Francis Report

Debate between Joan Walley and Paul Farrelly

Wednesday 5th March 2014 Commons Chamber

[Joan Walley]

I agree, and in the many meetings that north Staffordshire MPs have had with the University Hospital of North Staffordshire, the hon. Gentleman has made that point, as we all have frequently. We have also said that it is incumbent on us to relay that to the Government, because unless there is a shift and some recognition that the funding assumptions are flawed, no matter who is on the trust board of any new hospital, they will never be able to provide the necessary genuine health care.

[Paul Farrelly (Newcastle-under-Lyme) (Lab)]

I am sorry that I could not be here at the beginning of the debate because of other commitments. Will my hon. Friend pay tribute to the willingness of the University Hospital of North Staffordshire to engage with all MPs across party to resolve the situation? Should we not recognise that in ensuring arrangements for financial stability, there is still a gap of some £15 million to be bridged to ensure that we can proceed on the basis of stability that is needed for the benefit of everyone in north Staffordshire and Stafford?

[Joan Walley]

I am conscious that many hon. Members want to speak. My hon. Friend has pre-empted two points that I want to make, so I will go straight to them.

If we accept that it is the trust special administrator’s report that is taking us forward in north Staffordshire in respect of the application by the University Hospital of North Staffordshire to take over Stafford hospital, there are two aspects to consider. The first is that there is a revenue shortfall of £4 million; and secondly, there is a capital shortfall of £29 million. I raised that matter at Prime Minister’s Question Time last week without realising that I was doing so prior to the written statement having been made available to the House of Commons. It is vital that the Government recognise that this gap must somehow be closed as the University Hospital of North Staffordshire moves forward, possibly under a new name, in taking on responsibility for this. In looking at the figures that have been put forward by the very diligent and committed directors and staff at UHNS, it is vital that the Government take account of the fact that in making a bid to take on services, those people know what they are doing, they have the expertise, and they know what changes will be needed for capital investment in Stoke and in Stafford. The gap should be closed; otherwise, Stoke-on-Trent will end up paying for the cost of bailing out Stafford hospital.

[Joan Walley]

It was suggested earlier that we might need a special debate, at length, solely on the trust special administrator, so that we can look at how this is being resolved in Staffordshire, and I would agree with that. There was also a suggestion in a previous debate that we need a debate solely on the Care Bill and its implications for changing that. Lots of different things are going on in parallel, but not in an integrated way. The real failure would be for the Government to allow the two procedures to go forward without understanding the changes made in the Health and Social Care Act 2012 which shift all the responsibility from the Secretary of State down to the commissioning bodies.

The hon. Gentleman is absolutely right. Here we are again trying to find some way of having a centralised Government system, when no matter what anybody says to the TSA or to anybody else, if the local commissioning group chooses not to go ahead and commission the services that the TSA has identified and the Government have said will be funded, those services will not be provided. I cannot understand how we are in this situation where we are not looking at all the implications of what is happening.

When the Government announced last week in a written statement that they had accepted in full the recommendations of the TSA’s report, I expected that, as a result, the UHNS would proceed quickly to implement what had been agreed in the hope that there would be a process to close the funding gap in one way or another.

The problem that I wish to give back to the Government and ask them to comment on in detail—the Secretary of State has had a detailed letter from me about this—is the uncertainty that arises as a result of the comments that were made by the Prime Minister and in a statement about obstetrics-led and consultant-led maternity provision in Stafford. On an emotional level, I absolutely agree that, as my right hon. Friend the Member for Leigh and the hon. Member for Stafford (Jeremy Lefroy) said, we need maternity services in situ that are easily accessible, and not only in Stafford but right across the country. However, my head says that the detailed financial arrangements that we currently have for maternity provision and the model that is apparently proposed do not allow for that kind of option.

We are therefore in a situation whereby people are, rightly, campaigning to have maternity services close to where they live, but the rigid procedures laid down either nationally or locally do not permit the additional funding for that. This is not just about having additional funding but about capacity in the form of trained, expert people able to deliver those services. If neither the funding nor the capacity is there, there is no point in any amount of hoping that we can have such maternity-led services in small district general hospitals, in whatever part of the country. The Government have to address that, but they cannot do so as part and parcel of the way in which they are taking forward the new configuration of health services across north Staffordshire. When the Minister replies, I want a very detailed response to the questions that I have asked the Secretary of State and given to his office, as he is aware; I am grateful for that.

The MPs concerned have met the Secretary of State and the Prime Minister to try to get some clarity on this. Until we get clarity, we cannot proceed to deal with the situation that we now have across mid-Staffordshire and in north Staffordshire. When is NHS England going to report on the further review? May we have a detailed time scale for that? To what extent will that delay the possibility of the UHNS board taking forward the new services? Already, 14 extra ambulances a day are bringing people from Stafford to Stoke-on-Trent, and staff are leaving Stafford hospital. We desperately need certainty about how this is being taken forward. When the Minister replies, the Government must set out in detail how they expect to be able to accept the TSA’s recommendations in full and then add an addendum without there being any mechanism to enable it to be implemented.

[Paul Farrelly]

Does my hon. Friend agree that the Francis report is all about patient safety? What happened at Stafford is a blot on the history of the NHS from a patient safety point of view. North Staffs hospital has reopened beds to cope with the crisis in A and E and admissions on the grounds of patient safety and therefore already has a deficit. The overriding concern of patient safety must mean that any solution for Stafford involving North Staffs has to be financially stable.

Energy Intensive Industries

Debate between Joan Walley and Paul Farrelly

Wednesday 4th December 2013 Westminster Hall

[Paul Farrelly]

I am grateful to be so popular for the first time in many a month. I do not want to make this party political, but one of the lessons the Government seem to have learned from the Labour party’s initiative on energy prices is that we need to have simplicity and to reduce prices for domestic customers. However, the same message needs to be learned in respect of industry across these islands.

As I was saying, the ceramics industry, along with other industries represented here by Members, uses some of the most electro-intensive processes in the UK and Europe. The advanced refractory and technical ceramics manufacturers, which make products that must withstand high temperatures, operate electric arc and indication furnaces at well over 2,000° C, which is getting on for half the surface temperature of the sun.

That brings me to one of the key points I want to make. Several of our major manufacturers in these highly competitive industries have already moved overseas, relocating inside and outside Europe, including in Germany and France—our major European competitors—and they have cited electricity costs as a key reason for doing so. That is happening in not just the ceramics, but other sectors, such as chemicals and steel. We have heard about INEOS, and Members will no doubt want to refer to the steel industry and the experience of Tata.

To take one further example, the German multinational chemical company BASF, which is a major employer near Manchester, just north of my constituency, wrote to me to underline that electricity and other energy costs have been responsible for rendering uncompetitive its 60-year-old Scottish pigments plant at Paisley—the group’s second most energy intensive plant. As a result, that plant will close in 2015, with the loss of another 150 jobs. That is the stark message from the industry about UK competitiveness. Manufacturers now typically pay between £80 and £100 per megawatt-hour in the UK. Some of their German competitors pay nearer to €40—not even £40—per megawatt-hour, which is less than half that price. In France, they pay €50. If nothing is done, and if UK electricity costs rise further, more businesses, investment and jobs here will be put at risk.

[Joan Walley (Stoke-on-Trent North) (Lab)]

I congratulate my hon. Friend on obtaining the debate. Must not we make sure that we can maintain manufacturing jobs in the UK, including in the ceramics industry, and support energy intensive industries, while enabling them to decarbonise? A key difference between the UK and Germany is the fact that in Germany the power sector has been transformed with a move towards clean energy. We must not lose sight of the necessary innovation and the transformation of the energy sector.

--- Later in debate ---

[Paul Farrelly]

My hon. Friend anticipates the final paragraph of my speech—which is not too far off—with a plea for simplicity and predictability.

Industry’s message about comparative prices and prospective increases is simple. With non-baseload charges rising so rapidly, on top of wholesale price increases, the UK’s energy intensive industries will be at a growing disadvantage, not only compared with international competitors, but because of lower-cost countries internationally that are hungry for their investment. Of course, the fact that the playing field is so far from being level harms UK industry, but it will also do nothing to help with climate change or to reduce carbon emissions, if it means that manufacturing ends up in less energy efficient factories in countries with a laxer view of their environmental obligations. I know that my hon. Friend the Member for Stoke-on-Trent North (Joan Walley) is concerned about such prospects for carbon leakage.

[Joan Walley]

I refer my hon. Friend and the Minister to the report of the Environmental Audit Committee on the energy intensive industries compensation scheme and the issue of carbon leakage. There is a need for proper research on which to base future policy, to provide the necessary certainty.

[Paul Farrelly]

I hope that everyone will put the report on their Christmas reading list and that the Government will take note of the evidence base and the recommendations.

What is to be done? Industry, although deeply concerned, is not totally ungrateful to have had the Government’s ear in recent years. There has been a welcome for the announcement in the Budget that ceramics and other industries would be exempted from the full cost of the climate change levy. I recall that in giving that news the Chancellor paid tribute to his Tea Room discussions with my hon. Friend the Member for Stoke-on-Trent Central (Tristram Hunt), who chairs the all-party group on energy intensive industries. Of course Opposition Members thought that that compliment meant that his political career was done for, but changes since then have happily proved us wrong. The reality is that the tax exemption is hardly what the British Ceramic Confederation calls a game-changer. Welcome though that gesture was, it will save only an estimated 2% of energy costs for ceramics, mineral and metallurgical companies. Similar things can be said about the £250 million package to compensate energy intensive industries in the 2011 autumn statement—relief that was extended in the recent Budget—and about the sentiments behind the exemption, which the industry argues is too limited, from the UK’s new contract for difference charges.

What further things would those vital industries like from the Minister today and from the Chancellor, if not tomorrow, then in the future? One thing is further news on practical implementation, without state aid complications, of the climate change levy exemption. Looking further ahead, they would like the compensation package that has already been announced to be linked to the carbon price floor, so that it remains for the duration of the policy, and so that its value will reflect the trajectory of the price floor, if that continues. The industries would also like a widening of the contract for difference exemptions, so that there will be help for more companies than the estimated 10% of the ceramics industry that it is thought will be helped. They would certainly like a bigger helping hand in relation to Brussels. There was dismay, a fortnight ago, in the ceramics, glass and cement industries at the discovery that they would be excluded from compensation under the EU emissions trading system, even though highly electro-intensive processes are employed in the sector.