Public Sector Funding

Nick Hurd Excerpts

Wednesday 23rd March 2011 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

It is a great pleasure, Mr Amess, to serve under your chairmanship. I congratulate the hon. Member for Worsley and Eccles South (Barbara Keeley) on securing the debate and on the way that she spoke. However, special congratulations are in order for the hon. Member for Newcastle upon Tyne North (Catherine McKinnell) on thinking so quickly on her feet, and on representing so sincerely sentiments that I heard directly only a few weeks ago in Newcastle from people concerned about what is going on.

The hon. Member for Worsley and Eccles South spoke passionately about TimeBank, and tried to make some wider points. I know that she has a particular interest in carers, and has done some distinguished work in this place since being elected on that important agenda. The leadership of TimeBank is here, and those people are probably shooting daggers at me; we shall meet soon to discuss the decision, but of course they will not agree with it.

I shall start with the specifics before going on to wider matters. I make no apology for rationalising the Office for Civil Society strategic partner programme. We inherited a situation with more than 40 strategic partners and almost as many civil servants, at a cost of some £12 million a year. I could not see what value the taxpayer was getting from that programme, and I received a lot of support from within the sector to rationalise it.

The intention to rationalise was communicated to all strategic partners in July 2010. As a result, all partners were effectively at risk of seeing some reduction in their funding. We announced yesterday that we would be reducing it to nine organisations or partnerships, and I am satisfied with the mix. The simple fact is that no organisation has the right to be a strategic partner of the Government. The right has to be earned, and the process must be run robustly and professionally by civil servants, I received a recommendation about those nine organisations, but unfortunately TimeBank was not included. I do not expect it to like that decision, but it was a robust process which I think was run properly.

[Barbara Keeley]

rose—

[Mr Hurd]

May I finish my point about figures, because it is perhaps the most important? Does it mean that TimeBank and other organisations that are working hard to manage and structure volunteering opportunities and inspiring people to volunteer will have no further opportunity to access taxpayers’ money? Of course not. I refer the hon. Lady and all with an interest in the subject to the recently published Giving Green Paper, which will lead to a White Paper. In it, we made it clear that we will be investing in a volunteering infrastructure programme with voluntary match funding, which will be worth about £40 million over this Parliament. There will be opportunities for TimeBank and other organisations to add value to those programmes.

[Barbara Keeley]

As the Minister is touching on his reasons for cutting away at the infrastructure of an organisation that supports volunteering for hospices, for the Olympics and for carers, I invite him to explain exactly why—beyond a departmental goal to rationalise the number of strategic partners—the Government are cutting away at a vital organisation? The same question could be asked about others. TimeBank is crucial to supporting volunteering, and has an excellent 10-year track record. Indeed, he sent it a message when it achieved its 10-year anniversary. Why is he doing this?

[Mr Hurd]

I tried to explain why earlier. We ran a process to identify a shorter list of strategic partners, with criteria; TimeBank and other organisations on a longer list did not make it through that process. As I said, no organisation has the right to be a strategic partner of the Government, but I do not expect them to be comfortable with that.

I have to tell the hon. Lady that her approach is symptomatic of the previous Government’s approach to public money. There was absolutely no rigour in the strategic partner programme that we inherited; we are trying to introduce it for the first time. The hon. Lady speaks about our cutting funding, but she completely ignores the fact that there will be further opportunities, in what are frankly more appropriate programmes, for organisations such as TimeBank to access taxpayers’ money and continue their work.

[Barbara Keeley]

rose—

[Mr Hurd]

I wish to make progress.

The wider context is extremely important. It is not just about TimeBank, or the other organisations mentioned by the hon. Members for Bolton West (Julie Hilling), for Makerfield (Yvonne Fovargue), for Nottingham South (Lilian Greenwood) and for Wolverhampton North East (Emma Reynolds). There is considerable concern in communities across the country about the impact of the cuts.

It would have been nice to have heard more recognition from the Opposition about the economic context, but that fell to my hon. Friends the Members for Banbury (Tony Baldry) and for Warwick and Leamington (Chris White). The fact is that we are spending £120 million a day in interest, and that is entirely unsustainable. A sector that receives £13 billion of taxpayers’ money cannot be immune from the process.

The public hate to see politicians playing the blame game, and I understand that, but nor should we take them for fools. I believe that they understand the basics—that the Labour Government left this country massively over-borrowed and that the coalition Government were elected to sort it out. That means that tough choices have to be made by councils. As my hon. Friends the Members for Warwick and Leamington and for Castle Point (Rebecca Harris) said, some have decided to give priority to cutting internal costs and making efficiencies before making cuts in the voluntary and community sectors. Others have taken a different course for very different reasons.

No one pretends that it is an easy business—it is not—but the Government want to put in place active programmes to help the voluntary and community sector manage the transition. We understand the need for such a transition—from a situation in which too many organisations depend on state income to one in which the sector will have to diversify its sources of income in new ways.

We want to help manage the transition because we see big opportunities for the voluntary and community sector to do more to deliver more public services, and to have a bigger voice at the local level, exactly the point made by my hon. Friend the Member for Banbury. In future, there will be many more arguments about local priorities, and the voluntary and community sector can give a voice to people who often struggle to have their voices heard. The localism agenda will give them a big opportunity. We are obviously very ambitious in our wish to encourage people to give more time and money to help others.

[Jeremy Corbyn]

rose—

[Mr Hurd]

I do not have time to give way.

People will go to charities and the voluntary sector. There are significant medium and long-term opportunities for the sector, but we have to help manage the short-term transition.

That brings me to the transition fund and the specific questions raised by the hon. Member for Islington North (Jeremy Corbyn). Most of the answers are contained in the basic statement. The fund had to be rationed. It had to be targeted on those organisations most vulnerable to a cut in public grant or contract. We took advice from the sector on the criteria. We had to set an income threshold.

We are proud of the progress that BIG fund has managed for us. I visited an organisation yesterday that has benefited from it. The charities’ fund is £100 million, and it was topped up yesterday by £7 million from the Department of Health. That is serious money, and it will help organisations that are particularly vulnerable, or that have more than 60% of income vulnerability to the state, to make the transition.

The hon. Member for Ceredigion (Mr Williams) asked about the big society bank. It is not a panacea for cuts in grant. It is a serious strategic long-term intervention, designed to make it easier for the sector to access capital. I expect between £60 million and £100 million from dormant bank accounts to be released in the third quarter and be made available for deployment. I expect £200 million to come from the four major banks before the end of the year. The balance of the bank’s capitalisation will come from the rest of the dormant bank accounts, once they have passed through the state aid process, but it is difficult to pin that down at the moment.

We are talking about a £600 million opportunity—a serious attempt to make it easier for social entrepreneurs to access capital in this country. It is part of our programme to help the voluntary and community sector play a full role; it will help to build a stronger society, which we want to encourage, and a better partnership between the state, business, the voluntary and community sector, and active citizens who feel empowered to take more control over their lives.

Big Society Bank

Nick Hurd Excerpts

Monday 21st March 2011 Written Statements

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

On 14 February, the Minister for the Cabinet Office and I published a strategy to grow the social investment market, giving charities and social enterprises access to new capital to help them to increase their impact. The strategy explained the central role of the big society bank as a cornerstone of the market, acting as both a champion and wholesale provider of capital.

In February we also announced that we would work with leading social investment experts to develop a proposal for the establishment of the big society bank as an independent private sector organisation. Since then, we have been engaging with the social investment sector, and we are pleased with the ideas coming forward. Today I would like to update the House on the next steps.

As we announced in February, Sir Ronald Cohen, former chair of the social investment taskforce, and Nick O’Donohoe, former global head of research at JP Morgan, are taking the lead on developing a proposal for a big society bank. They are engaging with the sector, and we expect that they will present their proposal to Government within the next few weeks. At that point, we expect to make an in-principle decision about whether the organisation they are proposing to establish could be the recipient of unclaimed assets from dormant accounts, subject to further development work and state aid approval. If the decision is made to go ahead, detailed set up work for the big society bank would then be able to commence, including recruitment of its chair and board.

By making this statement today we want to ensure that everyone has the opportunity to feed in comments on the development of the proposal, or on our approach more generally. Separately, we are currently working to secure the state aid approvals from the European Commission that would be needed in order to capitalise an independent big society bank with money from dormant accounts and to provide it with the flexibility it needs to grow the market. We are also working with the big lottery fund on interim arrangements that will enable investments to be made as soon as dormant accounts money becomes available in the summer, using existing state aid exemptions. We will make further announcements in due course.

Voluntary Sector (Nottingham)

Nick Hurd Excerpts

Tuesday 8th March 2011 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

It is a great pleasure to serve under your chairmanship, Ms Osborne.

I congratulate the hon. Member for Nottingham South (Lilian Greenwood) on securing this debate. She started by paying an extremely sincere tribute to her local voluntary community sector and her local paper. I began to lose respect for her speech, however, when she failed to recognise the difficulties faced not only by the Government, but by those trying to govern local authority areas.

The situation is horrendously difficult for everyone. The hon. Lady spoke of political choices, but I did not go into politics to make spending cuts, and I doubt whether the people on Nottingham city council did so either. The cuts were forced on us by the shambles that resulted from the previous Administration’s stewardship of our public finances, but she showed no recognition of that. I leave to one side whatever happened in the past to the administration of the various Nottinghamshire councils.

[Mr Mark Spencer (Sherwood) (Con)]

I am grateful to the Minister for allowing me to intervene, given the short time that he has left. Is he aware that Nottingham city council has compensated two previous chief executives that it could not get on with, has sent an executive to the south of France on jollies and has hired a cherry picker to remove conkers from a tree? Would it have been better to spend that money on the voluntary sector rather than wasting it like that?

[Mr Hurd]

My hon. Friend makes a powerful case, which brings me to my next point. However difficult this environment may be, it boils down to local choices, and local choice is often dictated by decisions taken in the past.

Those are local choices, but it is clear to me that the picture is very different around the country, with some local authorities—perhaps they were better run in the past, with a greater eye for efficiency and spending on what is really valuable—being in a position to minimise reductions to the voluntary and community sector. Indeed, places such as Reading and Wiltshire have increased investment, or are engaging in a process with that sector that is more transparent, more up-front and more engaged. There is a mixed picture across the country.

I know from personal contact with representatives of Nottinghamshire’s voluntary community sector that there are problems on the ground. I wrote to every Member of Parliament offering to meet members of the local voluntary community sector, and I know that my hon. Friends the Members for Broxtowe (Anna Soubry) and for Sherwood (Mr Spencer) took up my invitation. I met representatives of the sector there, and they directly expressed their concerns to me, which were principally about how the county council had managed the process of engagement.

In the little time that remains, I shall try to set out our stall and say what the Government are trying to do to help in this incredibly difficult situation. Clear messages have been sent to local authorities on the best way of behaving in this situation. The Prime Minister gave a clear steer, asking councils to cut their cost bases and make their own efficiencies before starting to think of making what might seem to be easy cuts to the voluntary sector. That is what my local authority has done, and many others are doing so, too.

That approach is clearly not happening across the piece, however, which is why I am delighted that my colleagues at the Department for Communities and Local Government have gone further. They are urging local authorities to be much more transparent about their spending on the voluntary and community sector, so that the people whom we represent can see what is being done in their names and exactly what choices are being made—for instance, decisions on county hall salaries compared with cuts for the local voluntary and community sector. The public have a right to know what is being done in their name.

[Anna Soubry]

I am grateful to the Minister for giving way. It is most unfortunate that of all the local authorities in England, it is Nottingham that still refuses to publish expenditure of more than £500. One wonders what is the problem—what has Nottingham got to hide?

--- Later in debate ---

[Mr Hurd]

That is certainly the question in my mind and in the mind of the Secretary of State for Communities and Local Government. We, in Parliament, know the power of transparency—we know that it gives real power to citizens. In this instance, the public have the right to know how their money is being spent and what choices are being made. We are trying to help by sending a strong steer to local authorities and allowing the public to make up their mind about local decisions.

We have set aside £100 million of taxpayers’ money—a significant sum—as a transition fund to help voluntary sector organisations. Many are finding themselves terribly exposed to cuts of grant or in contracts, and need some help to get out of the hole—as long as they have a plan to do so. We continue to invest on behalf of the taxpayer in that sector. My Department has a budget of £470 million, and we structure what we do around three questions.

First, we ask what we are doing to make it easier to run voluntary community sector organisations. That involves cutting red tape to make it easier for those who have the incredibly difficult job of running small charities or civil society organisations. We continue to invest in the infrastructure that exists to support the sector. We want to make it much more effective.

Secondly, we ask what we can do to get more resources—both time and money—into the sector. We published a Green Paper on giving, which will become a White Paper. We are well on track to deliver a big society bank, which will make it much easier for social entrepreneurs to access capital, and we are coming up with new programmes such as the National Citizen Service, which I hope will be available in Nottinghamshire before too long. We are about to commission next year’s pilots, with 30,000 places. I urge the hon. Member for Nottingham South to engage with it when it arrives, as it will be an enormously positive opportunity for local young people, and a fantastically good process of connecting them and giving them the power to make a contribution to community.

Last but not least, we ask ourselves the question, “What can we do to make it easier for charities, social enterprises and voluntary organisations to deliver public services?” The sector delivers about 2% of contract value, but we would like it to do much more. We are working towards publishing a White Paper on public service reform, which will specifically address what should be done to open up the public service markets to more competition. Under it, charities and social enterprises will have the opportunity to deliver more public services, with some of the real value being in supporting those people mentioned so eloquently by the hon. Member for Nottingham South. In my experience, with some of the really difficult things—getting the long-term unemployed back into work or keeping people out of jail or off drugs—really valuable work is being done by quite small community organisations or social enterprises. We want to level the playing field to make it much easier for such organisations to deliver public services.

[Lilian Greenwood]

Will the Minister give way?

[Mr Hurd]

I shall not give way, as this is my last minute and the hon. Lady spoke for a long time.

None of this is easy, but we are actively trying to help the sector and local authorities through the difficult process of managing this transition. We want to minimise the damage in the short term, and maximise the opportunities for the voluntary and community sector so as to unlock the potential that is out there for improving more lives.

Oral Answers to Questions

Nick Hurd Excerpts

Wednesday 2nd March 2011 Commons Chamber

[Amber Rudd (Hastings and Rye) (Con)]

1. In which regions the national citizen service will operate in the summer of 2011.

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

The pilots will be based in 190 different locations this summer and have a good geographical spread in regions across England. I am delighted to say that more than 11,000 16-year-olds will have the opportunity to take part.

[Amber Rudd]

My constituents and I are very much looking forward to the service arriving in Hastings and its environment. What are the arrangements for rolling the service out further; who will be in charge of fulfilment; and how can MPs get involved with it?

[Mr Hurd]

This year’s pilots involve areas represented by 400 MPs, so there are plenty of opportunities to get involved. I am delighted to say that Catch 22 and the Prince’s Trust are leading the pilots in East Sussex this year, and I very much hope that my hon. Friend will get involved because this provides a fantastic opportunity for young people in her area to participate in a very positive experience.

[Jon Trickett (Hemsworth) (Lab)]

Anything that taps the idealism of young people in the wider society is clearly to be welcomed; it is a good thing. These pilots, however, seem to be an inadequate response to the needs of 965,000 young people who are now out of work. The scheme itself was criticised, as the Minister will know, by the university of Strathclyde, so will he at least indicate the date by which the scheme will be made universal for all young people, as the Prime Minister promised before the election?

[Mr Hurd]

I am sorry that the hon. Gentleman appears to have such a downer on the scheme, which provides a hugely positive opportunity for young people in this country. We are testing it thoroughly on behalf of the taxpayer—there are 11,000 places this year and 30,000 next year—with a view to rolling it out, as he suggested, to make it more widely available and so compelling for all 16-year-olds that they will want to get involved in the future.

--- Later in debate ---

[Rosie Cooper (West Lancashire) (Lab)]

6. What estimate he has made of the likely change in the number of jobs in the voluntary sector in the next three years.

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

Unfortunately, the sector cannot be immune from the cuts that are forced upon us, so of course there is concern about short-term job losses, but we firmly believe that there will be opportunities for the sector in the future, not least in delivering public services, and we are working very hard to make those opportunities real.

[Rosie Cooper]

I thank the Minister for that answer, but the National Association for Voluntary and Community Action estimates that 26,000 charity workers will lose their jobs in the face of the Government’s accelerated cuts to services. Does he agree with that estimate, and if not, will publish his own estimate of the job losses in the sector?

[Mr Hurd]

I do not recognise the basis of that estimate, but of course there is a challenge in the short term, and this Government are working very hard to try to help the sector manage through this period of transition. There is a very significant long-term opportunity for the sector to deliver more public services, to help people find more of a voice at the local level, and to benefit from the additional time and money we hope to encourage people to give as well as the social investment we are trying to encourage through the big society bank.

[Mr David Evennett (Bexleyheath and Crayford) (Con)]

I welcome the progress my hon. Friend is making in promoting and advancing the voluntary sector. [Interruption.] Will he compare that with the lacklustre performance of the last Labour Government?

[Mr Hurd]

I thank my hon. Friend for that question, and it was interesting to hear the chortles from those on the Opposition Benches. Of course there is absolutely no recognition among Labour Members of the necessity for these cuts after their Government’s absolutely shambolic stewardship of the economy over the past 13 years.

[Roberta Blackman-Woods (City of Durham) (Lab)]

Many in the voluntary and community sector are describing the transition fund, which was heavily over-subscribed and I believe is now closed, as a drop in the ocean compared with the tsunami of cuts facing the sector. Does the Minister not agree that he needs to do more to protect the voluntary sector from job cuts, especially at a time when he is asking it to do more?

[Mr Hurd]

I do not think any of my constituents would consider £100 million of taxpayers’ money to be a drop in the ocean. As the outgoing Labour Chief Secretary to the Treasury said, “There is no money,” yet we have found £100 million to try to help the most vulnerable organisations through a very difficult transition period. We wanted to get that assistance up and running as quickly as possible so the money could get out in as unbureaucratic way as possible, and I am very proud of what we have managed to achieve.

[John Glen (Salisbury) (Con)]

7. What steps he is taking to make Government procurement simpler for small and medium-sized enterprises.

--- Later in debate ---

[Anne Marie Morris (Newton Abbot) (Con)]

13. How many valid bids the transition fund received.

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

There were just over 1,700 applications to the transition fund, which are currently being assessed by our delivery partner the BIG Fund. The first transition fund awards, totalling £1.7 million, were made on 15 February to 18 organisations and there will be hundreds more awards over the coming months.

[Anne Marie Morris]

Given the appetite for the transition fund, will the Prime Minister consider a new fund to enable even more civic societies that undertake such valuable work, such as Home-Start in Teignbridge, to continue to operate? Will he consider including smaller organisations in such a new fund?

[Mr Hurd]

I understand the question, but unfortunately we have no money to consider such an initiative. We had to take some very tough decisions on eligibility criteria for the first round and we are actively looking at ways to top that up, but we have no current plans for a second round.

The Prime Minister was asked—

Big Society

Nick Hurd Excerpts

Monday 28th February 2011 Commons Chamber

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

We have heard 39 speeches—I did count them—which were often lofty, sometimes earthy and always interesting; I thank the Backbench Business Committee and congratulate my hon. Friend the Member for Dover (Charlie Elphicke). In the short time available, I wish to make three quick points in response to an excellent debate.

First, I wish to express a personal conviction. I really believe that we have barely scratched the surface of what can be achieved in this country if we strike a more effective and balanced partnership between government, business and civil society, including active citizens in our communities who want to get more involved. That is what we are working towards, because we need a new approach to tackle the entrenched social challenges that we face. As many speakers have said, relying on big government and “Whitehall knows best” just has not worked well enough, and it must be time to make better use of the talents and resources of this country. Of course this will involve a big culture change and it will not happen overnight, which brings me to my second point.

The new approach requires strong leadership from government, and not a traditional top-down programme; to make this work we have to redistribute power in a bold and genuine way, to allow communities to take more control and to recast government so that it supports community action, rather than stifles it. That is now happening and it is being built on three core strands, the first of which is the transfer of real power to communities.

First, power is being transferred in the form of information. Whether we are talking about crime maps, departmental business plans or detailed breakdowns of local authority spending, our constituents already have more information than ever before on what is being done in their name. With that comes the power to act and challenge, and the Localism Bill offers people new rights and opportunities to take more control, not least in the planning process. That is being supported by a new attitude from government which asks, “How can we help?”, rather than saying, “You can’t do that.” That is why it was right to review the health and safety regulations and the vetting and barring regime. It was encouraging to see the Department for Communities and Local Government immediately set up a new bureaucracy-busting service and challenge communities to tell it what is getting in the way, and 140 communities have already engaged in that process.

The second strand of Government action is fundamental public service reform. Yes, we do believe that we can deliver better public services by opening up the market to competition and new providers, including social enterprises, mutuals and the voluntary sector. We do believe in giving communities and front-line professionals much greater freedom to meet local need. We also want to get the public more involved in shaping the services they use, whether that be through personal budgets or greater involvement in how resources are allocated and services are commissioned. We will soon be publishing a White Paper on public service reform, which will set out our plans in more detail. All I will say for now is that when one visits social enterprises such as Zest in Sheffield, which is delivering public services in a fantastically fresh way, the two senior nurses who have set up their own social enterprise in Leicester or a group of public agencies in Calderdale working together to shape a new service on debt advice, one has a strong sense of how much better things could be if we gave people at the sharp end much greater freedom and responsibility.

The third strand of action is about encouraging more social action in our communities. Of course we are not inventing anything new: this is about building on the fantastic work done in constituencies across the country by dedicated people who know the value of giving time and/or money to help others. We want to encourage a step change in attitudes to giving both time and money. Our recent Green Paper set out how government can help in traditional and non-traditional ways, such as by setting up new match funding schemes to encourage local endowments and private sector support for volunteering projects or by encouraging civil servants to get more involved in community service, thereby setting an example to other employers. The national citizen service has enormous potential to connect our teenagers with their power to make a contribution to the community. Our Communities First programme will give more deprived neighbourhoods access to a new grant programme that will help them to implement their own plans, supported by community organisers whose job will be to build local networks and leadership, encouraging people to come together and take action.

[Albert Owen]

Will the Minister give way?

[Mr Hurd]

I am afraid that I have no time for interventions if I am to give the last Back Bencher the chance to wind up the debate.

We are going further than the three strands I have discussed. The hon. Member for Dagenham and Rainham (Jon Cruddas) talked about business having a bigger role. On 2 December, the Prime Minister made an important speech to business, setting out a new deal, Every Business Commits, challenging business to step up and play a bigger part in helping to tackle the social challenges of the day. Since then, the biggest banks have pledged £200 million to help to capitalise the big society bank, and businesses in the community are actively developing, in response to that speech, a network of business connectors—individuals who can make connections between local businesses and local organisations that need support.

That brings me to the role of the voluntary and community sector and the need to support it through what is, as many hon. Members have pointed out, an extremely difficult and challenging time. We should not forget that the majority of the voluntary sector does its valuable work with no help from the taxpayer at all, but many of our constituents will be surprised to learn that the sector receives almost £13 billion in public money, before the benefits of gift aid are counted. Faced with the monstrous legacy of a deficit that costs us £120 million a day in interest alone, we have always been clear that the sector cannot be immune from the need to find savings on that scale.

I know from my everyday contact and conversations with the sector that it is most anxious about cuts at the local level. We cannot control local authorities, but we have given a very strong steer that we do not expect them to cut the sector disproportionately. Many local authorities, such as Reading and Wiltshire, have confirmed that they will be maintaining or even increasing their investment. However, many have taken a different course. With our new transparency requirements, local communities will be able to see how their council has responded to the tough choices before it and to make their own judgments.

We are not laissez-faire about this issue. We see the voluntary and community sector as a key partner in this new partnership and we are actively trying to help it manage a very difficult transition by making it easier to run a social enterprise or voluntary sector organisation. Lord Hodgson will soon report to me with ideas on how to cut red tape for small charities, and we will continue to invest in the infrastructure that exists to support front-line organisation, trying to make it more effective. We have set aside £100 million as a transition fund to give a lifeline to the organisations that are most vulnerable to cuts. We are actively considering what we can do to encourage giving and a White Paper will be published after the Budget.

We are in the process of setting up the big society bank with £200 million of capital from the private sector and an expected £400 million from dormant bank accounts. Our recently published social investment strategy document sets out the role we see for it in growing the social investment market, thereby making it easier for social entrepreneurs to access capital. We want to make it easier for charities and social enterprises to work with government and we will soon publish our response to a consultation on the changes to the commissioning process needed to level the playing field and reduce the ridiculous amount of bureaucracy in the system.

There is no getting away from the short-term pain that a number of charities and social enterprises are feeling, but we want to work with them and help them to take advantage of the serious long-term opportunities that the big society agenda offers. They include the chance to deliver more public services, the chance to mobilise people and win arguments at the local level about what priorities should be and the chance to benefit from the time and money that we hope people will give more of in future. The Government are doing a huge amount to create the right conditions for this rebalancing of power and responsibility.

My final point is that this is not a Government programme, however important our lead is. It depends on a grass-roots local response from organisations and individuals who see a chance to do things in a better way. It is too early to say how high or far the bird that my hon. Friend the Member for Penrith and The Border (Rory Stewart) described will fly. It will take time, but we believe that we are going with the grain of what people want—more open, efficient government, better connected communities with people looking out for each other, more respect for the voice of the citizen, giving people real power to make a difference to the things that they care about, and a greater sense of togetherness at a tremendously challenging time for the country.

Whether we call it big society or stronger society, there ought to be more common ground on the need for a new approach, one based on a wholly positive vision of a better partnership between all elements of society, and a genuine belief in what people can achieve if they are trusted and given the power to make a difference to the things that they care about.

Public Services (Social Enterprise and Social Value) Bill (Money)

Nick Hurd Excerpts

Tuesday 15th February 2011 Commons Chamber

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

I beg to move,

That, for the purposes of any Act resulting from the Public Services (Social Enterprise and Social Value) Bill, it is expedient to authorise the payment out of money provided by Parliament of any expenditure incurred in consequence of this Act by a Minister of the Crown, government department or other public authority.

I should like to take this opportunity to thank my hon. Friend the Member for Warwick and Leamington (Chris White) for introducing this important Bill. I am pleased to confirm the Government’s support for the Bill, subject to certain amendments at the Committee stage. On Second Reading, it was the will of the House that the Bill should be discussed in Committee.

The primary measure that the Government are supporting is the requirement for contracting bodies to consider how they might promote or improve economic, social or environmental well-being when commissioning services. This includes a requirement that authorities consider whether to consult the persons who will benefit from the service. The decision on how authorities should take account of this wider value is left to the authority. It is already best practice to take account of wider value when undertaking procurement and to consult in such circumstances, and guidance and tools are already available. For an individual contracting authority, the costs are likely to be small. The measure therefore triggers the need for this new money resolution, which I commend to the House.

Community Cohesion

Nick Hurd Excerpts

Wednesday 26th January 2011 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

It is a pleasure to serve under your chairmanship, Mrs Main, for the first time. We have had an excellent, wide-ranging debate and you have chaired it very firmly. I congratulate the hon. Member for Sedgefield (Phil Wilson) on not just securing the debate, but battling flu so valiantly and presenting a sincere picture of his concerns for his constituency.

I have picked out three things that I would like to respond to directly. First, I shall discuss the hon. Gentleman’s suggestion that the Government do not really know what big society means—he talked about fresh air in that context. I would also like to address his valid concern about cuts to the voluntary community sector, which was picked up by his colleague who represents the beautiful city of Durham, the hon. Member for City of Durham (Roberta Blackman-Woods). I would then like to deal with the issue of landlords and how their practices risk unsettling, dividing and undermining communities.

Out of courtesy, if I could address the specific issue first, I will undertake to write to my right hon. Friend the Minister for Housing and Local Government on the issue of a national register. That subject is not my direct responsibility and I am sure that there are lots of complexities underlying his suggestion, so I will write to the Minister for Housing and Local Government to alert him to the concern expressed in this debate. I have discussed the matter with a colleague who represents a seat in Cornwall. That is a long way from Sedgefield, but it has exactly the same problem the hon. Gentleman mentioned. That area adopted the grass-roots solution of personal advocacy. Basically, the community was fed up with the situation, so it got together and lobbied directly the people causing the problem and forced a change in policy. I do not know how applicable that is in Sedgefield, but there are examples around the country where that problem has been tackled by grass-roots action—a very big society response. I will write directly to the Minister on his behalf.

[Phil Wilson]

Will the Minister give way?

[Mr Hurd]

I will not take an intervention at this point because I want to move on from that issue.

I shall address the hon. Gentleman’s main concerns about what the big society is, what the Government are trying to achieve and what we mean by it. If he wants to look at the record tomorrow, he will see that my hon. Friend the Member for Banbury (Tony Baldry) articulated the matter as well as anyone, when he talked about trying to promote a greater culture of social responsibility. The idea is not fresh air because, as the hon. Member for City of Durham and various hon. Members pointed out, a lot of wonderful activity is going on in constituencies across the country, where people are working together and giving up time to try to find better ways of doing things, supporting initiatives and getting things going.

The Government want to throw a bigger spotlight on that activity to try to make it easier for people to do more such things and be more ambitious. The matter should not be divisive. My hon. Friend the Member for Wirral West (Esther McVey) put the argument beautifully. We should all be encouraging such things. I shall put the matter simply: it is about trying to encourage more people to get involved. There is no point pretending that all is rosy in the garden, as I think both Labour Members were saying when they cited the citizenship survey. We know that the country faces enormous challenges and that there are very stubborn, expensive social problems. It seems absolutely ridiculous to continue pretending that the state, people here or in Whitehall or even local authority chief executives somehow have all the solutions.

From my constituency, I know that we have barely begun to scratch the surface of the value that residents—constituents—can bring to the idea in terms of tapping into the talent, expertise, experience, ideas, networks and skills that are out there in communities. The big society is about trying to get more people involved and engaged in traditional volunteering or in that hugely important valuable work that we all know about from our constituencies. It is about providing the opportunity to give time to help improve someone else’s life. The value of that is two-way. Of course, we want to encourage more of that, but it is by no means the whole story. The big society is also about trying to get more people involved in shaping the future of communities, in the decisions that really matter and in trying to save things if things need to be saved, such as post offices, pubs, shops or whatever. It is about trying to combat the voice that I hear from constituents who say, “It’s not worth getting involved because it’s not as if we can change anything.” That is what we want to change.

The big society goes beyond that into the reform of public services and trying to open those up and get the people who pay for them and use them more involved in them. Again, in my constituency, I get a sense that people are becoming increasingly resentful of just taking what they are given and feeling that matters are being dealt with in a very detached way. Yes, this is about encouraging more volunteering, but it is also about getting people more involved at a local level in shaping the public services that they use. My hon. Friend the Member for Hexham (Guy Opperman) used the powerful expression “giving the power back,” which I liked. The hon. Member for Carshalton and Wallington (Tom Brake) was entirely right: that is what people want; they would like to get more involved. The citizenship survey showed that, and we are trying to make it easier.

There is a specific, proactive, big role for Government. There is no point in pretending that suddenly Government will disappear. The Government will play a hugely important part in all our lives, whatever the scale of the spending cuts. However, when it comes to making it easier for people to get involved and making the case for that more compelling, the Government are absolutely committed and on track, and will be delivering through three strands of action.

The first strand is about transferring real power to communities. That is now moving from words to realities. The specific measure has been mentioned—the Localism Bill. I am very pleased about and encouraged by the welcome that it has received, not least from the hon. Member for City of Durham. It is raising expectations. I think that that is right. People are excited about it, which suggests that its time has come. It is a huge piece of legislation, with lots of new rights and opportunities. However, there is more to the issue than just legislation.

The hon. Member for Carshalton and Wallington challenged me to be more specific about what we are doing to get out of the way. He was entirely right. If he listens to my right hon. Friend the Secretary of State for Communities and Local Government, he will get the sense that that is a Secretary of State who wants to do exactly that. He wants to change the whole nature of his Department so that it works for citizens.

The hon. Gentleman may be aware that our approach is to send this message to communities: “Tell us what is getting in the way and we will work to see what we can do to remove it.” There is a specific barrier-busting service, of which he may be aware. That flows from a very powerful piece of legislation called the Sustainable Communities Act 2007, which I took through Parliament as a private Member’s Bill. Already, communities are responding to this invitation: “Tell us what’s getting in the way and we will see whether we can remove it, but give us the specifics.” The new website was launched a few weeks ago, and I think that more than 50 proposals have come in already. That is on top of the 300 different proposals that we had for the first wave under the Sustainable Communities Act. These things are community driven, so there is a real determination on our part to get out of the way.

The second strand is about public service reform: opening up the public services to new providers, including, specifically, the voluntary and community sector; bringing those services closer to the people who use them; and liberating people who are in the front line delivering the services. My hon. Friend the Member for Banbury talked passionately about schools. He will know from his experience with local heads about their desire to be liberated. Specifically in relation to public service reform, a White Paper, which I think will be published next month, will set out our stall on that and explain exactly how we intend to go about it.

The third strand is about social action—trying to inspire people and make it easier for them to give time and money to get things done locally to help people. Again, the words are now being backed up by actions. The Cabinet Office has published a Green Paper on giving, which will lead to a White Paper. We seek fresh ideas on what Government can do with partners—the charitable sector and business—to make it easier for people to give time and money.

We have announced the pilots of the next phase of the national citizen service. Again, that is a powerful, positive programme, which is designed to connect young people with their ability to make a contribution to their communities. I think that one of the biggest pilots, involving 1,000 young people, is taking place on the edge of the constituency of the hon. Member for Sedgefield. I urge him to engage with it, because I have seen that that programme can be very powerful in lifting the aspirations and confidence of young people.

The hon. Member for City of Durham rightly challenged me on this important point: the big society must be open to all. We all know that some communities are in a stronger position than others to take advantage of it. I represent a relatively affluent, suburban constituency on the edge of London, a long way from Sedgefield. My communities are well networked, strong and ambitious and, I think, will respond quickly to that agenda, but other communities will need some help.

The Government are determined to be proactive in encouraging, supporting and helping those communities to help themselves. That is one of the driving forces behind our community organiser and community first programmes, which we will be announcing more details of soon. The aim will be to establish, in those communities, people who can bring people together, organise communities and start building networks—people who have the confidence to start getting people together to get things done. With that will be a neighbourhood grant programme. Again, that will be targeted on the most disadvantaged areas, where the social capital is lowest. It will put money into the hands of neighbourhood groups to help them to develop and deliver on their own plans. The hon. Member for City of Durham mentioned the big society bank. That is wholly designed to make it easier for social entrepreneurs—people who want to take a bit of a risk to get things happening and who want to do things differently in those areas—to access capital.

The Government are doing things, but things are also beginning to happen in communities. My hon. Friend the Member for Banbury was very modest about his pioneering work on developing job clubs in his constituency. My hon. Friend the Member for Hexham is getting a big society initiative going in his constituency. In my constituency, I am convening people in exactly the same way—in one ward, people are concerned about the future and feel that they need to come together and think about a neighbourhood plan for the area. I am facilitating that.

Last week I was in Halifax, where groups of people from the public sector—different stakeholders—were gathered round a table, talking about partnership in a way that they never had before, because they felt that that was possible and they were being encouraged to do it. One could sense that they were not going to go back to the bad old ways of sitting in their silos and just pursuing their individual targets and budgets. Something is happening and changing out there, and it needs to, because we have to find better ways of doing things.

I shall spend the time left to me on dealing with the very important issue of cuts to the voluntary and community sector, which is an emotive issue for many hon. Members. I have written to every Member of Parliament, inviting them to bring in representatives of their voluntary and community sector to talk to me about that, and many have taken up the invitation.

Of course, the voluntary and community sector is hugely important to this project, because of its ability to support and mobilise people, but it is not—we should be frank about this—the whole story. Business has a hugely important part to play, as do citizens and residents groups and as do Government. Charities are not a proxy for community, but they are a hugely important partner in the process.

There is a very difficult issue, which we should not underestimate, in relation to managing the transition. However, we need to be honest about this. Unfortunately, the sector cannot be immune from the cuts. The nation is spending £120 million a day in interest and borrowing £1 for every £4 that we spend. That is not sustainable. We have to reduce public spending on a scale that means that, unfortunately, the sector cannot be immune. That would have been a reality confronted by the Labour Government, exactly as the hon. Member for Carshalton and Wallington emphasised, so there are cuts and there will continue to be cuts.

[Tom Brake]

Will the hon. Gentleman give way?

[Mr Hurd]

I would rather not, because I would like to finish this important point. The numbers being bandied around are entirely speculative. The Government are monitoring the situation closely, at central and local government level, because we are concerned that the process should be managed properly. We established a transition fund, which has now closed. That process was well run. From the Prime Minister down, we have sent a strong steer to local authority leaders that we do not expect them to take the easy option of making cuts to the voluntary and community sector before they have taken the opportunity to pursue their own efficiencies. Many councils, such as Reading and Wiltshire, which I heard about today, are increasing the amount of funding that they are giving to the voluntary and community sector. We are continuing to invest in the training of commissioners. We have reviewed and updated the compact, which is the framework that steers the relationship. The Office for Civil Society is continuing to invest to support and strengthen the sector.

We have three priorities. We ask ourselves, “What are we doing to make it easier to run a charity or voluntary sector organisation?” We are continuing to invest in infrastructure to support the sector. We are examining the red tape and regulation that get in the way. There are reviews across Government in respect of the Criminal Records Bureau and health and safety. Again, we are trying to get out of the way where we can. We are actively examining ways of getting more resources into the sector. The giving Green Paper is about trying to stimulate more charitable giving. The social investment bank—the big society bank—is about trying to grow a new market of social investment. We are reviewing everything that we can to try to make it easier for charities, voluntary organisations and social enterprises to deliver more public services.

The transition that we have to manage is very difficult, but we are trying to help the sector to work towards a future in which it can be a very active player in the big society, delivering more public services, helping to give people a voice at local level, and benefiting from the extra time and money that we hope people will give. The Government are absolutely determined to make it easier for people to get involved, to live in even better connected communities and to feel part of something bigger.

Chilcot Inquiry (Civil Service Code)

Nick Hurd Excerpts

Tuesday 25th January 2011 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

Mr Williams, it is a pleasure to serve under your chairmanship for the first time. I know that my being English will not count against me in what would otherwise be a Welsh affair.

It is also a pleasure to respond to an important debate. The recent Iraq conflict, as we saw last week, stirs powerful emotions. We should recognise that the hon. Member for Dwyfor Meirionnydd (Mr Llwyd) has been one of the leaders of the debate on the legality of the war. He should be congratulated on his part in the democratic process. It is surely in the interest of all of us that the Chilcot inquiry should be conducted with impeccable impartiality and integrity. The hon. Gentleman obviously believes—and I listened to him carefully—that the process is, to use his words, flawed and compromised, principally by the process of appointing Margaret Aldred to the secretariat of the inquiry. As the hon. Gentleman was the first to admit, those are serious allegations, and should be responded to in like manner, not least for the sake of the reputation of the individual concerned, who cannot be here to defend herself.

I will simply disagree with the hon. Gentleman, not least because the chairman of the inquiry and his committee appear to be satisfied with their procedures, but I am happy to respond to the points that have been made. It might be helpful to provide some additional background context to the Iraq inquiry, in relation to the appointments that we are discussing.

The Iraq inquiry was launched, as the hon. Gentleman will know well, on 30 July 2009 with a remit to examine the United Kingdom’s involvement in Iraq, including the way decisions were made and actions taken, to establish as accurately and reliably as possible what happened, and to identify lessons that can be learned. The committee is made up of Privy Counsellors, is chaired by Sir John Chilcot and has four other members: Sir Lawrence Freedman, Sir Martin Gilbert, Sir Roderic Lyne and Baroness Usha Prashar. I think that it is generally accepted—I certainly accept it, but I am not sure whether the hon. Gentleman shares my view—that each committee member is independent, non-partisan and committed to undertaking a thorough, rigorous and fair inquiry.

[Mr Llwyd]

It is no part of my view that any of the inquiry members should be impugned. I have no wish to denigrate them. I am discussing a conflict of interest specifically.

[Mr Hurd]

I am grateful to the hon. Gentleman for placing that on record and making it entirely clear. I am pleased that he has done so. Obviously, to some degree, their reputation and integrity are on the line, as the procedures for which they are responsible are being called into question. I am sure that they would take very seriously indeed any suggestion of mismanagement of a potential conflict of interest. As he says, it might undermine the integrity of the processes to which their names are attached. As I understand it, they have placed on record the fact that the committee and the secretariat work collectively. The committee is satisfied that its procedures are capable of dealing with any potential conflict of interest. The Privy Counsellors are supported by a secretariat staffed by civil servants who share their commitment and are governed by the values of the civil service code, which I will address at the end of my remarks.

Having provided the background and context, I will address the role of the secretariat and the process of appointing the secretary, which is the crux of the hon. Gentleman’s argument. The secretariat supports the chair of the inquiry and its members in carrying out their tasks. Its duties are varied and wide-ranging and include making logistical arrangements, requesting statements and papers and preparing papers for consideration by the committee.

The secretariat operates independently of the Department and is currently staffed by 16 civil servants drawn from seven Departments: the Cabinet Office, the Ministry of Defence, the Foreign and Commonwealth Office, Government Communications Headquarters, the Department for International Development, the Northern Ireland Office and the Serious Fraud Office. There are also two suitably cleared temporary support staff members supplied by a recruitment agency. Those appointments to the Iraq secretariat were made in line with Cabinet Office human resources procedures, which are similar to those used by other Departments to provide staff for inquiries. I understand that they were used most recently in relation to the Gibson inquiry. It is regular practice.

I will explain more. When the Government decide to establish an independent inquiry, the timing is such that it must often be done as a matter of priority and with a degree of urgency. Decisions about the chair and members of an inquiry are matters for the Government. It is usual for an inquiry secretariat to be staffed by civil servants on loan or secondment from Departments. Decisions about the secretary to an inquiry will normally be for the chair, and the secretary will then recruit the supporting team in consultation with the chair.

When considering individuals’ suitability for secretariat roles, a number of factors are taken into account, ranging from availability to relevant skills and experience to the potential for any conflict of interest. I can confirm that that process was followed for the Iraq inquiry secretariat. The posts were not initially advertised, as they needed to be filled urgently. The secretary and the Cabinet Office human resources team worked with colleagues in other Departments to identify individuals considered suitable for the various roles, taking into account their availability, skills, knowledge, experience and any identified potential conflicts of interest. After the individuals had been agreed, the moves were made through the Cabinet Office human resources managed move policy.

Moving on from general recruitment, I will focus on the specific position in which the hon. Gentleman is interested, that of inquiry secretary. It is clearly a crucial role. The Cabinet Secretary discussed with Sir John Chilcot the experience, skills and background knowledge required and agreed that the secretary should be a senior individual in the civil service, ideally with previous knowledge and experience of defence and foreign affairs. The Cabinet Secretary proposed Margaret Aldred, who had been the deputy head of the Foreign and Defence Policy Secretariat—formerly the Defence and Overseas Policy Secretariat—in the Cabinet Office since November 2004. Sir John, after considering with others Mrs Aldred’s background and experience, agreed. He did not call for more choices or more alternatives. He agreed with the proposal from the Cabinet Secretary. Given the professional standards of the senior civil service, he and the Cabinet Secretary concluded that there would not be a potential conflict of interest with her appointment, and it would not affect the independence of the inquiry. We strongly support his view.

Regarding Mrs Aldred’s previous involvement in Iraq issues, which is the issue that concerns the hon. Gentleman, the inquiry has papers from the Cabinet Office covering the whole period of its terms of reference. Those include papers produced by the foreign and defence policy secretariat, in which Mrs Aldred was previously employed. In addition, it has heard evidence from the Prime Minister’s foreign and defence policy advisers for whom Mrs Aldred worked.

Sir John and other committee members are fully satisfied that the secretary is discharging her role efficiently and effectively and with the highest levels of professionalism. Mrs Aldred is a highly experienced member of the senior civil service, with a deep understanding and knowledge of defence and foreign policy issues. Her previous work on Iraq has been handled by the inquiry in a way that is fair and open and avoids conflicts of interests. Again, I stress that the committee is satisfied that that does not have any negative impacts on the inquiry and does not call into question the independence of its work. It would be wrong to suggest otherwise.

Let me conclude by talking briefly about the civil service code and its values, because the hon. Gentleman suggested that this process cut across the bow of that code. The code and its values are clearly important in gaining a full appreciation of how they apply in relation to the secretariat to the Iraq inquiry. Let me start by covering the values. As civil servants, the inquiry secretary and other members of the secretariat are required to carry out their duties and responsibilities in accordance with the requirements of the civil service code, including integrity, honesty, objectivity and impartiality. They are also required to comply with the law and uphold the administration of justice. While working for the inquiry, the civil servants will be accountable to the inquiry for their work and actions.

To conclude, I have no doubt at all, if things are as the hon. Gentleman said, that some things should have been done better, not least in terms of the courtesy that should have been extended to him, and the length of time that it took to respond to the FOI request. I am sure that the people involved in that will think on it. But in terms of the core issue—the integrity and professionalism of the secretariat to the inquiry—I am pleased to have the opportunity to place on record my appreciation of the work done by the inquiry, which I am sure is shared by the House and the general public. I am also pleased to be able to put it on record that both I and the independent committee of Privy Counsellors who constitute the Iraq inquiry, and whose reputation and integrity are on the line in this process as well, are confident that the inquiry secretary and the other civil servants are providing impartial and objective advice to the inquiry in a way that upholds the impartiality of the civil service and preserves the independence of the inquiry.

Government IT Procurement

Nick Hurd Excerpts

Wednesday 12th January 2011 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

I welcome you to the Chair, Mrs Brooke. This is the first time I have served under your chairmanship, and it is a real pleasure. I do not know whether you count yourself as one of life’s anoraks. I do not, but I thoroughly enjoyed that speech by the hon. Member for Southport (John Pugh). I congratulate him on securing this debate and, if I may say so, on the elegant way in which he plugged the forthcoming book by my hon. Friend the Member for South Norfolk (Mr Bacon), with whom he served on the Public Accounts Committee.

It is one of the oddities of this place that the Minister for Civil Society should find himself responding to a debate on cost reduction in information and communications technology procurement, but that is my fate as the junior Minister in the Cabinet Office. I should start with an apology to the hon. Member for Southport: this is not my area of day-to-day responsibility, so I am a fish out of water here, but I shall flap to the best of my abilities for the next eight minutes or so. I take this opportunity to reassure him that the Cabinet Office takes seriously the opportunity he has identified to find substantial savings and efficiencies, and better ways for the Government to commission, procure and manage ICT. I shall focus more on procurement, because that is where the Cabinet Office is in a leadership role and where it is particularly focused at present.

The hon. Gentleman was clear about the context in which this debate takes place, including the overriding priority to control the deficit. He will know from his experience on the Public Accounts Committee that there clearly is considerable scope to make savings on ICT, and we are focusing on that. Specifically, there has been a review of major programmes, the introduction of the ICT moratorium and a new, rigorous approval process for procuring consultants and contractors. We expect that up to £1 billion might be saved through the moratoriums in this financial year, if current buying behaviour continues.

In addition to those short-term measures, the Government are committed to delivering sustainable reductions in ICT expenditure—both the cost of goods and services, and the cost of procurement—through the following key initiatives, which are being incorporated. The first one involves managing the Government’s strategic suppliers on a consolidated basis from the centre as the Crown, not from individual Departments—an opportunity that the hon. Gentleman identified. We expect that work to deliver up to £800 million of savings through renegotiating and de-scoping existing contracts with the Government’s top suppliers.

The second initiative involves centralising the procurement of commonly used goods and services, including ICT commodities, to standardise specifications and aggregate the Government’s expenditure more effectively than in the past. That will deliver significant sustainable cost reductions from the existing baseline of £13 billion over the next four years and, in doing so, build on the recommendations made in the Green review.

The third initiative involves streamlining the current process used to source from and contract with suppliers through the application of industry best practice—in this case, “lean” techniques, which have identified the potential to reduce procurement and sourcing project times from an astonishing 85 weeks to 27 weeks, depending on the size, complexity and risk of the procurement, while ensuring compliance with European Union directives.

The fourth initiative involves introducing new spending controls, including a moratorium on any new ICT spend with a value of £1 million or more, and a review of all major projects, a number of which are IT-based. So far, we have reviewed more than 300 Government ICT projects worth nearly £3 billion, and have recommended that more than £1 billion of expenditure be stopped or curtailed. We estimate that the review of major projects has saved £400 million this year. Those are all serious numbers.

We are also developing a strategy that increases the agility of public sector ICT in supporting policy delivery, that achieves greater value for money, that enables effective and efficient digital services and that empowers the big society through greater collaboration and transparency, which is a theme the hon. Gentleman discussed.

Let me elaborate further on each of the initiatives. First, on managing the Government’s strategic suppliers as the Crown rather than as individual Departments, one of the first actions that we took as a new Government was to announce saving targets of £6.2 billion for this financial year. A key part of that involves working with our leading suppliers, including ICT suppliers, to reform our commercial relationships and try to eliminate waste while protecting the fundamental services that we need to provide.

We are driving down the cost of Government IT contracts by negotiating directly with suppliers to achieve cost reductions and efficiency savings in our contracts. As I said, those renegotiation activities are expected to yield £800 million of in-year savings and substantial future savings. In addition, we are commencing reviews of large contracts with more than £100 million remaining contract value to identify further potential savings opportunities.

Secondly, on centralisation of the procurement of commonly used goods and services, we know that the Government buy the same commodity many times but at different price points. We are working to eradicate duplication, apply common specifications, and leverage the Government’s considerable collective buying power more effectively. We are creating a new centralised procurement operating model, and that capability will be mandated across all Government Departments. That transformation of how the Government procure common goods and services through centralised category management is targeted to deliver significant sustainable cost reductions in the region of 25% from the existing baseline of £13 billion.

For each category, there will be a single supply strategy that will deliver a centralised sourcing solution, so that central Government can significantly reduce their spend through aggregation, standardisation and rationalisation. Centralised category management teams will negotiate best-value contracts for central Government Departments based on volume-bound agreements.

[John Pugh]

The Minister mentioned a moratorium. Clearly, a moratorium by itself stops the spend and in doing so saves money, but advocates and supporters of a project who want it to go forward will say that, if it goes forward, it will save far more money than will be saved by virtue of the moratorium. How does the Cabinet Office in its approval mechanism make a judgment about a specific project? Does it take a broad view on how credible a project is or how secure the savings are, or is it simply the case that a certain number of projects need to be stopped in order to meet a certain figure?

[Mr Hurd]

It is more the case that the moratorium provides an opportunity to go through the discipline of looking closely at what is actually going on.

In my last minute, I would like to expand a little on the third pillar of our approach, which involves improving procurement processes. We know that bid costs range from £20,000 to £200,000 for every month. We are determined to reduce that, and the 6,000 pages of guidance on procurement within Government. The “lean” study has set out the task ahead of us: to refine and introduce a lean, new procurement process.

The point of all that is to try to reassure the hon. Gentleman that the Government take extremely seriously the need and the opportunity to be more efficient in how they procure IT and manage it on an ongoing basis.

Oral Answers to Questions

Nick Hurd Excerpts

Wednesday 24th November 2010 Commons Chamber

[Mr David Ruffley (Bury St Edmunds) (Con)]

3. What steps he is taking to increase the participation of voluntary and charitable bodies in bidding processes for Government contracts.

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

The Office for Civil Society will shortly publish a consultation on what changes need to be made to commissioning to make it easier for voluntary and community sector organisations to compete for public contracts. The results will feed into a wider public services reform White Paper, which is due to published early in the new year.

[Mr Ruffley]

I am grateful to the Minister. On 13 November, I chaired a summit meeting of the chief executives of 14 significant third sector bodies in Suffolk to discuss the big society and Suffolk county council’s radical new strategic direction programme to contract out local public services. The third sector bodies were extremely keen to bid for these contracts, but they were concerned that unscrupulous, large corporate prime contractors and a very crude payment-by-results regime could fatally damage their cash flow—

[Mr Speaker]

Order. I think that the hon. Gentleman wants to be reassured that that will not be the case. We are grateful to him for so indicating—[Interruption.] Order. That is the end of it.

[Mr Hurd]

As my hon. Friend knows, there will be cases where large-scale contracts are more efficient, but we want to make sure that voluntary and community sector organisations do not feel excluded from them and are treated fairly by the prime contractors within any consortiums. The White Paper will address that issue. In addition, the private Member’s Bill of my hon. Friend the Member for Warwick and Leamington (Chris White), which the Government support, will place a firmer requirement on commissioners to consider social value in their buying decisions. That will help. I should be delighted to meet representatives of the local voluntary and community sector organisations in the constituency of my hon. Friend the Member for Bury St Edmunds (Mr Ruffley) and I extend the same offer to all hon. Members.

[Roberta Blackman-Woods (City of Durham) (Lab)]

I am sure that the Minister will agree that bidding processes and the awarding of Government contracts must be transparent and fair—and seen to be so. Does he therefore think it good practice that his Department awarded a huge £4.1 million contract to a charity founded by his policy adviser, Lord Wei? Will the noble Lord consider his position as a result of this matter?

[Mr Hurd]

I am not entirely sure to which contract the hon. Lady refers, but if she means the recently announced awarding of contracts to 12 providers of the national citizen service, that process was run in an impeccably transparent way. We are absolutely delighted with the outcome and with the prospects for that programme.

[Dr John Pugh (Southport) (LD)]

On probity and transparency, what puts off most charitable organisations is the time, the expense and the long drawn-out nature of the process. Is the Minister going to do something about that?

[Mr Hurd]

Absolutely. That is a hugely important point. Everything I have learned over the past two years suggests that for many organisations the whole process of applying for and reporting public money is a bureaucratic nightmare—often totally disproportionate to the sums involved. Changing that is fundamental to the reform of commissioning and procurement that we are undertaking.

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

4. What assessment he has made of the likely effects of the outcomes of the comprehensive spending review on voluntary sector organisations over the spending review period.

--- Later in debate ---

[Dr Julian Huppert (Cambridge) (LD)]

8. How his Department plans to measure and promote well-being.

[The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd)]

The hon. Gentlemen will know from the Budget and previous statements by the Prime Minister that the Government are committed to developing broader measurements of well-being to inform policy development. A conference tomorrow will bring together experts to discuss how we measure and promote robust, independent measurements of subjective well-being.

[Dr Huppert]

I am delighted that the Government are taking this issue of well-being seriously. Does the Minister agree that promoting well-being involves a focus on development and understanding in schools, not just exams, on fulfilment and job satisfaction at work, not just salary, and on community and opportunity nationally, not just gross domestic product?

[Mr Hurd]

I know that the hon. Gentleman takes a big interest in this subject as vice-chair of the all-party group. The Government take it seriously. We are taking forward the recommendations in the Stiglitz, Sen and Fitoussi report and the conference tomorrow will be the first step in deciding how we go forward to measure and promote subjective well-being. I am sure that the hon. Gentleman’s view will be heard.

[Barry Gardiner (Brent North) (Lab)]

As part of his efforts to promote well-being, will the Minister consider the abolition of the Independent Parliamentary Standards Authority?

[Mr Hurd]

I sense that there might be some consensus on that in the House, but it is a subject well above my pay grade.

The Prime Minister was asked—