Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 19th December 2012 Commons Chamber

[Mr Hurd]

I join my hon. Friend in congratulating our hon. Friend on doing an extraordinary job in taking that private Member’s Bill through Parliament. I can assure him that we are about to issue the necessary guidance to local authorities.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

With one in six charities fearing that they will face closure next year, after huge cuts in Government funding, and after the promised bonanza of new income from Whitehall contracts failed to materialise, how does the Minister hope that his performance will improve next year?

[Mr Hurd]

I put it to the hon. Gentleman that just as Labour Members talked down the economy for three years, now they are talking down the voluntary sector, which has grown over the past three years. I set him a test of seriousness: will he send a stronger message to Labour local authorities, as the Prime Minister has done, about the need to avoid disproportionate cuts on the sector, starting with Derby?

Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 7th November 2012 Commons Chamber

[Mr Hurd]

I am grateful to my hon. Friend for his question. He takes a strong interest in the matter. The Government are ambitious to accelerate the development of social impact bonds, which create the space for commissioners to innovate and try new interventions in that space. We have already announced that we will shortly publish the details of an outcomes fund designed to do exactly that.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Four out of five small charities surveyed by the National Association for Voluntary and Community Action expect their finances to worsen in the next year as Government cuts bite even harder. Is not the truth that the Minister has so little ability to deliver extra funding for small charities’ big society projects that if he were to hop on a plane to Australia to join his hon. Friend the Member for Mid Bedfordshire (Nadine Dorries) in the jungle, nobody in the charity world would notice?

Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 5th September 2012 Commons Chamber

[Mr Hurd]

My hon. Friend and neighbour from Harrow makes a good point. Locally, we have the contrast between Conservative-run Hillingdon council, which is increasing its investment in the front-line voluntary sector, and Labour-controlled Harrow next door, where that investment is being reduced.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Ministers’ huge cuts in funding for charities mean that volunteer centres across England are losing, on average, 25% of their income, according to Volunteering England. With so many Olympic and Paralympic volunteers wanting to continue to volunteer after the games are finished, why are Ministers so determined to make it so hard for them to do so?

[Mr Hurd]

We are not. The hon. Gentleman has never let facts get in the way of shameless opposition and he has not disappointed today. We are investing in the infrastructure to support and inspire volunteers, with £30 million for the transforming local infrastructure fund. We are doing our bit from the centre, but the point I would make to local authorities across the country is that they should recognise the value of the volunteers in their community and not cut the investment in the local infrastructure that supports them.

Prime Minister’s Adviser on Ministers’ Interests

Gareth Thomas Excerpts

Tuesday 17th July 2012 Commons Chamber

[Mr Jenkin]

We held a hearing with the new adviser on Minister’s interests, but we were anxious—at least, I was anxious—to make it clear that it was not a pre-appointment hearing. Personally, I have absolutely no doubt of Sir Alex Allan’s bona fides and integrity. Unfortunately, we expressed the view that the manner of his appointment undermined the idea that he is actually an independent adviser, although he is certainly an adviser. He has a day job, too, in that he advises Ministers on their respective private interests and potential conflicts of interests, and ensures that there is a register of Ministers’ interests. That is his main job, and I have no doubt that he does it extremely efficiently. As I say, however, the manner of his appointment does not lead the public to believe that he is truly independent.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Does the hon. Gentleman have any plans to persuade his Committee to do further work in this area, perhaps in line with Sir Philip Mawer’s suggestions for trying to establish ground rules for assessing whether Ministers should be suspended as and when an investigation is taking place—a suggestion made in answer to an earlier question from the hon. Member for Vale of Glamorgan (Alun Cairns)?

--- Later in debate ---

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

This has been a brief but interesting debate. I commend the work of the Public Administration Committee, chaired by the hon. Member for Harwich and North Essex (Mr Jenkin). He has rightly received praise for the tenacious way in which he and his Committee have pursued these issues. I hope he will forgive me if I praise my hon. Friend the Member for Newport West (Paul Flynn), too, for he has also pursued these issues with considerable vigour and tenacity.

I studied the contributions of all Select Committee members. I carefully read the questions they put to Sir Philip Mawer and Sir Alex Allan, and noted in particular the contributions of my hon. Friend the Member for Luton North (Kelvin Hopkins), who is also a consistent campaigner on these issues, my hon. Friend the Member for Glenrothes (Lindsay Roy), and the hon. Member for Leeds North West (Greg Mulholland). They all made good contributions to this debate, too.

This debate would not have the resonance it currently has outside the House if it were not for the Prime Minister’s mishandling of key questions about possible violations of the ministerial code—a point that was implicit in the speech of my hon. Friend the Member for Glenrothes.

The Opposition remain determined to take the steps necessary to continue the process of restoring trust in the political process. When we were in government, we took steps to reform Parliament, passing new laws to protect our democracy. We acted to increase transparency and strengthen public accountability for Members of the House of Commons. On ministerial accountability, we also introduced further reforms. The then Prime Minister, my right hon. Friend the Member for Kirkcaldy and Cowdenbeath (Mr Brown), introduced the publication of an annual report and a list of Ministers’ interests, again to increase transparency and Ministers’ accountability to this House. He also appointed Sir Philip Mawer as the independent adviser on Ministers’ interests, calling on him, as a number of Members have mentioned, to investigate the then Member for Dewsbury in May 2009, against whom a particular allegation—it was unfounded, as it turned out—had been made. Sir Philip investigated and the Minister was cleared and returned to his ministerial duties.

I have a number of questions for the Minister and, if I may, the Chairman of the Public Administration Committee, but the context of our debate is worth touching on. It is the Prime Minister’s refusal, using the Leveson inquiry as his reason, to ask Sir Philip’s successor, Sir Alex Allan, to investigate the conduct of the Secretary of State for Culture, Media and Sport, and the Prime Minister’s failure to call in the independent adviser in the case of the right hon. Member for North Somerset (Dr Fox), that form the backdrop to our debate. The fact that so many Members wanted this debate is in no small part due to the Prime Minister’s refusal to use consistently a system which the last Prime Minister established and used, but which the current Prime Minister now appears unwilling to use—except when he is sure of the outcome.

In short, the motion before the House today is the direct result of the belief of too many Members, on both sides of the House, that the Prime Minister has mishandled his responsibility for the ministerial code.

[Mr Jenkin]

I resent the hon. Gentleman making that implication, because I do not think that it does reflect why all the signatures are on the motion. What it does reflect, however, is the fact that the previous Labour Government did not accept this recommendation from the predecessor Committee. It is incumbent on him to explain whether the Labour party has now changed its mind and will support this motion, or whether he is just going to use this opportunity to make political points in this debate.

[Mr Thomas]

I will come to the position that Opposition Front Benchers are taking, but the Chairman of the Public Administration Committee is wrong not to recognise the considerable concern on the Opposition Benches—and the Government Benches—at the Prime Minister’s decision not to refer the case of the right hon. Member for North Somerset to the independent adviser, which I understand prompted the Committee’s original inquiry into this issue in this Parliament. The Prime Minister’s more recent decision to refer the case of the noble Baroness Warsi and not that of the Culture Secretary has galvanised interest in the Committee’s work in this area.

The shadow Leader of the House, my hon. Friend the Member for Wallasey (Ms Eagle), set out in her speech on 13 June some detailed concerns, which I do not intend to dwell on now, about the Prime Minister’s failure to uphold the code and to ensure that an appropriate investigation took place.

[Alun Cairns]

The hon. Gentleman talks about the Opposition’s concern about this issue, but does he not accept that their remarks would have far greater traction if they said that they now supported the motion and regretted not having taken action when in government?

[Mr Thomas]

As I think I set out earlier, we did take action when we were in government, and the House is better for it. However, I want to come to some of the points that the hon. Gentleman made not only in this debate but in the Public Administration Committee’s hearings.

There is a particular outstanding question that the Prime Minister still needs to answer, and perhaps the Minister can give us some clarity on it. Why is it appropriate for the independent adviser to be used in the case of the noble Baroness Warsi and not that of the Culture Secretary? I also have a series of questions on which I would welcome the views of the Chair of the Public Administration Committee in his concluding remarks. As I hope I made clear, I think some further work by his Committee in this area would be useful for the whole House, not least in questioning the current ministerial adviser on his lack of consultation in the case of the Culture Secretary.

The new independent adviser told the Committee when giving evidence that he had made the point to the new Cabinet Secretary, Sir Jeremy Heywood, that

“there are advantages to him in bringing the Adviser in early and whenever major issues arise.”

That appears at odds with the comment in a letter from Sir Alex that was deposited in the Library, accepting the Prime Minister’s decision not to refer the case and noting the work of the Leveson inquiry, and with the clear view of Sir Brian Leveson that his inquiry was not an appropriate place for the Secretary of State’s conduct to be investigated. I raise this question not in any way to express doubt about Sir Alex’s capacity or commitment, but to inquire whether the Committee will continue to explore the circumstances in which it would be appropriate for the ministerial adviser to be brought in, and to suggest—in a spirit of helpfulness, I hope—that Sir Alex’s evidence may well be helpful in that context.

Will the Chairman of the Public Administration Committee be summoning the Cabinet Secretary to explore the extent to which there was consultation with Sir Alex over the Culture Secretary’s case? In my intervention on the Chairman, I raised the possibility of further work by his Committee in this area, highlighting two issues that Sir Philip Mawer raised, in part in answer to some questions from the hon. Member for Vale of Glamorgan (Alun Cairns): whether suspension of a Minister is really possible during a code investigation in practical political terms; and the possibility of the Committee helping to establish a set of “ground rules”—his words—for a situation where an investigation is under way and the media is in full pursuit of that Minister.

The Opposition will listen carefully to the position and argument that the Minister, and indeed the Public Administration Committee Chairman, develop. We will want to consider the Government’s response to the Committee’s report, which it is a pity was not available for today’s debate. I have genuinely an open mind on this issue. The Opposition’s instinct is that further work is required.

This debate is born out of frustration with the Prime Minister’s handling of his responsibility for the ministerial code.

[Greg Mulholland]

Will the hon. Gentleman give way?

[Mr Thomas]

I am winding up.

The failure to use the independent adviser in the case of the right hon. Member for North Somerset, compounded by the failure to contemplate using him in the case of the Culture Secretary, provides the context for this debate. Sadly, it is yet another debate called in this great House because of the errors of judgment of the current Prime Minister.

Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 13th June 2012 Commons Chamber

[Mr Maude]

Advice providers, like other parts of the voluntary sector, are facing a difficult funding situation. In the Budget, the Chancellor made £20 million available in each of the next two years to support the not-for-profit advice sector as it adapts. Our transition fund also provides support to 45 CABs and 17 law centres, and the Ministry of Justice is increasing funding for mediation services by £15 million to encourage greater use of mediation in disputes.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Twelve months ago, the Minister for the Cabinet Office gave the Work programme as an example of the big society in action. A year on, some of the charities that signed up originally have gone bust and almost 100 have withdrawn their welfare-to-work expertise from the programme completely. Is this yet another example of the lack of leadership from Cabinet Office Ministers for charities across Whitehall, or can we finally expect some action to sort this mess out?

[Mr Maude]

I do not know from that question whether the hon. Gentleman believes it is right for social enterprises to play a major role in the provision of public services. We do, and more than 500 social enterprises and voluntary organisations are involved in the supply chain. I would have thought that he welcomed that.

Debate on the Address

Gareth Thomas Excerpts

Wednesday 9th May 2012 Commons Chamber

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

It is a pleasure to follow the hon. Member for Dover (Charlie Elphicke). I enjoyed his speech very much—even the more provocative parts. I suspect that many of our constituents who have children with special needs will empathise with his comments. I confess that I did not understand his reference to grandparents occasionally being annoying, but perhaps that is Conservative party code for something else. I also empathised with his description of many of his constituents not having had a pay rise for years and struggling to keep their jobs. I therefore say gently to him that I do not understand how he can say with a straight face that the Budget was good for those families. Nevertheless, I enjoyed listening to his speech.

Two years into the coalition, it is striking that the Queen’s Speech has so little to offer to solve the challenges that our country faces. Its measures show that the Prime Minister and the Chancellor did not listen to the anger of Britain’s citizens last week and that they are ignoring the now considerable economic evidence that a new direction is needed. Equally clearly, the confident communities that our constituents want to live in will seem further away than ever, with declining levels of social capital, public services under greater pressure than ever, and the opportunity to have real influence over how key services are run at local level growing ever more distant.

My constituents tell me that they are now seeing fewer police officers than for a long time. The fact that the Government are announcing legislation to set up the new National Crime Agency when police numbers are dropping, and that the Metropolitan police want to close all the cells at Harrow police station with little notice and even less discussion, suggests that Ministers are out of touch with what is happening at the grass roots to the services that our constituents depend on.

Given the present Home Secretary’s now notorious description of the Conservative party, it is perhaps appropriate to wonder, in the light of the Queen’s Speech and the Budget, whether the “nasty party” is very much back in evidence. Over the next 12 months, we will see more cuts that will once again hit the most vulnerable and those least able to help themselves. If the measure in the Queen’s Speech goes through, it will become easier to sack the strivers, the hard workers, those who speak out, those who blow the whistle on bad practice and those who, for just one period in their lives, are at their most vulnerable through illness, if their face does not fit.

There has also been a tax cut for millionaires, which hard-working families and pensioners are being made to pay for. To cap it all, the Conservative party is agonising once again about all things foreign. It is again anti-European in tone, and predominantly anti-aid, too. Above all, it is on the economy that the Prime Minister needs to tell the Chancellor to change course. Bank lending continues to fall as businesses continue to struggle. Year on year, net lending to businesses has now fallen in every single month since the coalition came to power. How many times have we heard the Prime Minister promise to get the banks lending? Despite all the hype that Project Merlin and, then, banking reform were the answer, bank lending continues to fall; it was down 3.5% last year alone.

My right hon. Friends on the Opposition Front Bench have consistently warned that the Government’s austerity plan was self-defeating, and that cutting spending too far and too fast at the same time as putting up taxes such as VAT would backfire. America, and indeed a series of countries in Europe, have taken a far more balanced approach to reducing their deficits, with strong plans to produce jobs and deliver economic growth. Why could the Chancellor and Prime Minister not have listened to and looked at what is happening in those countries? As a result of their mistakes, my constituents are suffering. Their bills are up because Ministers will not really challenge the big energy companies. There is certainly a Bill to introduce electricity market reform, but it will come far too late in this Parliament to make a real difference to the size of the bills my constituents will have to pay.

In many cases, mortgage rates are rising, while tube fares have never been so expensive. In Harrow town centre in the heart of my constituency, I have never seen as many empty shops as there are now—a daily demonstration of a recession that has been made in Downing street. Harrow council, told by the Mayor of London to plan for a huge increase in housing units over the next decade or so—half in Wealdstone and Harrow-on-the Hill—is seeking to use this open door policy for developers to try to redesign, reinvigorate and redevelop the heart of our borough, despite the recession. It is, however, striking how difficult it is at the moment to persuade developers to put affordable housing at the centre of their plans—for example, on the Kodak site, set to be home to a potential 3,000 housing units. For those in Harrow who want to get on the housing ladder, the prospect of being able to buy their first home in the Harrow community where they grew up seems ever further away.

The next generation, hammered by the high cost of tuition fees from October this year, will wonder why there is so little to help them in this Queen’s Speech. There is nothing to make the cost of going to university easier—just cuts in the funding that their university is receiving. They face higher living costs while they are at university, and now there is the possibility, as announced in the Budget, of a tax give-away for private universities, many of which are run by hedge funds.

Equally striking is the recent absence of “big society” language from the rhetoric of the Prime Minister’s speeches. Community groups that were championed when the Conservatives were in opposition are now left very much on the sidelines. Huge cuts in funding that began to hit hard last year will hit even harder this year. Last week, the head of Volunteering England warned that the network of volunteer centres across the country is beginning to fragment, with a number set to close this year. Why, at a time when we need national renewal, are we set to make it harder for people to give something back through volunteering? The National Children’s Bureau has warned that 25% of the charities it contacted that help young people and children believed that they might have to close next year. Charities that were promised Government contracts will now know that they were hollow words when Ministers spoke them.

The Work programme, run by the Department for Work and Pensions, has seen the private sector winning 90% of the prime contracts. Charities that were told that they would get 35% to 40% of the referrals under the Work programme are seeing at best half that—fewer than under the future jobs fund. More than 100 charities have lost confidence and walked away, yet there is nothing in the Queen’s Speech to seek to address those problems. Indeed, an independent audit published by Civil Exchange and the Joseph Rowntree Charitable Trust at the weekend argued that there is

“an implicit bias towards the private sector in tendering”

and that

“it is particularly hard for small, local voluntary organisations to compete for contracts.”

I suggest that this is the Serco society, not the big society, so it is hardly surprising that some 70% of charity chief executives did not think that the Government respected or valued their sector.

Arguably, the most fundamental challenge identified by the audit is how to extend social action to a younger population and across socio-economic groups. The core, it says, of those who provide the majority of volunteering are more likely to be middle-aged, to have higher educational qualifications, to practise their religion actively and to have lived in the same neighbourhood. There is nothing in the Queen’s Speech to suggest that the Government understand how to get more people enrolled in their communities or even the desire to do so.

Where, indeed, is the co-ops Bill that the Prime Minister once promised? This comes on the back of no serious effort to remutualise Northern Rock over the past 12 months, no serious interest in encouraging more energy co-ops to emerge, no sustained effort to encourage real involvement in the running of football clubs by football fans through football supporters’ co-operatives, and no requirement to promote a diverse market in financial services for the Financial Services Authority or its replacement to help financial mutuals. Sadly, the Queen’s Speech confirms that once again the Government have walked away from the real practical measures that could have helped the co-op and mutual movement to grow.

One of the Bills that will be before the House during this Session will be a crime and courts Bill, the details of which I shall examine especially carefully. As I made clear earlier, my constituents will be sceptical about the benefits of such a top-down change when they are seeing fewer police officers on the ground. I recently organised meetings between constituents who are experiencing challenging antisocial behaviour problems near the Racecourse estate in Northolt, which my hon. Friend the Member for Ealing North (Stephen Pound) will know particularly well—

[Stephen Pound (Ealing North) (Lab)]

It wasn’t me.

[Mr Thomas]

It also occurs in south Harrow. What frustrated those residents was the lack of visibility, at key times, of police officers who could have moved on local troublemakers, and, indeed, could have deterred them from gathering in the first place. Constables are routinely deployed away from their wards, and are rarely available for standard safer neighbourhood team duties in those areas.

What is most worrying, however, is the threat to close the custody suite at Harrow police station. With no consultation, the Metropolitan police have decided to shut the custody suite, which consists of 13 cells, in mid-September. There will then be no more cell capacity in Harrow. All those who are arrested will have to be transported to out-of borough police stations—to Kilburn and Wembley—by a minimum of two officers, more if there is a possibility that the prisoners could turn violent. Given the number of annual visits to Harrow’s cells by alleged criminals—an average of 5,000, I believe—and given the time that it takes to travel from my constituency to Kilburn and Wembley, that represents a loss of between 10,000 and 20,000 police officer hours. Officers will be wasting time by acting as transport couriers for alleged criminals when they could be investigating, detecting and, better still, preventing crime in Harrow.

[Stephen Pound]

I do not want to hijack the Queen’s Speech into matters of custody accommodation in west London, but is my hon. Friend as surprised as I was to learn that a place called Polar Point has opened at Heathrow airport to receive those who used to be in custody in Harrow and Ealing, and that the decision was made by a company called Emerald, which is apparently the privatised cell provider and which doubtless refers to the prisoners as “customers”?

[Mr Thomas]

I am indeed very surprised by that information. One is always grateful when additional cell capacity is provided elsewhere in London, but it is hugely disappointing that there is still a threat of closure of the custody suite in Harrow.

I have not received any formal explanation from the Metropolitan police of why they think that the closure is necessary, let alone been consulted. Given that CID officers tend to be based where custody suites are housed, and given that space is to be set aside at Wembley police station for Harrow CID officers, it does not look good for the future of borough-based policing in Harrow, and it certainly does not look good for the long-term future of the 110 CID officers who are currently based there. Almost a third of our own police officers will have to spend some of their time out of the borough if the cells shut. Let me ask this question of the Metropolitan police, and indeed of Ministers: why should my constituents have any confidence that those 110 CID officers will continue to be based in Harrow in the long term? I hope that, even at this late stage, the Home Secretary will encourage the Metropolitan police to think again.

This Gracious Speech is striking in that it does not include a Bill to fulfil the commitment that 0.7% of our national income should be spent on development assistance. The three major parties all committed to legislating on that. Indeed, before the last general election, I had the honour of taking such a Bill through the pre-legislative scrutiny process. There is a strong case for Britain continuing to set an example on the provision of international aid for people in less well-off countries. We should think of the current west Africa food crisis and the huge numbers of people at risk of dying of hunger there, and of the considerable remaining health challenges in respect of HIV/AIDS, tuberculosis and malaria.

The lack of action by the Government parties in respect of the ancient, yet still very important, United Nations commitment that every rich country should give 0.7% of its income to help the world’s poorest is a huge missed opportunity. In the forthcoming debate on the Gracious Speech, I look forward to hearing the Secretary of State for International Development give a clear and detailed explanation as to why he has failed to convince his colleagues to introduce legislation to that effect.

Trade Union Funding

Gareth Thomas Excerpts

Wednesday 29th February 2012 Westminster Hall

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

I congratulate the hon. Member for Congleton (Fiona Bruce) on securing the debate. She said that trade unions are a valuable part of our civic society and that they do hugely important work on behalf of many of their members, and I very much agree with that comment. She went on to make a series of other points from which she drew conclusions with which I am afraid I cannot agree.

I am slightly surprised that she and some Conservative Members should so obviously want to attack the interests of hard-working people—the home help, the teacher, the nurse, the learning assistant, the dustman, the cleaner. Those and many others who work in the private and, in particular given today’s debate, the public sectors are not paid huge salaries. They are part of the squeezed middle and are seeing their finances hit hard by the Government’s VAT rise, for example, and by high energy bills, which Ministers will not act on. Many of them are extremely worried about whether they will have a job in six months’ or a year’s time.

If the hon. Lady and some of her colleagues have their way, the right of such people to be properly represented will be taken away. Thousands of hard-working families will lose that most basic of rights—the right to be properly represented when they need it most. That point was made by my hon. Friends the Members for Blaydon (Mr Anderson) and for Wansbeck (Ian Lavery).

Virtually all the staff who would be affected most by the hon. Lady’s proposals do not earn huge salaries, yet they still demonstrate considerable commitment and hard work in delivering some of our most basic and important public services. The Prime Minister once spoke of compassionate conservatism. I ask the hon. Lady and her colleagues, how is it compassionate to take away from often low-paid, hard-working employees the opportunity to be properly and professionally represented when they need it most?

[David Morris]

The hon. Gentleman referred to hard-working families. Does he not think that it is appalling that hard-working families’ taxes are funding people who should be working, but rather than doing their actual jobs, the taxpayer is paying them to be union officials pro rata?

[Mr Thomas]

With all due respect to the hon. Gentleman, I think that he has got completely the wrong end of the stick, as I will explain.

If an employee is facing sexual harassment, worried about safety in the workplace, about to lose their job or have their pay cut, and does not know where to turn when they have problems at work, trade union representatives—independent of their employers—offer a crucial place to turn. They are trained and experienced in handling such issues and in liaising with employers to resolve disputes and workplace problems before they escalate. They help to reduce the cost to the immediate employer and the social and human cost for the individuals concerned. They reduce costs to the employer and ultimately help to reduce the cost to the taxpayer, a point made by my hon. Friend the Member for Aberdeen North (Mr Doran).

Even if one accepts the figures in the TaxPayers Alliance report, which seems to have provided the context for the debate, union representatives amount to only 0.05% of the public sector work force, and, it must be said, they carry out a significant proportion of union duties in their own time. They have attracted a vast amount of Conservative MPs’ time. It is reasonable to wonder whether spending so much time on that issue is the best use of the House’s time. The national health service is in crisis, we have record levels of joblessness, the economy is in free fall, welfare to work schemes are falling apart, many charities and community groups are in a desperate search for funding and there are huge cuts to our armed forces. When all those issues deserve the attention of the House, it is a little surprising that Conservative Members want to focus on 0.05% of the work force.

As my hon. Friend the Member for Paisley and Renfrewshire North (Jim Sheridan) pointed out, interestingly, union representatives continue to enjoy the support of many business people, so much so that the former director general of the CBI, Sir Richard Lambert, described them as having

“a lot to give their fellow employees and the organisations that employ them.”

If such a senior figure from the business world was moved to endorse the role of union representatives, maybe Conservative Members should pause and consider whether the performance of organisations in the public sector benefits from union representatives paid for by the public sector, as my right hon. Friend the Member for Wentworth and Dearne (John Healey) and my hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr McCann) said.

Research by the University of Hertfordshire examining the benefits of funding trade union facility time in the public sector suggests that the work of union representatives saves between £260 million and £701 million per annum. For every £1 spent on union facility time in the public sector therefore, between £2 and £5 is returned in accrued benefits. Many City institutions would be proud of that rate of return. I gently ask why the hon. Member for Congleton and her hon. Friends think that Britain can afford to waste such sums of money, because that is what would happen if her proposals were accepted.

The organisation that appears to have created the context for the debate, and indeed for other such debates, is the TaxPayers Alliance. Its report does not seem to be terribly well researched. It is certainly not up there with research from the Institute for Fiscal Studies or Barnardo’s and it certainly contains misunderstandings about how the Union Learning Fund works. When I was preparing for the debate, I was interested that the slightly calmer voice of the Minister for Further Education, Skills and Lifelong Learning praised the work of Unionlearn. The report refers to unions that do not exist and to organisations that are not unions, including School Leaders Scotland, the Retired Officers’ Association and, I am told, a credit union.

[Priti Patel]

Will the hon. Gentleman give way?

[Mr Thomas]

Not now, no.

Trade unions are heavily regulated, a point made by my hon. Friend the Member for Wansbeck. The right of employees in the public sector to be represented properly is a measure that not even Margaret Thatcher in her wildest moments wanted to abolish. I recognise that TaxPayers Alliance reports are to Conservative MPs what sweets are to little children: a temptation, a must-have, something to cry and shout about. Older heads, wiser heads—I hope Ministers—need to recognise that behind the sound and fury, trade unions play a quiet, useful and important role in helping our public services to run more smoothly. In the worst of times, when employees feel vulnerable and on their own, a trained and professional representative, a trade union representative, can play an important role in supporting them.

[Albert Owen (in the Chair)]

I am grateful to hon. Members for adhering to the time limit. I call on the Minister to reply.

Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 8th February 2012 Commons Chamber

[Mr Letwin]

My hon. Friend is absolutely right, and that is a classic example of what I see in my own constituency, in many other rural constituencies up and down the country and increasingly in the suburbs. People are taking charge and making sure that they get what they actually need delivered locally, by people who understand the local circumstances, and in many cases much more cheaply than was previously possible from the centre.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Given what is really happening, the objectives for the big society would appear to be huge funding and job cuts across the third sector, charities walking away from the Work programme and health service mutuals not getting health service contracts. Given the lack of influence that Cabinet Office Ministers clearly have across the rest of Whitehall, is the Cabinet Office not now merely the place where the emperor’s new clothes get spun?

[Mr Letwin]

Unfortunately, what the hon. Gentleman fails to reckon with is that not only this Government but any Government currently trying to run the United Kingdom would be faced with the need to clear up the fiscal mess that he and his colleagues left this country in, and that certainly entails cuts. We are very clear about that, and as matter of fact his own leader is now beginning to be clearer about that—although we are still not clear how clear he is. The fact is, therefore, that the voluntary and community sector does suffer some reduction in funding, but we are determined to create vast new opportunities for that sector, so it can compete to provide public services effectively and for the sake of the taxpayer.

Oral Answers to Questions

Gareth Thomas Excerpts

Wednesday 14th December 2011 Commons Chamber

[Mr Hurd]

My hon. Friend knows from his lengthy experience in the area that we have fantastic social entrepreneurs in this country, and we want to make it easier for them to access capital, but, as he points out, some of them need more help to become more investment-ready. That is exactly why we have set up a £10 million investment and contract readiness fund—to provide grants for organisations that want to attract investment but know they need more help to become more investment-ready.

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

Among the Public Administration Committee’s many criticisms in its report today, it rightly highlights that Ministers cannot expect the big society bank to provide the solution to the funding crisis that their cuts are causing for hundreds of charities. Given that the report goes on effectively to accuse Ministers of being out of touch and not providing effective leadership to tackle the problems that charities face, would not now be the perfect time for yet another one of the Prime Minister’s big society re-launches?

[Mr Hurd]

I am not going to take any lectures on leadership and Big Society Capital from the Opposition, because they talked for 10 years about setting it up but did not actually do it. We are doing it because we want to make it easier for social entrepreneurs to access capital. It is on track, and we are very proud of it.

Public Services (Social Value) Bill

Gareth Thomas Excerpts

Friday 25th November 2011 Commons Chamber

[Mr Gareth Thomas (Harrow West) (Lab/Co-op)]

I beg to move, That the clause be read a Second time.

[Mr Speaker]

With this it will be convenient to discuss the following:

New clause 2—Local authority strategies—

'(1) Section 4 of the Local Government Act 2000 (strategies for promoting wellbeing) is amended as follows.

(2) After subsection (1) insert—

“(lA) A local authority’s sustainable community strategy must include—

(a) their proposals in connection with promoting engagement in social enterprise in their area; and

(b) a statement of measures proposed for enabling persons or bodies engaged in social enterprise in their area and such other persons as they consider appropriate to participate in the implementation of the proposals referred to in paragraph (a).”.

(3) After subsection (4) insert—

“(4A) For the purposes of this section a person or body is engaged in social enterprise if—

(a) the person or body is carrying on a business;

(b) the business’s activities are being carried on primarily for a purpose that promotes or improves the social or environmental wellbeing of the United Kingdom, whether the purpose is pursued in relation to all or any part of the United Kingdom or all or any of the persons resident or present in it; and

(c) the greater part of any profits for distribution is applied for such a purpose.’”.

New clause 3—Annual report to parliament—

'(1) The Secretary of State must prepare and publish an annual report on the operation of the Government’s strategy for social enterprises in the preceding year and must lay a copy of the report before Parliament.

(2) The Secretary of State must, during the preparation of each report, consult—

(a) the National Audit Office;

(b) the Charity Commission;

(c) Co-ops UK;

(d) the National Council for Voluntary Organisations;

(e) Social Enterprise UK;

(f) the Association for Chief Executives in Voluntary Organisations;

(g) the Office for National Statistics; and

(h) such other organisations or persons as the Secretary of State considers appropriate.

(3) Each report must include statistics on the performance of social enterprises.’.

Amendment 1, in clause 1, page 1, line 3 after first ‘of’, insert ‘goods and’.

Amendment 2, in clause 4, page 3, line 36, after ‘Services (’, insert ‘Social Enterprise and’.

Amendment 3, in title, line 1, at beginning insert—

‘To require the Secretary of State and local authorities to publish strategies in connection with promoting social enterprise; to enable communities to participate in the formulation and implementation of those strategies;’.

Amendment 4, in title, line 1, leave out from ‘Require’ to ‘and’ in line 2 and insert

‘that public sector contracts include provisions relating to social outcomes and social value;’.

[Mr Thomas]

I congratulate the hon. Member for Warwick and Leamington (Chris White) not only on his choice of subject but on the way in which he has steered the Bill through the House thus far.

The Opposition want a comprehensive change programme to boost social enterprise further. I hope to set out this morning a more ambitious approach to the Bill than the Government and the Minister, sadly, have been willing to countenance so far, but before I do so let me explain how my amendments seek to build on some of the issues raised in Committee.

In new clause 1, I have sought to respond to the appetite shown in Committee for more certainty about the definition of social enterprises, and in particular how an asset lock might be worked into the Bill. In new clause 3, I have sought to provide a clear means of encouraging the Government to be accountable for their work in social enterprises. Amendment 1 offers the Minister an opportunity to clarify the arguments that he used in Committee to justify the limited scope of the Bill in relation to commissioning.

In Committee, we had an interesting discussion about the merits or otherwise of a national strategy for social enterprise. I fear that the absence of a clear requirement for such a strategy poses the risk of a loss of momentum behind the sector when ministerial attention is diverted, as it inevitably will be. An example is the point of order on which you ruled earlier, Mr Speaker. No doubt ministerial attention has been diverted, quite rightly, to youth unemployment and the return of the future jobs fund in another guise. There is a risk that other issues might also divert Ministers’ attention from their commitments to social enterprises in the future, and a clear strategy would help to avoid any such loss of focus and interest.

I fear that things that could and should be done by other Whitehall Departments to help social enterprises cannot be done without a requirement for a cross-Whitehall strategy. I fear, too, that some parts of the country will miss out, and that many communities that could and should benefit from what social enterprise can offer will not be able do so because of the absence of a clear strategy framework for Whitehall’s work.

The Minister claimed in Committee that there was a strategy for social enterprise, and cited social investment as one part of that strategy. I must point out gently to him that he did not seem to be willing to give many more such examples. He did, however, go on to say that the Cabinet Office was working with the Department for Business, Innovation and Skills, suggesting that that somehow proved that the whole of Whitehall was united behind work for social enterprises.

I believe that a strategy for social enterprise should touch on a series of issues. Access to finance is clearly a key issue, as are access to commissioning opportunities and the role that social enterprises can play in assisting the process of modernising our public services, making them more flexible and personal. Access to advice and support for fledgling or “wannabe” social enterprises is clearly a further aspect of such a strategy. Ongoing support and representation from—ghastly phrase—infrastructure organisations to help social enterprises to share best practice, to solve legal problems that they may face, or to tackle difficult human resource issues would also be worthy of inclusion.

A strategy could explore the scope for more work with, or indeed instead of, the private sector. It could also consider issues relating to coverage: which communities are likely to need more help to enable more social enterprises to emerge, and what should that help look like in practice? It could outline the role not only of other Whitehall Departments but non-Whitehall players in developing the Government’s endeavours to help social enterprise.

[Hazel Blears (Salford and Eccles) (Lab)]

Does my hon. Friend share my regret that the original Bill, which was genuinely about social enterprise, has been reduced—as a result of, I believe, arguments within the Government—to a Bill that simply talks about the very minimal bit of social value that is left, rather than giving what could have been a really good boost to the social enterprise sector?

[Mr Thomas]

My right hon. Friend makes an important point. The Bill represents a huge missed opportunity for the Government to embrace the other elements of the Bill. This is a Government who made much of their commitment to the big society, yet here is, arguably, a big society Bill that they have—as my right hon. Friend rightly says—gutted. The absence today of Conservative Members who might have been present to defend and advocate this big society Bill is, I fear, further testimony to the lack of support for it in practice.

Let me now deal with some of the issues relating to access to money that might constitute part of a national strategy.

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

On the subject of money, may I ask whether the hon. Gentleman has assessed the possible cost of producing a national strategy?

[Mr Thomas]

I have not, but the explanatory notes prepared by the hon. Member for Warwick and Leamington for Second Reading contained an assessment of the cost, which, if I remember rightly, was approximately £41,000.

Many social enterprises clearly have a strong trading and enterprise ethos, but most have required start-up finance or transitional funds, or funds for specialist advice. For voluntary sector organisations wishing to become social enterprises, strong grant income can help to provide a cushion allowing a business model to be properly developed. If there is no clear, thought-through process to make appropriate funding available, the huge cuts in Government funding for the third sector may not only put at risk the services provided by voluntary and civil society groups on which so many of our constituents rely, but hold back the growth of the social enterprise sector.

It is, I would gently suggest, not enough for the Government to talk about a strategy for social investment. I do not doubt the Minister’s commitment to growing the market for social finance, and the Government’s interest in social impact bonds and support for the big society bank—both Labour ideas—are welcome, but when those initiatives are set against the scale of the cuts in direct funding from national Government and, as a result, local government, there seems to be little hope that the social finance market will have grown sufficiently robust to replace the estimated £3.2 billion—possibly as much as £5.1 billion—of direct funding that will be lost. That estimate of the potentially huge loss to the third sector over the coming comprehensive spending review period was provided by the independent analysts New Philanthropy Capital.

[Richard Fuller (Bedford) (Con)]

I am listening to the hon. Gentleman’s speech with great interest. He is making a point not only about the need for a strategy, but about the impact of cuts in the near term. Does he agree that, in essence, the Bill in its present form retains the opportunity to support social enterprises, and that the Social Enterprise Coalition and other leaders of social enterprises support it?

[Mr Thomas]

The hon. Gentleman makes a valid point when he says that the Bill, although its scope is substantially restricted, offers some opportunity for progress to be made in support of social enterprises. The Opposition welcome and support that, but, as my right hon. Friend said, this Bill provided the Government with an opportunity to be far more ambitious in scope, and it is a tragedy that the Minister has not been able to persuade his colleagues in Government to support the more far-reaching measures.

New Philanthropy Capital has assessed the funding situation facing the voluntary sector in the coming years. It noted how the scale of the cuts would be far too big for public foundations or other forms of philanthropy to be able to compensate for, and also noted that charities funded by local authorities, which will bear particularly heavy cuts, are at great risk. The Minister will not, I suspect, be surprised by these difficulties facing the third sector, especially those resulting from the Government’s cuts on local authorities. This is yet another example of their cutting public spending too far, too fast. I am sure the Minister will know about the cuts at Hillingdon Community Transport, Hillingdon Law Centre, Hillingdon Arts Association and Hillingdon Women’s Centre. Those are just a few examples of local organisations that are being affected by the coalition’s economic strategy.

Social enterprises that trade directly with the public are all too aware of the extremely difficult trading environment on the high street. The latest news, which came out today, is that Sir Philip Green is having to axe a whole series of shops. That proves the error of the Government’s economic strategy, and if his business is facing such difficulties, it is unsurprising that social enterprises that trade with the public are also experiencing falling incomes. The crisis facing the economy, and therefore the circumstances facing social enterprises trading with the public, are yet another reason why the Chancellor should consider introducing a temporary cut in VAT and adopting the plan B proposed by the shadow Chancellor, my right hon. Friend the Member for Morley and Outwood (Ed Balls).

--- Later in debate ---

[Hazel Blears]

I wonder whether my hon. Friend shares the following concerns, particularly in respect of the national health service. If it is truly to become the biggest social enterprise in the world, as the Secretary of State for Health has said, there needs to be a lock on public sector assets that have been paid for by taxpayers, so that they are not transitioned into the private sector. That has already happened in some instances. I have made that point to the Minister on several occasions, and I am very concerned that public assets will be transferred to private companies, making private profit for people in the private sector.

[Mr Thomas]

I entirely agree with my right hon. Friend. It is precisely because of the concern she has raised on this issue—and the support she received, including from Members of the coalition parties, in Committee—that I propose a revised definition of social enterprise in this new clause. It seeks to provide in legislation the asset lock facility. Central Surrey Health is owned by the nurses and managers who work in it, and it was the first employee-owned spin-out from the national health service—that occurred back in 2006, under the Labour Government. It is a classic employee mutual. The Cabinet Office has confirmed that Central Surrey Health has delivered substantial improvements in quality and efficiency in the services provided. However, it would appear that quality counted for far less in the tendering exercise than the ability to raise capital.

The chief executive of Social Enterprise UK, Peter Holbrook, put it as follows:

“If Central Surrey Health, the government’s flagship mutual social enterprise, which has demonstrated considerable success in transforming health services, reducing waiting times and increasing productivity can’t win”—

in a commissioning contract process—

“what does this say for the future of the mutuals agenda?”

He went on to say:

“Public sector workers will be understandably anxious about spinning out from the NHS and setting up a social enterprise on the back of this news. The government needs to take action to reassure them that they will not be operating in markets weighted against them.”

The thought, consultation and preparation required in a proper strategic review of how to support social enterprises might begin to give those public sector workers the confidence they need to be part of employee spin-outs.

The sense that nobody has a proper joined-up grip of how to transform commissioning has perhaps left many public sector workers sadly sceptical about being part of creating an employee mutual. The Minister for the Cabinet Office and Paymaster General has bravely pledged that by 2015 the country will have 1 million more public sector workers in mutuals. I have tabled parliamentary questions asking each Department how many applications Ministers have received from employees to run services for which their Department is directly responsible. Sadly, the overwhelming majority of Departments had received absolutely none.

A strategy for social enterprises could also explore where and how social enterprises can get the advice, the support and even the training that they need in commissioning, and in the legal and human resources issues that they would face, for example, in respect of TUPE. Where do social enterprises go for that support now? Clearly they can go to the excellent Social Enterprise UK or Co-operatives UK, but are they well enough funded for the scale of the Government’s future ambitions? I pose that question in the context of Rise, the south-west social enterprise agency, having decided to close its doors because of a lack of income. As a result, there is understandable concern that Ministers have not thought through the external support required to grow the social enterprise sector. Social Enterprise UK has suggested that there should be more social enterprise hubs offering a combination of business support, shared work space and peer support to support the growth of the sector. That is a very interesting idea, and if there were to be a proper strategy, the Government could explore it in more detail.

What thought have the Government given to encouraging the growth of social enterprises to take on tasks that have traditionally been the preserve of the private sector, for example, in the areas of finance or energy? The Government want social enterprises to help them to roll back the state, but have they thought through the opportunities for social enterprises to do more in those traditional private sector areas? Let me give one example. Access to loans and the level of personal debt have been issues of huge concern across the House. Social enterprises that do not need to fund profits for shareholders could offer cheaper loans and could do so in areas where traditional businesses might not operate. Credit unions are a powerful example of the potential in that area. The London Mutual Credit Union, which I believe operates in Southwark and Lambeth, wants to offer a cheaper payday loan in competition with similar private sector products and it would charge far less than the very high rates of interest that private sector payday lenders currently offer.

--- Later in debate ---

[Mike Freer (Finchley and Golders Green) (Con)]

Before we move off new clause 1, may I draw the House’s attention to subsection 5(b), which contains a definition of “social enterprise”? As I read it, Barratt Homes would qualify here, because one could argue that by building houses it is improving social infrastructure; the provision of affordable homes meets the criteria. Section 106 agreements, which provide affordable homes for rent, housing facilities and health facilities, all meet those criteria. In addition, the definition could exclude those seeking to provide fair trade services, because they do not provide or improve social or environmental well-being in the United Kingdom. Will the hon. Gentleman clarify how that provision would actually be applied? Would it not, in fact, open the door to every business?

[Mr Thomas]

The hon. Gentleman makes an interesting point about Barrett Homes. I draw his attention to subsection 5(d) of new clause 1, which refers to the business being

“majority-owned and controlled in the interests of improving the social or environmental well-being of the United Kingdom.”

Given that Barrett Homes has a substantial shareholder base, it would be difficult to justify in any court of law that it met that definition.

The hon. Gentleman's interesting point relates to Fairtrade, too, and if the Government accept the new clause, a small amendment in the other place could help to ensure that Fairtrade organisations were not excluded. I am open to the idea that his suggestion might work and I gently suggest that it would require the Minister to have a slightly more open mind than he demonstrated in Committee. Perhaps the hon. Gentleman will have more luck in encouraging the Minister behind the scenes than I did in Committee.

New clause 2 highlights the key role that local authorities will play in helping to grow the social enterprise sector. Indeed, many of the representations I have received about the Bill stress the importance of local authority commissioners for social enterprises. A requirement for a proper strategic look at the needs of social enterprises in each local authority area would mean that Conservative councils, desperate simply to privatise services, would have to at least to consider the merits of the social enterprise sector. They would do well to look at the example of the many Labour-run co-op councils around the country that are already doing much to encourage social enterprises to develop.

In Committee, a number of Members noted the danger of strategy documents gathering dust and achieving little, which none of us in the House of Commons would want to see. I accept that that is a risk, and new clause 3 is designed to help minimise that risk. I have been struck by the enthusiasm of many of the organisations included for consultation on new clause 3. New clause 3 requires an annual report to be laid before Parliament with the clear involvement through consultation of a diverse range of representative bodies from the sector and others, such as the National Audit Office, which, if it wanted to do so, could comment effectively on the success or otherwise of the commissioning for social value part of the Bill. The Charity Commission would be able to provide a view on the effectiveness of the Government’s strategy to encourage further charities that are social enterprises, while the Office for National Statistics clearly needs to be encouraged to develop statistics to enable the sector’s strength and performance to be properly understood.

Evidence-based policy making and proper evaluation of what has worked and what has happened so that one can learn from mistakes is surely always a sensible approach for Ministers and Parliament to encourage. The National Council for Voluntary Organisations, the Association of Chief Executives of Voluntary Organisations, Social Enterprise UK and Co-operatives UK are all strong, excellent bodies that could offer insightful comments to help Ministers and, crucially, Parliament, to assess the effectiveness of the Government’s policies for encouraging the sector to grow.

I was struck by the recent Public Administration Committee’s report “Change in Government: the agenda for leadership”, published in September. The Committee noted the Prime Minister’s promise on, among other things,

“re-empowering…communities as part of the ‘Big Society’”.

Two paragraphs on, it stated:

“The principal message of this report is that unless there is a comprehensive change programme for government, there will be little of the real change”

that the Conservative manifesto promised. There are three new clauses before the House today that all offer the chance of that comprehensive change programme for social enterprise to be embedded across Whitehall.

My final point on the three new clauses is to draw the House’s attention to the new suggested definition for the sector. In Committee and in her intervention today, my right hon. Friend the Member for Salford and Eccles (Hazel Blears) rightly raised the issue of an asset lock to protect taxpayers’ assets to stop them simply being transferred to the private sector. In Committee, my right hon. Friend received support for the principle of an asset lock from the hon. Member for Bedford (Richard Fuller) and even from the Minister.

As I said in response to the intervention from the hon. Member for Finchley and Golders Green (Mike Freer), subsection 5(d) of new clause 1 seeks to add a key description to the definition of social enterprise which locks in any public assets transfer to the social enterprise. That matters because the Opposition remember the bus privatisation scandal of the 1980s. The bus industry was transferred lock, stock and barrel from public ownership to employee mutuals. It was not that long before the employee mutuals handed themselves over to what had become big corporate bus businesses. Those businesses gained the assets on the cheap while the community and employees lost some of the social value implicit in those public assets, which were taken out as profits of those private businesses to reward their shareholders.

I do not criticise the entrepreneurs who set up and now run the bus industry, as the rules at the time allowed them to do what they did. I am certainly not against privatisation. It has its place, although that is not everywhere and not all the time. If that is the Government’s intention for an industry or a particular part of a sector, however, we should have proper, transparent debate about its merits.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

I appreciate the point made by the right hon. Member for Salford and Eccles (Hazel Blears) about how some overage must be retained by the taxpayer when surpluses are gained later, but the hon. Gentleman is rewriting the history a little, I think, of the effect of bus privatisation. I remember that when I was a schoolgirl in Liverpool the introduction of choice and competition meant that we had better services, not worse, as a result of the privatisation.

[Mr Thomas]

My recollection is slightly different; we remember that in the 1980s there were substantial cuts in bus services after privatisation. Arguably, that is not the point. The key point is whether the assets should remain in the ownership of the public sector or, if not, in that of members of the public who are combining in a social enterprise. The asset lock clause seeks to achieve just that.

[Ian Murray (Edinburgh South) (Lab)]

I thank my hon. Friend for allowing me to make a small contribution on this point. The publicly owned bus company in Edinburgh, Lothian Buses, has won bus operator of the year for five of the past 10 years. It is 90% owned by the city of Edinburgh council and 10% owned by each of the surrounding authorities in the Greater Edinburgh area, including Midlothian, East Lothian and West Lothian. That investment in public buses has made it one of the best bus companies in Europe—holding fares down and being responsive to local communities. I wholeheartedly agree with what my hon. Friend has just said.

[Mr Thomas]

My hon. Friend makes the interesting point that public sector-run organisations can be extremely successful and often are extremely efficient. The key issue we focused on in Committee is that when assets are transferred out of the public sector we need to ensure that if they have been built up over the years as a result of taxpayer investment, there will be proper protection for the social value that the assets have generated. My revised definition of social enterprise seeks to achieve that objective.

The last amendment on which I want to focus is amendment 1, as the others are all consequential on the three new clauses. Amendment 1 would ensure that the one part of the original Bill to which we know the Government are committed is widened in scope. The Government want and the Opposition support further reforms to the public procurement process to encourage the Government in their various forms to take account of wider economic, social and environmental well-being in the commissioning process.

--- Later in debate ---

[Hazel Blears]

My hon. Friend will recall that in Committee I raised the example of B4Box, a construction social enterprise that refurbishes houses, does construction work and employs people who have a difficult and troubled employment history. The Minister was unable to satisfy me at that time—and I have heard nothing since—about how that amazing social enterprise could be covered under “social value”, because it deals with goods and services, and sometimes the goods might well exceed the services.

[Mr Thomas]

My right hon. Friend made a very valid intervention in Committee on exactly this point, and I shall return to that issue in a moment.

The Minister also said in Committee that he wanted to

“strike a proper balance between our”—

the Government’s—

“objective to encourage more commissioners to think about wider values, such as social and environmental values, in their considerations, and our determination to try to streamline the process and to reduce the number of additional duties on commissioners.” ––[Official Report, Public Services (Social Enterprise and Social Value) Public Bill Committee, 19 October 2011; c. 19.]

However, he did not explain why it is reasonable to encourage commissioners to think about social value in the context of services but is unreasonable to ask the very same commissioners—as it is usually, although not always, the same commissioners—to think about social value when awarding contracts for work or, crucially, for goods. Will he clarify a little further how he arrived at the view that services could be covered but that contracts for work and for goods should not be covered? Was there a discussion across Government in which he lost out? Perhaps the Secretary of State for Communities and Local Government saw this as a step too far. I note that there was a huge gap between the Bill’s Second Reading and Committee, which suggests there was a fairly intense debate behind the scenes in Government—was it on this issue?

If there was not a political problem in Government about the inclusion of contracts for work or for goods, perhaps there was some research basis for suggesting that only contracts for services mattered in legislative terms for encouraging and embedding that concept of social value in commissioners’ thinking. If that is the case, will the Minister enlighten the House as to the research evidence in question? The whole House believes in transparency and I am sure that we all want to see clear, evidence-based policy making. Will he tell us with whom he discussed such research, if it exists? Was it with Social Enterprise UK or with Co-operatives UK, either of which would have been a logical choice? Was it with the Charity Commission or just with officials? It would be helpful to know the thought process he went through in deciding to omit contracts for work and contracts for goods from the scope of the Bill so that not only those of us in the House today but people in the third sector, particularly public sector commissioners, who consider our debate can better understand what is expected.

During our Committee discussions, my hon. Friend the Member for Stretford and Urmston highlighted the issue of books and publications, which are goods, and the fact that publications providing information about the social security system are arguably providing a service. She noted the potential dangers of confusion and difficulty for commissioners with contracts for goods being excluded from the Bill’s scope.

My right hon. Friend the Member for Salford and Eccles raised in Committee the issue of construction, as she has just done, and whether it would count as a service, a good or work. I gently point out to the Minister that he did not answer her question on that. Following our Committee discussions, I have received further representations suggesting that construction contracts could be outside the scope of the Bill. The organisation in question suggests that legal advice might be necessary, but surely the Minister, having had so much advance notice of the concerns of many Committee members on this issue, can clarify the situation today. I have also received representations that if the Bill covered the provision of food, furniture or plants, the civil society organisations bidding for contracts would be more likely to benefit from the socially and environmentally responsible manner in which those goods are or could be produced.

Similarly, I have received representations suggesting that statutory guidance and training are required on how and where social value can legitimately be considered and inserted into tender specifications. Does the Minister intend to bring forward such guidance for commissioners and for those third sector organisations, social enterprises and others that could benefit from this clause? The Bill could achieve so much more. My amendments seek to do justice to our debates in Committee and, above all, to the huge potential that social enterprise and social value offer.

[Chris White (Warwick and Leamington) (Con)]

I thank all those who have enabled the Bill to get to this stage today. It is a rare feat for a Bill to go this far and it is a credit to all the political parties and Members who have been involved in the process that so much has been achieved. I again thank the Parliamentary Secretary, Cabinet Office, my hon. Friend the Member for Ruislip, Northwood and Pinner (Mr Hurd) and the hon. Member for Harrow West (Mr Thomas) for their continued support for the principles enshrined in the Bill.

It is wise, at this juncture, to take a step back and remember what has been achieved so far. During the Bill’s progress through Parliament there has been significant national debate on the way that public money is spent. Across the country, local authorities, public sector commissioners, charities, social enterprises, chambers of commerce, community groups and politicians have been seriously considering how we should commission the services we need. In addition, all the political parties have signed up to the principles of social value commissioning. That cross-party support has been one of the most distinctive features of our deliberations on the Bill.

We are very close to being in a position to send out a message to commissioners across the country that we want to do things differently and that although we consider value for money as being important, we mean “value” not in its narrow sense but in its true sense—recognising the importance of social, environmental and economic well-being across our communities and in our lives. This has been welcomed by organisations throughout the country. Only this week a letter from the chief executive of Social Enterprise UK in support of the passing of the Bill was signed by the Association of Chief Executives of Voluntary Organisations, Action with Communities in Rural England, CAN, Children England, Co-operatives UK, Community Matters, Locality, the National Association for Voluntary and Community Action, the National Council for Voluntary Organisations, the National Council for Voluntary Youth Services, the Race Equality Foundation, Urban Forum and Social Firms UK. That is just the tip of the iceberg.

Across our communities, thousands of organisations are looking to us here today to give them a vote of confidence. Yes, we want to see those organisations able to deliver more of our public services. Yes, we want to support them doing the excellent work that they do. Yes, we appreciate the extra miles that they go to support our communities. The biggest show of support that we can give to these organisations is to pass the Bill today.

I appreciate that the hon. Member for Harrow West has only the best of intentions for the Bill. I am pleased that many hon. Members have taken the opportunity to engage seriously and considerately in the process leading up to today, and have sought to do what they can to help make the Bill a success. Every single Member of Parliament who has participated in discussion of the Bill should be proud of the role they have played in ensuring that we do something positive for charities, voluntary organisations, small businesses and social enterprises, but we cannot allow the best to become the enemy of the good.

I recognise that the shadow Minister is seeking to return to some of the clauses that were included in the original Bill, and I sympathise. Of course I want to see, and I believe we all want to see, a more strategic approach to supporting social enterprise in local and central Government. I believe, like him and like most of those in the Chamber, that social enterprise is the way forward and that social enterprise is good for our communities, but the best thing we can do for social enterprise is to focus not on reports or strategies, but on social value. Social enterprises, like other organisations, want more than words. They want concrete action, and the Bill has the potential to deliver that action.

In 2006, the then Parliamentary Secretary, the Cabinet Office, now the Leader of the Opposition, the right hon. Member for Doncaster North (Edward Miliband), produced a social enterprise action plan through the Office of the Third Sector. The action plan outlined 24 separate actions that it wanted to achieve, but nearly half of them were never acted on. That is not to say that we should not have strategies and plans, but strategies and plans by themselves do not necessarily lead to actions that benefit those whom they are meant to support. The social enterprise sector, like voluntary and community organisations up and down the country, see the Bill as a positive action that we can take today that will directly help them and potentially help thousands of others in the years ahead.

The social value aspect has always been the most important part of the Bill, and I am sure that all hon. Members recognise how imperative it is that the Bill goes through with that social value section intact. We should also remember that the Bill in no way prevents the Minister, his successors or local authorities from producing their own action plans and strategies to boost social enterprise, and if they were to do so, they would find in me one of their strongest supporters.

We should recognise that a great deal of the ideas generation that the sector needs comes from within it. The Social Enterprise Coalition, as it was before the last general election, produced an excellent manifesto for social enterprise which outlined a range of specific measures that could be taken to support the sector. We should take on board those ideas and encourage central and local government to work with organisations such as Social Enterprise UK and their regional bodies, to keep a constant dialogue going about how to boost the sector. However, if we are faced with the choice of having strategies within the Bill and it failing, or having strategies removed and it passing, I think we all know which is the more important. This is an opportunity that we simply cannot afford to miss.

--- Later in debate ---

[Chris White]

I thank the right hon. Lady for that intervention. I appreciate the tremendous work that she has put into getting the Bill to this stage. All the work that she does with social enterprises is well recognised. Do I feel a touch of disappointment? I am a practical and pragmatic person. I want to see something that works, something to build on. That is why I am making the remarks that I am.

[Mr Thomas]

Will the hon. Gentleman give way?

[Chris White]

I am about to conclude.

I appreciate that we all have a duty to ensure that the best legislation gets through the House. It is true in this case that some legislation is better than no legislation. This is a chance for us to send a message that when it comes to these important issues, we can all work together, we can prevent politics from getting in the way of good policy and we can be trusted to do the right thing when the time comes. I hope that given the hon. Gentleman’s well-documented support for the principles of the Bill and for the social enterprise, voluntary and community sectors, he will withdraw the amendments today so that we can push forward with much-needed reform of procurement. This is a chance that we may not get again for some time, so let us take it and see the Bill through to the other place and from there, we hope, on to the statute book.

--- Later in debate ---

[Mr Nuttall]

It is, as always, a great pleasure to follow my hon. Friend the Member for Finchley and Golders Green (Mike Freer), who brings his experience in local government to this debate.

I rise to oppose new clauses 1, 2 and 3 and amendments 1, 2, 3 and 4. That is primarily because, while I appreciate that there is sometimes a time and a place for strategies, and that it is sometimes a good thing to have a strategy, I agree with what the Minister said in this House on Second Reading:

“I believe that, particularly in this context, strategies should be governed by the need of the moment, and should be driven by conviction rather than by a requirement to comply with some bureaucratic process. I do not want the process of drawing up strategies to be bureaucratic. I do not want it to be simply an exercise in producing more glossy brochures that fill up the bookshelves in our offices, which are not read and which do not have real traction.”—[Official Report, 19 November 2010; Vol. 518, c. 1217.]

I could not agree more. There is a real danger that the new clauses will have the effect of introducing a level of bureaucracy to this procedure that will not add anything to the overall aim of the Bill.

I congratulate my hon. Friend the Member for Warwick and Leamington (Chris White) on his perseverance and determination in piloting the Bill through to this stage. He should be commended for that. Although it has been over a year since Second Reading, and some might think that that is slow progress, it has been positively sprightly when compared with the glacial progress made by the Bill promoted by my hon. Friend the Member for Castle Point (Rebecca Harris), who I see in her place—the Daylight Saving Bill, which, after a year, has yet to reach its Committee stage.

On the cost of these strategies, when I intervened on the hon. Member for Harrow West (Mr Thomas) he referred back to the cost of £41,000, which was cited by my hon. Friend the Member for Warwick and Leamington on Second Reading. I was not present on that occasion, but when I read the record of the debate shortly afterwards, I thought that estimate slightly optimistic, if my experience of the costs of achieving anything in government are anything to go by. I am still of that opinion today. In fact, I think that the figure is wholly unrealistic.

The costs are compounded by the solution that is given to the question of how one comes up with a mechanism to ensure that the strategies are actually carried out, provided in new clause 3, which is to produce an annual report—yet another cost and yet another obligation on the Secretary of State. The Secretary of State would have not only to produce a report, but consult several bodies including the National Audit Office, the Charity Commission, Social Enterprise UK, the Office for National Statistics and many others. I do not think that that would help to achieve the overall aims of the Bill.

I am often concerned when a Bill has cross-party support. I notice that there were no Divisions on Second Reading or in Committee.

[Mr Thomas]

Yes there were.

[Mr Nuttall]

Oh, there were Divisions in Committee.

This Bill plays a large part in the big society agenda. Once or twice today, anybody listening to this debate would have thought that it was a Government Bill. Of course, it is actually a private Member’s Bill. I am sure that even in its slimmed-down form, thousands of social enterprises across the country will welcome the progress that it has made. Having said that, there seems to be little in the Bill that could not take place regardless of whether the Bill makes progress and without the passage of new legislation. What is needed by those involved in the commissioning and procurement of public sector services is the will to secure diversity of provision. Users of public services are not concerned about whether the services are provided by the public sector, the private sector, the third sector, voluntary organisations, charities or social enterprises; what matters is the quality of the service they receive.

We need the process of bidding for public sector contracts to be made a great deal easier, not just for social enterprises, charities and voluntary organisations, but for small and medium-sized enterprises in the private sector. In that regard, I associate myself with the remarks made by my hon. Friend the Member for Congleton (Fiona Bruce). Smaller organisations, whether in the third sector or the private sector, often need a helping hand to guide them through what can seem to be a burdensome, complex and bureaucratic procedure. One thing that we need to do, as a Government and as a society, is to make that whole process much easier.

I hope that the Bill will encourage more social enterprises to develop and to take over, where feasible, areas of service from the public sector. From my point of view—I appreciate that this will not be welcome in all parts of the House—I would not worry if this was seen as a stepping-stone towards services being provided by the private sector. Of course when assets leave the public sector, the true and full price must be paid. Provided that that is done, there should be no loss to the public sector. We need dynamism in the procurement of public services, with contracts moving. Sometimes contracts might be kept in-house, sometimes they might go to the—

--- Later in debate ---

[Mr Hurd]

I accept that point, and to some degree that is what we are doing today. We are moving forward on that. My hon. Friend mentions the concept of the right to challenge, which had not previously been mentioned in the debate. Again, we are moving forward on that, because we are moving into a world in which there will be much more information about what commissioners are doing and how public money is being spent. Through the Localism Act 2011, which I am delighted to say has completed its passage through Parliament, the right to challenge is now set in statute, with regulations to follow shortly to clarify how it will work. That is progress on the journey that I have described.

[Mr Thomas]

Will construction be covered by the clause on social value?

[Mr Hurd]

I have nothing to add to what I said in Committee. The Bill is reasonably clear about where it will apply.

The right hon. Member for Salford and Eccles mentioned B4Box in her constituency. The position will be enhanced by the new best value guidance, and there is nothing to prevent the local authority from working on the basis that she described. I am grateful to her for bringing Aileen in to talk about the matter. Aileen is doing it. There is space in the system for her to do it. She and I would probably agree that we need to send a stronger signal that it is okay, but it is okay and people are doing it. The best value guidance from the Secretary of State moves things on further by sending a signal of permissiveness.

I have always made it clear that the Government have from the start supported the principle of the Bill because of the value that it adds to the process, and it goes with the grain of what the previous Administration were trying to achieve. The system, risk averse as it is, is getting a consistently stronger signal about the need to take account of wider social value considerations when spending taxpayers’ and constituents’ money and to be more alive to opportunities to commission intelligently. Lots of examples have been cited in our debates of fantastic organisations, such as Create, that are adding value to our communities. I cited that example in my Brussels speech because in many ways it embodies exactly what we are trying to encourage.

We can do more. The hon. Member for Harrow West goaded us to come up with more ideas to support social enterprises in this movement. I have talked about the need to open up new market opportunities to help these enterprises grow and to help more people, but the Government can do more to make life simpler for the social entrepreneur. I shall come later to the question of definition but these are businesses first and foremost, and the guidance and requirements that we place on people trying to run businesses in this country are ridiculously disproportionate. A rigorous process is under way. It cannot be undertaken lightly and it does not lend itself to soundbites. It is a rigorous process of going through each subsector of the economy to look at the regulatory burden and to discuss with the players in those sectors what we can remove and what is no longer proportionate or necessary. That process is well under way.

We can also help social enterprises with the increasingly important question of how to measure social impact. That is their currency. Many of us know that the money providers, whether private or public, are increasingly demanding that social enterprises, charities and, I hope, other organisations measure and communicate their social impact and social value, which is their unique selling point. Many of us are also aware that arguably there is too great a profusion of initiatives in this area and of the risk that this will only confuse the landscape. I want greater coherence and consistency not least so that we, as funders, and other stakeholders can agree on what is worth measuring and how it can be measured affordably by all organisations.

--- Later in debate ---

We oppose the amendments. We note that most of the stakeholders in this conversation are happy with the Bill as it stands. I urge the hon. Member for Harrow West not to press his new clause to a vote, because it runs the risk of wrecking a Bill that is a useful, incremental step. It is certainly not the end of the journey; it is a chink of light. When I took the Sustainable Communities Act 2007 through Parliament, I was clear that it was not complete; rather, it was about putting a foot in the door, confident that the door would not then be closed. From that process, the Localism Act 2011 is now on the statute book and the game has been changed. On that basis, I urge the hon. Gentleman to withdraw his new clause and allow the Bill to move to the Lords and, I hope, on to the statute book, so that we can continue on this journey.

[Mr Thomas]

We have had an excellent debate on new clause 1 and its associated new clauses, with an excellent speech from my right hon. Friend the Member for Salford and Eccles (Hazel Blears) and similarly strong speeches from the Bill’s promoter, the hon. Member for Warwick and Leamington (Chris White), and the hon. Members for Congleton (Fiona Bruce), for Finchley and Golders Green (Mike Freer) and for Bury North (Mr Nuttall), as well as the Minister.

The hon. Member for Warwick and Leamington encouraged us in the view that he was a practical and pragmatic person; I hope that I, too, share those characteristics. I say gently to him and his hon. Friends who are not convinced of the merits of a strategy that if one is comfortable with unintended consequences or outcomes that one does not necessarily want, a strategy is certainly not required. However, if one has a clear vision and a sense of the possibilities for a sector, a strategy can help to unlock the incremental steps required to allow it to flourish. The hon. Gentleman mentioned the social enterprise plan, which my right hon. Friend the Leader of the Opposition developed when he held the position currently held by the Minister. The hon. Gentleman said that some parts of that strategy were not implemented, but that is often the case with strategies. Not everything is successful, but if one is trying to grow a sector strategically, one learns from the things that have not worked in order to enjoy even more success in future.

My right hon. Friend the Member for Salford and Eccles suggested that the Government were moving too slowly and not deeply enough on this agenda—a succinct and accurate summary of some of the problems that parts of the Government face in implementing it. She rightly talked about the potential benefit of the one bit of the Bill that the Government support, which is that on encouraging businesses in the private sector to continue the journey that many are already on and think about how best to use social enterprises in their supply chains. Many businesses recognise that CSR reports, corporate donations to charity and corporate philanthropy are important, but not enough on their own, and that building social enterprises into their supply chains—she gave the example of how Morrisons is working with social enterprises in her area—can make a genuine difference to the private sector and, similarly, help to grow social value.

The hon. Member for Congleton praised the social enterprises in her constituency and highlighted how the social value element of the Bill could help them to grow further.

The hon. Member for Finchley and Golders Green explored in his speech some of the issues that he raised in his intervention on me about the definition of a social enterprise. I was struck by the benefit that a proper strategic conversation on how to grow the social enterprise sector might have for one very interesting idea recently presented to me—the idea of developing the concept of a social enterprise limited liability partnership to help ease investment finance from the City into social enterprises.

The Minister began his remarks wishing I had been with him in Brussels. He is, as ever, charming and I would have found it hard to resist if he had indeed called me in time to accompany him. He is absolutely right that the Government have taken some positive steps on this agenda, but, sadly, there have also been negative steps backwards for the sector. I welcome the progress made on the big society bank, but even the £600 million with which the Minister hopes the bank will be capitalised will not plug the huge amount of grant income being taken out of the sector.

I was encouraged by the Minister’s recognition that the Work programme has not gone well for the sector. He said that he is listening, but I fear that his colleagues in the Department for Work and Pensions are, sadly, out of touch with just how badly things are going for many charities and social enterprises that had hoped to be part of the Work programme.

Let me leave the House with one further statistic about the failure to date of commissioning in this area. The London Voluntary Sector Consortium surveyed some 25 tier 2 providers, 23 of which had had no referrals from their prime contractors—hardly a ringing endorsement of the success of commissioning for social enterprises under this Government to date.

Lastly, the hon. Member for Bury North almost appeared to lament the cross-party support for the Bill. I thought he was encouraging me to press my amendments to the vote. I recognise that there are insufficient Members in the House today, which means that if a vote were called the Bill’s progress would be stalled. Although the Minister has made a slightly better fist, if I may say so, of answering the concerns of Labour Members about the Bill’s narrow scope, I would have been tempted to press some of my amendments. I want the Bill to make progress, however, so I beg to ask leave to withdraw the motion.

Clause, by leave, withdrawn.

Third Reading.

--- Later in debate ---

[Mr Thomas]

Let me again congratulate the hon. Member for Warwick and Leamington (Chris White). He has done a masterly job in nursing his Bill through the corridors of Whitehall, where I suspect that he has engaged in some particularly interesting conversations, and through its various stages in the House. He took his party’s leaders at their word and presented a big society Bill, and it is certainly not his fault that the Government have gutted it. What remains is nevertheless useful, and, as many Members have observed, could begin to make a difference in local communities as commissioners think a little more carefully about how to maximise social value.

[Mr Philip Hollobone (Kettering) (Con)]

The hon. Gentleman has correctly described this as a useful Bill. Will he give the House the assurance of his party that in the other place everything possible will be done to ensure that it is passed before the end of the current parliamentary Session?

[Mr Thomas]

I will certainly do all that I can to encourage its passage. I hope that I have demonstrated to the hon. Gentleman, as well as to the hon. Member for Warwick and Leamington, the spirit of co-operation that was needed for it to make progress today, and I sincerely hope that it is passed in the other place and becomes law.

A week or so ago, on social enterprise day, I visited Hackney Community Transport, a remarkable social enterprise. I met not only its chief executive, but some of the staff who have been selected as this year’s social enterprise champions for the organisation. It is a remarkable outfit. In the early 1980s, finding it increasingly hard to obtain the grants that it needed in order to continue to meet the demand for transport from pensioners’ clubs, community swimming groups and the local Guides and Scouts, it set out to try to win commercial transport contracts. Last year its turnover was some £28 million, and over the past five years it has sustained a 20% to 25% annual rate of growth. That is a remarkable success by any definition.

Hackney Community Transport creates social value by reinvesting the profits from its commercial contracts in transport services for community groups in its area, and by training the long-term unemployed to help them prepare for a return to work. In its small way, the Bill will reinforce the extra value that it creates in its local community. Let me point out gently to Conservative Members that Hackney council has been a supporter of that social enterprise, working with it and commissioning contracts in ways that give it a fair chance. Here is the state in action at its most innovative, working with the community to create real social value and community benefit.

The Bill has the potential to help two more excellent social enterprises, as well as, I am sure, many others. Greenwich Leisure is another part local government, part enterpreneurial employee-led social enterprise, born in response to John Major’s cuts in the early 1990s. Winning contracts from local authorities to provide leisure services, it has created many new jobs and offered a range of initiatives to persuade those who have previously been unable or unwilling to use leisure centres through its doors. I am delighted to say that my own council has a contract to run our leisure centre with that excellent social enterprise.

The superb Coin Street Community Builders, 10 minutes away from this great House, was formed as a result of a challenge from the private sector. Big hotel groups wanted to take over the frontage of the River Thames, not for the community’s benefit but purely in their own interests. The tenacity of the community—and, to be fair, the skill of the Greater London Council planners at that time—led to the site being protected. Through a mix of legal forms—a housing association, a co-operative, a company—the community gradually generated new social housing. It has also refurbished the striking Oxo tower, created new work spaces for businesses, and helped regenerate the surrounding area. That has created considerable community benefit, and real social value.

The Labour party champions social enterprise and social value, not because we want to roll back the state or provide cover for tax cuts for the few and huge cuts in services for the many, but because we believe in strong communities and we recognise that we need to allow the ideas and imagination of the brightest and the best in our communities to flourish. Social enterprise and social value, along with Government, have key roles to play in that regard, and we support the Bill on that basis.