State of the Estate

Oliver Dowden Excerpts

Wednesday 28th March 2018 Written Statements

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

I have today laid before Parliament, pursuant to Section 86 of the Climate Change Act 2008, the “State of the Estate in 2016-17”. This annual report describes the efficiency and sustainability of the Government’s Civil Estate and records the progress that Government have made during the financial year 2016-17. Since 2010 we have delivered savings of over one billion pounds in annual operating costs and a 25% reduction in the size of the estate (2.8 million square metres). We have also made significant progress on other key areas including achieving a 33% reduction in emissions by the end of 2016-17, which exceeds the 2020 target of 32%.

Looking ahead, our aim is to ensure that our estate not only delivers value for the taxpayer but also acts as an enabler to the delivery of the Government’s wider commitments—from releasing surplus Government land to building new homes, to delivering public services that are more accessible and responsive to citizens’ needs and to ensure our estate showcases best practice in mobile technology and workplace design.

[HCWS598]

Government Property Agency

Oliver Dowden Excerpts

Wednesday 28th March 2018 Written Statements

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

I wish to update the House on the establishment of the Government Property Agency as an Executive Agency of the Cabinet Office.

Government are delivering a modern, innovative public estate strategy that drives a step-change in our property ambitions—broadening from a primary focus on efficiencies and savings to one that uses assets as an enabler to deliver our priorities for excellent public services; economic growth; and more land for housing across the UK.

The previous Chancellor set out some of that ambition at the March 2015 Budget where he announced that Government would implement a new commercially driven approach to land and property asset management across the central Government estate and that it would create a new central body which would own and manage relevant property assets.

I announce today a significant step forward in creating a modern, effective and efficient civil service fit for the 21st Century, positioning property as a strategic enabler of wider civil service transformation, through the creation of a Government Property Agency.

The agency will be a new executive agency of the Cabinet Office from 1 April 2018 and will provide the centralised ownership, control and delivery infrastructure needed to unlock benefits across organisational boundaries. It further positions Government to deliver workforce change and wider business transformation, delivering efficiencies and releasing land and property for productive use, including building new homes.

The assets in scope to transfer to the agency at this stage are general purpose assets (offices, warehouse and depots), plus non-specialist science assets. Specialist assets such as courts, prisons and specialist science assets will remain on Departments’ balance sheets and the model also excludes devolved administrations, local governments, schools, NHS clinical estates, HCA regeneration assets, MOD estate and overseas estate.

The Government Property Agency has been running in shadow form since January 2017, working with a small number of Departments to test structures and processes before launch in April 2018. The agency will initially deliver the Government Hubs programme with HM Revenue and Customs and manage non-specialist properties for Cabinet Office and Department of Business, Energy and Industrial Strategy—before expanding its scope to the non-specialist properties of other Government Departments in subsequent years.

Creating the agency will bring benefits to Departments and their arms’ length bodies through more effective management of the assets they occupy and own. It will establish a single agency providing the basis for a joined-up approach to the management of Government property assets. And the taxpayer will also benefit from reduced cost and improved efficiency of the estate.

[HCWS599]

Oral Answers to Questions

Oliver Dowden Excerpts

Wednesday 21st February 2018 Commons Chamber

[Kerry McCarthy (Bristol East) (Lab)]

4. What recent discussions he has had with Cabinet colleagues on ethical procurement.

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

The Government are committed to ethical procurement. The Public Services (Social Value) Act 2012 requires commissioners to consider the social benefits of their approaches to procurement, and the industrial strategy requires Departments to consider wider social and economic factors in the design of major Government contracts.

[Kerry McCarthy]

Another recent report has commented on the link between ultra-processed food and cancer, rising levels of obesity, and the fact that only one in four adults is eating five a day. What more can the Government do through their public procurement processes to encourage healthy, sustainable eating, and to source it from British producers?

[Oliver Dowden]

The hon. Lady has raised an important point. As I have said, the Public Services (Social Value) Act 2012 enables procurers to take those wider factors into account. We are also encouraging the adoption of a so-called balanced scorecard approach whereby, in the process of procurement, we consider those wider factors. We have rolled that out for all contracts worth more than £10 million, and have extended it to the Crown Commercial Service framework for facilities management.

[Michael Fabricant (Lichfield) (Con)]

What additional flexibility in public procurement will be yielded by Brexit?

[Oliver Dowden]

One of the advantages of Brexit is that it will provide a wide range of opportunities to tailor our procurement rules to the needs of this country. Once we have left Europe, we will be considering exactly those measures.

[Thangam Debbonaire (Bristol West) (Lab)]

What certainty does the Minister have that there is no direct or indirect gender discrimination anywhere in the Government’s supply chain?

[Oliver Dowden]

In October last year, the Government produced a code of conduct relating to Government procurement which covered precisely those points.

[Chris Davies (Brecon and Radnorshire) (Con)]

5. What steps his Department is taking to promote Government procurement from small and medium-sized businesses.

--- Later in debate ---

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

The Government are committed to moving activities away from London and the south-east. There is a presumption that all new non-departmental public bodies should be outside London, so we have created Government hubs across the UK, including in Edinburgh and Glasgow. My hon. Friend makes a marvellous case for having more such opportunities in Scotland.

[Jamie Stone (Caithness, Sutherland and Easter Ross) (LD)]

T5. Dounreay in my constituency is being decommissioned, and it is crucial that both levels of government should work in harmony to ensure future employment for the people of my constituency. Canada and Australia typify joint working between levels of government. Will the Minister work very hard indeed to ensure that the Scottish Government and the UK Government work together to allay the fears of my constituents and to provide future employment?

[Mark Pawsey (Rugby) (Con)]

T4. Too few of our small businesses apply to sell their goods to Government because they are worried about the bureaucracy involved. What reassurance can the Minister give them and, specifically, what feedback is available to them when they do so?

[Oliver Dowden]

My hon. Friend makes an important point. Small businesses are the engine of our economy, and we are committed to supporting them in public procurement. That is why we have already streamlined our procurement processes to assist small businesses by, for example, abolishing complex questionnaires. Specifically in relation to too much bureaucracy, businesses can report such practices to the mystery shopper service.

[Patrick Grady (Glasgow North) (SNP)]

T6. On what date were Government officials first instructed to work on draft amendments to clause 11 of the European Union (Withdrawal) Bill?

--- Later in debate ---

[Alison Thewliss (Glasgow Central) (SNP)]

My colleagues in Edinburgh will be voting today to scrap the public sector pay cap and give a 3% pay rise to those earning under £36,000. When will public sector workers in England see a similar rise?

[Oliver Dowden]

Public sector workers are among the most talented and hard-working people in our society, and they should be fairly rewarded. In respect of the Cabinet Office, the Chancellor’s Budget statement confirmed that we are moving away from the 1% average public sector pay award, and proposals will be issued later this year.

[Mr Bernard Jenkin (Harwich and North Essex) (Con)]

I wish my right hon. Friend every success in his forthcoming meeting with the Scottish and Welsh Governments this week. Will he bear in mind that he is being compromising and open, and will he invite them to be the same?

Strengthening Families

Oliver Dowden Excerpts

Thursday 8th February 2018 Westminster Hall

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

It is a pleasure to serve under your chairmanship, Ms Buck, and it was a pleasure to have Mr Bone as our Chair prior to your arrival.

When we go to someone’s funeral, it is rare that people talk about that person’s educational or career successes. They certainly, as my hon. Friend the Member for Gainsborough (Sir Edward Leigh) said, do not talk about the money that person made during their lifetime. Almost always, the eulogy centres on the family. People want to be remembered for the family—for their contribution to family life and the stable family life that they built. Families are at the centre of all our individual lives. They provide us with a sense of stability, security and purpose, sustaining us through times of emotional, health and financial difficulty, and providing us with a sense of place and fulfilment. We all experience families in different ways throughout our lives, as children to our parents, as parents or indeed grandparents as we grow older, as partners or through our extended relationships. To answer a point made by my right hon. Friend the Member for New Forest West (Sir Desmond Swayne), of course we all know that modern families are not all two parents with two children. It has been established during the debate that it is not helpful to stigmatise people who do not conform to that measure, and I do not think anyone suggests we should do so.

As a dad with two young children, I know the importance of strong families and the role that families play in children’s development—not only physical development but cognitive, emotional and social development. I completely agree with the attitude of my hon. Friend the Member for Stafford (Jeremy Lefroy) towards television and social media for children. The decline in the practice of children sitting at the table to eat with the family has profound consequences. When children eat with the family they learn many soft skills such as conversational ability and table manners that put them at an advantage and help them succeed throughout life. I certainly agree about playing games: my family like Articulate! My six-year-old already beats me at Cluedo so I am giving up on that one. I shall resist the temptation to speculate on games that members of the Cabinet might choose to play.

For all the reasons I have given, it is, for me and certainly for my party and the Government, families and not the state that form the cornerstone of our society. That is why families are at the heart of Government policy and why I am so pleased to have the opportunity to respond to the debate on behalf of the Government. It is an important issue, and, as my hon. Friend the Member for Congleton (Fiona Bruce) said, it is also a cross-cutting issue where responsibilities lie with a number of different Departments. As a Minister in the Cabinet Office, which has responsibility for co-ordinating cross-Government work and policy, I am responding to this wide-ranging debate on behalf of the Government. Within the Cabinet Office, we are continually looking at ways to measure the impact of policies in relation to the family. We currently analyse that impact through mechanisms such as the implementation unit, which falls within my brief. That is a central part of the initiative.

I pay tribute to my hon. Friend for securing the debate. I know what a strong campaigner she is on the importance of families, and how much of her parliamentary career she has devoted to championing the cause. That was demonstrated once again by her passionate speech today. I also pay tribute to all hon. Members who were involved in drawing up the “Manifesto to Strengthen Families”. I know that she chaired a roundtable on Tuesday with our hon. Friend the Member for South West Bedfordshire (Andrew Selous) and David Burrowes. I join my hon. Friends in paying tribute to Mr Burrowes. He was a neighbour when he served as Member of Parliament for Enfield, Southgate and he is completely and passionately committed to this cause.

I am very familiar with this cause from my time working for the former Prime Minister. My hon. Friend the Member for Congleton mentioned “Breakthrough Britain”. I well remember that report and its impact and the significant contributions, not just from David Burrowes, but people such as Dr Samantha Callan, who are very committed to this project. For me, the statistic that brought it home during the debate is that children are more likely to have a smartphone than a father at home. What does that say about our values as a society if that is the case?

[Margaret Greenwood]

When the Minister is talking about values as a society, will he set out for us what his Government are going to do to tackle child poverty, which is set to rise to 5 million?

[Oliver Dowden]

As the hon. Lady has raised the point now, I am happy to talk about it. It was certainly my experience growing up that my dad losing his job at a wire factory had the single biggest impact on our family finances and our family life. It put the greatest strain on our family. I am very proud to serve in a Government under which more than 2 million new jobs have been created—that is hundreds of thousands of households where children grow up seeing their parents going out to work and having the stability and security of a wage packet.

That achievement stands alongside a range of measures that we have taken—for example, we are the first Government to introduce a national living wage. We are also cutting people’s taxes so they keep more of what they earn. We have essentially doubled the tax-free allowance, meaning that anybody working 30 hours a week on the minimum wage pays no tax at all. In addition to that, universal credit reforms pioneered by my right hon. Friend the Member for Chingford and Woodford Green (Mr Duncan Smith), the former Work and Pensions Secretary, have had a tremendous impact. When I visit jobcentres in my own constituency, I see the enthusiasm that people working there have because they know that we finally have a policy that genuinely incentivises people from welfare into work. We have a record of which we can be proud.

I did not want to descend into party political points at this early stage, but I would note on the issue of the so-called privatisation of the health service that I do not see how that accords with the tremendous increase in funding we have provided for the NHS.

[Margaret Greenwood]

Will the Minister give way?

[Ms Karen Buck (in the Chair)]

Order. Before the hon. Lady intervenes, I would remind Members that this is not a debate about the health service.

[Oliver Dowden]

I will give way in just one moment. Record numbers of operations are being performed on the NHS, record numbers of people are seeing GPs, and record numbers of people are being seen in A&E. We have committed an extra £8 billion in this Parliament and another £6 billion was committed in the Budget to the NHS. I will give way, and then I must move on.

[Margaret Greenwood]

I thank the Minister for giving way and I take on board your comment, Ms Buck, but I would say that the debate is cross-departmental and the document does refer to health. Accountable care systems or integrated care systems are suggesting bundling together budgets for the hospitals, the GPs, community health, public health and local authority spending of one area—Wirral, for example—and potentially giving that to one private provider. We have seen what happened with Carillion, so there is clearly a huge risk in taking that kind of approach. I would say that if that leads to the privatisation of the national health service, it will have a devastating effect on families.

[Ms Karen Buck (in the Chair)]

I call the Minister, and I would stress my earlier point to him as well.

[Oliver Dowden]

I thank you for that warning, Ms Buck. I will deal with the comment in one sense and move on to the substance of the manifesto.

There is virtue in integrating services, The sort of thing that is being pioneered in Manchester, where we bring together different services—it is in fact being pioneered by a Labour Mayor, in conjunction with the former Chancellor’s measures—is, I think, a way of improving health outcomes.

I will now move on to the specific measures in the manifesto, which form part of broader Government policy. For example, there is the important matter of education. There are now 1.9 million children in good or outstanding schools, which is a record number. My hon. Friend the Member for Stafford raised some important points about mental health. As was recognised, we are investing £1.4 billion in mental health services for children and young people, and we have set up a scheme in schools to raise awareness and help them to know how to deal with individuals in schools suffering from mental health issues. We have published a Green Paper to set out our plans to transform mental health services in schools. My hon. Friend made an important point about the need for a holistic, family approach to mental health, and hopefully the Green Paper will be a starting point.

As I said, a route into meaningful work is very important for improving children’s life chances. We now know that nearly three quarters of children from workless households moved out of poverty when their parents entered full-time work. That means 608,000 fewer children are living in workless households.

Before moving on to the contents of the manifesto, I would like to try to address some of the points raised by my hon. Friend the Member for Congleton. The importance of champions for the family in Government was raised by several Members. As a starting point, I know that the Prime Minister is personally committed to this—she is the principal champion of families. We have already discussed the other Ministers with family responsibilities, but I have certainly heard the point about a specific, designated family Cabinet Minister loud and clear, and I will relay that to my colleagues in Government.

My hon. Friend the Member for Congleton raised the DAD scheme. I understand from my officials that the Department for Education has funded a range of family advice and support services since 2008, including Family Matters, which runs the website called DAD. The service is well used and is valued by its users. Ministers at DFE are considering the future requirements for the next financial year, so it is under active consideration. I am sure the representations made by my hon. Friend will have been heard loud and clear. On children’s centres, an important point was raised about family hubs. Clearly, local authorities have responsibility for children’s centres and they are free to pioneer family hubs. As my hon. Friend said, a great number are already doing so. She highlighted Westminster and the Isle of Wight. I would urge other councils to consider doing so.

My hon. Friend made an excellent representation on a transformation fund. Sadly, it is entirely beyond my remit to make public spending commitments, but I am sure the Chancellor will take note, particularly regarding the £90 million in dormant bank accounts. On the statutory duty to have the father’s name on birth certificates, it is worth noting that 94% of birth certificates already have the father’s name there, so we are making progress.

On relationships education, which came up in a number of contributions, the call for evidence is out at the moment. Some passionate pleas were made. I would urge hon. Members to respond to that call for evidence—I believe it closes on Monday. That is the route for formulating policy in that area. Again, I think a valuable point was made about the need for an annual statement on strengthening families and that is again something I will relay to my right hon. Friends in Government.

My hon. Friend the Member for Stafford talked about Home-Start, which is very important. I have looked into it very briefly, and I believe that comes under the local transformation plans that we put in place in 2014-15. There is an opportunity, as part of those plans, to provide for such schemes, but I will write to him further on that point.

Let me turn to the substance of the debate: this excellent manifesto. The Government introduced the family test in 2014 to bring a family perspective into policy making. It helps to ensure that the impact on family relationships and functioning, both positive and negative, is recognised in the process of policy development, and it informs policy decisions made by Ministers. We introduced the test to ensure that, across Government, we think carefully about the potential for new policies to support or undermine family relationships. The Implementation Unit has a role in ensuring that the family test is implemented. The test means that families are considered at the start of any new policy development.

[Margaret Greenwood]

How would the two-child policy, under which families are disincentivised to have a third child, measure up to the family test?

[Oliver Dowden]

The whole point of the two-child policy is that people on benefits should be subject to the same restraints as people who go out to work. Anyone who goes out to work has to think carefully about whether they can afford to have more children, and many people choose not to have a third or fourth child. All the policy does is to replicate that in the benefits system by ensuring a cap at two children. It is a perfectly sensible policy with which many members of the public completely agree.

[Margaret Greenwood]

rose—

[Oliver Dowden]

I really need to make progress, and I do not want this to become a two-way, Conservative-versus-Labour debate.

On the point about spending on childcare, I have already talked about the role of parents in children’s development. Children from less advantaged backgrounds are already behind in their learning by the time they start school, and high-quality early learning from the age of two can help us to close that gap. Parents have a vital role to play in their child’s development. Evidence suggests that, aside from maternal education, the home-learning environment is the single biggest influence on a child’s vocabulary at the age of three. That is why we have committed £5 million to trial evidence-based home-learning environment support programmes in the north of England—my hon. Friend the Member for Congleton referred to them. They will focus on early language learning and literacy. We are currently running a procurement exercise to identify an external organisation to work with us in delivering that trial.

The primary purpose of providing free early learning places for two-year-olds is to improve outcomes for children. We want to make it as easy as possible for children to benefit from early education. One of the interesting initiatives in that area is community-based nurseries, at which parents volunteer in return for lower childcare fees. Disadvantaged families are helped through the lower cost of childcare, and they learn parental skills by working in the nurseries. A number of those trials have already happened with voluntary organisations, and they have had very positive outcomes.

The “Manifesto to Strengthen Families” also recommended that relationship education should be extended online, with a dedicated campaign and virtual platform. The Government want to help all schools to deliver high-quality relationships education and relationships and sex education to ensure that pupils are taught about healthy and respectful relationships, and that they stay safe and are equipped with the knowledge they need to prepare for adult life. I completely agree that it needs to cover concepts such as commitment, respect and safety. Of course, marriage is a perfect example of all those things. I urge hon. Members to make sure their views are heard as part of that consultation process, because that evidence will shape draft statutory guidance and regulations, which will be subject to further consultation later this year. There will be many opportunities for hon. Members to have an input into that process.

In December, the Government published our social mobility action plan, which set out our ambition to close the word gap in early years. It is a clear direction for all those that have a part to play, including children’s centres. Our focus is on delivering that ambition. We welcome the development of family hubs as one way to meet local needs. We believe that local councils are best placed to understand local needs, so if they believe there should be a family hub, they should be free to set one up.

This excellent manifesto also focused on health. The Government are already working to reduce health inequalities by addressing the social causes of ill-health, promoting healthier lifestyles and tackling differences in outcomes of NHS services. We are doing that in a number of ways. We are investing more than £16 billion over the current spending period to support local public health services. That action is being led locally to ensure that the solutions reflect the needs of individual communities. Local authorities can also commission a range of children’s public health programmes that support women in pregnancy through childbirth and support children from early years through to adolescence. Clinical commissioning groups and local authorities are responsible for commissioning services to meet the needs of their local populations. As part of that, we also need to look at mental health. The Government are committed to parity between mental and physical health, which has been one of the challenges in our health service for successive Governments.

The manifesto contains an excellent recommendation about maternity services and maximising the involvement of fathers. Perhaps I can call myself a new dad—I was certainly there at the birth of my two children. There really are some excellent maternity services now. I was at a midwife-led unit at Watford General Hospital, just outside my constituency, and I saw how helpful it is to have a dedicated room in which the birth takes place with en suite facilities. That helps the father to be involved. That is why the Government have provided more than £37 million of capital funding since 2013 to support maternity services and to create safe, family-friendly environments. That includes increased provision of facilities in labour and post natal units, such as double beds, reclining chairs—which can be converted to beds for partners to rest in, especially overnight, and remain with their partner and new-born children—en suite toilets, new birthing pools, and dedicated family rooms.

The manifesto also raised the important issue of couples therapy. When children arrive it is a time of great happiness, but it can put a tremendous amount of strain on relationships, so it is important that we focus resources at that stage. The NHS already offers couple-based therapy as part of its Improving Access to Psychological Therapies programme.

On drug addiction, many hon. Members eloquently made the point that families play an absolutely central part in helping people through that very challenging time in their lives. At a national level, we have extended the troubled families programme to help local areas to ensure that their services have an integrated, whole-family approach. The programme now specifically supports families with younger children and those with a broader range of problems, including substance misuse, mental health problems and domestic abuse.

On the point about police and crime commissioners working with schools in which domestic abuse issues are prevalent, the Government are fully committed to tackling domestic abuse, and we will shortly be launching a consultation on the landmark domestic abuse Bill to improve protection and support for victims, to strengthen the focus on perpetrators, and to recognise the lifelong damage that domestic abuse does to children. The evidence on that front is completely overwhelming.

My hon. Friend the Member for Mid Dorset and North Poole (Michael Tomlinson) made a passionate speech about the prison system and the role of families. I was particularly struck by his statistic that reoffending rates are 35% lower if partners and families are allowed to visit. That is also borne out by other studies. The impact of imprisonment on a family is likely to be long term, especially if the main breadwinner of a family goes to prison—the problems back home build up, with rent or mortgage arrears going up, and social stigma and loneliness for the family left behind.

While offenders are in custody, therefore, we have an opportunity to support them in changing their values and perspectives on their roles and responsibilities. As a Government, we believe that prisoners who are in touch with their family are likely to be more settled while in jail. Multiply that improved mood among prisoners, and we see a transformation in prison conditions. As we have heard, on 10 August last year the Government published a review by Lord Farmer that made several recommendations to strengthen family or significant other ties. As has been recognised, we have welcomed all those measures and will be working to implement them.

On the military covenant, the case was well put by the hon. Member for Glasgow North West (Carol Monaghan) —sadly, she is no longer in her place. We all know, and I certainly do from my previous role as the Parliamentary Private Secretary to the Defence Secretary, the huge sacrifice made not only by our armed forces, but by their families. That is often under-reported, with the families often the ones who take the strain of prolonged periods of absence and moving around, so it is important that we support those families under the military covenant, which is exactly what we have done.

The Ministry of Defence launched its first ever UK armed forces families’ strategy in 2016, which focuses and co-ordinates activity to support service families. The single service welfare organisations provide a flexible and inclusive network of welfare support to service personnel and their families. Defence also rightly works hand in glove with the principal service charities and organisations such as Relate to provide specialist support to families. In addition, we have launched a health and wellbeing strategy to improve mental health, and developed a memorandum of understanding with the Royal Foundation. As part of such efforts, I certainly take on board the suggestion of my right hon. Friend the Member for New Forest West about ensuring that we include training courses.

I thank hon. Members for allowing me to speak for some time. I wanted to cover all the points included in the manifesto, as well as the other matters raised. If Members feel I have left anything uncovered, I undertake to write back to them. I believe that as a Government we are working towards a shared goal of putting family at the heart of policy making. I hope that we will continue in that vein, because all the evidence shows the value of families to our national life.

[Fiona Bruce]

I thank all right hon. and hon. Members who have spoken in this debate, and who have stayed the course in our final debate before we break for our recess. That demonstrates the commitment of colleagues to “A Manifesto to Strengthen Families”.

I thank the Minister for his response, which showed his personal interest, his genuine concern and his desire to see families strengthened in this country. We appreciate that very much. We appreciate, too, the fact that he represents the Cabinet Office, which indicates a recognition by Government that this is a cross-cutting issue that needs a degree of oversight by one Department, across the many Departments that we have referred to as being affected by the policies in the manifesto that we want to see implemented.

I have one further request of the Minister. So many issues have been raised today and so many have to be taken back to other Departments that, on behalf of my colleagues who have spoken, I would ask him whether he will meet us in a few weeks’ time for a further discussion of how the policies in the manifesto can be taken forward.

[Oliver Dowden]

indicated assent.

Question put and agreed to.

Resolved,

That this House has considered strengthening families.

Capita

Oliver Dowden Excerpts

Thursday 1st February 2018 Commons Chamber

[Rachel Reeves (Leeds West) (Lab)]

(Urgent Question): To ask the Minister for the Cabinet Office and the Chancellor of the Duchy of Lancaster to make a statement on the risk to public finances and public services as a result of the serious financial concerns at Capita, and on the Government’s contingency plans.

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

I have been asked to comment on the stock market update issued by Capita plc yesterday and its impact on the delivery of public services. I completely understand that this is a matter of significant interest to many in the House following the recent failure of Carillion, but I can assure Members that this company is in a very different situation. To be clear, this announcement was primarily a balance sheet strengthening exercise, not purely a profit warning. As has been widely reported, the company has significant cash reserves on its balance sheet. We do not believe that Capita is in any way in a comparable position to Carillion. Furthermore, Capita has a very different business model, and if the House will allow me, I will give an update on that.

The issues that led to the insolvency of Carillion will come out in due course, but our current assessment is that they primarily flowed from difficulties in construction contracts, including those overseas. By contrast, Capita is primarily a services business, and 92% of its revenues come from within the UK. As Members would expect, we regularly monitor the financial stability of all our strategic suppliers, including Capita. As I said, we do not believe any of them are in a comparable position to Carillion. The measures Capita has announced are designed to strengthen its balance sheet, reduce its pension deficit and invest in core elements of its business. Arguably, those are exactly the measures that could have prevented Carillion from getting into the difficulties it did. Of course, the impact of these measures has been to reduce dividends and shareholder returns in favour of others, so this is further evidence of shareholders and not the taxpayer taking the burden on this.

As I have said, my officials met senior Capita executives yesterday to discuss the impact of the announcement. We continue to work closely with the company to monitor the execution of its plan and to ensure the continued delivery of public services. We continue to engage with all our strategic suppliers and make continuing assessments of our contingency plans, where necessary. It would not be appropriate for me to comment in any further detail on the specifics of those contingency plans, given their commercial sensitivity. But let me reiterate that the priority of this Government, and the reason why we contract with these companies, is to deliver public services, and our priority is the continued delivery of those services. As Members will have seen in respect of the collapse of Carillion, whatever the shortcomings there public services continue to be delivered, and we are confident that public services will continue to be delivered as provided by Capita.

[Rachel Reeves]

I thank the Minister for his response, but I cannot help but conclude that the Government’s thinking on this is both muddled and complacent. He has told us that the situations at Capita and Carillion are completely different, but let us look in more detail at the circumstances of both companies: both have debts of more than £1 billion and pensions deficits in the hundreds of millions; both paid out dividends of more than £1 billion in the past five years; both rely on the public purse for half of their contracts; both were audited by KPMG; and both grew through acquisition and not through organic growth. It seems there are more similarities than differences between these two companies.

I join the Minister in welcoming the decision by the new Capita chief executive officer to face up to some of these problems with a rights issue and the suspension of dividends. But can the Minister honestly say that Capita could not come to the same fate that Carillion did just two weeks ago, that people working for Capita have nothing to fear, and that those saving prudently for a pension with Capita can rely on that pension paying out fully on retirement? Can he say to people who rely on Capita to carry out basic public services, such as the electronic tagging of offenders or the billion-pound contract with the NHS, that they can count on it to fulfil its contractual obligations for the life of those contracts?

I have some specific questions about what happens now. What is the contingency planning? Do the Government have representatives in the business, including a Crown representative? How long have the Government been aware of the problems at Capita, and how many contracts have been issued to it since then? What specific risk assessment have the Government made of other large outsourcing firms? Capita is currently bidding for the Defence Fire Risk Management Organisation contract. Will the Government now review that process and reconsider the decision to outsource that and other services they are currently looking to offload?

Will the Government commit to urgently reviewing what looks like a cosy and complicit relationship between the big accountancy firms, the Financial Reporting Council and the corporates they are supposed to be auditing? Is it not now time to split up the big accountancy firms and stop auditors being paid for other consultancy work at the firms they are supposed to be auditing? Capita has announced a fire sale of assets. Will the Minister confirm that Capita is in consultation with the trade unions and its workforce about redundancies and TUPE arrangements in the event that services are sold off?

Jobs, pensions, small businesses and vital public services now depend on these outsourcing companies, but it is time we rethought the whole strategy for public service provision. How many more warning signs do the Government need?

[Oliver Dowden]

I thank the hon. Lady for her questions. I know she takes a close interest in this important issue. She has raised a large number of questions, and I shall seek to address as many of them as I can. I am pleased that she has acknowledged that Capita is facing up to its problems. Indeed, that creates a contrast with Carillion. She talked about the financial situation of Carillion versus Capita. The chief executive of Capita has faced up to this and strengthened its balance sheet—it has been widely reported that Capita has more than £1 billion on its balance sheet—which shows that the situation is significantly different from that at Carillion and gives us confidence in its ability to continue to deliver services.

The hon. Lady talked about dividends. Again, as a result of this announcement, Capita will not be issuing dividends, which means that money can go back into the pension scheme, allowing £200 million extra to be spent on the company’s core services, rather than dividends. That is evidence that the chief executive has understood the position and is creating a different situation from that which pertained to Carillion. She raised an important point about the major accountancy firms, such as KPMG, involved in this market. The Financial Reporting Council is looking into this matter. We expect to hear from it in about six months, and we will, of course, respond as appropriate. On her question about a Crown representative, I can assure her that there is one in Capita.

I explained in my original answer the role of the Cabinet Office and the Government and the reason that we contract with private companies. The previous Labour Government and other Governments did the same. As has been reported many times, a third of Carillion’s live contracts were agreed by the last Labour Government, a third by the coalition and a third by the current Government. Governments do this to deliver public services. Our role, as a Government, is to ensure the continued delivery of those public services, and the test for me and my colleagues and officials in the Department is this: is the company capable of delivering those public services, and if there is a problem with the company, will those public services continue to be delivered? In respect of Carillion, Members will have seen that all those public services have continued to be delivered, and I am confident that they will continue to be delivered.

[Sir Patrick McLoughlin (Derbyshire Dales) (Con)]

Will my hon. Friend look at the total contempt that the Labour party has for the private sector today? Will he take the time to publish, in due course, a full list of all the contracts with the private sector that were entered into between 1997 and 2010? That will provide a fine example of how the Labour party of today is nothing like the Labour party of that period when they were in government.

[Oliver Dowden]

My right hon. Friend makes an important point. This Government, and the previous Government, have engaged with private sector companies for the delivery of public services. Gordon Brown, Labour’s last successful Prime Minister—[Interruption.] Well, he was the last Labour Member to hold the office. May I take the opportunity to correct the record on that, Mr Speaker? Gordon Brown said:

“It simply would not have been possible to build or refurbish such a number of schools and hospitals without using the PFI model.”—[Official Report, 14 November 2007; Vol. 467, c. 665.]

Why is it that we use these contractors? Because we know that they can deliver. Labour’s position is slightly confused. Is it honestly now Labour’s position that we should not use the private sector at all? Is the state going to start building roads again? Where does Labour draw the line? It is complete confusion.

[Several hon. Members rose—]

[Jon Trickett (Hemsworth) (Lab)]

I will take your advice, Mr Speaker.

Only two weeks ago, I warned that there was a danger that this whole outsourcing problem would become a set of dominoes, with one falling after another. I believe the House will conclude that the Government’s behaviour in response, and the Minister’s response today, has been marked by indifference to corporate mismanagement, incompetence in office and complacency in the face of a crisis.

The Minister will not tell the House, but I will: Capita was given 154 Government contracts last year. Only last week, Carillion contracts were being re-brokered to Capita, yet the company was clearly in trouble. Share values were plummeting and profit warnings were being issued. There was short selling on the stock market and allegations against Capita of fraud in the handling of public contracts. Yesterday, Capita’s total value on the exchange was barely much more than its total debt. The company is in serious trouble. It is a familiar tale of woe, with strong echoes of Carillion.

We want to know that the Government’s contingency plans in relation to Capita will assure jobs for current employees and protect the pensions of those employees and the pensions of the public sector workers that the company is managing. Will the Minister confirm that the public services that Capita manages will be protected in the event of a corporate disaster? Does the Government’s contingency plan allow for that? What will be the common impact of the problems at Carillion, and now Capita, on the spiralling costs of HS2? Does the Minister agree with the Opposition that not a single penny should be used to prop up badly managed outsourcing companies?

The Government are blind to the corporate greed of these outsourcing companies. Does the Minister agree that it is clear that, as the Under-Secretary of State for Justice, the hon. Member for Bracknell (Dr Lee), said only the other day, the Government should be driven by the “evidence, not dogma” on outsourcing?

[Oliver Dowden]

I thank the hon. Gentleman for his questions, the core of which was about support for outsourcing companies. He said we should not provide a penny more to prop up badly managed outsourcing companies. Indeed, that is exactly what we did in respect of Carillion. We took the decision that this was a private company and should bear the loss. That is why shareholders in Carillion are unlikely to get more than a few pennies in the pound back for their investment. The private sector has taken the risk, but the job of the Government is to ensure the continued delivery of those public services—to ensure that the dinner ladies get paid, that the hospitals get cleaned, and that the railways continue to be built. That is exactly what we did in respect of Carillion and it is exactly what our contingencies involve for all our strategic suppliers. That is the test for the Government: can we ensure the continued delivery of those public services, and can those public services continue to be delivered?

The hon. Gentleman made a point about pensions. The fact that Capita has embarked on this course of restructuring means that it is effectively choosing to switch resources away from the continued payment of dividends and towards pension funds. That should give pensioners confidence in respect of that pension fund. He also asked about jobs, and again, the restructuring can give confidence about the continuing delivery of those jobs.

I keep coming back to the same point. This is a private company and the interest of the Government is to ensure the continued delivery of those public services, and those public services continue to be delivered. That takes me back to Labour’s position. What Labour seems to be suggesting is that the private sector has no role in public life, and that the level of small and medium-sized businesses working for the Government should be zero. If that is not Labour Members’ position, are they going to tell us where they choose to draw the line? Labour has gone from pumping billions of pounds into private companies for the delivery of public services when Gordon Brown and Tony Blair were Prime Minister, to saying that they should not have a penny. Some clarity would be helpful, because otherwise people may draw the conclusion that there is more than an element of opportunism here.

[Bim Afolami (Hitchin and Harpenden) (Con)]

Does my hon. Friend agree that it would be irresponsible of this Government to cancel private companies’ contracts simply on the basis of a single profit update?

[Oliver Dowden]

I thank my hon. Friend for that question, and this is an important point about profit warnings. A profit warning does not mean that a company is imminently going to collapse. A profit warning is a warning to the markets that its results will not be in line with what it had previously thought. If every time that a company issued a profit warning, we as a Government said that we would cease to contract with them, there would be very few companies we could contract with. I will not name leading companies, because I do not want to influence their market value, but I could name a huge list of FTSE 100 companies that routinely issue profit warnings. That does not mean that they are about to disappear.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

For the second time in two weeks, we are discussing a private firm, responsible for the delivery of vital services, that has caught us cold with a profit warning. Will the Minister now acknowledge that there is a role for a proper public sector? Will the Government now start to roll back on the privatisation agenda that they and the previous Labour Government obsessed about? Can we look forward to a proper plan for taking public services back into the public sector? And will he now acknowledge that public sector employees should deliver public services?

[Oliver Dowden]

Of course we acknowledge that there is a proper role for the public sector. That is why, for example, this Government committed at the last election to providing £8 billion more for the NHS and a further £6 billion more for the NHS. To go to the core of the hon. Lady’s argument, the reason that successive Governments of all political persuasions have chosen to engage with the private sector for the delivery of services is that those companies have a speciality in it. They have a speciality in delivering such services, so they can deliver them more efficiently. That means there are savings for the taxpayer. If the Scottish National party position is seriously that we should not have any outsourcing, they need to explain to taxpayers why, instead of ploughing those efficiency savings back into our schools and hospitals, they are choosing to use them to pay for less efficient ways of delivering public services.

[Paul Masterton (East Renfrewshire) (Con)]

Does the Minister agree that the biggest risk to jobs, the biggest risk to pensions and the biggest risk to the delivery of public services would be to withdraw support for Capita on the basis of a reactionary announcement to this profit warning?

[Oliver Dowden]

Yes, my hon. Friend is absolutely right. If we were to choose overnight, in the face of one profit warning, to stop contracting with that company, there would be a significant risk of the delivery of public services falling over. As I have said, the objective of the Government is the continued delivery of public services, and we have continued to pay the cleaners, continued to have the dinners served and continued to ensure that what the people out there in the country care about, which is that their public services are delivered, continues to be delivered.

[Sir Vince Cable (Twickenham) (LD)]

Yesterday, the chief executive of Capita said that his organisation was “far too complex”. If the chief executive finds it difficult to understand how his own organisation works, how do the Government monitor the stability and performance of these very large, complex outsourcing companies, such as Capita, Serco, Atos and G4S?

[Oliver Dowden]

The right hon. Gentleman is absolutely right about what the chief executive said, and that is the reason why that chief executive has embarked on this restructuring; it is precisely because of that complexity. I well remember working with the right hon. Gentleman when I was an adviser in Downing Street and he was Business Secretary in the coalition, so he will have knowledge of that. In fact, a third of the contracts from Carillion were agreed by the coalition. The process that we had then, and that we have continued to strengthen, is twofold. First, we look at the published results of these companies and use third parties to understand them properly and verify them. Secondly, we continue to engage on a one-on-one basis with each of those companies through the Cabinet Office, to understand their financial position in order to ensure that we deliver on what the public expect—the continued delivery of public services.

[Rachel Maclean (Redditch) (Con)]

The hon. Member for Leeds West (Rachel Reeves), in the Business, Energy and Industrial Strategy Committee, has rightly raised concerns about the failure of regulation from the Financial Reporting Council and KPMG. Does the Minister agree that the answer to this dilemma is not to nationalise those companies, but to make sure that those bodies do their job for the taxpayer and the public service user?

--- Later in debate ---

[Oliver Dowden]

Yes, my hon. Friend is absolutely correct. That is why I, and we as a Government, welcome the fact that the FRC is looking into the four major accountancy firms and seeing what lessons we need to learn. Of course we will respond to that and act appropriately.

[John Spellar (Warley) (Lab)]

May I bring the Minister back to the core issue, which is that there are two separate but linked problems: the business model and the performance of these companies? Like Carillion, Capita seems to be part of the over-concentrated, over-leveraged, dividend-and-bonus-exploiting culture that relies on the state to bail out failure. Capita incompetence is only too clear from its lamentable performance on the recruitment contract for the armed services. When will this Government finally get a grip?

[Oliver Dowden]

Behind the right hon. Gentleman’s question is an important point about the diversity of suppliers in this market. We do need to look to diversify further. That is why, for example, we have set a target that 33% of all our Government contracting should be with small and medium-sized enterprises—precisely to ensure that we have that greater diversity. On his point about state bail-out, we have done precisely the opposite of a state bail-out. Carillion went into liquidation, so its shareholders paid the price; because Capita has decided to stop paying dividends, its shareholders are paying the price. Therefore, it is not correct to say that the state is bailing them out in this situation.

[Mark Pawsey (Rugby) (Con)]

Is not the Government’s role to continue to act as a prudent customer and to continue to monitor their suppliers and the services provided? Right now, the best thing that the Government can do is to allow the company to get on with its plans to restructure its business.

[Oliver Dowden]

Yes, my hon. Friend is absolutely right. Capita and its executive and shareholders are responsible for Capita. Our responsibility as a Government is for the continued delivery of public services—to make sure that the services on which the public rely continue to be delivered. That is exactly what we did in respect of Carillion, and that is exactly what we are ensuring in relation to contingency plans for all our strategic suppliers, including Capita.

[Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)]

The Minister said that Capita has a positive record of delivery, but it has been responsible for the £1 billion contract for the delivery of NHS England’s primary care support services since 2015. From the outset, both GPs and local medical committees identified serious issues with the service, including patient safety, GP workload and an effect on GP finances. Although some progress has been made, two and a half years on the service falls far short of what is acceptable, and there is still an urgent need to resolve these issues to give practices and GPs across the country confidence in it. What are the Minister and the Government doing to improve the quality of services provided by Capita?

[Oliver Dowden]

The Government contract with a company to deliver the individual services, and that is done through each Department. In respect of health services, that is done by the Department of Health, which has to ensure that Capita or any other contractor delivers on what it has promised. The function of the Cabinet Office in this respect is to ensure that overall public services continue to be delivered if there is a failure of the company.

[Jeremy Quin (Horsham) (Con)]

If I understand the Minister correctly, this company is raising funds from its shareholders in order to strengthen its balance sheet, enhance its pension fund and invest money in its core business. These corporate actions should be welcomed on both sides of the House. Does he share my frustration that the attitude of the Opposition towards the private sector seems to be, “You’re damned if you do and you’re damned if you don’t”?

[Oliver Dowden]

Yes, my hon. Friend is precisely right. As I said, it would have been helpful if Carillion had considered these actions; perhaps then it would not have got into this position. Members cannot say that somehow the Government are bankrolling these companies, while simultaneously saying that we are allowing the companies to go bust if things go wrong with them and shareholders pay the price. They cannot make those two propositions at once.

[Thelma Walker (Colne Valley) (Lab)]

Does the Minister agree that, with Carillion and now Capita, the outsourcing of our services has failed? Instead of expensive bail-outs, they should be brought back into public ownership.

[Oliver Dowden]

The Government have not bailed out a single supplier. It is the shareholders who have paid the price. It is the shareholders of Carillion who will not receive back the money they invested—or, at least, they will receive a very small proportion of the money, depending on the outcome of the liquidation. The hon. Lady’s characterisation of the situation is simply not correct.

[Rebecca Pow (Taunton Deane) (Con)]

Will the Minister assure the House that the combatant steps that the Government have taken to date regarding Carillion have protected services and ensured that there is minimal disruption to citizens? Will he also assure us that they are taking a similar combatant approach to the Capita situation so that we can protect services such as the NHS admin that is so important to us all?

[Oliver Dowden]

My hon. Friend is absolutely right. Our focus has been to ensure the continued delivery of public services. In respect of all the key strategic suppliers, we ensure that we are confident that public services will continue to be delivered if there is an interruption to those companies. That is what the House saw in respect of Carillion, and it is exactly what we prepare for all the time with regards to all our strategic suppliers.

[Hywel Williams (Arfon) (PC)]

This is a very worrying time for Carillion employees in Wales, including the hundreds employed at the call centre in Bangor in my constituency. It is also a very worrying time for disabled people, as all personal independence payment assessments in Wales are carried out by the company. Will the Minister give these people a cast-iron guarantee that their jobs are safe, and that their benefits assessments will be carried out properly and accurately?

--- Later in debate ---

[Oliver Dowden]

I believe that the hon. Gentleman is referring to Capita, not to Carillion.

[Hywel Williams]

indicated assent.

[Oliver Dowden]

I assure the hon. Gentleman that it is the priority of the Government—this is what we are working on—to ensure that there will be no interruption to the very important public services that he outlined, no matter what happens to their delivery. That is what happened with Carillion. On the very day it was announced that Carillion was going into liquidation— the announcement was made at 7 o’clock in the morning—we ensured that the people delivering public services could continue to turn up to work and to be paid, and that the public services they delivered could continue to be delivered.

[Mr Philip Hollobone (Kettering) (Con)]

Before any new Government contracts are awarded to Capita, will the Government seek fresh assurances in respect of existing and future pension obligations to its employees?

[Oliver Dowden]

I can assure my hon. Friend that in fact officials from my Department met Capita only yesterday. This is an ongoing process of engagement with all the strategic suppliers, asking exactly those sorts of questions to ensure that we have public services delivered. Of course, we are very cognisant of things like the pension fund as well.

[Tony Lloyd (Rochdale) (Lab)]

One of the real issues that comes through with both Carillion and Capita is that the enormous growth of the conglomerate structure means that these corporations are vulnerable when any part begins to fail, and that of course puts at risk the whole. Where is the risk assessment that the Minister and his team have done that guarantees that we will not see failure in Capita and in other public service providers?

[Oliver Dowden]

As I said, there is a continuing process of engagement. Over the years, the Government Commercial Function has been beefed up. We have brought in people with expertise who understand these companies and are engaging with them on a day-to-day basis to understand their business models. The purpose of doing that is to understand those business models to ensure that we are confident that we can continue to deliver these public services.

[Edward Argar (Charnwood) (Con)]

Will my hon. Friend confirm that what matters to this Government is what delivers the best public service outcomes to our constituents in terms of quality and value for money—exactly the same considerations that motivated Labour when, in government, it let so many public service delivery contracts to private companies?

[Oliver Dowden]

Yes, Labour let lots of contracts to private companies, because it believed that they had the expertise to deliver them, and that is exactly what we are doing. Interestingly, since the surge in the use of PFIs that took place under the Labour Chancellor before last, Mr Gordon Brown, we have tightened up the terms of PFI. We are learning the lessons from some of the excessive PFI contracts that we saw, which had underneath them ludicrous service fees for some of the services provided.

[Mr Barry Sheerman (Huddersfield) (Lab/Co-op)]

Capita is a significant employer in Huddersfield in its shared transport business. It has a very important role in gas safety for the Health and Safety Executive. It is a very important company. Nobody on the Labour Benches wants to see it fail; like all businesses, we want to it to succeed. There is nothing wrong with a public-private partnership: what is important is getting the contract and the relationship right. What went wrong in many PFIs was rotten contracts that still bedevil local hospitals and local schools.

[Oliver Dowden]

The hon. Gentleman makes a very important point. He is precisely right. There is nothing wrong, per se, with engaging with the private sector for the delivery of services, but we must ensure that there is rigour in the contracts. Many contracts in the past have not been properly negotiated and have not delivered value for the public sector, and they will continue to burden us for many decades to come. However, that is not an invalidation of the model; it is about problems with specific contractual negotiations.

[Bob Blackman (Harrow East) (Con)]

It is clear that Capita is unique because it grew out of outsourcing from the public sector, but as it grew the structures outstripped its proper corporate responsibility. It is also clear that we need to argue the case for the benefits to the public sector of outsourcing. Will the Minister therefore set out the benefits of outsourcing and give one or two examples of where it has been a success and delivered better public service?

[Oliver Dowden]

I am very happy to do so. This is precisely why private sector companies use outsourcing. Every company engages in outsourcing because it recognises that there are some areas where there is greater expertise than can be delivered by that company. It is exactly the same for the public sector. We focus on what actually works—what delivers for the public sector and what delivers the best price and the best value. Over 4,500 projects have been delivered since 2010; over a quarter of a trillion pounds has been invested in infrastructure; and over 70% of our 175 long-term priority projects and programmes identified are now complete, under construction, or part of a programme being delivered. This is delivering the public services that people want.

[Jenny Chapman (Darlington) (Lab)]

Capita employs 450 people in my constituency, who are principally engaged in administering public sector pensions. When the Minister has met Capita, what discussions has he had about the pensions function and the Darlington site specifically? Will he meet me to discuss that?

[Oliver Dowden]

I would be very happy to meet the hon. Lady to discuss all those points.

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Will the Minister tell the House the size of the pension deficit and what arrangements the Government are putting in place to cover that black hole?

--- Later in debate ---

[Oliver Dowden]

Capita is a private company, responsible for the running of its business. If the hon. Gentleman looks at the announcement made yesterday by Capita, he will see that it has chosen not to issue a dividend, which has released more cash and means that it can shore up its pension fund. It is a positive announcement in that respect.

[Laura Pidcock (North West Durham) (Lab)]

Will the Government review all major outsourced contracts as a matter of urgency, and in particular the contracts awarded to Capita for assessing personal independence payments for disabled people? It has been subject to justified heavy criticism for the way it treats disabled people during that process.

[Oliver Dowden]

The Government routinely publish all significant outsourcing contracts, and I would be happy to provide the hon. Lady with a link to the website so that she can get a full list of those. That is the process for doing it.

[Liz McInnes (Heywood and Middleton) (Lab)]

Is it not time that private companies providing public services were subject to the same rules of openness and transparency as the public sector, so that they can no longer hide behind the cloak of commercial confidentiality?

[Oliver Dowden]

Of course there are lessons to be learned from this. Indeed, that is exactly what bodies such as the Select Committee on Public Administration and Constitutional Affairs are looking into. However, there is a distinction between a private company and a public body. I do not think it would be appropriate to extend the full FOI provisions to all private companies.

[Drew Hendry (Inverness, Nairn, Badenoch and Strathspey) (SNP)]

If the Minister is serious about getting the best value for the public, will he commit to learning from the Scottish Government? The Scottish Futures Trust’s latest independently audited benefits statement shows more than £1 billion in savings since it was established.

[Oliver Dowden]

I welcome the hon. Gentleman’s question. Of course we will learn those lessons, but it is worth noting that the Scottish Government gave a contract to Capita in 2015. Capita was appointed by the Scottish Public Pensions Agency to deliver its integrated pensions IT software solutions, which is another example of Governments choosing to use the expertise of the private sector.

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

There are echoes of Corporal Jones from “Dad’s Army” in the Minister’s response this morning—“Don’t panic! It’s all okay.” Why does he think that Barnet Council—a flagship Tory council, known as “easy council” because of its extreme outsourcing—has put in place contingency plans based on the possible failure of this company?

[Oliver Dowden]

I can assure the hon. Lady that we are not in any way complacent. That is why we continue to ensure—I believe Barnet Council will be doing exactly the same—that there are contingency plans in place. Indeed, those contingency plans have worked in respect of the one collapse of a company we have seen: Carillion. Those public services continue to be delivered.

[Melanie Onn (Great Grimsby) (Lab)]

Capita has a £1 billion contract in the primary care sector of the NHS. The Minister has sought to minimise the necessity of declaring any kind of contingency plans to the House. Does he not think that the House and the general public deserve to know exactly what plans the Government have in the event that Capita is unable to provide those essential services to the public?

[Oliver Dowden]

I thank the hon. Lady for her question. I have given that reassurance, and I can reassure the House again that in respect of all our strategic suppliers, including Capita, we are understanding their financial position and taking appropriate contingency measures. I hope she will understand that lots of these things are commercially sensitive, and it would not be helpful to go into excessive detail on that.

[Nick Smith (Blaenau Gwent) (Lab)]

Capita’s stock has dropped 84% since its 2015 peak. Are there plans for a ministerial taskforce to grip this situation should it worsen?

[Oliver Dowden]

It is worth noting that a large chunk of the drop in the share price came yesterday in respect of the restructuring of the business—it was a consequence, for example, of the rights issue—but we are of course engaging in such a way. I and the Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Burton (Andrew Griffiths), who has responsibility for small businesses, have established a taskforce for Carillion. We are ensuring that we provide all the support we can for the private sector side of Carillion’s delivery of services. For example, we are ensuring that HMRC is showing flexibility in relation to payments, and that banks are showing some flexibility. Should the need arise, we would do exactly the same for Capita.

[Kate Green (Stretford and Urmston) (Lab)]

Poor service delivery is often an early warning sign of future financial difficulties. GP practices in my constituency have been complaining for at least two years about the poor quality of service they are receiving. We know that the contract for assessments for personal independence payments has been failing, and this morning we have heard examples of many other service delivery failures. Rather than leaving this to individual Departments to manage, should not the Cabinet Office have a central overview of where service performance is failing as an early warning of future difficulties?

[Oliver Dowden]

Yes, we should, and we do exactly that. We of course take an overall view of the delivery of public services, the financial position and contingency. The specifics of public service delivery clearly have to be contracted by the relevant Department, because the relevant Department has a deeper understanding of the need. For example, for health and education, the Department of Health and Social Care and the Department for Education are in a better position to negotiate such contracts.

[David Linden (Glasgow East) (SNP)]

Last year, a Press Association investigation revealed that Capita received £200 million more than originally planned from the Department for Work and Pensions for PIP assessments, so there is a clear trail of the Government rewarding failed performance. Will the Minister assure me that the Government will not also be rewarding corporate recklessness?

[Oliver Dowden]

No, the Government certainly will not be rewarding corporate recklessness. Carillion shareholders paid the price for the failures of Carillion in that they will not receive back their initial investment, which is precisely correct. The role of the Government is to ensure that those public services continue to be delivered, and the private sector bears the risk.

Oral Answers to Questions

Oliver Dowden Excerpts

Wednesday 10th January 2018 Commons Chamber

[Hon. Members]

Hear, hear!

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

Thank you, Mr Speaker, and hon. Members for that very warm welcome.

Small businesses are the backbone of our economy, and this Government are committed to supporting them in securing Government contracts. To that end, we have already streamlined our procurement processes to assist small businesses. Our small business panel is working to improve accessibility of Government contracts, and we continue to focus on breaking down the barriers that might deter SMEs.

[Nigel Mills]

I thank the Minister for that answer and welcome him to his position. He will know that many small businesses are put off trying to get contracts by the amount of information they need to supply and the bureaucracy they have to go through. What more can the Government do to reduce that bureaucracy and amount of information?

[Oliver Dowden]

My hon. Friend raises a very important point. It really is vital that small businesses can access Government contracts as simply as possible, so to achieve this we have already taken action to ensure that bidding processes are simplified across the public sector, with complex pre-qualification questionnaires abolished for low-value contracts. We will continue to look at ways to reduce burdens for business, particularly small businesses.

[Derek Twigg (Halton) (Lab)]

Given what the Minister has said, what information does he have that there has actually been an increase in the number of small and medium-sized businesses accessing Government contracts?

[Oliver Dowden]

I would point to three pieces of information: direct spend with SMEs is up 80% since the Conservatives came to power in the coalition in 2010; more small businesses than ever are bidding for Government business; and the Government now spend about £5.6 billion directly with SMEs.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

As a fellow Hertfordshire MP, may I congratulate my hon. Friend on his well-deserved new role? Does he agree that it may be possible for prime contractors with Government contracts to do more to bring in small and medium-sized businesses, particularly in specialist areas, where Hertfordshire is of course so strong?

[Oliver Dowden]

I thank my right hon. and learned Hertfordshire Friend for his welcome. He raises an important point. There are two aspects of this: there is the direct spend—as I have said, it is about £5.6 billion—but we also need to ensure that we get spend into contracts lower down, with people who have Government contracts then spending with small businesses, which is something we are committed to doing as a Government.

[Jon Trickett (Hemsworth) (Lab)]

Too often, rather than outsourcing to SMEs, very large companies are employed. In this respect, despite being under investigation by the Financial Conduct Authority and reportedly having debts of £1.5 billion, the massive outsourcing company Carillion remains a major supplier in terms of Government procurement. If it were to collapse, it would risk massive damage to a range of public services. Do the Government have a contingency plan for such an eventuality, and what is the likely cost to the taxpayer?

[Oliver Dowden]

As the hon. Gentleman would expect, we of course make contingency plans for all eventualities. If I could briefly update the House, Carillion, as Members will know, is a major supplier to the Government, with a number of long-term contracts. We are committed to maintaining a healthy supplier market and working closely with our key suppliers. I can tell the House that Carillion’s operational performance has continued to be positive. For example, it advanced its work on Crossrail over the Christmas period.

[Jon Trickett]

The truth is that the Minister has failed to answer the central question. The Government have been outsourcing public services to large outsourcing companies on an industrial scale. When these massive outsourcing companies fail, as too often they do, does the Minister really think it is fair that the costs stay with the taxpayer, while the profits are creamed off by the shareholders?

[Oliver Dowden]

I do not think there is anything wrong with profit. Profit is a reward for investment made by businesses. Perhaps if the hon. Gentleman had listened to my answer, he would not have had to read a pre-scripted question. I gently suggest to him that this is something the Government take very seriously. We, for the first time, as a Government—this had not been done for 13 years previously—started measuring the number of small and medium-sized enterprises that have Government contracts. We set a target of 25% in the last Parliament, and we have delivered on that, so I think that is a record of success for this Government.

[Jeff Smith (Manchester, Withington) (Lab)]

4. What steps he is taking to ensure that democratic processes are protected against foreign influence.

--- Later in debate ---

[Bill Esterson (Sefton Central) (Lab)]

6. What recent assessment he has made of the level of Government procurement from small businesses.

[The Parliamentary Secretary, Cabinet Office (Oliver Dowden)]

In November 2017, we published the 2015-16 figures for central Government Departments. The Government are fully committed to supporting our small businesses, which are the engine room of our economy, so we are continuing to take action to meet our target of a third of procurement being with small businesses by 2022.

[Mr Speaker]

It is good to see the Minister looking in a state of high excitement, as well he might.

[Bill Esterson]

Those 2015-16 figures show procurement to small and medium-sized enterprises to be falling, from 27% to 24%. The majority goes through indirect procurement, so is not the truth that wholesale changes are needed in a Government procurement system that just delivers crumbs from the table of large contractors to SMEs?

[Oliver Dowden]

The hon. Gentleman is right to highlight the fact that this is a challenging target, but, as I said previously, we set a challenging target in 2010 and we met it by the end of the Parliament. I am confident that we will meet our target again. In particular, we will be taking further measures in relation to SMEs. We will use transparency to encourage large businesses to employ more SMEs and make prompt payment part of the selection process for larger suppliers, which is the point that he raised. I can tell the House that we will be bringing forward proposals on that very shortly.

[Jo Platt (Leigh) (Lab/Co-op)]

7. What steps his Department has taken to co-ordinate the Government’s work on social mobility.

European Council

Oliver Dowden Excerpts

Monday 23rd October 2017 Commons Chamber

[The Prime Minister]

I always welcome the literary and classical references that my right hon. Friend the Foreign Secretary brings to bear in his speeches and statements, and he and I are both working to ensure we get the right deal for the United Kingdom when we leave.

[Oliver Dowden (Hertsmere) (Con)]

I, too, was listening to the Foreign Secretary’s speech, and I was heartened by his remarks on Korea. I thank my right hon. Friend the Prime Minister for her update on those discussions at the European Council; does she agree that, as we leave the EU, it is more important than ever that we reassure our important friends and allies in that region, such as Japan and the Philippines, that our support for them remains undimmed, and, indeed, is stronger than ever?

[The Prime Minister]

I am very happy to give my hon. Friend that reassurance. Indeed, I spoke to Prime Minister Shinzo Abe this morning to congratulate him on his victory, but also to reinforce the fact that we in the United Kingdom want to build on and enhance our relationship with Japan. We will continue to work with it and other international partners to ensure we get the right result by stopping the Democratic People’s Republic of Korea’s illegal activities, but we also want a stronger defence and trade relationship with Japan in the future.

UK Plans for Leaving the EU

Oliver Dowden Excerpts

Monday 9th October 2017 Commons Chamber

[Mr Speaker]

Order. I am keen to accommodate remaining colleagues. However, although we have been blessed with commendably succinct replies from the Prime Minister, the length of some questions has equalled the eloquence with which they have been expressed, so there is a premium on brevity.

[Oliver Dowden (Hertsmere) (Con)]

Businesses in my constituency are concerned about outcomes, particularly the frictionless movement of goods across Europe and the mutual recognition of standards, rather than membership of particular institutions. Will the Prime Minister reassure me that, during the second phase of negotiations, those outcomes will be the Government’s priority?

[The Prime Minister]

Yes, I can give my hon. Friend that assurance. That is exactly why we have said that we want to negotiate a new agreement and a new partnership with the European Union. It will be the interests of businesses across the United Kingdom that will be part of what is driving us towards that new arrangement.

Debate on the Address

Oliver Dowden Excerpts

Wednesday 21st June 2017 Commons Chamber

[The Prime Minister]

I can confirm to my hon. Friend that we do indeed intend to take action on this issue. We recognise the problem in relation to energy bills and we want to ensure that we get the best measure in place to deliver what we all want, which is to see people no longer being ripped off by high energy tariffs.

[Oliver Dowden (Hertsmere) (Con)]

The Prime Minister has talked about the national interest and the need for cross-party support. Does she agree that for her excellent proposal of a commissioner for extremism to work it requires the engagement not just of Government Members but of Opposition Members, if we are to stamp out the evil ideology of extremism that drives terrorism in this country?

[The Prime Minister]

My hon. Friend is absolutely right. We have spoken a lot about the need to deal with terrorism. Of course we need to look at the powers we have to deal with terrorists, but we also need to ensure that we deal with the extremism and hatred that fuel that terrorism. That is why the commission for countering extremism is so important, and I hope, as I said earlier, that it is a measure that can be supported in all parts of the House. It is important if we are to ensure that we drive this extremism and hatred out of our society.

Article 50

Oliver Dowden Excerpts

Wednesday 29th March 2017 Commons Chamber

[The Prime Minister]

No, I have said clearly that when we are able to provide clarity, as we have done up until now and look to do in the future, we will do so. However, it is absolutely the case that if we are to get the best deal for the United Kingdom, we should not reveal every detail of our hand at every stage in the negotiations. We will be looking to ensure that clarity and information are available where that is appropriate.

[Oliver Dowden (Hertsmere) (Con)]

While seeking to protect and enhance workers’ rights, will the Prime Minister also seize the opportunity afforded by leaving the European Union for greater sectoral deregulation so that businesses are able to create wealth and prosperity, which we all need and upon which our public services ultimately rely?

[The Prime Minister]

At the point at which we leave the European Union, the acquis will be brought into UK law, which will provide businesses with certainty. It will then be up to the UK Government and the UK Parliament to determine what regulations remain in place in the future and what deregulation should take place.