Private Finance Initiative

Philip Davies Excerpts

Thursday 23rd June 2011 Westminster Hall

[Jesse Norman (Hereford and South Herefordshire) (Con)]

I am grateful for the opportunity to discuss the important issue of the private finance initiative under your chairmanship, Mrs Main. I thank the Minister, the Backbench Business Committee, which allowed us to hold this debate, and my many colleagues in the Chamber today.

Since its inception in the early 1990s, the private finance initiative has resulted in more than £200 billion of public debt, the cost of which will hang over the British taxpayer for decades. It has created great private fortunes and fundamentally shaped the nature of our public services. It has generated huge public outrage, as we will hear in this debate. It has raised profound issues of fairness between this generation and the next and it has affected virtually every constituency in the land and the lives of millions of people.

For reasons that I will explain, the extraordinary fact is that until now there has never been a full three-hour debate on the PFI in this House. There has never been a comprehensive assessment by the Government of the cost and benefits of the PFI or a successful attempt to collect all the relevant data about the PFI into one place. None the less, the topic of this debate could hardly be more relevant. We need to ask three questions. How did we get here? How can we make savings from the PFI for the taxpayer? How can we design a better system for the future?

[Philip Davies (Shipley) (Con)]

I am grateful to my hon. Friend for bringing this debate to the House. One thing I have stumbled across is that the Prison Service does not own a computer because of the PFI. It rents them all at the cost of £160 a month, which most people would think was a ludicrous state of affairs. To prevent such a thing happening again, does he not agree that the people who negotiate the contracts within Government should be surcharged if the National Audit Office or some other similar body judges that the contract that they entered into was negligent to the taxpayer?

[Jesse Norman]

That is an extremely interesting suggestion. I am not sure how the details would work, but I will make specific proposals for improvement to public procurement later on in my speech. I thank my hon. Friend for his intervention.

Like many colleagues, I first understood the impact of the private finance initiative through my local hospital. Starting in 1999, Hereford hospital was one of the earliest PFI projects. It was built and is currently owned and managed under a 30-year contract through a special purpose company, which is three-quarters owned by Semperian, a large PFI firm based in the City of London, and one-quarter owned by the French industrial services giant, Sodexo. Non-clinical services are contracted out to Sodexo, WS Atkins and to others.

Car parking charges at the hospital have been the source of huge local anger because they penalise patients at a very vulnerable time in their lives. They particularly hit frequent users such as those visiting in-patients and those suffering from cancer. They are socially regressive, falling relatively harder on the poor than on the rich. As I investigated further, I found that that was only the tip of the iceberg. The reason why the charges were so high was down to the PFI itself, because car parking was contracted out not once but twice—first to Sodexo and then to CP Plus, and each had its own mark-up.

Oral Answers to Questions

Philip Davies Excerpts

Tuesday 16th November 2010 Commons Chamber

[Mr Hoban]

My hon. Friend is absolutely right, and it just goes to show that credit rating agencies do not get it wrong all the time. In May, Standard & Poor’s put the UK’s credit rating on a “negative outlook”, as a consequence of the previous Government’s policies. However, in October it said that

“the coalition parties have shown a high degree of cohesion in putting the U.K.’s public finances onto what we view to be a more sustainable footing.”

We welcome those comments.

[Philip Davies (Shipley) (Con)]

9. What recent assessment he has made of the effectiveness of the outcome of the comprehensive spending review in reducing the budget deficit.

[The Chief Secretary to the Treasury (Danny Alexander)]

The Office for Budget Responsibility will update its forecast of the deficit on 29 November, taking into account the spending review. Other assessments have backed the Government’s plans, with the International Monetary Fund, for example, stating that our consolidation plan

“greatly reduces the risk of a costly loss of confidence in fiscal sustainability and will help rebalance the economy”.

That backs our view that the spending review was fair and supports growth.

[Philip Davies]

One of the big winners from the comprehensive spending review was, of course, the European Union. The EU has not had its accounts signed off by auditors for 16 years running, so if the Government are looking for a popular way to reduce the deficit, may I suggest that they go to the EU and say that it will not get another penny-piece out of the UK until it has had its accounts signed off?

[Danny Alexander]

Of course, the European Court of Auditors report, which fails to qualify the accounts for the 16th year in succession, is disappointing, as my hon. Friend observes. We will continue to champion reform through engagement with European institutions and other member states. It is worth him bearing in mind that the Government’s most important priority for the forthcoming budget negotiations is to reduce and to keep under control the EU budget, not just next year, but in subsequent years, in recognition of the fact that many EU countries are facing tough financial circumstances, as we are.

European Union Economic Governance

Philip Davies Excerpts

Wednesday 10th November 2010 Commons Chamber

[Mr Hoban]

I have not seen Mr Van Rompuy’s comments. As hon. Members will recognise, I have been rather tied up in the Chamber for most of this afternoon.

Let me continue to make the Government’s position clear. Will we have to present our Budget to Europe before we present it to the House? No. Will we have to give Europe access to information for budgetary surveillance that is not similarly shared with organisations such as the IMF, or that is not publicly available on the internet? Again, the answer is no. Will powers over our Budget be transferred from Westminster to Brussels? Again, the answer is no.

[Philip Davies (Shipley) (Con)]

Does my hon. Friend understand that many people have lost confidence in assurances given whenever a new European treaty is discussed that there will be no loss of sovereignty? Ever since we went into the Common Market, the British public have been told at every stage along the way, “Actually, we’re not giving up any sovereignty. This new treaty doesn’t give anything away,” but people have found time and again that these treaties have done just that. Does my hon. Friend understand people’s concerns that although the powers in question do not apply to the UK at the moment, they may well do so in future, as the European Union is clearly looking at extending sanctions to non-eurozone countries as well?

[Mr Hoban]

Nothing in the documents before us today does what my hon. Friend suggests. People should listen and read the documents to which we have subscribed, and understand how firm and robust the Government have been in defending our economic sovereignty.

--- Later in debate ---

[Chris Leslie]

Our perspective is clearly different from that of the hon. Gentleman. I want to consider what is on the table. There are details still to come when the European Council meets in December, and we shall have to look at those proposals then. It seems to me that there is a case to be made for some sort of objective analysis of just what transfers of policy may or may not be involved in the proposals that are before us today.

[Philip Davies]

Does the hon. Gentleman think it makes sense for an organisation whose accounts have not been signed off by auditors for 16 consecutive years to be given more powers over economic and financial governance?

[Chris Leslie]

The hon. Gentleman has made his point in his own inimitable way, but I do not want to be diverted from the substance of what is before us. There is a substantial proposition on the table, and I think it is important for all Members to understand it. The detail that will eventually emerge from the final taskforce report is important, and it would be useful if the Minister could deal with some of the question marks that hang over some of the detail, to which Members have already alluded.

For example, a series of new fiscal disciplines—as they are called—will be pursued across the European Union but, of course, largely for eurozone countries; yet the adoption of enforcement measures will apparently be subject to the negative qualified majority voting procedure. That presumably means that the United Kingdom will take part in any of those decisions. If that is so, can the Minister say how we will inform our policy position if we are involved in votes on enforcement measures? While we may not have a vetoing power here, our role could be strategically significant.

Economic Governance (EU)

Philip Davies Excerpts

Wednesday 27th October 2010 Commons Chamber

[Mr Hoban]

The hon. Lady makes some sensible points about this matter, but she needs to speak to some of her own colleagues in the European Parliament, because they voted against the freeze on the budget. And of course it was her right hon. and hon. Friends who gave away some of our rebate as well. That is part of the problem that this Government are trying to sort out.

[Philip Davies (Shipley) (Con)]

Whenever the Minister defends this country from a power grab and a cash grab by the European Union, he will have the enthusiastic support of Members on these Benches. Some of us are rather nervous, however, because when the Conservatives were in opposition, they opposed the European External Action Service, yet they sang its praises when introducing it in the House not long ago. They also opposed giving more money to the European Union, yet they recently rubber-stamped an increase through this House that had been agreed by the previous Government. Does the Minister agree that his Government should be judged on what they do, and not on what they say?

[Mr Hoban]

Absolutely. That is why I would encourage my hon. Friend to read this document. He will see the gains that we have managed to secure in Europe to defend our position.

Equitable Life (Payments) Bill

Philip Davies Excerpts

Tuesday 14th September 2010 Commons Chamber

[Mr Hoban]

I shall give way to my hon. Friend the Member for Shipley (Philip Davies).

[Philip Davies (Shipley) (Con)]

Nobody is keener than me for the Government to save money and get the finances back on track, and I am happy to meet my hon. Friend to give him some of my ideas about how we can do that. However, I hope that the Government, having made commitments to people while in opposition, will not use the argument that there is no money in order not to pay a fair settlement. After all, we all knew that there was no money when we were in opposition.

[Mr Hoban]

That is why, when the ombudsman published her report, we highlighted her recommendation that we need to consider the impact on the public purse of any compensation scheme. We made that point when she published her report, and it was in the Opposition day motions on which we voted prior to the election. It has been a consistent strand in our policy to recognise the impact on the public purse of this compensation pot.