, as we are still going to lose half a billion pounds over this spending period? There is still going to be a massive cut if the Scottish Government do not follow what this Government are imposing upon them.
David Mundell
The difference it makes is that the SNP will have the option to back up its words with deeds, but instead it fails to do so. Its argument is entirely based on blaming the Westminster Government. It has funds available to make these choices, yet it prefers to deceive public service workers in Scotland by suggesting that everything is entirely at the behest of the Westminster Government.
Mr Weir
Will the Minister therefore go to the Chief Secretary and say, “Take away this threat and allow the Scottish Government to do what they want to do for Scottish public sector workers”? Is the Minister happy that there will be this cut of half a billion pounds over the spending period?
David Mundell
I know the hon. Gentleman does not want Scotland to remain in the United Kingdom—that is his policy—but he and his Government have the ability to make this choice, as the hon. Member for Dundee West (Jim McGovern) set out, yet they have chosen not to do so.
Katy Clark (North Ayrshire and Arran) (Lab)
We should look at what the SNP has actually done in this respect. It has responsibility for the Scottish Public Pensions Agency, whose submissions to the Hutton review were far worse than what the coalition Government propose.
David Mundell
I will not presume that the hon. Lady was complimenting the Government, but she is correct in that all four of the suggestions the Scottish Government made to the Hutton inquiry would certainly leave Scottish public sector workers no better off than under the UK Government proposals, and a number of those suggestions would leave them distinctly worse off.
Pete Wishart
As an Under-Secretary, the Minister surely recognises the difference between a Government agency and a Government spokesperson.
David Mundell
I recognise the full ambit of the First Minister’s many responsibilities and I do not believe that such a submission would have been made without consultation with the Scottish Government.
Ian Murray (Edinburgh South) (Lab)
I think we are getting to the crux of some of the issues. I would never agree with what the coalition Government are doing to public sector pensions in Scotland, but the Scottish National party did put in a report to the Hutton review that was far more draconian than what the Government are proposing. The SNP may be trying to say to the House that this was done by an agency, but why did the Scottish Government not contribute a proposal to the review?
David Mundell
The hon. Gentleman makes a valid point. It reinforces what all of us who are aware of day-to-day Scottish politics know, which is that the SNP Government in Scotland speak with one word but their deeds are quite different.
I return to what I was discussing before the interventions. The Government accepted Lord Hutton’s recommendations in full and can reassure the House that the reformed public—
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
The Minister has made much of Hutton’s report and fairness, but does he not agree it seems odd that the Government jumped the gun by announcing the 3% increase before Hutton’s final report? How does that demonstrate fairness?
David Mundell
I know that the hon. Lady was not in the House at the time, but the 3% figure is broadly equivalent to the sum that her Government had identified in the pre-Budget report in 2009.
David Mundell
I will give way in a moment, but I want to make some progress.
The Government continue to engage actively with the trade unions to agree what the new pension schemes will look like. Discussions began in February and the Government remain fully committed to meaningful engagement. Scheme-level discussions are continuing with the trade unions, with meetings yesterday, today and tomorrow, which deals with a question asked by the hon. Member for Arfon. Significant progress has been achieved and the trade unions have welcomed many of the commitments that we made at the start of this process, including the one that public sector schemes will remain defined-benefit schemes, with a guaranteed amount provided in retirement. That, of course, was one of the options not put forward by the Scottish Public Pensions Agency.
David Mundell
I am going to take an intervention from the hon. Member for Ayr, Carrick and Cumnock (Sandra Osborne) once I have completed this section of my speech.
The unions also welcomed the commitment that all accrued rights will be protected. Everything that public servants have earned until the point of change they will keep, and it will be paid out in the terms expected, at the retirement age expected. Final salary means just that: that someone’s accrued rights will be based on their final salary, not at the point of change but whenever their career ends or they choose to leave the scheme. No public service worker need worry about the entitlements they have already built up.
Sandra Osborne
The Minister talks about public sector reform, so why is the 3% rise going straight to the Treasury? That has nothing to do with the sustainability of public sector pensions.
David Mundell
As the hon. Lady knows, the Treasury underwrites the scheme. The Treasury requires to be paid out whatever is required to be paid out in relation to the scheme. The scheme does not operate on a basis of contributions and pay-outs, because the Treasury is underwriting the scheme so that everybody is paid in full as is their entitlement.
David Mundell
May I just make a little progress and then give way again? I think I have been generous with my time.
Our reforms are not retrospective, nor do they seek to correct the past failure of the Labour party; they are driven by the need for fair, affordable and sustainable pensions in the future. We have reached agreement with the unions on the importance of transparency, equality impacts, participation rates and opt-outs, scheme governance and high-level principles to inform consultations on scheme-level pensions.
David Mundell
I will give way in a moment.
We have set out our proposals. When we make our reforms, the taxpayer needs to be properly protected from the future risks arising from increases in life expectancy by the link between the scheme normal pension age and the state pension age. On 2 November, after months of negotiations with the trade unions, the Government set out a revised offer that was more generous by 8%.
The offer is generous. Most staff on low and middle incomes will retire on a pension that is as good as what they expect today, and for many it will be better. Lord Hutton has said that it is difficult “to imagine” a more generous offer. The offer includes generous transitional arrangements for those closest to retirement; those closest to retirement should not have to face any change at all. This approach mirrors the steps taken in relation to increases in the state pension age, and it is fair that the same applies here. Anyone 10 years or less from retirement age on 1 April 2012 can be assured that there will be no detriment to their retirement income. However, this enhanced offer is conditional upon reaching agreement. It is an offer that can inform the scheme-by-scheme talks which will continue until the end of the year. Of course, if agreement cannot be reached, the Government may be required to revisit our proposals and consider whether those enhancements remain appropriate.
Hywel Williams
Some time ago, the Minister referred to a meeting held yesterday, but will he clarify who was involved? Was a Minister involved in the discussions?
David Mundell
My right hon. Friend the Minister for the Cabinet Office and Paymaster General and my right hon. Friend the Chief Secretary to the Treasury have made it clear that the meetings are ongoing on a regular basis in respect of the specific schemes. I am sure that I will be able to give the hon. Gentleman the information he requires.
Our objective remains to agree reforms of the main schemes—those for teachers, health and the NHS, the civil service and firefighters—by the end of the year, and my right hon. Friend the Chief Secretary will update the House in due course. The Government’s preferred scheme would produce better pensions for those on low and middle incomes who have devoted a lifetime to public service. At the same time, public service pensions will remain considerably better than those available in the private sector, as my hon. Friends have suggested. A primary school teacher earning £32,000 per year could receive a pension of £20,000 under our proposals. To earn the equivalent pension in the private sector, an employee would have to pay in more than one third of their salary.
Bob Stewart (Beckenham) (Con)
Several of my constituents who work in the private sector have told me that they totally agree that public sector workers should get sustainable, affordable and fair pensions, but they are concerned that for them to have a similar pension they would have to increase their contributions by a factor of three or four. They do not think that that is fair in the current circumstances.
David Mundell
My hon. Friend makes a good point and I empathise with it as the MP for a constituency that has some of the lowest private sector wages in the UK.
Only 10% of private sector workers have access to the type of scheme that I was describing, which is at a guaranteed level and is inflation proofed, while only one third of private sector employees currently get any contributions from their employers.
Jonathan Edwards
I come back to the issue of the divide-and-rule strategy of playing the public sector off against the private sector. Is the Minister aware that the average pension of a retiring teacher is £9,000 per annum, and that the figures for NHS workers, for civil servants and for members of the armed forces are £7,000 per annum, £6,000 per annum and £7,500 per annum respectively? Do those figures seem unfair to him?
David Mundell
It is a question not of playing the public sector off against the private sector but of setting out a fair scheme for public sector workers, and that is what this Government are seeking to do.
The motion mentions two reports, one by the National Audit Office and the other by the Public Accounts Committee, which do not provide us with sustainable and lasting models for the future. Pensions, as they stand, are not affordable. As Lord Hutton says,
“the status quo is not tenable.”
The Office for Budget Responsibility’s latest forecast demonstrates that long-term costs have continued to increase since March, so reform is now essential because the costs of public service pensions have risen dramatically over the past few decades. The fact is that we are all living longer; the average 60-year-old is living 10 years longer than was the case in the 1970s.
David T. C. Davies (Monmouth) (Con)
I thank my hon. Friend for the points he is making. Does he agree that unless these reforms go ahead public sector workers will not be able to rely on anything, because there might not be any money to pay them anything? That is why it is so important that these reforms go ahead.
David Mundell
I absolutely agree. The speech from the hon. Member for Arfon seemed to me, particularly on Wales, to be very much an argument for the status quo.
Katy Clark
We already know that public sector pensions are, on average, less than £5,600 a year, so if they are going to be even lower what will people live on—state benefits?
David Mundell
There is no suggestion that those on the lowest pay will receive lower state pensions. The Labour party has been very keen to engage in such scaremongering, but the Government’s proposals specifically protect those on the lowest earnings of below £15,000.
Before I finish, I want to turn to some of the specifics about Scotland.
Dr Whiteford
I hope that when the Minister comes to explain the protection for low-paid workers he will be able to clarify something about which many people in trade unions have been asking. Will part-time workers’ earnings and the increase in their contributions be calculated on the basis of full-time equivalent wages?
David Mundell
They will be based on full-time equivalent wages. That point is clear. The difference on pensions between this Government and the Scottish Government is that we are clear on the points that people might not want to hear rather than pretending to people that they can have everything when that is not sustainable.
Dr Whiteford
The contributions of a woman who works part-time in a professional job—for example, as a nurse or a teacher—but takes home less than £15,000 a year will be increased not at the lower rate but at the higher rate of a full-time equivalent.
David Mundell
The hon. Lady knows that in all aspects of employment, the full-time equivalent applies. That is what will apply to pensions.
David Mundell
Indeed. The hon. Gentleman makes a very good point and I am about to come on to some of the issues about the Scottish Government. The point that has been underlined several times in this debate is that there are many issues on which the Scottish Government could make a decision but have chosen not to do so.
Susan Elan Jones
I am sure it could be. The Minister refers to transparency and clarity but yet again refuses to answer the question about ministerial involvement, or lack of it, in negotiations. Why will he use those words yet refuse to do that?
David Mundell
My understanding is that my colleague the Secretary of State for Health is meeting NHS unions as this debate is going on. There are significant ministerial discussions.
We have set out that the budgets of the devolved Administrations, who have these powers, would not be adjusted accordingly if they chose not to implement the reforms, because they have received higher settlements that reflect the proposed changes. If the devolved Administrations do not implement our public sector pensions reforms, Barnett consequentials will be reduced.
The Treasury wrote to tell the Scottish Government they had to apply the 3.2% increase in contributions or make up the shortfall and presented them with a choice. They could have chosen not to apply the increased contributions and make up the difference to the Treasury, but they followed a now familiar pattern: they failed to take any sort of decision and blamed Westminster at every turn. Their manufactured outrage is a smokescreen designed to cover the fact that they have no answers for the people of Scotland on how they would fund public sector pensions, never mind the wider state pension. We have asked them often enough—
David Mundell
I have already set out all the additional money that the Scottish Government have received since the budget settlement last year from which they could have made these choices. Sometimes, choices are difficult, but the Scottish Government prefer to pretend to people that they are on their side while not being willing to take difficult decisions.
Ian Murray
You are talking about choices that the SNP Scottish Government will make and one of the big choices they made was to cut capital spending far faster and far further than your own Government.
Madam Deputy Speaker (Dawn Primarolo)
Order. The hon. Gentleman is referring to the Minister and should refer to him as the Minister or “he”. “You” means the occupant of the Chair, and this is nothing to do with me, fortunately.
David Mundell
That is a phrase often used in Scotland, Madam Deputy Speaker, by one of the—
Madam Deputy Speaker
Order. I say to the Minister that I am absolutely aware of the use of “you”, but I think that in parliamentary debates we should stick to the convention here, as I am sure he agrees.
David Mundell
I will indeed do that, Madam Deputy Speaker.
The SNP Scottish Government have played fast and loose with Scotland on pensions. Rather than making responsible suggestions, they resort to scare tactics. In this motion, the SNP and Plaid Cymru are frightening people by saying that they will receive less pension. The SNP’s submission to Lord Hutton, as we have heard, offered at best no better and in some cases a much worse deal. The Scottish Public Pensions Agency, an agency of the Scottish Government, headed by the Cabinet Secretary for Finance and Sustainable Growth, John Swinney, made a number of interesting suggestions when it illustrated options for further change. It suggested reducing current employer contribution cap levels with members meeting all costs above that cap. Alongside that, it proposed to reduce the levels of benefits available without necessarily reducing the levels of contributions.
Pete Wishart
I am listening very carefully to the hon. Gentleman. I suppose it should not come as a surprise to anybody in this House that there are now more giant pandas in Scotland than there are Tory MPs; listening to the Minister, we can see why. Will the Minister concede that there was no submission from the Scottish Government to the Hutton report, but there was a submission from an agency of the Scottish Government?
David Mundell
I do not accept that analysis. The hon. Gentleman might have got a laugh if he had thought that up himself rather than stealing it from the Twittersphere.
The Scottish Government’s proposals were a toxic cocktail topped up by suggestions to introduce later retirement ages, change accrual rates, apply changes to all members, not just new scheme members, and move to a defined contribution scheme, which places the risk of uncertainty over the value of the final pension on the member. All those proposals would mean a worse deal for public service employees than the coalition’s proposals.
David Mowat
I am listening very carefully to the Minister’s comments on the interaction between the Scottish Government and himself. Does he agree that one of the interesting features of the motion is the last part, which appears to concede the point that the Barnett consequentials should be reviewed and that certain types of expenditure should be taken out of them? If that is a principle that the SNP wishes to adopt, we should consider the Barnett formula more generally and the whole settlement and block grant for Scotland.
David Mundell
My hon. Friend makes an interesting point, because that is one issue on which there is an absolute divide between Plaid Cymru and the SNP. Plaid Cymru wants significant change to the Barnett formula and, as I understand it, the SNP does not. That is part of the inherent illogicality that is at the heart of their argument.
I am surprised that we hear nothing these days about independence, which is relevant. Perhaps that is because Plaid Cymru does not promote independence. I look forward to hearing SNP Members set out exactly how an independent Scotland would be able to fund not only existing pensions, but provide enhanced pensions, without consequences for pensioners in Scotland. I am sure that we will hear calls for the break-up of the United Kingdom.
I also look forward to hearing from Labour Members. I understand that Labour MSPs chose not to take part in the debate in the Scottish Parliament because they were working in their constituencies that day. I know that the Labour party has not been an effective Opposition in Holyrood, particularly since the hon. Member for Glasgow East (Margaret Curran) left, but not to turn up at all is taking that to an extreme. I look forward to hearing their contributions today.
Iain Stewart
Absolutely. It is just a smoke screen.
It would create an enormous muddle if we had to pull apart the pension contributions, and we have heard absolutely nothing from the Scottish nationalists about how they would do that.
Sheila Gilmore (Edinburgh East) (Lab)
I do not intend to repeat the statements about the importance of public sector pensions that have been made so eloquently by many of my colleagues.
I am surprised that SNP Members, who among others have called this debate, have apparently not wanted to speak in it, because only one has done so. However, some of the comments they have made in interventions need to be addressed. It is not true to say that Labour Members have not raised the subject of public sector pensions in this House. Perhaps SNP Members were not here on 30 November to hear what the Leader of the Opposition said at Prime Minister’s questions and were not here during the Opposition day debate that followed, when several Members from my party made very strong speeches in support of public sector workers and on the pensions issue.
Moreover, in this week’s Opposition day debate on the economy, only one SNP Member was present, for a short time—the hon. Member for the Western Isles (Mr MacNeil). I will not attempt to pronounce the Gaelic name for his constituency because, as a lowland Scot, Gaelic is not native to me, and I am not going to pretend that it is. That was the extent of their interest in debating the economy and the issues that are so important in underpinning this debate on pensions, because unless we get the economy right, we will be in some difficulty. Today, several SNP Members left the Chamber early, presumably to put out their press releases to say how they had raised this important issue, but in reality they have not.
In the motion, SNP Members condemn the coalition Government for not being prepared to give them the money directly so as to be able to relieve some, but by no means all, public sector workers in Scotland of the contribution increase. They cannot have their cake and eat it within the system. They cannot have the Barnett consequentials when they like them and decide that they do not want them when they do not like them. Yes, it would be different if they achieved independence, although at that point we would have to ask, “How are you going to afford all the things that you say you are going to afford?”
David Mundell
Is the hon. Lady as surprised as I am that we have not heard a single mention of independence from SNP Members? As I understood it, that was their solution to all the pension issues in Scotland.
Sheila Gilmore
I suspect that in the fantasy world of the debate on independence, as it tends to be, SNP Members would indeed say that that is the answer, but they have to know how they would fund that and about issues to do with tax and making people as well off as possible.
During the SNP Member’s brief appearance in Tuesday’s debate on the economy, he kept talking about the Scandinavian economies. Of course, in the Scandinavian economies there is a very different view of taxation. It is disingenuous of the SNP to want to pose as a low-tax party and tell people that they can have wonderful public services and, at the same time, council tax freezes—which, by the way, are very regressive because they most benefit the people who are best off. The SNP has to decide where it wants to be. It deliberately put such a sentiment in the motion because it wants to be able to say that Labour Members will not support it.
We are in support of public sector workers. We do not think that what the Government are doing is right. We feel, very strongly, that we have to stop what this Government are doing, which is constantly to pit one group of workers against others. They are setting public against private, setting people in work against people who are out of work, and stirring up what I heard described on two occasions on Radio 4 at the weekend as an atmosphere of anger and bitterness. In the discussions on phone-in programmes about what is happening, all the clips were of people shouting at each other, saying, “Why should I, as a private sector worker, pay for your pension?” No commentator said, “Where is that anger being generated from?”, but it is being deliberately stirred up by this Government—
Dr Eilidh Whiteford (Banff and Buchan) (SNP)
This has been a wide-ranging debate and I think that there is agreement across the House that pension provision in the long term needs to be affordable, sustainable and fair, not just for public sector workers but for all old age pensioners.
Although we agree on those long-term objectives, the central contention of the debate has been that the short-term measures to reduce the deficit will hit public sector workers but be of no benefit to them. The issue at the heart of the debate is that the proposed 3.2% increase to public sector pension contributions is a straightforward cash grab by the Treasury on public sector workers. It has nothing to do with building long-term sustainability into our pensions system, but is unequivocally a short-term measure to cut the deficit.
Several hon. Members have pointed out that this is not fair and not affordable for a public sector work force who are already feeling the full effects of austerity measures that have gone too far, too fast. Most public sector workers are facing a two-year pay freeze, a 1% pay rise in 2013, increases in VAT and national insurance, and inflation of more than 5%. The cost of their essentials, such as heating, food and fuel, is going through the roof. The pressure on household budgets is intense and is getting worse.
In that context, increasing pension contributions for short-term gain is just the wrong thing to do. It is being done at the wrong time, for the wrong reasons and in the wrong way. It carries the risk that large numbers of people, especially part-time workers, will drop out of schemes altogether because of the immediate financial pressures that they face.
I think, and most Members on both sides of the House agree, that public sector pensions matter. They matter to the one in five people who are directly affected. They matter to the rest of us who depend on public services and who realise that our public service work force are critical to the delivery of high-quality services. Above all, they matter to all of us who care about the welfare of older people in retirement. All of us want to enjoy a decent level of income. For parts of the country that have a high dependency on the public sector work force, the issue is even more acute.
David Mundell
What I do not understand about the hon. Lady’s logic is that the Scottish National party has said that it wants to have a referendum on independence for Scotland in the next four years. The area on which that would most significantly impact is pensions and pensioners, yet in her contribution and in the contributions of her fellow SNP Members, we have heard nothing about independence or about how pensions would be provided, guaranteed or sustained in an independent Scotland.
Dr Whiteford
I refer the right hon. Gentleman to the Order Paper and the motion that we are debating. It will come as no surprise to anybody in the House that I believe in independence—I am an SNP Member. However, we are talking about public sector pensions and the Government’s proposals. It might be a nice distraction for the Government to talk about other issues that are equally relevant to Scotland’s future.
One of the most disappointing things about this debate has been that the Government have tried to defend their proposals by constantly highlighting the disparity between public and private sector pensions. We owe a debt to the hon. Member for North Ayrshire and Arran (Katy Clark) for pointing out the detrimental state of private sector pensions. When the Government responded to the interim Hutton report, my understanding was that they accepted its conclusion that pensions should not become a race to the bottom. However, speaker after speaker on the Government Benches has resorted to the argument that because private sector pensions are really poor, public sector pensions should be levelled down. That will not in any way address our pensions challenge. It is not sustainable and it is not fair to anyone in the private or public sector.
We have some of the highest levels of pensioner poverty in Europe. Currently, 30% of pensioner households and a massive 43% of single pensioners, most of whom are women, are in receipt of income-related benefits, whether that is pension credit, housing benefit or council tax benefit. Having large numbers of older people on means-tested benefits is not the way to do things. It is the price that we pay for poor pension provision. It is not an efficient way to support people in retirement.
The other big myth that has been well and truly blown out of the water today is that public sector pensions are gold-plated. Quite simply, they are not. Member after Member has pointed out that most public servants retire on modest incomes. The PCS points out that its average member’s pension is only £4,200 year. That is £80 a week, which is only £4 above the Government’s pensioner poverty figure. If such people’s pensions are reduced or they opt out because of the new conditions and contribution increases, it will simply put the burden back on means-tested benefits to keep people out of abject poverty in their old age.
In local government, in which 67% of the work force are women, the average woman’s pension is only £2,800 a year. Almost half of local government workers are on pensions of less than £3,000, and even in the NHS, in which salaries are much higher because of the professional qualifications involved, three quarters of members are still on pensions of less than £9,000 a year.
The Government have tried to sell us their proposals on the basis that low and middle-income earners will be protected from contribution increases, and may even be better off as a result. That is one of their key claims. However, because of the switch in indexing from RPI to CPI, all public sector workers will lose out in the longer term, and they will all be working longer. That indexing switch has been mentioned in the debate, and I am sorry that more Members did not vote against it when they had the chance to do so back in February. They have a chance to rectify that now, and I hope that they will support us in the Lobby today.
Perhaps the most misleading aspect of the Government’s approach to the contributions increases is that they have said there will be protection for low-paid workers. As the Minister admitted earlier, the contributions of part-time workers will be calculated on the basis of full-time equivalent salaries, which will have massive implications for women, who make up the vast majority of part-time workers. About 32% of the women in our work force work part-time so that they can combine employment with unpaid work in the home or looking after others.
The Government have said that workers on incomes under £15,000 will not pay increased contributions, and that other low earners on up to £21,000 will pay reduced contributions, but when we look at the small print, we see that those thresholds, calculated on the basis of full-time equivalent salaries rather than their actual take-home pay, will mean that even professional people such as nurses and teachers who work part-time will have their pension contributions increased.
Parliamentary Written Question (Correction)
David Mundell Excerpts(12 years, 5 months ago)
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
I regret that the written answer given to my hon. Friend the Member for Harwich and North Essex (Mr Jenkin) on 15 November, Official Report, column 665W, contained an error. The answer stated that the TaxPayers Alliance applied for permission to bring judicial review against the Secretary of State for Scotland in respect of the Glasgow Commonwealth Games Act 2008 (Games Association Right) Order 2009. This is not correct. The application for permission to bring judicial review was made by Big Brother Watch and not by the TaxPayers Alliance.
The correct answer is as follows:
David Mundell: In the last Parliament there were two applications:
(1) Derek Traynor and James Fisher raised petitions for judicial review against the Secretary of State for Scotland and Scottish Ministers in respect of the Scottish Parliament (Elections etc.) Order 2007. The applications were unsuccessful at first instance in the Court of Session, the petitioners appealed, and the appeals remain pending at their request. The legal costs incurred by the Secretary of State for Scotland to date are £4,555.50.
(2) Big Brother Watch applied for permission to bring judicial review against the Secretary of State for Scotland in respect of the Glasgow Commonwealth Games Act 2008 (Games Association Right) Order 2009. The application was refused. The Scotland Office’s legal costs were £7,080. The Scotland Office applied for costs against the applicant. Costs were awarded in part and they have been paid.
There have been no applications for judicial review against the Scotland Office since May 2010.
Scotland (Poverty)
David Mundell Excerpts(12 years, 5 months ago)
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Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
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The Parliamentary Under-Secretary of State for Scotland (David Mundell)
Thank you, Mr. Robertson. I welcome the opportunity to appear under your chairmanship, and it is particularly appropriate that you are in the Chair for this debate on St. Andrew’s day. I pay tribute to the hon. Member for Ayr, Carrick and Cumnock (Sandra Osborne) for instigating this debate. She and other hon. Members who have contributed to the debate are correct to say that there should be more discussion and debate of these issues in relation to Scotland, and that there should be more discussion and debate in this Parliament in respect of the reserved issues for which this Government are responsible in Scotland. Scotland has two Governments, both of which play a significant role and both of which should be held to account.
I also agree that the two Governments should work more closely together on many of the issues that have been touched on today. Sadly, for reasons also touched on by many hon. Members, principally the obsession of the SNP Government in Edinburgh with independence and constitutional issues, it has not always been possible to have the dialogue that would serve the people of Scotland best—on substantive matters in relation to policy objectives and outcomes, rather than the debate constantly being about who did what.
We have had a number of detailed contributions to the debate, particularly by the hon. Member for Glasgow North (Ann McKechin), and the hon. Member for Aberdeen South (Dame Anne Begg), who chairs the Select Committee. I give them a firm commitment that I will take away the points that they have made, and raise them with Department for Work and Pensions colleagues and I will write back to them on their specific points. While we might not be in agreement on the policy prescription, or whether the policies of the Government of which they were a part delivered much of what the hon. Member for Ayr, Carrick and Cumnock set out, I am in agreement with them that the issues that they raised are important and significant.
As ever, I commend the right hon. Member for Stirling (Mrs McGuire) for the passion in her contribution. Again, the issues that she raised are worthy of much more significant debate, especially in relation to the concerns about the impact of hidden poverty, which is not just a financial issue. There would be agreement across the House on that. I listened to the points made by the right hon. Member for Coatbridge, Chryston and Bellshill (Mr Clarke). I do not necessarily agree with what he had to say, but I sense his passion on the issue, and he has a long track record of fighting the cause of the poor, and that is to be commended. My hon. Friend the Member for Argyll and Bute (Mr Reid) did not make a speech, although it felt as if he did. It will not surprise you to learn, Mr. Robertson, that I agree with most of the points that he made in his interventions. I am sure that, over the Christmas period, when he reflects on such matters, as he was asked to do by the right hon. Member for Stirling, he will reflect on the many achievements of the coalition Government in taking forward their agenda. When he intervened on the hon. Member for Glasgow North East (Mr Bain)—I welcome him to the first real exchange that we have had since he took his position—my hon. Friend the Member for Argyll and Bute make the most significant point, which is how the various aspirations that were expressed during the debate would be paid for. We did not hear anything about that. We heard again about Labour’s five-point plan. As far as I am aware, that is a £20 billion black hole for which no funding has been identified.
Sandra Osborne
Does the Minister agree that a far more effective way of solving the youth unemployment problem would be a £2 billion tax on bank bonuses, which would fund 100,000 jobs for young people?
David Mundell
The hon. Lady knows that the Government have moved forward with a bank levy, which has raised more than the tax on bonuses that her Government set out. It is populist to say, “tax the bankers,” but that does not set out where the money would come from that would create the funding she suggests.
I hope the hon. Lady will join me in welcoming yesterday’s announcement on the youth contract—a significant step forward in tackling what everyone accepts is the serious problem of youth unemployment. Of course, it was not acknowledged in today’s debate that youth unemployment rose under the previous Labour Government. Youth unemployment is a serious issue, on which we should be trying to work on a cross-party basis. That is why I was pleased to be part of a seminar in Ayrshire with the hon. Member for Central Ayrshire (Mr. Donohoe), bringing together the UK Government and the Scottish Government to look at the underlying problems of youth unemployment. That is why I am pleased that my right hon. Friends the Secretary of State for Scotland and the Secretary of State for Work and Pensions will host a national meeting in Scotland with John Swinney to focus on youth unemployment in Scotland.