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Wednesday Volume 51810 November 2010 No. 68

HOUSE OF COMMONSOFFICIAL REPORT

PARLIAMENTARYDEBATES

(HANSARD)

Wednesday 10 November 2010

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House of Commons


The House met at half-past Eleven o’clock

PRAYERS

[MR SPEAKER in the Chair]

Oral Answers to Questions

NORTHERN IRELAND

The Secretary of State was asked—

Exports

1. David Morris (Morecambe and Lunesdale) (Con):What recent discussions he has had with ministerialcolleagues on the contribution of Northern Ireland tothe Government’s programmes to increase the level ofexports for the purposes of international trade. [22147]

The Minister of State, Northern Ireland Office (Mr HugoSwire): My right hon. Friend the Secretary of State andI have had regular discussions with ministerial colleaguesin Northern Ireland on economic development issues.We will continue to work with the Executive to rebalancethe Northern Ireland economy and grow the privatesector.

David Morris: Does the Minister agree that theinspirational visit to China by the Prime Minister showsthat we should redouble our efforts on exporting?

Mr Swire: Yes, I certainly do. Invest Northern Irelandhas recently led trade missions to Brazil, South Africaand Vietnam, and 35 Northern Ireland companies fromacross the sector went with it. What is going on inChina should work as an incentive to others to export.Let me pay tribute to a company that I visited the otherday in Ballymena—and I see that thehon. Member forNorth Antrim (Ian Paisley) is present. Wrightbus hasjust supplied 450 double-decker buses to Singapore andhas won the design project for the replacement of the iconicRoutemaster bus here in London. The answer to rebalancingpart of the Northern Irish economy is to get—

Mr Speaker: Order. That answer is too long. TheMinister will resume his seat, and he must not repeatthat.

Ms Margaret Ritchie (South Down) (SDLP): I thankthe Minister for his answer. Given the need to providegrowth in the Northern Ireland economy and ensurejobs and investment, can he provide assurances to theHouse that the Prime Minister, on his current trademission to China, is aware not only of the need torebalance the economy in Northern Ireland but of theproducts that could be exported as part of internationaltrade—and also of the fact that the Government areabout to publish a paper on the Northern Irelandeconomy and corporation tax?

Mr Swire: Of course the Prime Minister continues totake an interest in Northern Ireland. The food, drinkand tobacco sectors account for 45% of total sales and46% of external sales. These figures could and shouldincrease, and the Secretary of State and I will work withthe devolved Administration, in whatever way we areasked, to support any incentive of that kind.

Ian Paisley (North Antrim) (DUP): Will the Secretaryof State commit to making representations to the Treasuryregarding alterations to how tobacco tax is lifted, sothat the Treasury can receive a bigger taxation takewhile allowing the industry to invest in securing jobs inNorthern Ireland?

Mr Swire: The hon. Gentleman has in his constituencythe Gallaher Group, which my right hon. Friend theSecretary of State visited recently. The loss to the UnitedKingdom economy from contraband cigarettes and forfeitedduty is in the region of £2 billion to £3 billion a year. Weshould consider that closely, and continue to makerepresentations in that regard.

Naomi Long (Belfast East) (Alliance): Is the Ministeras concerned as those of us who come from NorthernIreland that recent reports show a third quarter fall ingrowth in the private sector in Northern Ireland, andwill he therefore redouble his efforts to rebalance theNorthern Ireland economy more effectively?

Mr Swire: Clearly, Northern Ireland is not immuneto what is going on in the rest of the world—one hasonly to look over the border at what is going on inIreland to see that. We work very closely with NorthernIreland on rebalancing the economy and we have thesupport of the Finance Minister, who, along with theMinister of Enterprise, Trade and Industry, is meetingthe Select Committee on Northern Ireland Affairs thisafternoon to discuss corporation tax. We must leave nostone unturned in our attempts to rebalance NorthernIreland’s economy and, critically, to provide well-paidand sustainable jobs.

Mr Speaker: Unless I am mistaken, the hon. Memberfor Morecambe and Lunesdale (David Morris) did notput a supplementary question to the substantive question.If he did he can nod his head, but if he did not, heshould do so.

David Morris indicated assent.

Mr Speaker: He did; he is happy. He is sanguineabout it.

The Disappeared

2. Gavin Williamson (South Staffordshire) (Con):What recent progress has been made on locating thedisappeared. [22148]

The Minister of State, Northern Ireland Office (Mr HugoSwire): In July, the Independent Commission for theLocation of Victims’ Remains successfully recoveredthe remains of Charlie Armstrong, and it awaits DNAconfirmation regarding remains it believes to be thoseof Gerard Evans and Peter Wilson. This would take thetotal number of disappeared who have been located tonine.

269 27010 NOVEMBER 2010

Gavin Williamson: Is it still the case that the ICLVR isto be wound up at the end of this year?

Mr Swire: May I pay tribute to the excellent work ofthe ICLVR, particularly Geoff Knupfer and Jon Hill,who do such good work, as I have seen for myself ? I metthe Wilson family just before the find was announced,and I can testify to the very serious effect that it has onfamilies who have waited for many, many years to findsomewhere to put their loved ones in a grave and go andsee them regularly. That achieves closure for manypeople. The commission is a joint initiative between theIrish and the British Governments. It is led entirely byintelligence, and we will continue to be led by intelligence—

Mr Speaker: Order. The Minister will have to practise.He is far too long-winded, and that has got to change.

Eric Joyce (Falkirk) (Lab): The Minister refers to therecovery of remains, which is a painful reminder of theneed to deal with the legacy of the past in NorthernIreland. If the Secretary of State decides to place anynew obligations on the Historical Enquiries Team, willhe ensure that it is fully and properly funded to undertakethem?

Mr Swire: The two bodies are entirely different. Webelieve that the HET is a good organisation and shouldbe properly resourced, as we believe it represents theway forward.

Mr James Gray (North Wiltshire) (Con): The wholeHouse will think fondly of that gallant soldier CaptainRobert Nairac of the Grenadier Guards, who was sobrutally killed by the IRA. Does the Minister have anyup-to-date information about whether his remains mayyet be discovered?

Mr Swire: My hon. Friend is right to draw attentionto that. Alas, Captain Nairac is not alone. A considerablenumber of bodies have yet to be located, which we hopewill happen in due course.

Mr Jeffrey M. Donaldson (Lagan Valley) (DUP): TheMinister has already referred to the winding up of thecommission dealing with the disappeared. Does he thinkthat is wise, and does he think it is wise also to wind upthe Independent Monitoring Commission, given theongoing paramilitary activity in Northern Ireland?

Mr Swire: The right hon. Gentleman may have misheardme. I have not said that we will wind up the former.With reference to the latter, we announced that therewould be one more valedictory report. It was establishedin the first place to monitor the connections betweenelected representatives and paramilitaries. We believethat that is no longer appropriate or necessary.

Lady Hermon (North Down) (Ind): Would the Ministerkindly give me a commitment that fresh efforts will bemade to retrieve my young constituent, Lisa Dorrian,who was murdered and disappeared by those with loyalistparamilitary connections five years ago? That is fivelong Christmases for the family, who deserve closure.What fresh efforts are being made to retrieve her body?

Mr Swire: The hon. Lady is entirely correct, but shemust understand that the responsibility of the NorthernIreland Office in these matters is limited, and quiteproperly so. The ICLVR is an independent organisationand responds to intelligence provided to it—very oftenanonymous intelligence. I hope that it will listen to whatthe hon. Lady has said, but it will respond only whenthe intelligence comes. I hope that those who have anyunderstanding or any knowledge will bring that knowledgeforward.

Barnett Formula Funding

3. Tom Greatrex (Rutherglen and Hamilton West)(Lab/Co-op): What recent discussions he has had withprivate sector companies in Northern Ireland on theeffects on them of changes in Barnett formula fundingfor Northern Ireland consequent upon the outcomes ofthe comprehensive spending review. [22149]

The Minister of State, Northern Ireland Office (Mr HugoSwire): My right hon. Friend the Secretary of State andI have regular discussions with people from the privatesector in Northern Ireland. I have found a widespreadrecognition that the public sector can and should respondby delivering better value, and support for the objectivethat we and the Executive share of rebalancing theNorthern Ireland economy.

Tom Greatrex: The Minister will be aware of therecent report from PricewaterhouseCoopers stating that36,000 jobs will be lost in Northern Ireland as a resultof the Government’s policies—20,000 in the publicsector and a further 16,000 in the private sector. Whatestimate has he made of the cost to the taxpayer ofthose 36,000 people currently in work being madeunemployed by the Government’s policies?

Mr Swire: The hon. Gentleman was not in the Houseat the time, but these are not the Conservative andLiberal Democrat parties’ cuts. These are Labour’s cuts—[Interruption.] Northern Ireland has done better out ofthe spending review than it was led to believe wouldhave been the case under the previous Government. It isin the interests of everybody in the House to talk upNorthern Ireland, to attract inward investment and torebalance the economy so that it is not so dependent onthe public sector. That is the way forward for NorthernIreland, and I hope the hon. Gentleman will support uson that.

Alun Cairns (Vale of Glamorgan) (Con): Does theMinister agree that to reform the Barnett formula, allthe devolved nations would need to agree to a process,and that if one nation, such as the Scottish Government,refused to participate in that process, that would beshowing disrespect to all the others?

Mr Swire: Of course I am aware of the House ofLords Select Committee report on the Barnett formula,the Holtham Commission on Welsh funding and othercommentators on the system of devolution funding. Atpresent we are trying to get the public finances undercontrol to get the economy moving again. Any changein the system of funding the devolved Administrationsmust wait for the stabilisation of the public finances.

271 27210 NOVEMBER 2010Oral Answers Oral Answers

Sammy Wilson (East Antrim) (DUP): One of theimpacts on the private sector will be the huge reductionof 40% in capital spending over the next four years, andthere is disagreement about whether the settlement honoursthe St Andrews agreement settlement on capital spending.In the one area where there is dispute, does the capitalsettlement for Northern Ireland include capital spendingon the police? Is that part of the Minister’s assessmentof the total capital budget for Northern Ireland?

Mr Swire: The hon. Gentleman knows that under theprevious Government the reduction was likely to be50% of capital expenditure. Under us it is 37% over fouryears. In response to his comments on policing andjustice, I can tell him that we stand by the commitments.As he knows, the Northern Ireland Executive’s capitalallocation of £3.3 billion over the spending reviewperiod will permit those costs to be met, but there willbe difficult decisions, and unfortunately it is up to thehon. Gentleman, as the Finance Minister at Stormont,to make those difficult decisions. It is up to him and theExecutive, and I support his attempts to get them toform a budget.

Robert Halfon (Harlow) (Con): Does my hon. Friendagree that the people of Northern Ireland will welcomethe cut in business taxes, which will create real privatesector jobs, and the coalition Government’s action todeal with the £120 million a day in interest and debt thatwe are paying?

Mr Swire: Yes, of course. Northern Ireland, likeother parts of the United Kingdom, will benefit fromthose actions, which the incoming Government tookvery quickly. Beyond that, however, we are thinkingabout how, in the long term, we can stop the dependencyon the public sector, which is disproportionate in NorthernIreland. In that context, one way forward will be to lookat the whole issue of corporation tax.

Comprehensive Spending Review

4. Gemma Doyle (West Dunbartonshire) (Lab/Co-op):What assessment he has made of the likely effects onsecurity in Northern Ireland of the outcomes of thecomprehensive spending review; and if he will make astatement. [22150]

The Secretary of State for Northern Ireland (Mr OwenPaterson): Following the outcome of the 2010 spendingreview, it is for the Northern Ireland Executive to decidehow funds are allocated to the Northern IrelandDepartments. It will be for the Northern Ireland JusticeMinister and the Chief Constable of the Police Serviceof Northern Ireland, in the first instance, to negotiatethe PSNI budget with the Executive. My right hon.Friend the Prime Minister and I have made it clear thatwe will protect the people of our country from theterrorist threat with every means at our disposal.

Gemma Doyle: I thank the Secretary of State for hisresponse. He will appreciate that people in NorthernIreland and throughout the UK will be concerned aboutthe impact of spending cuts on peace and security inNorthern Ireland. Can he assure the House that thecomprehensive spending review will not impact on front-linecommunity policing in Northern Ireland? That is somethingthat the Minister stopped short of saying in response toan earlier question.

Mr Paterson: We have been absolutely clear that wewill stand by Northern Ireland. We will do what isnecessary to bear down on that threat, but the first portof call is for the Justice Minister and the Chief Constableto negotiate with the Executive on the very substantialallocation of public money that has been granted tothem in the spending round.

Mr Laurence Robertson (Tewkesbury) (Con): TheSelect Committee on Northern Ireland met the assistantcommissioner of the Garda two days ago, and he assuredus that in spite of the financial difficulties in Irelandthey would continue to police the border, in particular,in the same way. He said that there would be absolutelyno reduction in their efforts. Can the Secretary of Stategive us the same assurance today?

Mr Paterson: Emphatically yes. We have exceptionalco-operation with the Garda, and I should like tocongratulate them on their seizure of a significant amountof armaments at Dunleer woods in County Louth.Emphatically yes: we will work extremely closely withthem and match their effort.

Mr Gregory Campbell (East Londonderry) (DUP):The Secretary of State will be aware of the deterioratingsecurity situation in parts of Northern Ireland due tothe dissident threat. Will he be open to an approach,should it be required, for additional resources to dealwith that threat as it materialises over the winter months?

Mr Paterson: We have been clear, from the earlynegotiations that I had with the shadow Secretary ofState, when he was Secretary of State, that we wouldendorse the very substantial policing settlement that theprevious Government negotiated with the NorthernIreland Executive. That was quite clear. Should there besecurity pressure, and should the security positiondeteriorate, it would be right for the Justice Ministerand the Chief Constable to come to us and ask forcontributions from the national reserve.

Security Situation

5. Andrew Stephenson (Pendle) (Con): What his mostrecent assessment is of the level of threat posed byterrorist groups in Northern Ireland. [22151]

7. Ian Murray (Edinburgh South) (Lab): What hismost recent assessment is of the security situation inNorthern Ireland. [22153]

The Secretary of State for Northern Ireland (Mr OwenPaterson): The threat level in Northern Ireland remainsat severe. We are not complacent, but I am pleased totell the House that this year, following eight furtherarrests this morning, there have been 199 arrests and71 persons have been charged with terrorist offences.That compares with 106 arrests and 17 charges in thewhole of 2009. I commend the security forces for theircontinued successes in frustrating the efforts of residualterrorist groups. The coalition Government are committedto continuing to promote peace, stability and economicprosperity in Northern Ireland, and standing firmlybehind the agreements negotiated and the institutionsthat they established.


Andrew Stephenson: I thank my right hon. Friend forthat answer. The national security strategy has highlightedthe fact that there have been 37 separate attacks thisyear, so the threat from residual terrorist groups remainshigh. What steps is he taking to combat that threat?

Mr Paterson: I am grateful for my hon. Friend’squestion. We have taken this to the highest level ofGovernment. We presented a paper to the NationalSecurity Council, and as a result of that, the threat fromNorthern Ireland has been put in tier 1 in the nationalsecurity strategy.

Ian Murray: The latest Independent MonitoringCommission report highlights the continuing involvementof dissident republicans in very serious levels of criminalactivity. Will the Minister assure the House that allresources will be made available to ensure that thatthreat does not continue?

Mr Paterson: I repeat again that we are workingextremely closely with the devolved Administration andthe Dublin Government on bearing down on this threat,and we will do what is necessary.

Mr Nigel Dodds (Belfast North) (DUP): Will theSecretary of State acknowledge the deep anger amongall sections of the community in Northern Ireland atthe growing level of attacks by paramilitaries—with,indeed, activity on both sides, but particularly amongdissident republicans? People are looking for action tobe taken, and for co-operation between the agencies forwhich he is responsible and the Northern Ireland Executiveto deal with this problem urgently.

Mr Paterson: The right hon. Gentleman is right tomake that comment. That is why we produced a substantialpaper for the National Security Council, which wasdiscussed at the highest level; and that is why we areworking so closely with the devolved Administrationand the Justice Minister, to whom I spoke this morning,and the Government in Dublin. We are determined towork at all levels to end this security problem.

Mr Dodds: I thank the Secretary of State for hisanswer, and acknowledge the work that he is doing interms of the tier 1 level of threat assessment in NorthernIreland. However, the fact that the recent bomb find atEast Midlands airport happened on the same day as abomb find at Belfast City airport shows the level ofthreat against citizens right across the United Kingdom.Can we be assured that while the threat of al-Qaeda is apriority, the threat in Northern Ireland is also treated asa top priority?

Mr Paterson: The right hon. Gentleman is right topoint out that these threats affect us all in the UnitedKingdom. That is why the threat from Northern Irelandhas been placed in the No. 1 category—in tier 1.

Mr Shaun Woodward (St Helens South and Whiston)(Lab): The Secretary of State and his right hon. Friendthe Prime Minister gave an unambiguous undertakingbefore the Hillsborough Castle agreement that the previousGovernment’s financial arrangements for the devolutionof policing and justice would be upheld. In relation tothe security situation, this unequivocally included a

commitment that the Northern Ireland Executive wouldhave access to the reserve. Can the Secretary of Stateconfirm that he continues to stand by that commitment,without any new conditions being imposed by the Treasury?

Mr Paterson: I am grateful to the right hon. Gentlemanfor his question. I have said this already, but I am happyto look him in the eye and repeat it. Should the securitysituation deteriorate, then—according to the agreementthat the previous Government, in which he was Secretaryof State, made with the then Executive—the JusticeMinister and the Chief Constable have the right toapproach the Government with a clear strategy onsecurity grounds in order to call on the national reserve.

Mr Woodward: I am grateful for that reply. We allnote the decision to raise the threat level here in GreatBritain, and the Secretary of State can be assured thatthe Opposition fully support the decision to address theproblems created by that threat. Given the level ofrecent attacks in Northern Ireland, including the recentuse of a hand grenade, and given the need for theresponse to be measured, proportionate and joined up,would a request by the First Minister and Deputy FirstMinister to meet the Prime Minister as soon as possiblebe fully supported by the Secretary of State?

Mr Paterson: The Prime Minister made regular visitsto Northern Ireland when he was Leader of the Opposition.He met the First Minister and Deputy First Ministerthen, to discuss a broad range of issues. He intends togo back to Northern Ireland, and at that time he willhave the opportunity to discuss matters with them. Ifthe right hon. Gentleman is referring specifically to thebudget settlement, it is appropriate that the First Ministerand Deputy First Minister first discuss that with me,having done their utmost to come to an agreement andconsensus in the Executive on a budget for the substantialfunds that have been allocated to them in this spendinground.

Parliamentary Voting System and Constituencies Bill

6. Mark Durkan (Foyle) (SDLP): What discussionshe has had with ministerial colleagues on theimplications for Northern Ireland of the provisions ofpart 2 of the Parliamentary Voting System andConstituencies Bill. [22152]

The Minister of State, Northern Ireland Office (Mr HugoSwire): My right hon. Friend the Secretary of State andI have had regular discussions with ministerial colleaguesand with elected representatives in Northern Ireland onthe provisions of the Parliamentary Voting System andConstituencies Bill, and will continue to do so as theBill continues its progress through both Houses.

Mark Durkan: Does the Minister recognise that as itstands, part 2 of the Bill has serious implications for theNorthern Ireland Assembly, whose constituencies aremeant to be coterminous with parliamentary constituencies?Reviews every five years that could put those constituenciesout of cycle, or change the total number of constituenciesin Northern Ireland, will be hugely unsettling. Will hetake steps to ensure that full consideration is undertakenwith the authorities in the Northern Ireland Assembly,as well as with his ministerial colleagues?


Mr Swire rose—[Interruption.]

Mr Speaker: Order. I want to hear the Minister’sreply.

Mr Swire: Thank you, Mr Speaker.The hon. Gentleman raised this matter during the

passage of the Bill. It is true that coterminosity betweenthe parliamentary and Assembly seats has worked well,and the amended rules can continue to provide for theElectoral Commission to take that into account. I shouldsay to him that as he knows, the size of the Assembly isup to the Assembly, not to Parliament or to this Housethrough the Bill.

Presbyterian Mutual Society

8. Jonathan Reynolds (Stalybridge and Hyde) (Lab/Co-op): When the Government plan to disburse theirproposed financial assistance to savers with thePresbyterian Mutual Society. [22154]

The Minister of State, Northern Ireland Office (Mr HugoSwire): In the spending review announcement, my righthon. Friend the Chancellor of the Exchequer announcedthat the Government would meet in full a £175 millionloan and £25 million in cash to fund the NorthernIreland Executive’s proposal to resolve the PMS crisis.

Jonathan Reynolds: I thank the Minister for thatresponse, but given that the Government’s proposals area carbon copy of what my right hon. Friend the formerPrime Minister announced, why did the Secretary ofState delay the announcement by six months, causingunnecessary suffering and misunderstanding for thepeople who had lost money in the PMS?

Mr Swire: There is a fundamental difference betweenwhat the previous Government did and what the currentGovernment have done about the problems connectedwith the PMS: we have actually done something. Wehave responded to the request from the Executive infull. We stand by the Prime Minister’s commitment, andwe are very pleased that we were able to act so swiftly—unlike some others.

Dissident Violence

9. Patrick Mercer (Newark) (Con): What assessmenthe has made of the reasons for the recent increase inthe level of dissident violence in Northern Ireland.

[22156]

The Secretary of State for Northern Ireland (Mr OwenPaterson): This violence is a direct response to thecontinued political progress in Northern Ireland. Thosepeople are outdated and backward-looking. All thatthey have to offer is to destabilise the peace process anddisadvantage the people of Northern Ireland, but theywill not succeed. The Government take the terroristthreat in Northern Ireland extremely seriously. Therehave been 39 attacks so far this year, compared with22 throughout 2009.

Patrick Mercer: I heard what the Secretary of Statehad to say earlier about the operations of the police inthe Republic. Can he also give me some assurance thatthere is intelligence sharing between the Northern IrishGovernment and that in Dublin?

Mr Paterson: I am most grateful to my hon. Friendfor his question, and for his interest in Northern Irelandaffairs. I do not think I can give a better example thanthe fact that the current Chief Constable always hadgood relations with his neighbour when he was chiefconstable of Leicestershire, but has said that his relationswith Fachtna Murphy, the Garda commissioner, areeven better. I should like publicly to pay tribute toFachtna Murphy, who is, sadly, retiring at the end of theyear. He has been a great friend of Northern Ireland.The collaboration between the Garda and the PSNI isat an exceptional level, and I look forward to helping itcontinue.

David Simpson (Upper Bann) (DUP): The Secretaryof State will be aware of the recent series of dissidentrepublican operations in my constituency, including thebomb at a railway bridge and a previous bomb thatalmost killed three local children. Does he share theChief Constable’s current assessment of the levels ofresources and manpower available to the PSNI?

Mr Paterson: I am grateful for that question. I am alsopleased to send on my sympathies to the hon. Gentleman’sconstituents who have been subject to such intolerableattacks, which, thankfully, have not caused death orinjury. Last week the Chief Constable said:

“We are absolutely putting huge resources back in, we aregoing to sustain that next year and the year after until thoseresponsible are brought to justice or they can be persuaded togive up.”

Fisheries (EU Legislation)

10. Jim Shannon (Strangford) (DUP): Whatassessment he has made of the effects on the NorthernIreland fishing fleet of the operation of EU legislationon working time; and if he will make a statement.

[22157]

The Minister of State, Northern Ireland Office (Mr HugoSwire): Responsibilities here are divided: fisheries generallyare a devolved matter, but the UK Government have ledon aspects of the EU working time directive as it appliesto fishing vessels.

Jim Shannon: EU legislation includes a fundamentalright to work. What steps has the Minister taken withhis European counterparts to ensure that the fishermenof Portavogie, Ardglass and Kilkeen, who have hadtheir days at sea restricted, have a right to work?

Mr Swire: I understand that Diane Dodds and otherNorthern Ireland MEPs are working hard to addresssome of the difficulties experienced by the fishing industryin Northern Ireland, particularly in relation to thematter that the hon. Gentleman raises. I must stressthough that fishing matters are partly devolved. Nonethe less, I undertake to look into the matter, write to thehon. Gentleman in due course and put a copy of theletter in the Library.

PRIME MINISTER

The Prime Minister was asked—

Engagements

Q1. [22884] Jason McCartney (Colne Valley) (Con): Ifhe will list his official engagements for Wednesday10 November.


The Deputy Prime Minister (Mr Nick Clegg): I havebeen asked to reply. My right hon. Friend the PrimeMinister has been leading a major Government andtrade delegation to China, and is now travelling toSeoul for the G20 summit.

I am sure that the whole House will wish to join me inpaying tribute to Senior Aircraftman Scott Hughes of1 Squadron Royal Air Force Regiment, who died inCyprus on Sunday while returning from operationalservice in Afghanistan. He was a professional and braveairman, and it is very sad that he died while returninghome from a tour of duty. Our thoughts are with hisfamily and loved ones.

This week, on the eve of Remembrance day, weespecially remember all those who have given their livesin the service of our country, both in recent years andthrough previous generations. The sacrifices made byour servicemen and women for our peace and freedommust never be forgotten.

On a much happier note, let me, on behalf of theGovernment, extend our warmest congratulations andbest wishes to the Leader of the Opposition and hispartner, Justine, on the birth of their baby son. It iswonderful news and we really are thrilled for them.

Jason McCartney: A 12-year-old haemophiliac fromLindley in Huddersfield was injected with contaminatedblood products, giving him HIV, hepatitis C and CJD.When will he and the 2,000 other survivors of thisshocking scandal get fair compensation?

The Deputy Prime Minister: I know that my hon.Friend is a vigorous campaigner for all those whoselives have been so tragically affected by contaminatedblood. It really is a dreadful catastrophe for all thoseaffected. The Under-Secretary of State for Health, myhon. Friend the Member for Guildford (Anne Milton),intends to report by the end of the year on the outcomeof the current review to see what more can be done forthose affected by contaminated blood. Tomorrow, HealthMinisters will hold an open meeting in WestminsterHall at which hon. Members from all parts of theHouse and peers from the other place can raise theirconcerns.

Ms Harriet Harman (Camberwell and Peckham) (Lab):I join the Deputy Prime Minister in paying tribute toSenior Aircraftman Scott Hughes of 1 Squadron RoyalAir Force Regiment. We honour his memory and sendcondolences to his family. We will remember all ourservicemen and women on Remembrance day. I shouldlike to echo, too, the right hon. Gentleman’s best wishesto the Leader of the Opposition and Justine on thebirth of their new baby.

In April, the Deputy Prime Minister said that it washis aim to end university tuition fees. Will he update theHouse on how his plan is progressing?

The Deputy Prime Minister: Of course I acknowledgethat this is an extraordinarily difficult issue, and I havebeen entirely open about the fact that we have not beenable to deliver the policy that we held in opposition.Because of the financial situation and because of thecompromises of the coalition Government, we have hadto put forward a different policy—[Interruption.]

Mr Speaker: Order. I want to hear the Deputy PrimeMinister’s update.

The Deputy Prime Minister: None the less, we havestuck to our wider ambition to make sure that going touniversity is done in a progressive way, so that peoplewho are currently discouraged from going to university—bright people from poor backgrounds, who are discouragedby the system that we inherited from the right hon. andlearned Lady’s Government—are able to do so. That iswhy our policy is more progressive than hers.

Ms Harman: Well, I am glad that the Deputy PrimeMinister thinks it is so fair. I hope he will be going outand telling that to all the students and lecturers who aremarching on Westminster today. In April he said thatincreasing tuition fees to £7,000 a year would be a“disaster”. What word would he use to describe fees of£9,000?

The Deputy Prime Minister: I think there is moreconsensus than the right hon. and learned Lady concedeson the simple principle that people who benefit fromgoing to university should make a contribution to thecost of that university education. The question is: howdo we do it? Do we do it fairly and in a progressive way?The proposals that we have put forward will mean thatthose who earn the least will pay much less than they doat the moment—while those who earn the most will payover the odds to provide a subsidy to allow people frompoor backgrounds to go to university—and will, for thefirst time, end the discrimination against the 40% ofpeople in our universities who are part-time students,who were so shamefully treated by her Government.

Ms Harman: None of us agrees with tuition fees of£9,000 a year. This is not about the deficit: the Chancellorsaid that the deficit would be dealt with by 2014, whenthe new system will hardly have begun. No, this is notabout the deficit; this is about the Deputy Prime Ministergoing along with a Tory plan to shove the cost of highereducation on to students and their families. We all knowwhat it is like, Mr Speaker. You are at Freshers’ week.You meet up with a dodgy bloke and you do things thatyou regret. Is not the truth of it that the Deputy PrimeMinister has been led astray by the Tories?

The Deputy Prime Minister: I know that the righthon. and learned Lady now thinks that she can repositionthe Labour party as the champion of students, but letus remember the Labour party’s record: against tuitionfees in 1997, but introduced them a few months later;against top-up fees in the manifesto in 2001, thenintroduced top-up fees. Then Labour set up the Brownereview, which it is now trashing, and now the Labourparty has a policy to tax graduates that half the Front-Benchteam does not even believe in. Maybe she will go out tothe students who are protesting outside now and explainwhat on earth her policy is.

Ms Harman: As a result of the Deputy Prime Minister’splans, English students will pay among the highest feesof any public university system in the industrialisedworld, and why? It is not to give universities morefunds, but to replace the cuts that he is making touniversity teaching. Can he tell the House what thepercentage cut to the university teaching grant is?


The Deputy Prime Minister: I can certainly confirmthat the right hon. and learned Lady and her party alsohad plans to make massive cuts in the budget of theDepartment for Business, Innovation and Skills, whichwould have affected higher education. Here are a fewfacts. Every single graduate under our scheme will payless per month than they do under the scheme that weinherited from Labour. The bottom 25% of earners willpay much less in their contributions to their universityeducation than they do at the moment. Part-time studentswill pay no up-front fees, and not a single student willpay a penny of up-front fees whatsoever. It is a fair andprogressive solution to a very difficult problem.

Ms Harman: It looks as though the right hon. Gentlemanhas been taking lessons from the Prime Minister onhow not to answer the question. I asked him about thecut in the teaching grant. The truth is that it is astaggering 80%––80%. No wonder he is ducking thequestion. The real reason he is hiking up fees is that heis pulling the plug on public funding, and dumping thecost on to students. Is that not why he is betraying hispromise on tuition fees?

The Deputy Prime Minister: The graduate tax thatthe right hon. and learned Lady advocates would bemore unfair and would allow higher earners to opt outof the system altogether. We all agree—she agrees—acrossthe House that graduates should make some contributionfor the benefit of going to university. The question is,how? We have a progressive plan; she has no planwhatsoever.

Ms Harman: But during the election, the right hon.Gentleman hawked himself around university campusespledging to vote against tuition fees. By the time Freshers’week was over, he had broken his promise. Every singleLiberal Democrat MP signed the pledge not to put uptuition fees; every single one of them is about to breakthat promise. He must honour his promise to studentsand their families throughout the country. Will he thinkagain?

The Deputy Prime Minister: It is quite something totake lectures from the right hon. and learned Ladyabout party management after the mutiny in theparliamentary Labour party on Monday—[Interruption.]Labour Members are cheering her now, but they certainlywere not at the mutiny on Monday night. The truth isthat before the election we did not know the unholymess that would be left to us by her party. On this issue,as on so many, the two parties on this side of the Househave come together to create a solution for the future.The two parties on this side of the House have onepolicy; the Labour party has two policies.

Duncan Hames (Chippenham) (LD): In the internationaldialogue about democracy that we are witnessing, whatwould my right hon. Friend say to those who welcomedthe elections in Burma, which were nothing more thanan utter sham?

The Deputy Prime Minister: I strongly agree thatthose elections were a complete and utter sham. Theirconclusion was already decided well before they tookplace, with reserved seats for the military, and reservedseats for parties that were put up by the military. Theyare simply swapping their military uniforms for civilianclothing, but keeping their iron dictatorial grip on the

people of Burma. Aung San Suu Kyi should be releasedwhen her house arrest comes up for review in thecoming days, and real democracy should finally beintroduced in Burma.

Q2. [22885] Tom Greatrex (Rutherglen and HamiltonWest) (Lab/Co-op): Given that we all know howimportant consistency is to the Deputy Prime Minister,will he explain to the House why his Chief Secretary tothe Treasury is pictured on the Liberal Democratwebsite leading the campaign against selling offforestry in Scotland, at the same time as he is proposingthat in England?

The Deputy Prime Minister: The poor Chief Secretaryto the Treasury is picked on all the time—first for beingginger. Did the right hon. and learned Member forCamberwell and Peckham (Ms Harman) make an impactassessment of her outrageously discriminatory remarks?––[Interruption.]

Mr Speaker: Order. First, the Deputy Prime Ministermust be heard. Secondly, the public thoroughly disapproveof this level of destructive barracking from wherever inthe House it comes: note that, and learn from it.

The Deputy Prime Minister: I was simply making thepoint that any form of discrimination against rodentsor ginger-headed folk is wrong.

As the hon. Member for Rutherglen and HamiltonWest (Tom Greatrex) knows, on forestry issues, as onmany others, there is a devolved division of responsibility.He should know that better than anyone else.

Q3. [22886] Charlie Elphicke (Dover) (Con): Will myright hon. Friend tell the House whether the PrimeMinister received the “people’s port” communitymutual’s bid for the port of Dover? Will he allow acommunity right to buy, or will it be another Britishicon sold overseas, as the previous Labour Governmentplanned?

The Deputy Prime Minister: Of course I am pleased,as no doubt everyone is, that there is such a strongcommunity interest in the future of the port of Dover.Campaigners have received stellar backing, and I wishtheir campaign all the very best of luck. As my hon.Friend knows, the port’s assets are owned by Doverharbour board, not by the Government. The Ministerof State, Department for Transport, my right hon.Friend the Member for Chipping Barnet (Mrs Villiers)is considering proposals for a scheme that would allowthe board to sell the port, so it would be inappropriatefor me to comment further on that decision.

Q4. [22887] Chi Onwurah (Newcastle upon Tyne Central)(Lab): AgustaWestland is an excellent companyproviding skilled manufacturing jobs in Yeovil.Sheffield Forgemasters is also an excellent company,providing skilled manufacturing jobs in Yorkshire. Whydid the Government decide to support one and not theother?

The Deputy Prime Minister: Of course I agree withthe hon. Lady that both are outstanding companies.The difference is that the announcement of the decisionto provide a loan to Sheffield Forgemasters was made11 days before the general election, when there was nomoney in this year’s budget to make that promise. It wasa promise made by the previous Labour Government


knowing that the cheque would bounce. We have madea decision on Westland in the light of our difficult,controversial decisions to bring sense to the publicfinances. That is the difference.

Q5. [22888] Andrew Stephenson (Pendle) (Con): TheDeputy Prime Minister might be aware that, inresponse to the comprehensive spending review, thethree most senior officers of Pendle borough councilhave announced a wage cut of 27%. In contrast, thechief constable of Lancashire police, Steve Finnigan,has started a 90-day consultation on making allLancashire’s police community support officersredundant. Does my right hon. Friend agree that thechief constable should think again and that he shouldsupport our PCSOs—[Interruption.]

Mr Speaker: Order. I want to hear the Deputy PrimeMinister’s reply.

The Deputy Prime Minister: Of course I welcome thedecision by Pendle borough council and its executivedirectors to reduce the council’s wage bill. My righthon. Friend the Secretary of State for Communities andLocal Government has called on all local authoritychief executives earning £200,000 a year to take a10% pay cut, and those on £150,000 to take a 5% cut.They need to make sacrifices, just as everyone else is. Onpolicing, of course I understand everyone’s attachmentto PCSOs, but it would be a flagrant breach of thetraditions of policing in this country if we were to startsecond-guessing chief constables. I think we all wantmore visible policing; it cannot be right that the systemwe inherited from Labour means that only 11% ofpolice officers are ever seen on our streets at any onetime. That is wrong and it must change.

Q6. [22889] Gavin Shuker (Luton South) (Lab/Co-op):Tens of thousands of students have gathered outsidethis place today to oppose the right hon. Gentleman’sshameful policy of tripling student debt. He received arequest to address the crowd, but as yet no responsehas been received. May I give him the opportunity togive that response now?

The Deputy Prime Minister: As the hon. Gentlemanknows, I meet student leaders and representatives of theNational Union of Students all the time. I hope that,when he joins the demonstrators, the first thing he willdo is explain what on earth his party’s policy is. We havea policy; he has no policy and no plan, and is giving nohope to future generations of students.

Q7. [22890] Brandon Lewis (Great Yarmouth) (Con):My right hon. Friend might be aware of the great workbeing done by the East of England Energy Group, andby the borough councils, the county council and localsmall companies in Norfolk to ensure that GreatYarmouth and East Anglia benefit from economicgrowth and regeneration through the energy markets.Will he and the Government support our work toensure that East Anglia gets a fair and even chance tobid for the opportunities that these new markets canprovide?

The Deputy Prime Minister: I strongly agree with myhon. Friend that renewable energy is one of the greatindustries of the future, and we are doing everything wecan to support those areas that want to exploit the

opportunities. We have committed £1.4 billion to aregional growth fund, and we are establishing a greeninvestment bank with the explicit aim of creating furtherinvestment opportunities in green infrastructure in areaswhere private sector investment is currently constrained.I am delighted to hear about the way in which councils,businesses and the not-for-profit sector in Norfolk areworking so effectively together.

Sheila Gilmore (Edinburgh East) (Lab): In answer toa question that I asked last week, the Minister forFurther Education, Skills and Lifelong Learning indicatedthat the major reason for his proposals on fees was tochange the way in which higher education was funded,and to shift the burden from the state to the student.How does the Deputy Prime Minister square that withhis party’s view that the proposals are a deficit reductionmeasure only, and that they could be changed in thefuture?

The Deputy Prime Minister: As I said earlier, I thinkevery Member agrees that the funding for universitiesshould be a mixture of direct support from the state andcontributions made by—[Interruption.] As soon as wecame into government, we looked exhaustively at theoption of a graduate tax, which was proposed by someLabour Members and by the National Union of Students,but we discovered that that would be much more unfairand would allow particularly high earners to opt out ofthe system altogether, compared to the progressive systemof graduate contributions that we are proposing now.

Q8. [22891] Eric Ollerenshaw (Lancaster and Fleetwood)(Con): Her Majesty’s Revenue and Customs has abusiness payment support service, which has helpedmany businesses in my constituency that have metshort-term problems to achieve a delayed payment oftaxes—sometimes the taxman can help, apparently.Does my right hon. Friend agree that this is a valuableservice and that HMRC, alongside every other part ofGovernment, should provide as much flexibility andsupport as possible for business, if we are get out of therecession left to us by the previous Government?

The Deputy Prime Minister: I strongly agree with myhon. Friend. I think that HMRC’s business paymentsupport service is indeed, as he says, a very valuable andimportant service, and it remains in place. By the end ofSeptember this year, 371,200 arrangements had beengranted, worth £6.38 billion. That is extraordinarilyvaluable to small and medium-sized enterprises, whichare indeed struggling and deserve all the support theyrequire to power us out of this difficult economicenvironment.

Paul Blomfield (Sheffield Central) (Lab): The Ministerfor Universities and Science has made it clear that allpublic funding will be withdrawn from non-STEM subjectsin universities. Last Wednesday, the Minister for FurtherEducation, Skills and Lifelong Learning told a WestminsterHall debate:

“We will continue to support the arts through the subsidy forteaching in universities.”—[Official Report, 3 November 2010;Vol. 517, c. 315WH.]

Who is right?


The Deputy Prime Minister: The statement we madewas very clear. I hope the hon. Gentleman will acceptthat the model of mixed financing for our universities—partly from the Government and partly from graduates,who, as he knows, stand to benefit on average from tensof thousands in extra earnings because they have auniversity degree—is one that we are preserving andbuilding on in a progressive manner.

Q9. [22892] Caroline Dinenage (Gosport) (Con): InGosport, our Sure Start centres provide valuablesupport to some of our most vulnerable people, whichproves that even the Labour party can get somethingright. I welcome the Government’s continued supportfor Sure Start, but will the Deputy Prime Ministerplease reassure me that the programme will berefocused so that those in the greatest need get thegreatest support?

The Deputy Prime Minister: I strongly agree. SureStart children’s centres play a vital role in helping familiesand giving them the help when they need it throughearly intervention. That is why we announced in thespending review that Sure Start funding will be maintainedin cash terms. As for how that funding is allocated toreflect deprivation, which was the hon. Lady’s question,the money is already weighted so that local authorityareas with higher levels of disadvantage get more fundingthan others and, of course, local authorities have a highdegree of flexibility and latitude themselves—and wedo not propose to change that system at all.

Emily Thornberry (Islington South and Finsbury)(Lab): May I bring the right hon. Gentleman back tohigher education? He says that higher education shouldbe paid partly by the individual and partly by the state,but the confusion that the people of Islington will haveis that the right hon. Gentleman was not saying that inApril, so when did he change his mind? In the bestpossible scenario, if we had a fantastic economy and nodebt at all, would he still believe that higher educationshould be paid partly by the student and partly by thestate?

The Deputy Prime Minister: I find it extraordinarythat the hon. Lady can piously ask questions aboutchanging one’s mind on this issue, when her party saidno to fees in 1997, and introduced them; said no totop-up fees in the manifesto of 2001, and introducedthem; said yes to the Browne review, but now says no toit; says yes to some graduate taxes, but no to others.Labour Members should make up their minds.

Q10. [22893] Julian Sturdy (York Outer) (Con): As thecoalition continues to stabilise our economy, will theDeputy Prime Minister assure my constituents thatproviding long-term relief and support for small andmedium-sized businesses remains high on theGovernment’s priority list?

The Deputy Prime Minister: Yes, absolutely, as I saidin answer to the earlier question. Over the past sixmonths, we have taken a number of steps to help smalland medium-sized enterprises: reducing the small profitsrate of corporation tax from 21% to 20% from Aprilnext year; introducing new rules whereby for any newregulation, another one must be scrapped; the new

enterprise capital fund of £37.5 million to provide additionalequity finance; and of course the enterprise financeguarantee fund, which will be increased by £200 million.That is real support for the wealth creators of thefuture.

Q11. [22894] Meg Munn (Sheffield, Heeley) (Lab/Co-op):On 6 May, hundreds of the Deputy Prime Minister’sconstituents and hundreds of mine in Sheffield weredenied the right to vote because of current legislation.Why has the Deputy Prime Minister not taken theopportunity of legislation currently before Parliamentto change the law, so that in future all those in thepolling station at close of poll are allowed to vote?

The Deputy Prime Minister: I am acutely aware of theproblem. I visited polling stations several times on thatday, and saw the huge queues of people, many of whomwere denied their democratic right to exercise a vote.The question is: what do we do about it? I happen tothink that, in this instance, simply passing a law will notdeal with the problem, which was a lack of resourcesand poor organisation by the returning officer, whoacknowledged as much, as the hon. Lady knows, inSheffield. That is what we need to address; we shouldnot always simply reach for the statute book.

Tim Farron (Westmorland and Lonsdale) (LD):Thepartnership between schools and universities in theprovision of teacher education is absolutely critical,and at the moment it works terribly well. The universityof Cumbria is Europe’s largest provider of newly qualifiedteachers. Will the Deputy Prime Minister assure methat universities such as mine, which provide teachereducation, will continue to have a leading role in thetraining of our teachers of the future?

The Deputy Prime Minister: Of course we must supportall those institutions that produce the great teachers ofthe future. We must have great teachers who can also liftthe aspirations of children in this country and particularlyof bright young people from poor backgrounds who atthe moment feel completely intimidated from going touniversity. I hope such teachers will explain to thoseyoung people that under the new scheme that we haveproposed, they have a real route to live out their hopesand dreams at our great universities in the future.

Q12. [22895] Heidi Alexander (Lewisham East) (Lab):Yesterday, the National Housing Federation reportedthat a first-time buyer in London needs a salary ofalmost £100,000 to buy an average-priced property. Inthe light of that, will the Deputy Prime Minister tell mehow many low-cost homes will not be built in thecapital as a result of his Government’s decision to cutthe affordable housing budget by 63%?

The Deputy Prime Minister: What I do know, ofcourse, is that we inherited a situation in which fewer—[Interruption.] They do not like to hear it, but they haveto—it is the truth. Fewer and fewer affordable homeswere built, and more and more people and familiesended up on the waiting list for affordable homes. Wehave a plan finally to put that right, and to increase theconstruction of new affordable homes at a rate that theLabour party never achieved.


Mr John Baron (Basildon and Billericay) (Con):Successful counter-insurgency operations in the past,such as in Malaya, suggest that not one of the preconditionsfor success—control of borders, good troop densitylevels, a credible Government, and support of the majorityof the population—exists in Afghanistan. Does this notbeg for a more realistic assessment of the situation?

The Deputy Prime Minister: We have sought to try tointroduce a strong element of realism, not only in theextra resources and support that are required for ourtroops in Afghanistan, but recognise—I think this is theimplication of the question—that there is not a militarysolution to the conflict in Afghanistan. There must be amarriage of a military strategy, which applies pressureon insurgents who want to disrupt the peaceful co-existenceof communities and people in Afghanistan, with apolitical process of reintegration and reconciliation, sothat we can leave Afghanistan—

Mr Speaker: Order. May I ask the Deputy PrimeMinister to face the House? Otherwise, it is difficult forhim to be fully heard. [Interruption.] Order. I want tohear the Deputy Prime Minister.

The Deputy Prime Minister: I was always taught toaddress the person who had asked me the question,Mr Speaker. So let me say, addressing my hon. Friend,that we need to marry a political strategy with a militarystrategy. Only by balancing the two will we be able toleave Afghanistan with our heads held high, knowingthat we have done the difficult job that we were asked todo there.

Q13. [22896] Tom Blenkinsop (Middlesbrough Southand East Cleveland) (Lab): Apart from the promise togive rapists, murderers and paedophiles the vote, whatpre-election promises has the Deputy Prime Ministerkept?

The Deputy Prime Minister: I am not sure whetherthat was a question or merely a line that the hon.Gentleman has rehearsed over and over again over thepast few days. As for the issue of prisoner voting rights,in 2005, as he knows, there was a court judgment onwhich the last Labour Government consulted repeatedly.At some point, regrettably, we need to bring our lawinto line with the court judgments, and that is what wewill now seek to do.

Paul Uppal (Wolverhampton South West) (Con): Isthe Deputy Prime Minister aware that, according to areport on Radio 5 Live this morning, after the changesin tuition fees graduates earning £25,000 a year willhave to pay back only £30 a month?

The Deputy Prime Minister: Opposition Memberssimply refuse to acknowledge that the 25% of lowestgraduate earners will pay much less than they do now.That seems to me to be a strong indication of theprogressive nature of our proposals.

Q14. [22897] Mr Gregory Campbell (East Londonderry)(DUP): Business to be dealt with later today includes

the Equitable Life (Payments) Bill. Is the Deputy PrimeMinister aware of the anger and frustration felt bymany thousands of Equitable Life policyholders, willhe address that, and will today’s business—with,hopefully, his support and that of Members in all partsof the House—reach a more satisfactory conclusion forthose policyholders?

The Deputy Prime Minister: As the hon. Gentlemanknows, under the last Government there was no prospectof any compensation for Equitable Life policyholders.He will also know that the compensation package thatwe announced in the comprehensive spending review isfar in excess of the compensation levels recommendedby the independent review. Of course the situation isdifficult, and we would always like to provide morecompensation, but the compensation that we are providingis much, much more than many people expected.

Stephen Lloyd (Eastbourne) (LD): The Times EducationalSupplement recently published a feature article statinghow effective the pupil premium would be. Does theDeputy Prime Minister share my frustration at the factthat the Labour party appears to be more interested inscoring partisan points than in supporting the coalitionGovernment’s serious attempts—

Mr Speaker: Order. We have got the gist of it, and weare grateful to the hon. Gentleman.

The Deputy Prime Minister: I think that the pupilpremium is a significant policy. It puts an end to thesystem that we inherited from Labour, which meantthat if you were a poor child at school in one part of thecountry a lot of extra money would be allocated to youreducation, whereas that would not happen if you were apoor child in another part of the country. The pupilpremium is attached to children from poor backgroundswherever they live, to lift their sense of aspiration and toimprove the one-to-one tuition support that they need ifthey are to have the fair chance in life that all childrendeserve in our country.

Q15. [22898] Phil Wilson (Sedgefield) (Lab): Up to100,000 tenants are paying rent to more than44,000 private landlords who are being investigated fornon-payment of tax on rental income, and 53% ofthose tenants are receiving housing benefit. What arethe Government doing to clamp down on privatelandlords who fiddle the tax and housing benefitsystem?

The Deputy Prime Minister: I strongly agree that weshould come down very hard on those unscrupulouslandlords, who are profiteering from the housing benefitsystem that was so poorly administered by the previousGovernment. As the hon. Gentleman will know, rentsin the private sector have declined by about 5% over thelast year, while rents that depend on housing allowancehave increased by 3%. That is why we need to bringsome sense and proportion to the way in which weadminister housing benefit, which has more than doubledover the past few years.


Point of Order

12.34 pm

Mr Gerry Sutcliffe (Bradford South) (Lab): On apoint of order, Mr Speaker. On 1 November, the HomeSecretary made a statement in the House on aviationsecurity. The shadow Home Secretary asked her a numberof questions that she was not able to answer. She saidthat she in due course would write to the shadow HomeSecretary with the answers. Ten days later, we have notreceived those answers. I seek your advice, Mr Speaker,on how we can deal with the situation.

Mr Speaker: I am grateful to the hon. Gentleman forgiving me notice of his point of order. His complaintwill have been heard by Ministers. I hope, from hispoint of view, that it will also be heeded, and that hewill receive the promised answers soon. It may also behelpful for the hon. Gentleman and the House to bereminded that business questions will take place tomorrow.I hope that that is useful.

Support and Protection for Elderly Peopleand Adults at Risk of Abuse

Motion for leave to bring in a Bill (Standing OrderNo. 23)

12.35 pm

Mr Nigel Dodds (Belfast North) (DUP): I beg tomove,

That leave be given to bring in a Bill to promote awareness ofabuse of elderly people and adults at risk, to promote training onhow to recognise and respond to such abuse amongst those whoare likely to encounter abuse in the course of their work, topromote greater awareness and understanding of the rights ofvictims of abuse amongst agencies with responsibilities for providing,arranging, commissioning, monitoring and inspecting care services,to promote the development of local strategies for preventingabuse of elderly people and adults at risk and for ensuring thatvictims are assisted in recovering from the effects of abuse.

I am delighted to have this opportunity to move thismotion and introduce the Bill. The abuse of elderlypeople and adults at risk is a hidden problem, and Ihope that by raising it in the Committee today I willhelp to focus attention on this matter which affectshundreds of thousands of people every year, and whicha range of organisations, including Age UK and theAlzheimer’s Society, have already done much to highlight.

Issues of abuse are complex and much abuse goesunreported. The failure by abused elderly people andadults generally to report instances of abuse is down toa number of reasons: stigma, shame and even a feelingof guilt by the abused, wrongly but genuinely felt, forhaving provoked the abuse. Very often the abused adultis dependent on the abuser. Isolation also plays a part,as does lack of contact with care providers or criminaljustice agencies.

The complexity of the problem is illustrated by apiece of work recently carried out in Northern Irelandwhich showed that three quarters of incidents in whichelderly adults were subjected to abuse involved a familymember, including very close relatives. Often in suchsituations the abused person will want to maintainsome kind of relationship with the abuser, and theymight be threatened that if they report the abuse theywill be denied access to other family members, such asgrandchildren, thus reinforcing the feelings of lonelinessand isolation. In such cases, the elderly person oftendecides to balance the abuse they are actually sufferingagainst the fear of some future action that they believewould result in their being left in an even worse state.

As a country, we must do everything we can toprotect people at risk, especially our senior citizens,from abuse that can take many different forms. Oftenthese factors are combined, but generally abuse fallsinto the following categories: emotional, psychological,financial, physical, sexual and neglect. Although Memberswill be aware of extreme examples of abuse when theyare reported in the press and other media, it is clear thatmuch abuse happens almost unnoticed or is passed offand excused as “poor care”, or with the comment,“That’s just the way he or she”—the family member—“behaves.”

The issue of financial abuse is causing increasingconcern. A 2008 Help the Aged report found that up to2.5% of elderly people felt they had experienced somekind of financial abuse, exploitation or coercion, and in

289 29010 NOVEMBER 2010

[Mr Nigel Dodds]

my constituency case load I have come across increasingnumbers of specific issues involving the administrationof the personal finances of vulnerable adults. That isnow becoming a greater problem given the difficulteconomic times we are facing and pressures on familyfinances, yet public awareness of the issue is limited.

Many members of the public at large do not understandthe nature of the different types of abuse. That wasborne out by the work of a partnership project inNorthern Ireland, Uniting Against Elder Abuse, whichbrought together Age Concern and Help the Aged—whichare now united as Age NI—and the Alzheimer’s Societyand Carers Northern Ireland. The project delivered atwo-year strategic programme aimed at raising awarenessof the problem generally, providing access to independentadvocacy for frail older people and those with dementia,and developing a therapeutic response for those whoexperience abuse. I can say from the experience we hadthen in Northern Ireland that people were genuinelytaken aback at the report’s findings and the extent ofthe problem.

The number of people affected is much greater thanis sometimes realised. It is estimated that one in 25 of allolder people living in the community is affected bysome kind of abuse every single year. As the majority ofcases occur in the older person’s home, agencies such associal services are not necessarily involved or aware.According to one survey, 62% reported that they hadhad no contact whatever with social services or anyother support organisation, highlighting the fact thatthere is likely to be a considerable hidden minority ofolder people living in an abusive situation or subject tosome kind of abuse without recourse to traditionalforms of support or help.

There must therefore be greater commitment to educatingand informing people about the support available tothem. There are gaps in education, knowledge andtraining at the individual level and across the public andvoluntary sectors. Those gaps must be plugged. It isvital that we have a single, common piece of legislationto reinforce existing policies designed to protect theelderly and adults at risk of abuse. Current safeguardinglegislation is too complex and spread across many andvarious Acts and measures. It therefore offers onlylimited protection. No single professional, whether it bea social worker, a police officer or a nurse, could ever beexpected to be aware of all the legislation that is outthere. That is why overarching, comprehensive andconsolidating legislation is needed.

There would be immense benefit in bringing existingprovisions together, including principles, definitions, aduty to investigate, clarification of powers of entry,powers to remove a perpetrator or perpetrators of abuse,and a duty of co-operation. Legislation should not onlybe about responding to individual allegations of abuse,but should place a strong emphasis on prevention—andnot just preventing an abusive situation arising for anindividual. What is needed is a major shift towards

understanding the circumstances and situations thatcontribute towards abuse or render people vulnerable toit, acknowledging the reality of its effect and how we asa society must move towards eradicating it.

Often there appears to be little formal contact betweenagencies and services, and support can be unco-ordinatedand fragmented. Let us compare that with the protectionof children, which is a benchmark that we should seekto emulate. There is too much buck-passing over vulnerableadults and senior citizens, and only legislation will endthat. Legislation would require suspected abuse to beinvestigated. Guidance is all well and good, but itapplies differently to the various authorities and statutoryagencies. The law should apply to all agencies involvedin preventing and responding to abuse. Specific legislationwould force better co-ordination of the various statutoryagencies as they confront the silent offender of abuse.The same legislation could address the training andeducation deficit, which I have already mentioned, acrossthe range of elderly support services, including theprivate, public and voluntary sectors.

Devolved Administrations are already taking steps,or have taken steps, to target elder abuse, with Scotlandintroducing the Adult Support and Protection (Scotland)Act 2007, Wales preparing to make recommendationsby the end of this year, it is hoped, and NorthernIreland preparing a policy framework for consultationin early 2011.

The Department of Health opened up consultationon the “No secrets” guidance in 2009, but neither theprevious Government nor this one—I acknowledge thatthey have been in office for only a short time—haveresponded to the findings of that consultation, includingthose on whether legislation is needed.

Legislation on the abuse of elderly people and adultsat risk would facilitate a more comprehensive assessment,with a common benchmark standard across all supportagencies. It would establish a more consistent and effectiveresponse by statutory providers, ensure better trainingand education, which would improve awareness, andconsolidate local authority guidelines and offer enhancedguidance to the criminal justice system.

The day we set aside or neglect our responsibility tohelp and cater for the needs of our senior citizens andthose who are open to and at risk of abuse within oursociety is the day that we lose our moral compass. Ibelieve that this is an extremely important issue andhope that the presentation of the Bill leads to Governmentaction. I commend the Bill to the House.

Question put and agreed to.Ordered,That Mr Nigel Dodds, Andrew Percy, Malcolm Wicks,

Greg Mulholland, Dr William McCrea, Mr Jeffrey MDonaldson, Mr Gregory Campbell, Sammy Wilson,David Simpson, Ian Paisley and Jim Shannon presentthe Bill.

Mr Nigel Dodds accordingly presented the Bill.Bill read the First time; to be read a Second time on

Friday 17 June 2011, and to be printed (Bill 105).

291 29210 NOVEMBER 2010Support and Protection for ElderlyPeople and Adults at Risk of Abuse

Support and Protection for ElderlyPeople and Adults at Risk of Abuse

Equitable Life (Payments) BillConsidered in Committee

[MR NIGEL EVANS in the Chair]

Clause 1

PAYMENTS

12.46 pmMr Fabian Hamilton (Leeds North East) (Lab): I beg

to move amendment 1, page 1, line 7, at end insert—‘(2A) Payments authorised by the Treasury under this section

to with-profits annuitants shall be made without regard to thedate on which such policies were taken out.’.

The First Deputy Chairman of Ways and Means (Mr NigelEvans): With this it will be convenient to discuss thefollowing:

Amendment 2, page 1, line 7, at end insert—‘(2A) The Parliamentary Commissioner for Administration

shall report to Parliament on the implications for payments towhich this section applies of the findings of the IndependentCommission on Equitable Life Payments, no later than onemonth after the publication of such findings.’.

Amendment 7, page 1, line 7, at end insert—‘(2A) In determining the amount of the payments that it is

appropriate for the Treasury to authorise under subsection (2),the Treasury must have regard to such matters relating to theadverse effects of that maladministration on those persons andthe proper calculation of their resulting losses as have beendetermined by the Parliamentary Commissioner forAdministration to be relevant to and appropriate for thatcalculation.’.

Mr Hamilton: I tabled my amendment because, althoughI am well aware that the Bill is an enabling measure, Ifeel strongly that a group of Equitable Life policyholdershas been unfairly excluded from the compensation schemethat the Government have put in place. You will bepleased to know, Mr Evans, that I will not rehearse theentire history of the Equitable Life saga, because I donot think that we have the time this afternoon. However,to put my amendment into context, it might help righthon. and hon. Members if I remind them of some ofthe background to the case that I am about to put forthe with-profits annuitants who took out their policiesbefore 1992, for whom the Government’s proposedscheme will not offer any compensation at all—in starkcontrast to the post-1992 with-profits annuitants forwhom 100% compensation is now proposed.

Founded in 1762 as a mutual insurance companybased on the ideas of James Dodson, a fellow of theRoyal Society and a man well ahead of his time, EquitableLife started selling pensions as early as 1913, but it wasnot until 1957 that the society started to sell its infamousguaranteed annuity rate, or GAR, pensions, which gavea clear and unambiguous return on capital investeddepending on the age at which the policyholder decidedto start taking the annuity. That was to carry on until1988, at which point the society realised that its rateswere so good and so far ahead of the rest of the marketthat they were unsustainable.

In December 2000, Equitable Life was forced to closeto new business. By that time, it had more than 1.5 millionmembers. In the last Parliament, the Select Committeeon Public Administration said in its introduction to itsDecember 2008 report:

“Over the last eight years many of those members and theirfamilies have suffered great anxiety as policy values were cut andpension payments reduced. Many are no longer alive, and will beunable to benefit personally from any compensation. We shareboth a deep sense of frustration and continuing outrage that thesituation has remained unresolved for so long.”

In June 2009, I introduced an Adjournment debate inWestminster Hall on Equitable Life following manycomplaints from constituents over the past few years. Inmy debate, I was critical of the then LabourGovernment—my own party’s Government—and althoughI loyally and strongly supported almost all the previousGovernment’s policies, I felt that we were wrong on thisissue and should have done far more to implement theparliamentary ombudsman’s full and damning reportof July 2008 entitled “Equitable Life: a decade of regulatoryfailure”. Needless to say, that did not make me verypopular with my colleagues on the Front Bench at thetime. My right hon. Friend the Member for Birmingham,Hodge Hill (Mr Byrne), the then Chief Secretary to theTreasury, tried his best at the end of the last Parliamentto implement what I believe to have been a flawedexercise to bring in some sort of compensation schemeby employing Sir John Chadwick to design a system,but that took so long that it was overtaken by thegeneral election in May.

The new coalition Government decided initially tocontinue the Chadwick process, to the disappointmentof the Equitable Members Action Group. However, Imust thank my right hon. Friend for his courtesy andthe help that he tried to give me when he was ChiefSecretary. He clearly understood the moral imperativethat Parliament and the Government had to Equitable’spolicyholders, but his hands were tied and no compensationscheme was forthcoming under the previous Government.That was a great shame.

When Sir John Chadwick finally published his long-awaited report on 22 July, his recommendation on thetotal compensation to Equitable policyholders was forjust £400 million to £500 million, or about £400 to£500 per person, out of the estimated total losses ofapproximately £4.8 billion, as calculated by the actuariesTowers Watson almost two years ago. I am reluctant togive praise to the Government parties, but I was delightedwhen the Chancellor of the Exchequer, in his speech tothe House on the comprehensive spending review on20 October, scrapped the Chadwick report and proposeda compensation package amounting to £1.5 billion.That figure was a threefold increase on Sir John Chadwick’sinitial proposal but was still insufficient to make up forthe losses incurred by Equitable policyholders. Moreimportant, however, the Government accepted at longlast the report of the Parliamentary and Health ServiceOmbudsman in full. Again, I must reluctantly givecredit to the Government for having done somethingthat I wish my Government had done long ago.

Any delight that surviving Equitable policyholdersand I felt at the Chancellor’s announcement was soonclouded by the details of the proposed compensationpackage. All the 37,000 post-1992 with-profits annuitantswill eventually receive 100% compensation for theirlosses since then, but none of the estimated 10,000 pre-1992with-profits annuitants will receive any compensation.Let me explain how my amendment goes to the heart ofthis issue.

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Jonathan Evans (Cardiff North) (Con): I have noreluctance in paying tribute to the hon. Gentleman forhis independence of thought and the campaign that hehas waged on this issue. He has been not a lone voice,but one of very few Labour voices addressing the matter.On pre-992 annuitants, how on earth could one calculatewhat their losses might be as at that time, bearing inmind the fact that it is very likely that in the late1980s and early 1990s bonus payments that were probablymuch larger than was warranted, given subsequent events,were added to their asset share? In other words, theymight well already have been overcompensated.

Mr Hamilton: I thank the hon. Gentleman for hiskind words. I hope that in continuing my comments Ishall answer his question.

I have long believed that the Equitable saga is a moralissue for us in Parliament. We sought, through theFinancial Services Authority, to regulate financialinstitutions such as Equitable so that those who investedtheir valuable savings to ensure their future incomewere protected against fraud and maladministration.Our own ombudsman, Ann Abraham—she works forus—called the failure to regulate Equitable “catastrophic”and pointed to examples of savers encouraged to investwith that company long after it clearly could no longermeet its obligations.

If we as a nation want to encourage people to saveand to provide for their retirement and old age, inaddition to what they will receive in state pension, it isessential that the companies offering those savings productscan be trusted and relied on. With hindsight, we can seethat Equitable clearly could not deliver to the hundredsof thousands of investors who trusted it and thosepeople have been badly let down as a result. We had anobligation to ensure that that could not happen and wenow have an obligation—indeed, a duty—to ensure thatthose who have lost out are fairly compensated for alltheir losses. This matter is above crude party politics; itis an obligation to which 380 sitting MPs signed upbefore the last election when they put their names toEMAG’s pledge. We must not let the policyholdersdown now.

Let me relate some heartbreaking cases that willillustrate better than I can just how people have sufferedas a result of Equitable’s failure. One of my constituents,Mrs B of Leeds, has written:

“I signed for my With Profits Annuity in March 1991, investing£57,000. I am really suffering just now with my husband nowbeing disabled and I am still trying to work four days a week tomake ends meet. I receive only £141 a month from Equitable andit will continue to reduce. Surely all With Profits Annuitantsshould be included in the compensation! Have I been harbouringfalse hopes all these months? If so, there does not seem any pointin my continuing to write to my MP or the Prime Minister.”

Another policyholder, Mr D, who is not a constituentof mine as far as I am aware but will be a constituent ofsomebody in the House, writes:

“In his letter of 20 October Mark Hoban refers to the government’sconcern with the plight of the WPAs. However, he fails even tomention the Government’s decision that those who started toreceive their annuities before September 1992 are to get nothing.This is in spite of the fact that they too have not been allowed toget out, are continuing to suffer, year by year, reductions in theirannuities and are older than any of us.

Fortunately Paul Braithwaite [the Secretary of EMAG] perceivedfrom the first what was going on and has placed the matter of thetreatment of the pre-September 1992 WPAs at the top of theagenda for a judicial review. However”—

this is the crux of what Mr D says—“I think our MPs are fair minded enough to perceive for themselveshow unjust the proposed action of the Government is. I amwriting to my MP straight away.”

Whoever that might be should look out for the letter.Once an annuity has been purchased it cannot be

sold or changed, so the with-profits annuitants whotook out annuities before the September 1992 cut-offdate are trapped.

Stephen Lloyd (Eastbourne) (LD): I, too, pay tributeto the hon. Gentleman for his work. It has been apleasure to work with him on this issue and I supporthis amendment. In a nutshell, on the moral case, theparliamentary ombudsman and Sir John Chadwick bothsaid in writing in advance that all the annuitants shouldbe treated equally and that these annuitants should notbe excluded, not least because they are the oldest andmost frail.

Mr Hamilton: I thank the hon. Gentleman for hiskind remarks about the work I have done but, as theCommittee will know, he is the secretary of the all-partygroup on justice for Equitable Life policyholders, and Ithank him for his efforts in this regard. He is absolutelyright: Sir John Chadwick did say that, as I shall mentionlater.

The with-profits annuitants who took out annuitiesbefore the September 1992 cut-off date are as trappedas those who purchased them after that date and theirincomes diminish each year. Having taken out policiesthat they believed would allow them to make ends meetin old age, they now face increasing poverty becauseParliament did not act soon enough to prevent thecollapse of Equitable. That is why we owe them thecompensation that they deserve as much as the post-1992with-profits annuitants.

What is so important about September 1992? Let megive further reasons why this is an artificial and unfaircut-off date, which I seek to stop with my amendment.First, annuities could not be exchanged once bought, soevery annuitant has suffered from the consequences ofregulatory failure irrespective of when their annuitywas taken out or what extra bonuses were added. Thecut-off date ignores the views of the parliamentaryombudsman, Ann Abraham, and Lord Chadwick intheir reports. Even Chadwick, who came up with amuch smaller overall compensation package than the£1.5 billion now on the table, agreed that the pre-1992with-profits annuitants should not be excluded, as thehon. Member for Cardiff North (Jonathan Evans) pointedout.

It is said that because of the changes to the computersystem, Equitable’s records prior to late 1992 were notavailable, but the current chief executive of Equitable,Chris Wiscarson, who has been extremely helpful, haspreviously stated that this is a problem that could besurmounted. The parliamentary ombudsman has previouslymade it clear that nobody would sensibly have investedin Equitable after 1 July 1991 had the regulator actedeffectively and transparently. If that situation had beenmade apparent to the media and the public at that time,nobody would have sensibly invested after that date.

It seems clear to me that anybody who took out apolicy between July 1991 and September 1992 is beingunfairly penalised simply because of a change in Equitable’s

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computer system. This is exacerbated by the fact thatpolicies brought out in this period had the longestexposure to the adverse effects of maladministration.The coalition Government gave a commitment to“implement the Parliamentary and Health Ombudsman’srecommendation to make fair and transparent payments to EquitableLife policy holders, through an independent payment scheme, fortheir relative loss as a consequence of regulatory failure.”

My amendment would ensure that this commitmentcould be carried out properly and at a relatively smalladditional cost.

Let me be clear. I am not recommending that we takesome of the compensation from the 37,000 who havealready been promised 100% compensation, which amountsto about 50% of the total offered by the Government. Iam suggesting that we bring forward the £100 million ofthe total package that was proposed to be given in thenext Parliament, and that we add to that a further£100 million from current, albeit limited, reserves.

As I said earlier, I believe that this is a moral obligationand that Equitable pensioners are looking to us, theirrecently elected representatives in this Parliament, forjustice, which is why I intend to press the amendment toa vote so that there can be no discrimination betweenwith-profit annuitants according to when they purchasedthose annuities.

Andrea Leadsom (South Northamptonshire) (Con):Does the hon. Gentleman accept that there might bemore support for the amendment if it did not incurfurther cost to the taxpayer, bearing in mind the currentsevere financial constraints?

Mr Hamilton: Yes, of course the amendment wouldattract far more support if there was a net zero cost.However, this is an important moral issue. Many of myhon. Friends and other Members know my views, forexample, on the Trident replacement, which I know hasnow been shelved for a while, and on various schemesthat take a huge amount of capital expenditure. Thesum that we are discussing now is relatively small. Ibelieve there are other savings that may be made, particularlyin defence spending, which could pay for this.

That is a decision that the Government and the twoparties that make up the coalition will have to grapplewith, but I believe that the policyholders look to us toensure that the justice they have been promised is delivered.It is a moral obligation, and it overrides many of theother areas of expenditure to which any Governmentare committed.

Frank Dobson (Holborn and St Pancras) (Lab): Doesmy hon. Friend agree that if there is a moral case tocompensate anybody, there must be a moral case tocompensate everybody, and not leave some people outbecause of some mess-up over a computer system?

Mr Hamilton: I thank my right hon. Friend for that.He is right. It is galling when the very vulnerable andfrail pensioners who are the ones suffering most becausethey are the pre-1992 with-profits annuitants look, forexample, to the quite correct compensation given toIcesave investors of up to £50,000 per investor, and tosome of the other compensation schemes in which theGovernment have been involved over the years, and findthat they, who might not have much longer to live, aregoing to be without compensation at all.

Jonathan Evans: I am grateful to the hon. Gentleman,who is being extremely generous in giving way. I fullyaccept the moral argument that he is putting forward.That is why I was a signatory to the pledge as well. Inresponse to the question I asked earlier, he certainly hasa point about taking back the date to 1991. His amendment,though, would go back well before that, but he has notmade the argument for going beyond 1991. My secondquestion was how he would compute the compensation.That must be a central question, and in his argument sofar I have not heard an answer to that.

Mr Hamilton: I thank the hon. Gentleman for hisintervention. First, there would be relatively few annuitantsfrom further back in time. Clearly, a person who retiredin 1981 or 1985 would be getting on a bit in years now,so only a small number of people would be involved.Secondly, Equitable must have records showing whatbonuses were paid at different times.

The further back the scheme goes before 1991, thefewer annuitants there will be who demand or need thatcompensation, but the need will be greater because ofthe frailty and the loss in the value of those annuitiessince then. Since 1991, those annuitants, even thoughthey may have had bonuses before that, continue to seea decline because of the maladministration, which affectsthem as much as it affects post-1992 annuitants. I hopeI have at least partly answered the hon. Gentleman’spoint.

Jim McGovern (Dundee West) (Lab): Actuaries aresometimes disdainfully referred to as people who foundaccountancy too exciting, but surely a good actuarywould be able to calculate the sums in question, whetherfor pre-1991 or post-1991 annuitants.

Mr Hamilton: I thank my hon. Friend for makingthat very good point. We are talking about many hundredsof thousands of policyholders throughout the UnitedKingdom, but we know that there are about 37,000 orso post-1992 with-profits annuitants. We think there areabout 10,000 pre-1992 such annuitants, but the furtherback we go the fewer there will be, so if it was a difficult,time-consuming exercise to work out relative losses forall policyholders, which it certainly was, which is whySir John Chadwick was engaged, it will surely be a mucheasier exercise for the far fewer people who are with-profitsannuitants prior to 1991. My hon. Friend’s point goessome way to answering the question.

Richard Fuller (Bedford) (Con): I thank the hon.Gentleman for giving way again. This has been a long-standing issue, and perhaps he can help some of us whoare new to the House. He mentioned a total of £100million from subsequent years’ Budgets, plus £100 millionfrom reserves to be allocated to pre-1992 annuitantswho are not covered in the proposals. Is the hon.Gentleman making an estimate, or is that sum firm is inhis mind? That is a key issue. The concerns expressedabout computer records do not stand up against a pointof principle, but it is important that we have a sense ofhow firm and solid the hon. Gentleman’s understandingis of the sums that might need to be paid.

Mr Hamilton: The hon. Gentleman makes a verygood point, and I cannot give him a precise answer. Thefigures that I have quoted are estimates I obtained from

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[Mr Fabian Hamilton]

the Equitable Members Action Group, which has quitea lot of good people working for it—people who havebeen in the financial services industry. I go on theirexpertise. This is the best estimate that we can gain.

The reality is that many of the annuitants are quiteelderly. It is unlikely that in five years we will have thesame number we have now. We already know, for example,that 15 policyholders throughout the entire spectrum ofEquitable policyholders have died every single day sincethe disaster happened. We can therefore assume,unfortunately, that more will no longer be with us in theyears to come, so the amount of money will be adiminishing sum. The best estimate that we can gain is£200 million, and that estimate comes from EMAG.

Jim Shannon (Strangford) (DUP): Can the hon.Gentleman clarify that last point? Obviously, since ourlast debate on the subject in the Chamber way back inJuly, some people have passed away. Is there any provisionin the amendment for the next of kin to take advantage,in the absence of those who have passed on?

Mr Hamilton: That is a good point, and it was madeduring the previous Parliament, in February, at a packedmeeting with the former Chief Secretary to the Treasury,my right hon. Friend the Member for Birmingham,Hodge Hill, and Sir John Chadwick. My right hon.Friend made a commitment, which I am not sure theFinancial Secretary has made, so perhaps he will clarifythe situation in his contribution, that the estates ofthose who had passed away would receive somecompensation. The point that I have just made may becontradicted, but it depends on what the FinancialSecretary and the Treasury want to do.

The Financial Secretary to the Treasury (Mr MarkHoban): Before the hon. Gentleman continues, let mejust make it clear that long ago we established the factthat, under any compensation scheme designed, wewould make payments to those who had deceased, andthat there would be no means-testing.

Mr Hamilton: I thank the Financial Secretary forclarifying that point, which somewhat contradicts whatI said earlier about the diminishing amount of money.

The best estimate that EMAG can give us is £200 millionfor the 10,000 existing pre-1992 annuitants. I confirmthat I wish to press my amendment to a vote, andsimply conclude that we owe some of our most frail andvulnerable pensioners no less. I urge all Members tosupport my amendment.

Jonathan Evans: I am very pleased to have theopportunity to participate in this debate, but may Ibegin by declaring an interest? I am the chairman of alife insurance company, but I have no connection whateverwith Equitable Life, financial or otherwise.

The hon. Member for Leeds North East (Mr Hamilton),alongside very many Conservative and Liberal DemocratMembers prior to the election, fought very hard to putforward the cause of Equitable Life policyholders, and Iam pleased and proud of the position that my colleaguesand the Minister adopted. Many of us, in the lead-up tothe election campaign, signed a pledge to seek to putinto operation a number of factors. The first was the

recognition of all the individual provisions that theparliamentary ombudsman put forward. The hon.Gentleman will know that the previous Governmentonly partially accepted the ombudsman’s report, and Iam very pleased, and proud of the fact that the Ministerfully accepted all its points. I rather wish that EMAGhad been a little more generous in its praise of him forhaving done so.

Secondly, the compensation that has been put forwardwill come as a disappointment to some, but the ombudsmanmade it clear that we had to take account of pressureson the public purse at the time. When we heard Sir JohnChadwick’s proposals, there was virtual unanimity amongthose newly elected Government Members that £400 millionwas completely and utterly inadequate. I thought thatthe Government might put the figure up to about£1 billion and hope for the best, but we ended up with£1.5 billion.

James Morris (Halesowen and Rowley Regis) (Con):Does my hon. Friend agree that we would not be in thissituation, or have to have this conversation, if it had notbeen for the delay imposed by the previous Government?

Jonathan Evans: That is true, and the record of theoutgoing Labour Government in that regard is inglorious,but I do not want to be partisan. In essence, EquitableLife policyholders do not want us endlessly to bash theOpposition; they want to know which way we can goforward. So I shall turn my remarks to the specificpoints made by the hon. Member for Leeds North East.He made a good moral case for not excluding peoplewho ought properly to be included in the category towhom compensation could be paid, but, as I suggestedin my intervention on him, some factors cause me someconcern.

1.15 pmFirst, the hon. Gentleman referred to the elderly

pensioner who had put in £57,000 and now receives avery low monthly figure. I certainly share his concernabout that, but, if we were to unpick financial arrangementsgoing back to the 1980s, we would have to consider thedifficulty that arose from the fact that Equitable Lifegave guaranteed annuity rates to some of its policyholdersand, at the same time, record bonus rates to thosepeople who did not have those guarantees. In reality,Equitable Life was building its business on the basis ofbecoming a market leader in the bonuses that it granted—even to the point where the parliamentary authoritiesrecommended that all hon. Members making additionalvoluntary contributions should make use of EquitableLife because of its market-leading rates.

We know now that those rates were deceptive, butduring the 1980s those rates were paid and those bonusesadded to the asset pool being put together. Therefore, itcannot be gainsaid that, certainly by 1990, most peoplewith an asset share in an Equitable Life policy probablyhad an amount that was well beyond what was appropriatefor the investment that they had made. In other words,they were over-supplied with bonuses during that period.

Stephen Hammond (Wimbledon) (Con): I have takenpart in a number of these debates during my shortperiod as a Member, and, unlike some hon. Members, Iam not reluctant to praise the Minister. However, in my


constituency surgery last Friday I saw an 80-year-oldgentleman who accepts the points that my hon. Friendnow makes, but makes the point himself that the pre-1992group are still trapped and unable to take any action.Had they been able to take some action to mitigate orameliorate their circumstances, they would have doneso. My hon. Friend the Minister has done a great job inmoving the issue forward so quickly, but I hope that hewill at least listen to the concerns of the pre-1992annuitants.

Jonathan Evans: I am grateful to my hon. Friend forthat contribution. He approaches the issue with significantexpertise, so he will know that, if we are to achievejustice, it is not just a question of treating all thosepre-1992 policyholders in the same way as everybodyafter 1992. One would go back and assess the pre-1992annuitants’ asset share to see whether they were paid105%, 110%, 120% or 140% of asset share; and onewould correct that, so that the pre-1992 and post-1992annuitants were dealt with in a balanced way. Thedanger with the proposed approach is that there will notbe that balance. It is already clear, from the questionasked by my hon. Friend the Member for Bedford(Richard Fuller), that we do not have a basis for thefigure of £200 million; it is a wet finger in the air inorder to assess the situation.

The second factor that causes me significant concernis the lack of available actuarial information. I share allthe concerns about the Chadwick process, and, althoughSir John might have made an observation about thepre-1992 annuitants, he did not compute their liabilities.The danger, therefore, of being seduced by the strongarguments of the hon. Member for Leeds North East, isthat we would enter into an open-ended commitmentand have great difficulty realising its objective. Duringthe debate, however, he has made a good case on behalfof those annuitants who go back to 1991. We shouldremember the judgment made by the ombudsman andher terms of reference. Most of the inquiries startedlooking at the period from 1999 onwards, but most ofthe condemnation about regulatory failure goes back toevents prior to 1991. It is important that the Committeeshould take that factor into account when invited to saythat compensation should be granted going back verymany years before that.

Chris Leslie (Nottingham East) (Lab/Co-op): I shouldlike to speak to amendment 2, which is grouped withamendment 1, tabled by my hon. Friend the Memberfor Leeds North East (Mr Hamilton) and amendment 7,tabled by my right hon. Friend the Member for Holbornand St Pancras (Frank Dobson).

In wishing you a happy birthday, Mr Evans, let mesay that I do not have any registrable financial interestsin the matter under debate. However, I want to place onrecord that 18 months ago, some while before I wasreturned to the House, I was occasionally commissionedto give advice and training on parliamentary and publicpolicy matters, and on one occasion, I undertook aday’s work for a company whose clients included theformer chief executive of Equitable Life; by then, ofcourse, its fund had been closed for many years. Ithought it important to disclose that encounter for theavoidance of any doubt. Although I had a day’s workindirectly related to Equitable Life some time beforecoming into Parliament, I have not had any financial orpolicy discussions on the matter subsequently.

I have held this brief for a couple of weeks, and it hasbeen an extremely steep learning curve of reviewinghistory and policy that dates back well over 25 years, asmy hon. Friend the Member for Leeds North East said.I was struck by the opening words of the House ofCommons Library background note to the Bill:

“Describing the Equitable Life (Payments) Bill as the tip of aniceberg would be harsh on icebergs: at least they have 10% or so oftheir bulk above the water line. The Bill is but a tiny atoll belowwhich lies the immense bulk of the Equitable Life tragedy.”

In general, I intend to be as supportive as I can of theBill, as it is a positive step forward in the attempts torectify a long and sorry saga. The amendment simplyseeks to encourage the parliamentary ombudsman to“report to Parliament on the implications for payments…of thefindings of the Independent Commission on Equitable Life Payments,no later than one month after the publication of such findings.”

I do not want to go through the entire backgroundthat has brought us to this Committee stage today. Bymy count, eight separate inquiries, and possibly more,have done that, and there are conflicting and sometimescontradictory findings and accounts of what happenedin the past and who should be responsible for rectifyingthe situation for policyholders. However, we know thatin the spending review the Government accepted theombudsman’s approach to maladministration and, morerelevantly to this debate, to the framework for acompensation package. The Government say that theywant to honour the interpretation of the ombudsman’ssecond report in full. That is their choice. There areclearly arguments in favour of that approach, as well asagainst it.

The Minister now places great emphasis—although itcould be argued that he did so to a lesser degree beforethe general election, when there were a lot of loudcampaigns on signing up to the EMAG pledge—on itbeing appropriate to consider the potential impact onthe public purse of any payments of compensation inthis case, as the ombudsman has said. The Treasury hasconcluded that it will initially focus on total relative lossas the basis for its payments and will cover those lossesin full for post-1992 with-profits annuitants, to the tuneof some £620 million. Some 37,000 individuals will beinvolved in that. That means that that group of with-profitsannuitants will receive compensation equivalent to thatwhich they would have gained had they invested incompanies other than Equitable Life. However, becauseof the cap of about £1.5 billion that the Treasury isplacing on the total payouts, the other 1 million or sopolicyholders, including annuitants with older policies—Ipresume, although I may be wrong about that—willhave to have their compensation for relative loss adjustedto fit within the envelope available.

The Independent Commission on Equitable LifePayments, which is chaired by Brian Pomeroy, has beenset up by the Minister to advise on the allocation ofcompensation to policyholders other than those with-profitsannuitants, who will be getting 100% compensation. Iam conscious of the words of Sir John Chadwick whenI think through the technical challenge of administeringa compensation payment scheme; it is important that itsdesign and delivery are clear and efficient. I hope thatwe are not on the brink of a further failure that compoundsthe problems of the majority of policyholders by optingfor a compensation scheme that could be so complexand opaque that it might risk grinding to a halt. Weneed a scheme that works in practice.


[Chris Leslie]

If the Minister is opting for the ombudsman’sapproach—as I say, that is the Government’s choice—thereare questions that need to be answered, and I would begrateful if he could reflect on those when he makes hiscomments. First, exactly how will the apportionment ofthe relative loss figures for other policyholders notreceiving 100% compensation be calculated under theombudsman’s approach, if we will not be following theChadwick methodology given the Government’s acceptanceof all 10 findings by the ombudsman?

Secondly, will the other policyholders—the vastmajority—be classified into broad categories or subjectto individual assessment of their cases? Will there beany burden of proof requirement on the other policyholdersin the assessment of their relative loss, or is it likely thatthe compensation scheme will have some assumedautomaticity in all cases? I ask that only because theombudsman’s findings of loss are very specifically linkedto a policyholder’s reliance on the regulatory returndata. She said:

“I find that injustice was sustained by any policyholder whorelied on information contained in the society’s returns between1990 and 1996.”

I am trying to get a sense of precisely how that processwill work.

Thirdly, how will the payment scheme take into accountall the other maladministration factors for otherpolicyholders that Sir John Chadwick’s methodologywould not have covered, if we are following a classificationscheme?

Whatever compensation scheme the independentcommission eventually alights upon, it is an importantstarting point to establish that it is consistent with theMinister’s intentions—in other words, that it encompassesall the parliamentary ombudsman’s conclusions. I gatherthat there are moves afoot by the Public AdministrationCommittee to interpret whether the ombudsman’s modelaligns with the payment scheme that eventually emerges.That might be a good idea, but perhaps it is a littlecircuitous. It would be far better, in my view, to give theombudsman directly the right and the opportunity tosay publicly whether the payment scheme is indeed inkeeping with the spirit of her own findings. She couldthen say whether the total relative loss figures are accurateand whether the compensation scheme is fair, particularlygiven the controversy over the dates and whether somepeople will or will not be included in the 100% compensationfor with-profits annuitants. The purpose of our amendmentis simply to give voice to the ombudsman so that shecan confirm her view.

It is worth noting at this stage that, far from grantingthe wishes of the Equitable Life policyholders regardingeverything they wanted, the main pressure group formedto speak for their interests, EMAG, is angry and perplexedat the nature of the compensation scheme envisaged byMinisters and the constraints placed on the independentpayments commission. EMAG says on its website:

“The independent Commission’s recently torn up terms ofreference have not at this date”—

this was a week after the announcement in the spendingreview—

“yet been replaced.”

It says that the Minister’s letter of 20 October to thecommission’s chairman“makes clear that retrospectively the remit will now totally exclude”the full class of with-profits annuitants. My hon. Friendthe Member for Leeds North East alluded to that point.EMAG continues:

“So its remit now is to divvy up £775m between 600,000 and tosuggest the prioritisation. This surely cannot be what the ParliamentaryOmbudsman had in mind as the role for the independentCommission?”Given this question mark over the parliamentaryombudsman’s intentions, we felt it important to tablethe amendment to try to give voice to that.

There is doubt about whether the compensationarrangements are as much in alignment with theombudsman’s approach as the Financial Secretary wouldlike to argue, and I hope that our amendment will givethe ombudsman a chance swiftly to comment on thecalibre of the scheme and clarify once and for allwhether it fits with her approach. We believe that thatcan be done quickly, and there seems to us to be noreason why it could not happen within one month ofthe publication of the scheme’s proposals. There wouldnot be any reason to delay payments, and it would aidtransparency and confirm whether the Government’sarrangements via the commission’s payment schemewere the same as those envisaged by the ombudsman.Although amendment 2 may be a belt-and-braces approach,at this stage of the saga we need some cast-iron assurancesall round.

1.30 pm

Mr Mike Weir (Angus) (SNP): I should like to makea brief contribution to say that if the hon. Member forLeeds North East (Mr Hamilton) presses his amendment,we will certainly support him.

I have been debating Equitable Life in the House eversince I was first elected, and I well remember endlessdebates in the two previous Parliaments in which I wasjoined by Conservative Members in trying to get theLabour Government to take action. I recognise thatsome Labour Members also pushed their own Governmentfor action. It was a long battle, and frankly we did notget very far.

When the new Government were formed, I cannotsay I had any great enthusiasm for the thought of thecoalition, but I did at least think that perhaps we couldget an end to this saga, which had brought so muchunfairness to so many people throughout the country,many of them elderly.

One difficulty has always been what the finalcompensation bill should be. It is easy to get lost infigures, as they range from Chadwick’s £500 million upto EMAG’s latest figure of more than £6 billion, but thegenerally accepted figure seems to be in the region of£4.6 billion. The Government have set a figure of£1.5 billion, which is about a third of that generallyaccepted figure. I understand their reasoning that that isall that can be afforded, but sorting out Equitable Lifecould have been one of their great early achievements. Itis being undermined by arbitrary decisions, the worst ofwhich is the overall cap on the amount. Rather than anindependent commission considering the matter andrecommending a figure, a figure has been put in placeand all the independent commission can do is decidehow it is divided among policyholders.


Mr Fabian Hamilton: As I mentioned in my contribution,about half the overall £1.5 billion package will beconsumed by the 100% compensation for the 37,000post-1992 with-profits annuitants. Does the hon. Gentlemanagree that the remaining balance will provide a considerablysmaller sum in the pound to the rest of the policyholders?

Mr Weir: The hon. Gentleman is quite right. I understandthat the figure quoted by EMAG is about 15% of theirloss, which is a very small amount for people who havesuffered.

What could have been a very good outcome seems tohave been undermined by arbitrary decisions. I hopethat the Financial Secretary will explain the rationalebehind excluding the 10,000 pre-1992 annuitants fromcompensation altogether. I do not understand the logicof that. I do not see any suggestion that it should bedone in the ombudsman’s recommendations.

I have said in previous debates that it is importantthat this Parliament supports its independent ombudsman,and there seems to have been a major deviation fromwhat the ombudsman recommended. The hon. Memberfor Cardiff North (Jonathan Evans) made some interestingand relevant points about how compensation for pre-1992annuitants should be calculated, which is undoubtedlya difficulty. I am not an actuary and cannot give him theanswer to that, but I do not think it is beyond the wit ofman—or even an actuary—to work out a figure.

Ultimately, this is a matter of principle. I raised thatpoint on Second Reading. We are dealing with a situationin which many thousands of our fellow citizens havelost out through maladministration. The Governmentare ultimately responsible for that maladministration—theprevious Government, not the present one, but they arethe heirs to that. We should not accept the principle thatthe Government can say, “Okay, there has beenmaladministration. We are responsible, but we will set acap on how much compensation we give and thenarbitrarily decide which of the group who have sufferedwill be compensated.” That is a very bad principle. Inno other case in which there has been loss and there isliability would anyone be entitled to say, “I’m onlypaying a proportion of that. That’s all I can afford.”The Government should not go down that route.

I believe that we will debate an amendment later toset up a totally independent organisation to considerthe matter. We need that to be done independently, notwith a cap and not with some people arbitrarily excluded.We will support amendment 1 if it is pressed, because itis only reasonable. We have to right what has been aterrible injustice going back well over a decade.

Frank Dobson (Holborn and St Pancras) (Lab): Ishall speak very briefly in support of all three amendmentsin this group—those tabled by my hon. Friends theMembers for Leeds North East (Mr Hamilton) and forNottingham East (Chris Leslie), and even the one that Ihave tabled.

As drafted, the Bill leaves practically everything tothe discretion of the Treasury, which I find objectionable.I remind the Committee of what Winston Churchillsaid about people at the Treasury—that they were“like inverted Micawbers, waiting for something to turn down”.

The chance of their coming to any generous conclusionfor people who suffered in the Equitable Life scandal isvery small. The courts have held that bodies given

discretion are not allowed to fetter their own discretion.It is therefore necessary for the House to fetter thediscretion of the Treasury.

I strongly support the view that we should not allow asituation in which the most elderly people will be excludedfrom compensation. In view of the fact that everyoneplaces so much weight on the ombudsman’s contribution,I strongly support the amendment tabled by my hon.Friend the Member for Nottingham East, which suggeststhat we should give her a further look at what is beingproposed. It will be preposterous if, in trying to do whatthe ombudsman wants, we end up doing something thatshe thinks is unsatisfactory and inadequate. The reasoningbehind the amendment in my name is the same.

I do not wish to say any more, but the House shoulddo its proper job of telling the Treasury what the rulesshould be when it considers the matter. I am not gettingat Ministers; I am getting at the Treasury as an organisation.It does not have a good record, and ethics and decencyare not major considerations for it. They never havebeen, and perhaps they should not be its majorconsiderations, but we should bear them in mind, sothat we can bear down upon the Treasury.

Nadhim Zahawi (Stratford-on-Avon) (Con): The hon.Member for Leeds North East (Mr Hamilton) made animpassioned and moral argument for amendment 1, towhich I shall return later.

I have taken a very keen interest in this issue. It hasaffected a significant number of people in Stratford-on-Avon, to the extent that I have had hundreds of lettersand e-mails about it. Like many other Members, Isigned the EMAG pledge before the election, and Ibelieve that backing the Government to get the Billthrough is delivering on that pledge.

It is probably worth our spending just a few momentsthinking about the economic landscape in which we areoperating. We are borrowing about £500 million a day.Every time we go to sleep and wake up in the morning,we notch up another £500 million. To service the debtcosts about £120 million a day—that is not to pay itdown, but just to stand still. It is against that backgroundthat we must try to resolve the tragedy of EquitableLife.

Let me spend a couple of minutes on the timelines ofthe events. In 1988, Equitable Life stopped selling itsguaranteed annuity rate policies and, in 1990, thosepolicies became too expensive to honour because of thefalls in interest rates and in inflation. In 1999, after the1997 election, Equitable cut its bonus paid to 90,000 GARpolicyholders. In July 2000, the House of Lords ruledthat Equitable Life must meet its obligations to itsGAR policyholders, thus leaving it with a £1.5 billionliability.

In February 2001, the Halifax agreed to pay £1 billionfor the assets. In July, with- profits policyholders sawthe value of their savings slashed by 16%—by almostone fifth. In August, Lord Penrose announced hisinvestigation. In October, the then Economic Secretaryto the Treasury told the Treasury Committee that theprevious Labour Government might consider compensationfor some victims if a grave injustice had occurred.

In January 2002, policyholders backed a compromisepackage. In March 2004, the Penrose report blamedEquitable Life’s management for the whole affair. Following


[Nadhim Zahawi]

the report’s publication, the Government ruled outcompensation and were accused in this House ofabandoning policyholders. In April, the parliamentaryombudsman announced that she would reopen herinvestigation.

In 2007, the European Parliament called on the UKGovernment to compensate policyholders. In January2008, Equitable agreed to pay an undisclosed sum to407 with-profits annuitants who launched proceedingsin 2004. The ombudsman’s report was published in2008. The previous Government said that they wouldrespond by the autumn. When the deadline was missed,the then Prime Minister said that they would respondbefore Christmas. However, they did not respond untilthe new year.

In August 2009, Sir John Chadwick published hisfirst interim report, and in March 2010—more than ayear after his appointment—he published his third andfinal interim report with a promise of a final report inMay 2010. That date was subsequently extended to July.

I go through these events in chronological order todemonstrate the pain that the victims of Equitable Lifehave had to go through. This is a true human tragedy.The hon. Member for Leeds North East talked aboutthe e-mails and letters that he has received from hisconstituents, and the same is happening in all ourconstituencies.

The Government’s offer is a very good one. My hon.Friend the Member for Cardiff North (Jonathan Evans)said that, at best, he expected them to offer up to£1 billion. Many colleagues and I voiced our concernsthe last time we debated this matter in the Chamber.When one makes a pledge, one must try to honour it.

Richard Fuller: Like many of us, my hon. Friend iswrestling with this question of fairness and with thepolitical obligation to find a fair payment scheme thatwas mentioned in the Public Administration Committeeand that many of us have signed up to. Hon. Membersfrom both sides of the Committee are caught betweenwanting to praise the Minister for the swiftness of hisrecommendations—and we praise him for that—andfinding, in these difficult times, £1.5 billion. We oftentalk about that figure in comparison with the Chadwicknumber. However, does my hon. Friend not accept thatwe should view the figure with respect to what theGovernment themselves have said about policyholders’relative loss, which Towers Watson estimated at, I think,£4.3 billion? Does £1.5 billion represent meeting ourobligation of fairness if it is set against the relativefigure of £4.3 billion that the Government themselveshave accepted?

1.45 pm

Nadhim Zahawi: My hon. Friend is quite right: thefigure is £4.3 billion. I, too, have wrestled with theproblem. In the current economic climate, offering£1.5 billion to the victims is fair and it delivers on thepromise that many of us have signed up to. I hope thatmany colleagues will support the Government to expeditethe process and finally get money flowing to the victims,which we hope will happen by the middle of next year.The figure of £1.5 billion is about four times higher

than the £340 million that victims would have receivedif the coalition Government had accepted the Chadwickreport, which is what we feared would happen. I amvery comfortable with the sum being offered.

Stephen Lloyd: I accept my hon. Friend’s premise thatthe amount is considerably higher than the previousGovernment proposed. I also accept that we are in adesperate situation in which we are paying £120 milliona day to service a debt. That is outrageous and clearlywe must focus on that. However, a way around thechallenge is the one that I have presented to the EconomicSecretary to the Treasury, which is to urge the Treasuryto revisit the matter in five years’ time for the secondtranche of the £500 million. By then, the economy willbe transformed and we will be in a stronger position.Does my hon. Friend not agree that while the £1.5 billionseems a very generous sum at the minute, a little flexibilityfrom the Treasury means that the further £500 millioncould be revisited in five years’ time?

Nadhim Zahawi rose—

The First Deputy Chairman: Order. Before the hon.Gentleman responds to that intervention, may I remindMembers that interventions should be short and thatthis is not a Second or Third Reading debate? We arespeaking to the amendments that are before us and ifwe focus on them, we will make quicker progress.

Nadhim Zahawi: My hon. Friend makes a good point.However, having listed that extraordinary chronologyof debacles, it is clear that there could be a problem ifwe left things open and said, “We might be able torevisit them at some other stage”. We would be openingup other doors, and that may cause further delay. Icome from a world of business rather than of politicsand I believe that, if we try to put a line under a terriblesituation and compensate people, we should do it quicklyand completely.

Mr Evans, I take on board your remarks. All I willsay is that the Minister should be applauded. There willbe no means-testing and the dependants of the deceasedpolicyholders should be included in any compensation.I have had a number of heartrending letters in whichrelatives have written, saying, “It is too late for usbecause our loved ones have passed away.”

I understand the passion that the hon. Member forLeeds North East has shown through amendment 1.The problem with the amendment was outlined by myhon. Friend the Member for Cardiff North (JonathanEvans), who said that it was very difficult to put aquantum on what that number should be. In the currenteconomic climate, I would find it hard to support it ifwe said, “Oh well, maybe it is £100 million extra fromreserves; maybe it’s £100 million that we can bring infrom future years.” None the less, the hon. Gentlemanmade a strong point about the annuitants from 1991 goingforward, and I hope that the Minister was listeningcarefully.

Mr Fabian Hamilton: Does the hon. Gentleman notagree that creating an arbitrary date—which is what thecut-off point would be—would lead to a great deal ofanger and distress among some of the oldest and mostvulnerable policyholders?


Nadhim Zahawi: The hon. Gentleman would be rightif the date were purely arbitrary. However, the ombudsmanstated that the malpractice occurred in 1991, so the dateis not quite as the hon. Gentleman puts it. It has notbeen plucked out of the air.

Mr Jim Cunningham (Coventry South) (Lab): Leavingaside the economic difficulties that we face, is not thecentral problem that when we put a cap on something,we have to make it work? Therefore, we have to arrive ata certain formula to make the cap work, because we arelargely in the hands of the Treasury, as my right hon.Friend the Member for Holborn and St Pancras (FrankDobson) said earlier. Unless we get a grip on theTreasury, we will find ourselves in similar situations,and it is my guess that the Treasury has imposed the cap.

Nadhim Zahawi: The hon. Gentleman makes aninteresting point. What I would say is that, in contrastto the quotation from Winston Churchill earlier, myobservation as a new boy to this House over the past sixmonths is that the Treasury has behaved positively. Wemust remember that we will be administering publicmoney. The Government have no money of their own;rather, we collect money on behalf of the people andthen we administer it. It would be foolhardy and perhapseven foolish for us to say, “Let’s have somebody elseadminister public money.” At the end of the day, peoplehave to have someone who is accountable, and we areaccountable, as is the Treasury.

Amendment 7 seeks to ensure that the Treasury takesinto account a proper evaluation of the total relativelosses when determining payments—that is, the figureshould not be £4.3 billion, but could be much higher. Istrongly disagree with that. Many EMAG membershave written to me, lobbying me to see the matterdifferently, but I have to say that I disagree. Given thecurrent economic hardship, we all face an incrediblydifficult situation, in which we are all having to tightenour belts. To deliver compensation of £1.5 billion at thistime is entirely fair.

Amendment 2 is in the name of the hon. Member forLeeds North East and all I would say to him is that Iunderstand the thrust of his argument that we shouldconsider what the ombudsman says about the behaviourand actions of the coalition Government in dealingwith the issue. However, I would rather get things doneand dusted, and have something delivered to the victimsthan procrastinate further and wait for longer.

Mark Durkan (Foyle) (SDLP): I can fully appreciatewhat the hon. Member for Stratford-on-Avon (NadhimZahawi) said about the Government’s proposals beingclearly better than what the previous Government did.Frankly, that is not a very hard test to pass. The real testfor us in this Committee is surely not whether what wehave from this Government is better than what we hadfrom the previous Government. It clearly is better.Rather, we as a Committee have to see whether it is asgood as what is set out in the parliamentary ombudsman’sfindings and recommendations.

Nadhim Zahawi: Just to offer some explanation, whatthe Government have delivered is not just better thanwhat the previous Government were thinking about—ordithering about—trying to deliver. I also believe that

there was a point in this Parliament when the coalitionGovernment were seriously considering implementingonly what Chadwick had recommended, but we havemoved away from that. We have buried that, and we arenow in a much better place for the victims of EquitableLife.

Mark Durkan: My point still stands: the test is afairly easy one. The Chadwick report was so grosslyinadequate as not to be a credible starting point for anyGovernment. Many of us said that to the previousGovernment, including the hon. Member for LeedsNorth East (Mr Hamilton)—very bravely, loudly andconsistently—and many of us have said it to thisGovernment as well.

For us as Members of the Houses of Parliament, thetest that many people will apply is: what regard do wehave to the findings and recommendations of theparliamentary ombudsman? As the hon. Member forAngus (Mr Weir) stressed earlier, the public understandthe parliamentary ombudsman to be a creature ofParliament and to have some weight and merit inParliament’s considerations. However, the previousGovernment acted pretty dismissively towards theombudsman. What we have in some of the amendmentsbefore us is an attempt to show clearly that this Housewill give proper weight to what the parliamentaryombudsman is saying.

We all received a letter from the parliamentaryombudsman about some of the Government’s proposals.Given that, is it wrong that we should reference thejudgment of the parliamentary ombudsman—as thehon. Member for Nottingham East (Chris Leslie) issuggesting we do with amendment 2—perhaps as a wayof moving on from the scandal and confusion thatmany feel surrounds the fact that the ombudsman waslargely ignored by the Government and, in effect, byParliament for so long?

Jonathan Evans: I am anxious to ensure that the hon.Gentleman does not undersell what the Minister hasdone. The hon. Gentleman will recall that every aspectof the parliamentary ombudsman’s report has beenaccepted by the Government and that, furthermore, thereport said that whatever the overall compensationpackage should be, it had to take account of the impacton the public purse. Many of us on the GovernmentBenches think that those are the two crucial tests.

Mark Durkan: That is what the hon. Gentleman isarguing. However, given that the money that we aretalking about has been capped according to the Treasury’sjudgment of what it believes is available—that meansthat the overall sum to be offered by way of remedy andredress will be a long way short of what all the otherassessments say—I believe that it would useful for theCommittee to accept an amendment that would allowus to ensure that the parliamentary ombudsman hassome say in overseeing the measures. Under thecircumstances, that is fair and reasonable, but if thehon. Gentleman is so content that the scheme as itstands meets everything that the ombudsman has said,he should see such an amendment as adding no particularstress or difficulty for the scheme. Such an amendmentwould be a way of offering public assurance after all thedoubts that have been raised about how Governmentand Parliament have dealt with the issue.


Mr Weir: Does the hon. Gentleman not also agreethat at no time did the ombudsman suggest that anygroup of annuitants should be debarred from receivingcompensation, as is now being proposed?

Mark Durkan: I thank the hon. Gentleman for thatpoint, which quite properly brings me to amendment 1.

Jonathan Evans: I do not want to delay the hon.Gentleman, who is being very generous in giving way,but if he waits until Third Reading, he will hear what Ihave to say about the totality of the package.

Mark Durkan: What a trailer for Third Reading! Wewill all be waiting.

On amendment 1, the hon. Member for Leeds NorthEast set out a compelling case for why it is not just thecap, but the cut-off that we need to be seen to address.We have seen in the past how dates set for variousreasons have ended up creating unfair and unforeseenconsequences that Parliament did not truly intend. Thatcertainly happened with dates for schemes in previouspension Bills, for reasons that seemed reasonable andunderstandable to the House at the time. We are nowstruggling with the consequences that were never intended.We must be wary about such cut-offs.

2 pmThe arguments from the hon. Member for Cardiff

North about amendment 1 had some validity. I suggestthat some of the answers may be found in amendment 7,which was tabled by the right hon. Member for Holbornand St Pancras (Frank Dobson). The hon. Member forCardiff North said that it might be harder for somepre-1991 annuitants to make the case that some of theirlosses were directly due to maladministration and thatthe nature, degree and pattern of maladministrationwas more obvious and accentuated after that. If so,amendment 7 would allow account to be taken of that,because it states:

“In determining the amount of the payments that it is appropriatefor the Treasury to authorise under subsection (2), the Treasurymust have regard to such matters relating to the adverse effects ofthat maladministration on those persons and the proper calculationof their resulting losses as have been determined by the ParliamentaryCommissioner for Administration to be relevant to and appropriatefor that calculation.”

Amendment 7 would cut both ways. It would bean assurance that the loss suffered because ofmaladministration is duly reflected, and it could beused the other way because if it can be shown that someof the people who would be brought into the scheme byvirtue of amendment 1 had not suffered because ofmaladministration, due weight could be given to that.Equally, the pre-1991 undue profits issue—some peoplewent for market glister rather than reliable long-termworth—would not be precluded from being properlyaddressed and balanced. We all want to achieve anadequate compensation scheme.

I shall support amendment 1 if it is pressed to a vote,and I commend amendments 2 and 7. Together, theywould go some way to improving the Bill. They wouldalso go some way to improving Parliament’s reputationat a time when people have been so disappointed andfrustrated by how long this problem has been allowed torun on. I welcome the Minister’s assurances, which hemade in an intervention, that the interests of the dependantsof those who have died will also be properly addressed.

It is not enough to say, “Well, this is great; we nowhave something that is better than Chadwick. We nowhave something that is better than the previousGovernment’s proposals.” People were deeply distressedby the previous Government’s long inertia and indifference,but they are not hugely impressed by urgent inadequacy.The purpose of the amendments is to ensure that we donot make errors through urgent inadequacy.

Bob Blackman (Harrow East) (Con): I pay tribute tothe hon. Members who have spoken to the amendments.I praise our Treasury team, who have done a magnificentjob of righting the wrong that was done to EquitableLife policyholders over many years. OppositionMembers—there are some exceptions—should hangtheir heads in shame because of what they did when ingovernment to Equitable Life policyholders. I came tothe issue of the damage to policyholders rather late inthe process—shortly before the general election. Likeothers, I was encouraged by my former employer toinvest in Equitable Life, but it was a good job that I didnot do so, or my view now might be different.

I remind hon. Members about the pledge that wemade before the election: 380 MPs agreed to press forproper compensation for victims by swift, simple,transparent and fair payment schemes, as recommendedby the ombudsman; and we agreed that we would alljoin the all-party group on justice for Equitable Lifepolicyholders. I agree with the pledge, which I signed,and I have honoured every element of it. A largenumber of colleagues have not joined the all-partygroup that I have the privilege of co-chairing, and Iencourage them to do so even if latterly.

I want to concentrate on three aspects of theamendments. The first is the moral duty that we owe topeople who relied on advice and on the system of theregulator, the Government and Equitable Life. Therewas a major scandal, because those three bodies connivedto swindle people out of their money. That is a sadindictment of what happened, and that is what setEquitable Life aside from all other aspects of the pensionindustry. We must demonstrate to people, especiallyyoung people, that it is worth investing in their future.If young people do not do so, there will be a sad andsorry state of affairs in this country. There is a clearmoral duty.

The second issue is the amount of money that is duein compensation. I am delighted that the Treasuryaccepted that the ombudsman’s recommendation of£4.26 billion was the right amount to which policyholderswere entitled. The debate today is not about money, butthe Treasury team have come to a view that because ofthe economic circumstances only £1.5 billion is affordable.They have also had regard to the ombudsman’s report,which said clearly that relative loss must be taken intoaccount. The Treasury team must have done somecalculations to reach the figure of £1.5 billion, and Itrust that the Minister will tell us in his reply today howthat figure was arrived at. The reduction from £4.26 billionto £1.5 billion is dramatic, and he must respond to ourpoints.

Claire Perry (Devizes) (Con): My hon. Friend eloquentlysets out the outrage that many of us feel, having signedthe pledge. Does he agree that our Government, unlikethe previous Government, have reached a speedy conclusion,


as a result of which more people in the claimant groupwill receive compensation before there are further deaths?I agree with my hon. Friend about transparency and I,too, would support a motion to set out exactly how thecalculations were made, in the spirit of our Government’scommitment to greater transparency in all financialmatters.

Bob Blackman: I thank my hon. Friend for herintervention. The issues are complex, and the more onereads about and understands the scandal, the moredifficult it becomes to resolve it. The Government intheir wisdom have set out a compensation scheme thatwill continue for many years. The £1.5 billion is not aone-off payment that will go into a fund this year andend the matter. It will be spread over many years, and itwill extend into the next Parliament.

Mr Hoban: May I clarify the fact that those whoreceive compensation and are not with-profits policyholderswill receive a one-off payment during this Parliament.Only with-profits annuitants will have their paymentsspread over the rest of their lives.

Bob Blackman: I thank the Minister for his intervention.I was going to refer to that while I was responding tothe intervention from my hon. Friend the Member forDevizes (Claire Perry). The clear issue now is justice forthe people in the worst possible position—the trappedannuitants. I applaud the Government for honouringthe pledge that 37,000 people who have been trapped asa result of the scandal will receive 100% compensation.I strongly support and endorse that.

We have a problem, however, and amendment 1 attemptsto address it. The amendment has cross-party support;we must be seen to be acting not just as a party but asparliamentarians overseeing the Executive. The problemis that if someone took out a policy on a particular day,they would receive no compensation at all, even thoughthe maladministration was taking place at the time;whereas someone who took out a policy on the followingday would get 100% compensation. There are alwaysdifficulties when arbitrary dates are set, but that isneither fair nor reasonable.

I believe that we should set aside the date and reviewall the trapped annuitants to ensure that they get fairand proper compensation. The Chadwick report hasbeen rubbished by EMAG, and by Members on bothsides of the House, but even Chadwick proposed ascheme that would have compensated those trappedannuitants whose policies were taken out before thecut-off date.

Mr Marcus Jones (Nuneaton) (Con): When my hon.Friend signed the EMAG pledge, as many hon. Membersacross the House have done, did he believe that wewould end up leaving out about 10,000 pre-1992 annuitantsfrom the compensation scheme?

Bob Blackman: I and all the others who are new tothe House signed the pledge in the belief that, if wewere elected, we would compensate everyone who hadsuffered as a result of the maladministration, ratherthan taking an arbitrary position to compensate someand not others. I have heard heart-rending stories frommy constituents and from people all over the country

who are now living on desperately low pensions, havingexpected much larger ones, and we have a very strongmoral duty to all those people. We throw that away atour peril.

Dr Sarah Wollaston (Totnes) (Con): This is not just aquestion of fairness. Many of those individuals areolder and very vulnerable indeed. The letters that I havereceived make the point that those people are living onvery low incomes at a very vulnerable time of their lives,and they have already suffered from the effects of inflation.I agree with my hon. Friend that we should talk aboutthis as parliamentarians, not on a party political basis.

Bob Blackman: My hon. Friend clearly demonstratesthat we are talking about the oldest and most vulnerablepeople, and that they have been dealt with in a mostdisgraceful way following this scandal. We have a moralduty to compensate them.

Going back to the points made by my hon. Friendthe Member for Cardiff North (Jonathan Evans), it isclear that when the bonuses that were attached early inthe process are taken into account, some policyholdersmight not receive a penny piece in compensation. Weneed to recognise that, but there is an 18-month gapbetween the cut-off dates. A large number of the retiredpeople who had taken out annuities could not adjustthem once they had purchased them, and they are nowtrapped in that position. That is why we have a moralduty to compensate them.

Nadhim Zahawi: What action would my hon. Friendrecommend? My hon. Friend the Member for CardiffNorth mentioned the possibility of people being judgedto have received too much. Should we take that moneyaway from them? The malpractice took place in 1991,and we should be talking about 1991, not about 1992 orabout an open-ended process.

Bob Blackman: Clearly, if exorbitant bonuses wereattached to certain policies, the policyholders wouldnot be due compensation and they would not receive apenny piece. Remember, we are talking about compensation.We cannot take money off policyholders who have beenreceiving pensions. Parliament just cannot do that; itwould be a retrograde tax and therefore unacceptable.Those who are due compensation should receive it, butthose who are not due any would not receive any, and ifthey have benefited in the meantime, well, that is fineand dandy for them.

Jonathan Evans: In regard to the morality of theissue, I agree with many of my hon. Friend’s arguments.My concern, however, relates to the practicalities involvedwhen people are policyholders with other companies.Many of them had large bonuses from the 1980s onwards,but get hardly any at all nowadays. We have to takeaccount of this when we look at their asset share,compared with everyone else in the pool in a with-profitssystem. That is why many people believe that there is nofuture for with-profits business nowadays.

2.15 pm

Bob Blackman: The independent commission willneed to look at the relative loss that individual policyholdershave experienced as a result of the maladministration.


[Bob Blackman]

If annuitants took out policies well before themaladministration took place, there would be no relativeloss, and they would receive no compensation. The nubof the issue is that we want the review to be independent,so that we can all look the policyholders in the eye andsay that we have honoured our pledge to ensure thatthey were treated properly, and properly compensated.Under the Bill as it is drafted, we cannot do thatbecause of the arbitrary cut-off date.

Harriett Baldwin (West Worcestershire) (Con): Myhon. Friend is obviously extremely knowledgeable onthis subject. Does he agree that this is perhaps not somuch a question of a specific date as of whether or nota policyholder was trapped? If they are trapped, there isabsolutely nothing they can do about it.

Bob Blackman: That is clearly where our moral dutyarises. If policyholders are trapped and cannot adjusttheir position, they are unable to rectify the damagethat has been done.

I want to speak briefly to amendment 7. The Governmenthave accepted that £4.26 billion should be the fullamount available to policyholders, 37,000 of whom willreceive 100% compensation. That clearly involves ahuge amount of money, which will come out of the£1.5 billion. The policyholders who are not trappedannuitants would therefore get something like 15% ofthe compensation due to them, which seems prettyunfair and unreasonable. We should set up a commissionto devise a payment scheme, then look at the results.Instead, £1.5 billion has now been set aside, and anindependent commission will set up the mechanism fordistributing that money. That could have very seriousconsequences indeed.

Parliament has a problem in this regard. I applaudthe Government for moving swiftly to settle this matteronce and for all, but we are setting up a method fordistributing the money and creating expectations outthere. About 1.4 million policyholders have been affectedby the scandal, and 37,000 will receive full compensationwhile 10,000 will not get a penny. That leaves rather alot of policyholders among whom to divide a relativelysmall amount of money. When the Minister responds tothe debate, I trust that he will be able to set out how thecalculations were made, so that we can be clear aboutthem.

Amendment 7 would allow us to review the positionin five years’ time, when the economy has recovered andthe benefits of this Government are clear for all to see,and to top up the compensation further for those peoplewho will be retiring in five, 10, 15 or 25 years’ time. Wealso have a moral duty to honour our pledge to thosepeople. This is one of those cases in which we have setout to do something in the proper way, and I applaudthose on the Treasury Bench for moving swiftly to bringthe matter to a conclusion so that payments can bemade as soon as possible, but we must ensure that wefulfil our moral duty to those policyholders.

Mr Alan Reid (Argyll and Bute) (LD): I start byputting firmly on the record my belief that the Governmenthave implemented the parliamentary ombudsman’s reportand have honoured the pledges made before the election.

It was always part of the parliamentary ombudsman’sreport that this would be a political decision for theGovernment to make, taking the public finances intoaccount when they set the cap. The Government haveset the cap at £1.5 billion. I wish it could have beenmore, and I hope that it will be possible to revisit this infuture when the public finances are in a better state.

I have sympathy for amendment 1, but let me statemy understanding of how it would work in practice. Itdoes not alter the cap that has already been set, so if thepre-September 1992 with-profits annuitants were to becompensated to the same level as the post-September1992 with-profits annuitants, there would be less for thelatter group of people. If the cap remains the same, andthe amendment does not alter the cap, giving more tosome people would mean giving less to others. I ask theFinancial Secretary and the hon. Member for LeedsNorth East (Mr Hamilton) who moved the amendmentto comment on that when they respond.

I want to press the Government on why they havechosen the date of September 1992. As other hon.Members have said, the maladministration started inJune 1991. Penrose found that when the Equitable LifeAssurance Society’s board papers were sent to theGovernment Actuary’s Department on 11 June 1991,there was information in those papers showing that thesociety was not in a good position. Had the GovernmentActuary’s Department publicised that information atthat time, investors would have been deterred frominvesting in the society. There is a strong argument forsaying that the date should not be September 1992, butJune 1991.

On 30 July 1992, in an internal briefing, the GovernmentActuary’s Department described the society as beingone of the“companies on whom we have been keeping a close watch for anumber of years”

and said that Equitable Life remained a company “whichcaused serious concern”. There was evidence in July1992—in fact, before July 1992—that the GovernmentActuary’s Department was aware that Equitable Lifehad problems. Surely that should have been made publicand investors should have been deterred. In his response,will the Minister clarify why the date of September 1992was chosen, because it certainly seems to me that anearlier date—say, June 1991 or possibly even earlier—wouldhave been more appropriate?

Mr Marcus Jones (Nuneaton) (Con): I would like tospeak mainly about the position of with-profits annuitantsand the pledge that I and other Members of all partiesmade before the general election—that the Governmentshould make fair and transparent payments to thosewho had suffered as a consequence of the debacle ofEquitable Life. I am talking about 350 local people inmy constituency who are part of the Equitable MembersAction Group. Those 350 include people associatedwith many companies that were in the Equitable Lifescheme. Many hundreds of other people are affected.For some, Equitable Life provided their only privatepension to supplement their state pension provision.

I welcome the fact that for a number of my constituents,that pledge has been made good, and I understand thatthe trapped annuitants in the post-1992 cohort willreceive 100% of their compensation. I am delightedabout that. Needless to say, I am also very concerned


for the pre-1992 Equitable Life investors for whom, itseems, there will be no compensation at all. That seemscontrary to the recommendations of the parliamentaryombudsman, contrary to EMAG’s suggestions and contraryto the views of Sir John Chadwick, for whom not manyMembers have a great deal of time.

I understand that it is difficult to quantify the losses,but, if the Government have the will, the losses of thepre-1992 annuitants should be explored. The people towhom we made a pledge before the general election inMay were not necessarily concerned whether they werepre-1992 annuitants or post-1992 annuitants. Their concernwas as Equitable Life policyholders looking for justice.

If the Government and the Treasury have the will todeal with this situation, they should do so; if not, theyshould explain how I justify the position to constituentswho have been wronged.

If the Government and the Treasury are prepared tolook at compensating the pre-1992 annuitants, therehas to be a health warning, because there is a law ofunintended consequences, should we be stuck at thecompensation figure of £1.5 billion. Many of myconstituents who are post-1992 annuitants might beunaffected by any decision to include the pre-1992annuitants.

Amendment 7 deals with that position and the relativelosses. The Treasury should consider it, although I amconcerned about whether it could be taken into accountwithin the current comprehensive spending review orwould need to be considered after the current CSRperiod expires.

I would like to ask the Minister several questions.First, will he look again at how to compensate thepre-1992 annuitants, and at how that might be quantified?Will he commit to working with his Treasury colleaguesto take into account payments beyond the CSR periodto enable the pre-1992 annuitants to be compensatedwithout prejudicing the position of the post-1992 annuitantsand that of Equitable Life policyholders generally?

I implore the Minister again—I did so in the lastdebate on this subject—to recognise that the Government’sdecision over Equitable Life raises questions not onlyabout the integrity of the current Government, butabout the integrity of savings and investments for one’sretirement. I am well aware that many of my constituentsdo not have their own retirement provision. TheGovernment should encourage people to provide fortheir retirement, but if we do not ensure that there is asafety net for people who have invested and done theright thing for their retirement, they will think that it isnot worth putting themselves out by investing moneyfor their retirements during their early years of work.

I ask the Minister to consider those points extremelycarefully before any decisions are taken this afternoon.

Mr Hoban: I start by referring to the closing questionfrom my hon. Friend the Member for Nuneaton (Mr Jones).He will be aware that in July we published proposals tostrengthen the regulation of retail financial services,including pensions, which I hope will go some waytowards reassuring people that we have learned thelessons from the past and put in place a much morestable and robust framework for the regulation of long-termsavings.

I am grateful for the opportunity to discuss, first, therole of the parliamentary ombudsman in developingour policy on the payment scheme. Her work has beencentral to our approach. I also want to focus on with-profitsannuitants and those who took out their policies priorto September 1992. These issues have been raisedparticularly since our announcements in the spendingreview. I hope that I can bring some clarity to thetreatment of different groups of with-profits annuitants.

2.30 pm

At the spending review, my right hon. Friend theChancellor announced that about £1.5 billion offunding will be provided for the Equitable Lifepayment scheme. As hon. Members have said, that ismore than four times the figure produced by the Chadwickprocess, which was set in motion by the Opposition.The funding includes the full cost of losses to policyholderswith with-profits annuity policies—approximately£620 million—which will be paid through regular payments.That amount is to cover those with with-profits annuitypolicies, whose policies started between 1 September1992 and 31 December 2000. As hon. Members haveindicated, those who took out with-profits annuity policiesprior to 1992—in fact, not just with-profits annuitantsbut anyone who took out a policy prior to 1 September1992—are excluded from the scheme. The Governmentare committed to implementing the ombudsman’srecommendation to introduce a fair and transparentpayment scheme to Equitable Life policyholders fortheir relative loss as a result of regulatory failure. Thatis what the ombudsman asked us to do, and that is whatwe are implementing. The Bill authorises us to makepayment under the scheme.

Nadhim Zahawi: Is it not precisely the point that,rather than being an open-ended compensation scheme,the scheme relates to malpractice?

Mr Hoban: My hon. Friend is absolutely right. Ourobligation is to compensate people for regulatory failureby the Government when they were the regulator ofEquitable Life. The scheme is not an open-endedcompensation scheme. It is very focused, and that wasthe ombudsman’s recommendation. Her locus in thismatter is a consequence of the Government havingacted as the regulator for Equitable Life during theperiod in question.

Let me explain to the Committee and to the hon.Member for Leeds North East (Mr Hamilton), whoraised the question, why 1 September 1992 is a logical,not arbitrary, date. The ombudsman indicated in herreport that there were problems with the regulatoryreturns for 1991, and that those could influence policyholderbehaviour. However, they could not have come to theattention of policyholders, and prospective policyholders,before they were submitted at the end of June 1992. Nopolicyholder would have been aware of that regulatoryfailure until the returns had been published. It is unlikelythat those returns would have come to anyone’s attentionprior to 1 September 1992. I stress that the date is notarbitrary, but a consequence of the ombudsman’s findingsand how they impact on what policyholders would havebeen aware of. Policyholders would not have been awareof the regulatory failure until the autumn of 1992.


Mr Fabian Hamilton: I accept the Minister’s pointabout the date not being arbitrary, but does he notaccept that the regulatory failure affected those annuitantswho could not change their annuities, even if they werepurchased before September 1992? Along with thoseannuitants who purchased policies after September 1992,they continue to see a decline. Therefore, they wereaffected by regulatory failure.

Mr Hoban: The hon. Gentleman makes an assumptionthat the scheme is open-ended, but it is designed tocompensate policyholders who invested in EquitableLife from 1 September 1992. With regard to the implicationsof that, I shall respond to the intervention by my hon.Friend the Member for Cardiff North (Jonathan Evans).

Mr Weir: Will the Minister explain further, as I donot quite understand? He seems to be saying that onlythose who became aware of a regulatory failure in 1992are affected. However, am I not right in thinking thatthat suggests that the regulatory failure goes back priorto 1992, and would have affected people then, althoughthey would not have been aware of it? Are those peoplenot entitled to compensation?

Mr Hoban: The ombudsman is concerned about peoplewho invested in Equitable Life who might not havedone so had they been aware of that regulatory failure.That regulatory failure would not have been known tothem until September 1992, so there is a clear, rationalargument for 1 September 1992 being the right date tostart the calculation of losses.

Several hon. Members rose—

Mr Hoban: Let me continue.

We are excluding that group of people because theytook out policies before any maladministration couldhave affected their investment decision. Therefore, toecho my hon. Friend the Member for Cardiff North,they suffered no relative loss.

Bob Blackman: But will the Minister answer themoral issue? At the time when people were makinginvestment decisions, and taking out these policies, theregulatory failure was going on. As they became victimsof that regulatory failure, surely we have a moral dutyto compensate them.

Mr Hoban: When people made the decision on theinformation available to them, the relevant informationwas not in the public domain, and would not haveaffected their investment decision until September 1992.That is a clear, logical, sensible starting point, based onprinciples and on the ombudsman’s findings, for themaladministration, and that is the point from which weshould calculate relative loss for policyholders.

Mark Durkan: The Minister is in danger of askingthe Committee to accept the notion that customerignorance can be a legislator’s excuse. That cannot beso. If the Minister is trying to say that what they did notknow did them no harm, that is preposterous. They didnot know, and they have suffered harm.

Mr Hoban: I do not agree with that point. There is aclear principle: the basis on which people were investingin Equitable Life. At that point, no one knew about themaladministration.

We should also bear in mind the issue of practicalityand the lack of information available to Equitable Life’spolicyholders. Hon. Members should reflect on the factthat no one would have made investment decisionsbased on anything that happened prior to 1992 untilthat information was in the public domain. That is whythe group has been excluded from the calculation ofrelative loss.

Mr John Baron (Basildon and Billericay) (Con): Myhon. Friend is being generous in giving way. No onesuggests that the situation is not difficult, but whetheror not one was aware of maladministration, and whetheror not it existed pre ’92, surely the central point is thatannuitants who took out a policy pre ’92 sufferedrelative loss post ’92, courtesy of maladministration. Toreturn to an earlier point, perhaps there is a moral dutyto include such people in the compensation, as I believethat the parliamentary ombudsman suggested.

Mr Hoban: The parliamentary ombudsman’s findingswere clear: she said that the maladministration startedin 1991, but that it would not have been obvious topolicyholders until September 1992.

Let me deal with two issues that hon. Membersshould have take into account in assessing the point.First, as has been mentioned, there are challenges aroundgetting information for the pre ’92 period. Secondly,there is the point made by my hon. Friend the Memberfor Cardiff North about the timing of losses. We recognisethat pre ’92 with-profits annuitants were affected byhow Equitable Life was run. Sir John Chadwick andTowers Watson looked into what those WPAs wouldhave received from Equitable Life had there been nomaladministration. They concluded that they receivedmore from Equitable Life as a result of maladministrationthan they would have done had it been properly regulated.That was because Equitable Life paid out more to themin the early years than it would have done had therebeen no maladministration. Let me give an example toprove that.

If a with-profits annuitant had purchased their policyin 1989 and gained through that purchase an income of£7,200, by 1993 the policyholder would have been receivingan annuity of approximately £10,000 per annum. Partof that sum was a result of the bonuses that had beendeclared on the policy since commencement. It is recognisedthat Equitable Life was paying higher bonuses than itcould afford during the late ‘80s and early 1990s. IfEquitable Life had not been over-bonusing during thatperiod, Towers Watson has calculated that the policyholderwould have received only £9,500 per year. It is aconsequence of the maladministration that the policyholderis receiving £500 more than he or she should haveduring that period.

Equitable Life continued to overpay bonuses throughoutmost of the 1990s. As a result, by 2002 that policyholderwas receiving £17,000 per annum. If the over-bonusinghad not taken place, the policyholder would have receivedonly £15,800, so he or she was still receiving more as aconsequence of maladministration.


In 2003, Equitable Life cut the rate of annuity paymentsto its with-profits policyholders by about 20%. In theabsence of maladministration, the value of payments towith-profits policyholders would also have been cut,although, owing to market performance, by only 18%.After the cuts in 2003, our example policyholder wasreceiving £12,900 per year from Equitable Life. Hadthere been no maladministration, he or she would havebeen receiving only £12,300. I hope that that examplehas helped to clarify the consequences of maladministration,namely that even after the cuts in 2003 policyholdersare still receiving more than they would have if EquitableLife had been properly regulated. For a range of reasons,their plight is not as it has been represented.

The first question to be asked, then, is “When didmaladministration affect policyholders and the decisionsthat were made?” The second relates to the practicalityof extracting data pre-1992, which is well establishedand has been well aired in the Chadwick report andelsewhere; and the third concerns the consequence ofmaladministration in Equitable Life, which is that with-profits annuitants are receiving more over the lifetimeof their policy than they would have received if thatmaladministration had not taken place.

Jonathan Evans: I was interested in the way in whichmy hon. Friend dealt with my point about over-bonusing,but I feel that he has undermined another point that Imade: I suggested that it was not possible to make suchcalculations, but my hon. Friend has suggested thatTowers Watson has done so. In a sense that also underminesthe thrust of why the pre-1992 policyholders should beexcluded. I had assumed that they might not have beendisadvantaged and that it was too difficult to work outthe numbers, but if Towers Watson has worked outthose numbers and there is no relative loss, it seems a bitodd not to include them, at least for the purpose ofcalculating the position and telling them that there is noloss.

Mr Hoban: I was trying to make two points. First,those policyholders were excluded from the calculationof relative loss as a consequence of the ombudsman’sfindings and her view on when maladministration hadtaken place. According to the example that I have given,they would not have suffered loss in any event. I ammerely saying that, in my opinion, there is a strong casein principle for the exclusion of those policyholders,and in practical terms they have not suffered loss.

Mark Durkan: Will the Minister give way?

Mr Hoban: I want to make some more progress.The fact that with-profits annuitants who bought

their annuities before 1 September 1992 have seen areduction in the level of payments that they currentlyreceive from their annuities is a result of poor investmentmarket performance and the fact that their earlier annuitypayments were artificially high. That was because of thestructure of the policies that they bought, or becausethey received too much in the earlier years, as EquitableLife paid out more on a discretionary basis than itshould have. Unlike the value of conventional annuities,the value of a with-profits annuity varies according toinvestment return. Although the reductions are regrettable,they are not instances of Government maladministration,and therefore Government should not be providingcompensation for that group of policyholders.

2.45 pmA number of Members mentioned Sir John Chadwick.

My hon. Friend the Member for Harrow East (BobBlackman) said that Sir John’s report had been rubbishedby some people. The report included a mechanism forthe calculation of internal relative loss that would havedealt with the pre-1992 annuitants, but, as my hon.Friend said, there was widespread criticism of it, notjust in the House but by all the commentators, byEMAG and by others. No one came forward with analternative scheme to compensate the pre-1992 annuitants,because no one had really thought about them. It needsto be recognised that they fall outside the parameters ofthe ombudsman’s report, because she did not envisage aneed to compensate them.

Let me now deal with the future role of the ombudsmanin this process. When we came to office, we pledged to“implement the Parliamentary Ombudsman’s recommendationto make fair and transparent payments to Equitable Lifepolicyholders”.

My right hon. Friend the Chancellor of the Exchequerconfirmed that pledge at the time of the comprehensivespending review, when he announced our plans that wehave for the scheme.

As we all know, the ombudsman has worked tirelesslyto help to ensure that justice is delivered to the policyholderswho have waited so long for a resolution of this issue.Her continued interest in the matter has been of greathelp, and has brought some clarity to what is clearly avery complex issue. The ombudsman has been generouswith her time, and has continued to contribute to thedebate. She has, for instance, appeared before the PublicAdministration Committee. I discussed the Chadwickreport with her in the run-up to the spending review,and her views helped the Government to reach a viewon the losses suffered by policyholders.

I should welcome any continued contribution thatthe ombudsman might wish to make to the debate onEquitable Life, and if she wished to advise Parliamentof her views on the work of the independent commission,that would assist both the House and the Government;however, I think it would be inappropriate to requireher to play such a role. Her role and remit are clearly setout in the Parliamentary Commissioner Act 1967, whichdoes not give the ombudsman a standing obligation tocontinue to advise this House as to the response to herreports. There is good reason for that, not least the needto make appropriate use of the ombudsman’s resources.It must be for the ombudsman herself to decide whatrole she wishes to play once she has finished herinvestigation.

The hon. Member for Nottingham East (Chris Leslie)asked how we would implement the ombudsman’sapproach. We have said that the Government accept thecalculation of relative loss as £4.3 billion. The ombudsmanwrote to Members on 26 July this year saying that sherecognised that the relative-loss approach adopted byTowers Watson“provides a firm foundation on which to build.”

That is the basis on which we introduced the schemeand accepted the losses.

The independent commission will advise on the allocationof remaining funds to not-with-profits annuitants, apartfrom the post-1992 WPAs. The Equitable Life databaseallows us to apply relative-loss methodology to each


policyholder’s data, so there will be no individualrequirement to claim or provide evidence of claim, orindeed to reveal the instances of maladministration thatare relied on. That will benefit all policyholders whosuffered relative loss. The ombudsman spoke of relianceon regulatory returns, but Sir John’s alternative approachdoes not require us to ascertain what reliance wasinvolved. Effectively, that gives people the benefit of thedoubt, and in my view it means a simpler, fairer andmore transparent scheme.

Sir John also talked about the distribution of losses,which was mentioned by my hon. Friend the Memberfor Harrow East. Thirty per cent. of policyholderssuffered no loss at all, about 405 suffered a loss ofbetween £1 and £1,000, and 60% suffered a loss ofbetween £1 and £5,000. Therefore, as Members willrecognise, the distribution of losses is quite varied. Alarge number of policyholders either have no loss orsuffered a relatively small loss. That gives the paymentscommission some flexibility in respect of the design ofthe scheme and how to use the pot. I should, however,stress to Members that the amount that is available isfixed, so while we may want to be more generous to onegroup, that would mean that another group suffers. Weneed to bear that in mind in considering eligibility.

I encourage my hon. Friends to reject any amendmentsin this group that are put to a vote. We have come upwith a fair scheme that is based on the ombudsman’sfindings; the loss reflects her calculation. I thereforethink this is a good scheme, representing a balance offairness between policyholders and taxpayers.

Mr Fabian Hamilton: I am grateful to the Minister forhis clear explanation of his rationale for the compensationscheme. I am afraid, however, that I still do not acceptthe argument that the cut-off should be absolute andrigid and that those who took out annuities before 1September 1992 should not receive any compensationor be eligible in any way. As I do not fully accept hisargument, I will press amendment 1 to a vote.

Question put, That the amendment be made.

The Committee divided: Ayes 76, Noes 301.Division No. 114] [2.51 pm

AYESAlexander, HeidiBaron, Mr JohnBayley, HughBell, Sir StuartBingham, AndrewBlackman, BobBlenkinsop, TomBurden, RichardCampbell, Mr GregoryCampbell, Mr RonnieCaton, MartinClark, KatyClarke, rh Mr TomCooper, RosieCorbyn, JeremyCrausby, Mr DavidCryer, JohnCunningham, Mr JimDavidson, Mr IanDavis, rh Mr DavidDobson, rh FrankDodds, rh Mr Nigel

Donaldson, rh Mr Jeffrey M.Dowd, JimDurkan, MarkEdwards, JonathanFlynn, PaulFreer, MikeFuller, RichardGardiner, BarryGilmore, SheilaGlass, PatGodsiff, Mr RogerHarris, Mr TomHavard, Mr DaiHenderson, GordonHermon, LadyHopkins, KelvinHosie, StewartHowarth, rh Mr GeorgeKaufman, rh Sir GeraldLlwyd, Mr ElfynLong, NaomiLove, Mr Andrew

Lucas, CarolineMacNeil, Mr Angus BrendanMactaggart, FionaMann, JohnMcDonnell, Dr AlasdairMcDonnell, JohnMcGovern, JimMiller, AndrewMitchell, AustinMoon, Mrs MadeleineMudie, Mr GeorgeMurphy, rh PaulOsborne, SandraPaisley, IanShannon, JimSheerman, Mr BarrySimpson, DavidSkinner, Mr Dennis

Smith, rh Mr AndrewStringer, GrahamStuart, Ms GiselaVaz, rh KeithWalley, JoanWeir, Mr MikeWhiteford, Dr EilidhWhitehead, Dr AlanWhittaker, CraigWilliams, HywelWilson, SammyWishart, PeteWollaston, Dr SarahWood, Mike

Tellers for the Ayes:Mr Fabian Hamilton andStephen Lloyd

NOESAdams, NigelAfriyie, AdamAldous, PeterAlexander, rh DannyAmess, Mr DavidAndrew, StuartArbuthnot, rh Mr JamesBacon, Mr RichardBagshawe, Ms LouiseBaker, NormanBaker, SteveBaldry, TonyBaldwin, HarriettBarker, GregoryBarwell, GavinBebb, GutoBeith, rh Sir AlanBenyon, RichardBeresford, Sir PaulBerry, JakeBinley, Mr BrianBirtwistle, GordonBlackwood, NicolaBlunt, Mr CrispinBoles, NickBone, Mr PeterBradley, KarenBrady, Mr GrahamBrake, TomBray, AngieBrazier, Mr JulianBridgen, AndrewBrine, Mr SteveBrokenshire, JamesBrowne, Mr JeremyBruce, rh MalcolmBurley, Mr AidanBurns, ConorBurns, Mr SimonBurstow, PaulBurt, AlistairBurt, LorelyByles, DanCairns, AlunCampbell, rh Sir MenziesCarmichael, Mr AlistairCarmichael, NeilCarswell, Mr DouglasCash, Mr WilliamChishti, RehmanChope, Mr Christopher

Clappison, Mr JamesClark, rh GregClifton-Brown, GeoffreyCoffey, Dr ThérèseCollins, DamianCox, Mr GeoffreyCrabb, StephenCrockart, MikeCrouch, TraceyDavey, Mr EdwardDavies, David T. C.

(Monmouth)Davies, Glynde Bois, NickDinenage, CarolineDjanogly, Mr JonathanDorries, NadineDoyle-Price, JackieDrax, RichardDuddridge, JamesDuncan, rh Mr AlanDuncan Smith, rh Mr IainDunne, Mr PhilipEllis, MichaelEllison, JaneEllwood, Mr TobiasElphicke, CharlieEustice, GeorgeEvans, GrahamEvans, JonathanEvennett, Mr DavidFabricant, MichaelFallon, MichaelFarron, TimFeatherstone, LynneField, Mr MarkFoster, Mr DonFrancois, rh Mr MarkFreeman, GeorgeFullbrook, LorraineGale, Mr RogerGauke, Mr DavidGibb, Mr NickGilbert, StephenGillan, rh Mrs CherylGlen, JohnGoldsmith, ZacGoodwill, Mr RobertGraham, RichardGrant, Mrs HelenGrayling, rh Chris


Green, DamianGreening, JustineGrieve, rh Mr DominicGriffiths, AndrewGummer, BenGyimah, Mr SamHalfon, RobertHames, DuncanHammond, StephenHancock, MatthewHancock, Mr MikeHands, GregHarper, Mr MarkHarrington, RichardHarris, RebeccaHart, SimonHarvey, NickHaselhurst, rh Sir AlanHeald, Mr OliverHeath, Mr DavidHeaton-Harris, ChrisHemming, JohnHendry, CharlesHinds, DamianHoban, Mr MarkHollingbery, GeorgeHopkins, KrisHorwood, MartinHowarth, Mr GeraldHowell, JohnHughes, SimonHunt, rh Mr JeremyHuppert, Dr JulianHurd, Mr NickJames, MargotJavid, SajidJenkin, Mr BernardJohnson, GarethJohnson, JosephJones, AndrewJones, Mr DavidKelly, ChrisKennedy, rh Mr CharlesKirby, SimonKnight, rh Mr GregKwarteng, KwasiLaing, Mrs EleanorLamb, NormanLancaster, MarkLansley, rh Mr AndrewLatham, PaulineLaws, rh Mr DavidLeadsom, AndreaLee, JessicaLee, Dr PhillipLefroy, JeremyLeigh, Mr EdwardLeslie, CharlotteLetwin, rh Mr OliverLewis, BrandonLiddell-Grainger, Mr IanLidington, Mr DavidLilley, rh Mr PeterLopresti, JackLord, JonathanLoughton, TimLumley, KarenMacleod, MaryMaynard, PaulMcCartney, JasonMcCartney, KarlMcIntosh, Miss Anne

McLoughlin, rh Mr PatrickMcPartland, StephenMcVey, EstherMenzies, MarkMercer, PatrickMetcalfe, StephenMiller, MariaMills, NigelMoore, rh MichaelMordaunt, PennyMorgan, NickyMorris, Anne MarieMorris, DavidMorris, JamesMosley, StephenMowat, DavidMulholland, GregMundell, rh DavidMurray, SheryllMurrison, Dr AndrewNeill, RobertNewmark, Mr BrooksNewton, SarahNokes, CarolineNorman, JesseNuttall, Mr DavidOfford, Mr MatthewOpperman, GuyOttaway, RichardPaice, Mr JamesParish, NeilPatel, PritiPaterson, rh Mr OwenPawsey, MarkPenning, MikePenrose, JohnPercy, AndrewPerry, ClairePhillips, StephenPincher, ChristopherPoulter, Dr DanielPrisk, Mr MarkPugh, Dr JohnRaab, Mr DominicRandall, rh Mr JohnReckless, MarkRedwood, rh Mr JohnRees-Mogg, JacobReevell, SimonReid, Mr AlanRobathan, Mr AndrewRobertson, HughRobertson, Mr LaurenceRogerson, DanRosindell, AndrewRudd, AmberRuffley, Mr DavidRussell, BobRutley, DavidSandys, LauraScott, Mr LeeSelous, AndrewShapps, rh GrantSharma, AlokShelbrooke, AlecShepherd, Mr RichardSimmonds, MarkSimpson, Mr KeithSkidmore, ChrisSmith, Miss ChloeSmith, HenrySmith, Julian

Smith, Sir RobertSoames, NicholasSoubry, AnnaSpelman, rh Mrs CarolineSpencer, Mr MarkStanley, rh Sir JohnStephenson, AndrewStevenson, JohnStewart, BobStewart, IainStewart, RoryStreeter, Mr GaryStride, MelStuart, Mr GrahamStunell, AndrewSturdy, JulianSwales, IanSwayne, Mr DesmondSwinson, JoSyms, Mr RobertTapsell, Sir PeterTeather, SarahThurso, JohnTimpson, Mr EdwardTomlinson, JustinTredinnick, DavidTruss, ElizabethTurner, Mr AndrewTyrie, Mr AndrewUppal, Paul

Vaizey, Mr EdwardVara, Mr ShaileshVickers, MartinVilliers, rh Mrs TheresaWalker, Mr CharlesWalker, Mr RobinWallace, Mr BenWard, Mr DavidWatkinson, AngelaWeatherley, MikeWebb, SteveWharton, JamesWheeler, HeatherWhite, ChrisWhittaker, CraigWhittingdale, Mr JohnWiggin, BillWilliams, RogerWilliams, StephenWilliamson, GavinWillott, JennyWilson, Mr RobWright, SimonYeo, Mr TimYoung, rh Sir GeorgeZahawi, Nadhim

Tellers for the Noes:Jeremy Wright andMark Hunter

Question accordingly negatived.

Chris Leslie: I beg to move amendment 3, page 1, line 7, atend insert—

‘(2B) The design and administration of any scheme ofpayments to which this section applies shall be independent ofgovernment.’.

The First Deputy Chairman: With this it will beconvenient to discuss the following:

Amendment 4, page 1, line 7, at end insert—‘(2C) The Treasury shall publish details of the independent

appeals procedure for policyholders as defined in subsection (2)above to use in the event of dispute over the compensationpayment decision in their case, no later than three months aftercommencement of this Act.’.

Government amendment 6.New clause 1—Distribution of payments—‘(1) An independent payments commission shall be established

comprising three members appointed by the Secretary of State.

(2) The independent payments commission shall design adistribution scheme for payments made arising from this Act.

(3) In designing a distribution scheme under subsection (2) theindependent payments commission shall consult with interestedparties, including the Equitable Life Assurance Society andrepresentatives of policyholders.

(4) The Treasury may make provision by order made bystatutory instrument for payments to be made in line with thedistribution scheme designed by the independent paymentscommission.

(5) A statutory instrument containing an order undersubsection (4) may not be made unless a draft has been laidbefore and approved by resolution of each House ofParliament.’.

Chris Leslie: I shall speak to amendments 3 and 4,which stand in my name and the names of my hon.Friends. Amendment 3 would enshrine in the Bill the


[Chris Leslie]

fact that the design and administration of any paymentsscheme should be independent of Government. It ispretty straightforward and simple—in fact, it would bedifficult for it to be more straightforward and simple—butwe think it important to try to encourage the Governmentto enshrine in the Bill the Minister’s pronouncements sofar that the design of the compensation scheme shouldbe independent of Government. That is an extremelyimportant point, especially as it was part of the conclusionsdrawn by the parliamentary ombudsman herself.

The Minister has asked the independent commission,chaired by Brian Pomeroy, to report by the end ofJanuary, but there is too much wiggle room for theMinister then to take those recommendations and bringthe design and the administration of the subsequentpayments scheme in-house within the Treasury. I see noclear reason why the Bill does not contain clarity onthe next steps forward, particularly in relation to thedaunting task of creating a payments scheme to coverupwards of 1 million policyholders not falling into the100% compensated with-profit annuitant category.

Many other policyholders are still sceptical of theGovernment’s intentions and EMAG, which is the bodyrepresenting many of those policyholders, is voicing itsdiscontent with those who, before the election, signedup to their pledge to create “fair and transparent”payment schemes, which they now attack as akin toasking 1 million people—to quote the words of EMAG’sPaul Braithwaite—to

“share a pack of Smarties”.

Obviously, EMAG is making its point in its ownparticular way, but clearly there is some doubt andsome cynicism about the approach that the Minister istaking. I am sure, having heard what he has had to saybefore, that he indeed wants a level of independence inthe payments scheme as far as possible, but I do notunderstand why that commitment has not been includedin the legislation. That would seem to me to be the bestway forward.

Amendment 4 seeks to tackle the issue of any appealsprocedure that might be necessary for policyholders inthe compensation scheme. We suggest that no later thanthree months after the commencement of the Bill theTreasury be required to spell out quite how that appealsprocedure would operate for the policyholders who arenot content with the judgments made in the compensationscheme that eventually ensues. Several hon. Membersargued for an appeals procedure on Second Reading on14 September—my hon. Friend the Member for YnysMôn (Albert Owen) among them—and it was alsoraised by my right hon. Friend the Member for EastHam (Stephen Timms).

In that debate, the Minister stated that he had raisedthe issue with his officials but that there were clearproblems. He said he would pursue it, so the purpose ofthe amendment is to find out whether he has had theopportunity to do so and what the appeals process willlook like. I certainly expect that there will be complexity,not just in the payment scheme but in any subsequentindividual appeals adjudication, and that could be quitedifficult to imagine at this stage. However, it needsclarification given the route that the Minister has chosen,

moving away from the ex gratia model in the Chadwickmethodology and instead accepting the ombudsman’sapproach to compensation.

I was glad that the Minister said there were componentsof the Chadwick methodology that he favoured bringinginto any compensation scheme—specifically that therewould be no burden of proof on individual policyholdersto show that they had been misled by the regulatoryreturns. That would certainly make the scheme simpler.Will the Minister take this opportunity to tell us whetherthe independent payments commission will eventuallymetamorphose into an authority for administering thepayments? If so, will it be asked to design an appealssystem, or is it the Treasury’s intention to undertakethat part of the design?

Perhaps the Minister could say whether he sees anyparallels with the appeals system set up when the formerDepartment of Trade and Industry introduced an appealsmechanism in respect of the ill-health complaints aboutwhat was then known as vibration white finger. He willremember that a series of complex compensation paymentswere made in those cases, but an appeals system was setup that had a route into a judicial process and eventuallyto the High Court. If some policyholders might becomeinvolved in a judicial process, it would be useful to haveclarity about whether the same will happen.

Will the Minister also confirm not only, as I think hesaid, that the administrative costs of operating thecompensation programme will be separate from thecompensation fund, but that any appeals costs will alsobe separate from the compensation fund? I am sure thatthe Committee will welcome any clarification of theGovernment’s intentions, and in the meantime we feltthat the amendment was a reasonable device to ensurethat those answers are forthcoming.

Bob Blackman: I shall speak to new clause 1, which Itabled, but I made a long speech on the earlier group ofamendments and I do not want to repeat all the points Imade then.

We need to make the whole process clear, transparentand independent of Government so that the money thathas been set aside to compensate the victims of thisscandal is seen to be distributed so that they receivetheir due compensation in a manner that is independentof the Treasury. The dead hand of Treasury officialsshould not mean that the scheme is designed in aparticular way. I do not necessarily need to press thenew clause, but I seek assurances from the Minister thatwe have a full, independent, transparent way to compensatethe victims, who have been so badly treated over thepast 10 years.

3.15 pm

Mark Durkan: Obviously we are waiting to hear whatthe Government will say about their amendment, butthe other amendments—including the new clause proposedby the hon. Member for Harrow East (Bob Blackman)—arein essence an attempt to ensure that there is a sense ofcompetent independence in how the scheme is administeredand payments made. In terms of making appeals availableand ensuring that the design and administration of thescheme are independent of Government, the new clauseoffers a reasonable construct of what a clearly independentscheme would be.


In the debate on the previous group of amendments,there were many references to pledges that many of ussigned and how far the Government’s measures willmean that we have discharged those pledges, but I donot think that any of us signed pledges that said wewould do the whole thing just according to Treasurylights and nothing else. The amendments are an attemptto ensure that it will not only be Treasury lights that willgovern the terms of the scheme and its performance.

Mr Weir: Does the hon. Gentleman not feel, however,that the problem remains that the whole thing will begoverned by the ultimate cap? That is the difficulty thatfaces all Equitable Life policyholders.

Mark Durkan: Yes, I do. There is no escaping theconstraints that the cap will create. In the last group ofamendments, we considered the questions that arisewhen the cap comes together with the cut-off. Thatconspires to create a pretty selective injustice for agroup of people who are then left with very marginalcompensation.

Even a very independent process, such as that proposedin the amendments, will be constrained by the cap.However, people would trust a credible independentprocess applying that cap with due consideration for allthe concerns, rights and needs of policyholders morethan they would trust the Treasury. In the last debatesome Government Members said confidently howimpressed they had been with the Treasury since theycame into the House. That might well be—we are in theearly stages of this Parliament and this Governmentand the first few pages of the exercise book are lovely,neat, impressive and perfect—but degeneration creepsin later on and even the Treasury will revert to itstraditional roots and habits.

Mrs Anne Main (St Albans) (Con): I have confidencein the Treasury trying to sort this out—I am sure thatthe hon. Gentleman will not be surprised to hear that.However, I am concerned about anything that pushesthis matter into the long grass. We do not need anymore delays caused by trying to set up other bodies.That is why I would like to say, “Get on with it and getthe Treasury doing it.”

Mark Durkan: I do not believe that the hon. Memberfor Harrow East, for example, is trying to sow orfertilise long grass. This is about getting something thatis credible, competent and reliable and the Committeeshould try to help in that regard. That is the spirit ofthese amendments.

There has been much criticism of the underperformance,to put it mildly, of the previous Government on thisissue over more than one Parliament. Let us rememberthat those Ministers were not deliberately ignoring theplight of their own constituents who were coming tothem or the problems highlighted by many of us fromconstituencies across the United Kingdom. They wereconstrained by the advice that they were getting fromthe same Treasury that people are now so happy with.The Treasury was advising that serious precedents andproblems would be created.

Mr Nigel Dodds (Belfast North) (DUP): I understandwhat the hon. Gentleman is saying, but Ministers arethere to take decisions. They listen to advice but it is upto them to make things happen. He and I, as former

Ministers, know that only too well, so why is he makingan excuse for the inaction of the previous Governmentand their failure to respond to the needs of EquitableLife policyholders?

Mark Durkan: If the right hon. Gentleman had beenhere for the debates on earlier amendments, he wouldknow that I made no such excuses then. Indeed, in allprevious debates, I have been very critical of theperformance of previous Governments. We have bothbeen the Finance Minister in Northern Ireland, as hesays. When I held that position, I used the line, “I’m theMinister of Finance; I don’t suffer from depression butI am a carrier.” That is the effect: Treasury Ministers areput in that sort of position. They become aware ofconstraints and difficulties that they then have to putbefore everyone else and impose on them as well.

My point is not that Ministers were right or wrong tolisten to the advice but that we, as a Committee, mustchoose whether to go along with the Bill and say thatthe scheme will proceed only according to Treasurylights or whether to say instead that it should go accordingto wider lights and be informed by the sort of considerationsreflected in the various amendments that hon. Membershave tabled and by the many good observations madeby Members on both sides of the Committee. Either wewant to trust the Treasury and leave the scheme entirelyin its hands, with its considerations and constraintsalone, or we want to honour the spirit of what we haveall pledged to those who have lost out with EquitableLife and to act in the light of the sad experiences thatwe have heard about.

I commend the amendments to the Committee. Ishall wait to hear what the Government say about theiramendment, but it seems to reinforce the Treasury’swhip hand over the whole scheme.

Mr Hoban: I take the same view as the right hon.Member for Belfast North (Mr Dodds) on the responsibilityof Ministers. Civil servants provide advice but Ministersdecide and act and we cannot ignore that responsibility.We have taken this matter very seriously and havesought, over the past six months, to drive through aspeedy resolution to the problem. I echo the remarks ofmy hon. Friend the Member for St Albans (Mrs Main)on tackling this matter.

On the amendments before us, the purpose ofamendment 3 is to make the design and operationalmechanism of the scheme “independent of government”.I understand the need for independence in the design ofthe payment scheme, which is why I established theIndependent Commission on Equitable Life Payments.The commission’s advice will necessarily form the basisof the scheme’s design. It will advise on how best fairlyto allocate payments among policyholders, with theexception of with-profits annuitants, and it will considerwhich groups, if any, should be prioritised. It is rightthat that process should be independent, so the schemewill be independently designed.

The Government have considered whether the schemeshould also be operated independently of the Government,as amendment 3 proposes, and have concluded that thatwould not be appropriate for three key reasons. First, itwould delay the commencement of payments. Our ambitionis to start making payments in the middle of next yearusing our preferred delivery partner National Savings


[Mr Hoban]

and Investment. I shall say more about that on amendment6. If amendment 3 were accepted, NS&I, which is anExecutive agency of the Treasury, could not be used asthe delivery partner as it would not be operatingindependently of the Treasury, which would thereforehave to establish a new, independent body or identify anexisting such body that could operate the scheme. It isalso likely that legislation would be required to task theindependent body with the design and operation of thescheme, which would delay significantly the making ofpayments to policyholders.

Secondly, the Government have established anindependent commission to advise on the allocation ofpayments. This function is independent of the Governmentand is key in determining a fair allocation of payments.Making the operational delivery provider, whose job islargely about sending out the payments and makingsure that cheques get to the people who are entitled toreceive them, independent of the Treasury would notadd significant value to that task.

Finally, it is important to ensure that value for moneyis considered when deciding on a delivery partner. TheTreasury has satisfied itself that NS&I has the capacityand the capability to deliver the scheme, while at thesame time providing value for money. The Governmentconsider that by establishing the Independent Commissionon Equitable Life Payments on 22 July, we achieved theaim that is at the heart of the amendment.

I turn to amendment 4 and what policyholders shoulddo if they consider that they are not being treated fairlyunder the scheme. The Government are committed totreating policyholders fairly. In line with that, there willcertainly be a means by which policyholders can raiseconcerns about the incorrect application of schemerules to individual cases. We have given much thoughtto how best to deal with complaints and have made agreat deal of progress in putting together a process thatis fair and thorough. Full details of this process will beincluded in the document that sets out the schemedesign in full.

Angie Bray (Ealing Central and Acton) (Con): Ispoke about this last time we discussed the matter.Given that the message to savers from the previousGovernment was non-existent or at least negative, doesmy hon. Friend think the message that the presentGovernment are sending to savers is adequate? Are wesaying clearly, “We understand that you have beenbadly let down by Government and we want to putthings right as much as we can, given the circumstancesin which we find ourselves”?

Mr Hoban: My hon. Friend makes an importantpoint. There are two aspects to it. First, in respect ofEquitable Life, the speed with which we have acteddemonstrates our commitment to a resolution of theproblem. The second is a forward-looking and prospectiveissue, which is why we have brought forward proposalsto improve the regulation of retail financial servicesthrough the establishment of the new Consumer Protectionand Markets Authority. That will be a boost to regulationand give confidence to savers that the market will bebetter regulated. It is important, and we have introducedmeasures recently, to ensure that if anything goes wrong,there is a proper process in place to tackle that.

I was commenting on the scheme appeals mechanism,which will be published before the scheme begins makingpayments and will be made available for parliamentaryscrutiny. If a policyholder believes that the rules of thescheme have been incorrectly applied to their data, theywill be able to raise a query with the delivery body,stating the nature of their concern. The query will bepursued by the delivery body.

If there is merit in the challenge and it is upheld, arecalculation will take place. If the challenge is notagreed by the delivery body, the policyholder will havethe option of taking their case to the review panel. Thereview panel will consider the case in full and be able tomake a fresh decision based on the facts of the case. Itwill be independent of the original decision-makingprocess. If a complainant’s case is upheld, the reviewpanel will ensure that a recalculation is carried out. Ifthe complainant remains unhappy with the review panel’sdecision, they will be able to challenge that decision incourt by way of judicial review.

Sir Alan Beith (Berwick-upon-Tweed) (LD): My hon.Friend referred to cases in which the rules of the schememight not have been correctly applied, but such are thecomplexities of Equitable Life policyholders—for example,a constituent of mine whose policies were additionalvoluntary contributions in a pension scheme which hasbeen wound up—that someone might wish to arguethat their particular type of case had not been envisagedin the way the rules were formulated, and that a specificdecision needed to be made in that case. Will the schemebe wide enough to make that possible?

Mr Hoban: My right hon. Friend makes an importantpoint. I would expect the payments commission todesign a payments scheme that would be sufficientlycomprehensive to ensure that all groups of policyholderswere covered by it, so any appeal would be on the basisonly of any data used to calculate the losses, rather thanan appeal in principle against the design of the scheme.I will bear in mind the point that my right hon. Friendmakes and encourage the commission, when it takesrepresentations from people, to think as widely as possibleabout the different groups of policyholders that need tobe taken into account.

Chris Leslie: The Minister is being extremely helpfuland at least setting out a sense of what the architectureof that appeals system will be. He said that it would besubject to parliamentary scrutiny. Can he say for therecord that the relevant statutory instrument will besubject to the affirmative procedure?

3.30 pm

Mr Hoban: There is no requirement in the Bill to laythe scheme as a statutory instrument, but I shall ensurethat when the scheme design is produced, it is laidbefore the House and there is an opportunity to scrutinise it.

The hon. Gentleman asked a question about the costof administration and the cost of the appeals mechanism,and he was right to recollect that I said previously thatthe cost of administration would be separate from thecompensation pot. That is still the case, and it goeswithout saying that the cost of the appeals mechanism


will also be separate from the compensation pot. Wewant the money that is set aside for compensation to beused for compensation.

Bob Blackman: I am grateful to the Minister foroutlining the appeals process, which, in this complexand complicated arrangement, will be important. Willhe elucidate further on the effect of the time frame ofthe appeals process? What would happen if, for example,an individual policyholder or set of policyholders, whofelt that they had been wronged and not received thecompensation that they were due, went through theprocess and that led to a breach of the cap? If they weresuddenly compensated with a lot more money than hadalready been allocated, how would that be dealt with?

Mr Hoban: In that situation, there would be twoaspects: first, the design that the payment scheme hadapplied; and secondly, the data that were available tothe policyholder. The scheme will be designed in such away that it does not breach the cap, so it would bepossible to appeal only if the data were incorrect. Thedata that will be used to calculate the compensation willcome from a database supplied by Equitable Life, and Ihope that its data are of a high standard, so that thosesituations do not occur.

From the details given today, the Government havebeen considering very carefully the design of the appealsprocedure, and we will publish details of the procedure,along with other aspects of the scheme, ahead of thetime that amendment 4 proposes. So in light of that webelieve that the amendment is not necessary.

Let me turn to amendment 6, which is in my name.The delivery of the Equitable Life payments scheme isan important matter, and since we took office we havemade huge strides towards finding a resolution to theEquitable Life issue. However, we are aware that, formany policyholders, the issue will continue until theyfinally receive the money. As such, it is important thatwe find the right delivery partner to help us do that.Having given the matter careful consideration and lookedat a range of options, our preferred option is to useNS&I, to deliver the scheme.

Officials have held many meetings with NS&I to findout not only whether it is capable of carrying out thatimportant task, but the processes by which deliverycould be carried out. There are many factors that makeNS&I an appropriate delivery partner for the scheme.One of the most obvious and important is capability. Aspart of its everyday functions, NS&I makes millions ofpayments to customers every month. It has processesand infrastructure in place and experience of carryingout the functions that the scheme will require.

The need for value for money in the delivery of thescheme is also important. We are all aware that, in aclimate where we have had to make difficult decisionsabout where to make cuts, the Government must lookfor ways of making the cost of delivering the schemereasonable. Using NS&I will allow us to draw uponexisting Government relationships and contracts, and Iam satisfied that NS&I can provide a good deliverymechanism by which we can start making payments inline with our stated ambition of the middle of next year.

Chris Leslie: I am grateful to the Minister for theinformation about National Savings & Investment beingthe preferred vehicle. In theory, there is a separation

between policy, in terms of the scheme design, andoperations, in terms of the administration but blurrededges can sometimes appear between the two. Will theindependent commission hold the ring in any disputesabout the mechanism, timing and administration of thescheme? Who will be the final arbiter of any disputesthat arise from the process? Presumably, it will be theindependent commission.

Mr Hoban: The hon. Gentleman makes an importantpoint, and it is important that we are able to operationalise,as it were, the scheme design. That is why I haveencouraged the payments commission to engage withNS&I to ensure that the scheme that the commissiondesigns can be delivered. That is an important part ofthe process, and I expect the commission to do thatduring the course of its work. I think that addresses thehon. Gentleman’s point.

Let me turn finally to new clause 1 and the status ofthe independent commission. I have already spokenabout the importance of the work of the commission,and I am not sure that the new clause, which would giveit statutory footing, would add value to its work.

Mark Durkan: Returning to amendment 6, can theMinister assure us that it is there only to provide properstatutory cover to the director of savings and NS&I inrelation to the scheme, and not to extend Treasurycontrol or constraints in relation to it?

Mr Hoban: I can give the hon. Gentleman that assurance.We could not use NS&I if we did not include this powerin the Bill. Its purpose is to enable NS&I to act as adelivery partner, not to give the Treasury some way ofreaching back into the payments scheme. I reassurehim, and others, that the power is there merely todeliver the outcome of the scheme.

The role of the payments commission will be key. Itwill advise on the distribution of payments to thoseother than WPAs, and I will take its advice extremelyseriously. The new clause would introduce a requirementfor the commission to consult key bodies in the developmentof its advice, but let me tell my hon. Friend the Memberfor Harrow East (Bob Blackman) that it would need nostatutory encouragement to do so. The commission hasalready met Equitable Life and EMAG, and it haspublished a discussion paper asking for more views onthe guiding principles for determining fairness in allocatingand prioritising the funding. I do not believe that anamendment to the Bill would make it any more consultativeand thorough in its task. My hon. Friend is aware that Ihave made the commitment to go along to the all-partygroup with the chairman of the commission to engagewith parliamentarians on this matter. That is a veryclear sign of the way in which we want to engage, or thecommission wants to engage, with stakeholders to comeup with the best design for the scheme. I encouragepeople to read and engage with the commission’s discussionpaper, too.

The new clause would also introduce a statutory dutyfor the Government to lay the design of the schemebefore Parliament in the form of a statutory instrumentin order to allow full scrutiny. I entirely understand thethinking behind this, and transparency has been at theheart of our approach to developing the paymentsscheme. However, as I have said, I will publish and lay


[Mr Hoban]

before Parliament a document setting out the schemedesign in detail, which may then be debated as Parliamentchooses. Again, I do not think that a statutory requirementwill make my commitment to full transparency anystronger. The Government therefore resist the new clause.

Furthermore, including provision in the Bill as to thestatus and operation of the independent commissionwould pose a very serious risk to the timetable of thecommission. The commission is already in operationand has been since July, and it is due to report at the endof January. Notwithstanding the speed with which theHouse is dealing with the Bill, it will still take severalweeks for it to finish its passage through this House andthe other place. If the commission had to be reformedafter the Bill received Royal Assent, to restart itsdeliberations so as to comply with the provisions of thenew clause, there would be a real risk of delay to itsadvice. This would, in turn, delay the making of paymentsto policyholders—something that I am sure none of uswould want to happen. In the light of this, and given thecomfort that I hope I have provided on the operation ofthe commission, I invite hon. Members to withdrawtheir amendments.

Chris Leslie: I am grateful to the Minister for settingout the information about the preferred vehicle for thepayment scheme. Although we would have preferred tosee some of the issues regarding the design of thescheme independently set out and enshrined in the Billfor the avoidance of doubt, I accept his commitment inmaking these points on the record. Similarly, in respectof the appeals mechanism, this debate has given us theopportunity to shed a little light on to how he envisagesthat arrangement playing out.

I hope that the Minister’s commitment to allowingfurther parliamentary scrutiny will not involve merelytabling a negative resolution on the Order Paper so thatMembers have to beg the indulgence of those on theTreasury Bench to find time to debate it. Given theamount of interest in these matters across the House,the affirmative procedure would be preferable, as thatwould allow us to consider them in detail. With that, Ibeg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Chris Leslie: I beg to move amendment 5, page 1, line 7, atend insert—

‘(2D) The Treasury shall lay before Parliament details of thetimings and planned dates for payments of compensation towhich this section applies, no later than three months aftercommencement of this Act.’.

The Second Deputy Chairman of Ways and Means(Dawn Primarolo): With this it will be convenient todiscuss amendment 8, in page 1, line 7, at end insert—

‘(2A) After determining the total amount of the payments thatthe Treasury is to authorise under subsection (2) and the personsto whom those payments are to be made, the Treasury mustsecure—

(a) that each of those persons is paid the full amount dueto that person in a single payment, and

(b) that the single payment is made as soon aspracticable.’.

Chris Leslie: The amendment is intended to draw outmore information specifically about the timing of thecompensation payment scheme that the Financial Secretaryenvisages. In particular, we wish to ensure that theTreasury will lay before Parliament details of the timingand planned dates for payments no later than threemonths after the commencement of the Act.

We know that this long saga has involved manyraised hopes, which have often been dashed. Althoughthere were very good reasons for the last Government’sdetailed consideration of complex issues, I accept inhindsight that decisions could and should have beentaken more quickly and handled better. There weresound reasons why Ministers took a different approachto that of the Government today, but we are where weare, as the saying goes, and I wish to the ask theFinancial Secretary a few questions about how thematter will progress from here onwards.

I am aware that table 3 in the spending review document,on page 12, sets out the phasing of the total finance setaside as being £520 million in 2011-12, £315 million in2012-13, £210 million in 2013-14 and finally £100 millionin 2014-15. As the explanatory notes to the Bill state,that comes to a total of £1.1 billion that has been setaside for this spending review period. Clearly there is adiscrepancy with the £1.5 billion figure that we havebeen talking about, which presumably goes beyond thespending review period. I have a number of questionsfor the Financial Secretary, and I hope that he willexpand upon the details.

First, on what basis have those figures been arrivedat? Do they represent the expected phasing of payments,or are administrative costs included, for example, distortingthe apparently higher first-year figure set out in thespending review document? I presume that theadministration costs have to be set out somewhere inthe budgetary figures. If so, will the Financial Secretaryclarify his intentions? I do not want policyholders tolabour under the misapprehension that they will necessarilyreceive the bulk of their compensation up front, asthose figures might suggest.

At what stage will the timing and phasing of paymentsbecome clear? Does the Financial Secretary expect thatthe independent commission will set out those detailsearly on, and will there be any opportunity to enshrinethe timing of those arrangements in law, perhaps throughregulations, even though they will be designed independentlyof Ministers? In other words, will the commission comeback to Parliament and say, “This is how we are goingproceed”?

There have been reports that three tranches of paymentsare expected over a four-year period. Can the FinancialSecretary clarify whether that expectation is broadlyreasonable for the policyholders involved? The Governmentare clearly about to hand over many of the arrangementsto the independent commission and to National Savings& Investment, but it is still important that we know thebroad parameters that they will use. That is the purposeof the amendment—we are seeking a public commitmentand transparency about the timing of the payments.

Bob Blackman: I rise to support amendment 8. I donot want to go over all the ground that we covered indebating the previous amendments, but the purpose ofthe amendment is precisely what we talked about earlier.


Hon. Members intervened to say, “Let’s get this done.Let’s get it over with and ensure that policyholders areproperly compensated as quickly as possible.”

It is clear that trapped annuitants will receive theircompensation in staged payments over the life of theirpensions. However, we get into complex territory againwhen discussing the other policyholders and the differencebetween with-profits and other annuities. As I understandit—I hope that the Financial Secretary will clarify this—tranches will be paid out over the life of the comprehensivespending review period. The third tranche will only getpaid in 2013, which still leaves some £500 million to bepaid out in the next comprehensive spending reviewperiod. As we understand it, this will be a long-drawnout affair, so perhaps we can have further clarificationon the issue.

3.45 pmWe have set aside £1.5 billion to compensate the

victims of this scandal and we have set up an independentcommission to design the scheme and decide how thatmoney should be dispensed. The purpose of the amendmentis to say that we should now get on with it and compensatethose people while they are still alive. We should nothang on to the money and drag these payments out overan extended period.

We want to put in place a rapid approach. Onceagain, I congratulate the Treasury team on its rapidapproach to resolving the scandal. None the less, if weare to have long and extended periods of payment,many policyholders who have been affected by thisscandal will sadly have died before they can receive theirmoney. Therefore, I trust that we can implement thisclause and ensure that we demonstrate to all thepolicyholders who have been so badly affected by thescandal that they will receive their due compensationvery quickly.

Mr Hoban: Let me deal with amendments 5 and 8.We have stated that our ambition is to commencepayments in the middle of next year. As the Committeeis aware, we have made great progress on this issue.Within six months of coming to office, we have publishedSir John’s report and the supporting material; we haveprovided the first bottom-up estimate of losses sufferedby policyholders; we have set aside £1.5 billion for thepayment schemes; we have announced that we willcover the full losses of eligible with-profits annuitants;and we have established the Independent Commissionon Equitable Life Payments to advise us on the fairallocation of payments among policyholders. Such progressshows how seriously we take this matter and how quicklywe want to find a resolution. Our ambition is to commencepayments in the middle of next year, and our trackrecord of getting things done quickly on Equitable Lifeshows that we are capable of doing so.

Let me set out the process that we are following toensure that payments are made as quickly as possible.In line with out commitment to independence, we haveset up the independent commission to advise us on howwe can fairly allocate the funds among policyholders,with the exception of the with-profits annuitants andtheir estates, and on any priority groups or classes ofperson who should be paid earlier.

Such an approach will help to inform the sequencingof payments. To ensure that the payments can begin assoon as practicable, we have set a challenging timetable

for the commission and it will report at the end ofJanuary 2011. Between the end of January and the datesthat payments commence, we will be laying the adviceof the independent commission over the operationaltechnicalities of the scheme to ensure that the end-to-endprocess operates well. We will then publish a schemedesign document that sets out the end-to-end process ofthe scheme in the spring. We will also finalise thearrangements with the delivery agent. That will help toensure that when the scheme goes live, we can getpayments to policyholders efficiently.

I hope that I have reassured hon. Members that thisGovernment are committed to making payments topolicyholders as soon as it is practicable and that we aretaking all possible steps to achieve that. As a result,amendment 5 is unnecessary. I have addressed the pointsraised by the hon. Member for Nottingham East (ChrisLeslie) about the sequencing of payments. We are seekingadvice from the new payments commission on how thatsequencing will take place and how it will fit within theenvelope of public spending that is set out in thecomprehensive spending review.

Let me turn to amendment 8, standing in the name ofthe right hon. Member for Holborn and St Pancras(Frank Dobson), to which my hon. Friend the Memberfor Harrow East (Bob Blackman) spoke. The amendmentdeals with the issue of how payments should be made. Irecognise the fact that policyholders have waited far toolong for a resolution to the matter. That is why at thespending review we set out how we envisage the schemeworking. I want to set out that vision again. Thosepolicyholders who do not have a with-profits annuitantspolicy will receive their payments in one lump sum togive them the closure that they need quickly. As ithappens, amendment 8, tabled by the right hon. Gentlemanand my hon. Friend, would mean that with-profitsannuitants would not receive their payments in the waythat we envisage. One of the reasons why we have beenable to increase the amount available to policyholders isso that we can spread the amounts going to with-profitsannuitants over the remainder of their lives. If my hon.Friend’s amendment were accepted, it would stop thatprocess and mean that their payments would come outof the £1 billion set aside at the time of the CSR. Itherefore suggest that the amendment would not helppolicyholders to receive quite as much money as webelieve they should.

Owing to logistical constraints associated with such alarge and complex scheme and to affordability constraints,we cannot make all lump sum payments immediately.They will be paid out over the first three years of thespending review period. That is why I have asked thecommission on payments to advise me on whether thereare any classes of policyholders whose payments shouldbe prioritised, to ensure that those in most urgent needof redress are paid first.

Chris Leslie: This may be a naive question, but box 2.7in the spending review says:

“The Government expects the total amount of funding for thescheme to be in the region of £1.5 billion.”

That is the envelope that we have been debating, andthat figure matters quite a lot, especially for those otherpolicyholders. However, the same box says that“£1 billion will be allocated to the Payments Scheme in thisSpending Review period, which will cover…the initial costs of thefirst three years of WPA”—


[Chris Leslie]

with-profits annuitants—“regular payments, and all payments to other policyholders.”

Can the Minister explain the difference between the£1 billion and the £1.5 billion, and say how the timingswill be affected? Presumably the other £500 million willarrive after the spending review period, but I am a bitconfused on that point.

Mr Hoban: The hon. Gentleman makes an importantpoint, which gives me the opportunity to clarify themake-up of the £1.5 billion. The figure includes the fullcost of the losses to with-profits annuitants—approximately£620 million—which will be made through regularpayments. However, taking into account the pressureson the public purse, the Treasury could allocate only£1 billion over the first three years of the spendingreview. That will cover two things: the first three yearsof payments to with-profits annuitants, and lump-sumpayments to all other policyholders and to the estates ofdeceased with-profits annuitants.

It is important to start to pay off with-profits annuitants’losses quickly, alongside the lump-sum payments toother policyholders. About £225 million of the £1 billionis for with-profits annuitants and their estates, leavingapproximately £775 million for lump-sum payments tonon-with-profits annuitants. The Towers Watson estimateof £620 million for with-profits annuity losses leavesapproximately £395 million for the rest of the WPAlosses from 2014-15 onwards. Those who are quicker atmental arithmetic than me will have worked out that thetotal comes to about £1.4 billion. The balance is acontingency, because the payments to with-profitsannuitants are based on their longevity. We hope thatthey live long and healthy lives, and that buffer is setaside to cover this need. That is how the maths worksout.

Mr John Redwood (Wokingham) (Con): Could myhon. Friend provide further clarification on the taxstatus of those receiving such payments?

Mr Hoban: My right hon. Friend pre-empts a pointthat I was going to refer to in the clause stand partdebate. He gives me an opportunity to say now that thepayments will be free of tax.

The Second Deputy Chairman: Order. There has beena very expansive debate so far, so there will not be aclause stand part debate. If the Minister wants to sayanything, I would encourage him to say it now.

Mr Hoban: You are right, Ms Primarolo, we have hadan extensive debate, so I will ensure that I now have mynotes to hand for the clause stand part debate. I shouldclarify the treatment of the payments under the tax andbenefits system. They will not be treated as income fortax purposes, and will not be taken into account in thecalculation of tax credits, which is a benefit for policyholders.In terms of benefits, they will be treated as capitalrather than income, and given the beneficial nature ofthe treatment of capital in the benefits system, thathelps policyholders. We have sought in the design of thescheme, through measures such as the tax and benefitstreatment, to maximise the value so that policyholderswill receive the full amount.

Nadhim Zahawi: I will test the Financial Secretary’sarithmetic a little further. Has he worked out what thatadvantage is over and above the £1.5 billion?

Mr Hoban: My hon. Friend makes an interestingpoint. It is difficult to calculate that because, as he willrecognise, the tax status of Equitable Life policyholdersvaries. Some pay no tax, some pay tax at the 20p rate,some pay tax at the 40p rate, and some may even pay taxat the 50p rate. The value will depend on their taxstatus, and we do not have sufficient access to taxpayers’records to be able to match Equitable Life policyholderswith their tax records, so we cannot calculate the benefit.However, he will appreciate that it could provide asignificant benefit to some policyholders, and I hopethat they will recognise that when they receive theirpayments. We have sought to be as generous as possiblein the tax and benefits treatment for that purpose.

Mr Redwood: I thank the Minister for an importantimprovement to the scheme, which I am sure is welcomed.

Mr Hoban: I thank my right hon. Friend. Whendesigning the scheme, we considered seriously how toensure that policyholders would benefit as much aspossible from the payments. If we had been less generous,we would have been accused of clawing back moneythrough the back door, and that is an impression thatwe want to dispel.

Sir Alan Beith: I welcome that announcement, butthere is a group of people who are affected in multipleways: those who have funds in Equitable Life that arenot yet in payment and who have been given transfervalues substantially below what they believe the fund tobe worth, even now. If they are waiting up to threeyears, and take the money out, accepting the transferpenalty, will they invalidate their entitlement under thescheme?

Mr Hoban: That is an important point. I am sure thata range of issues will emerge as we move through thescheme’s design to payment. People who have had EquitableLife policies throughout the period and bought thempost-September 1992 will receive compensation even ifthey have exited from Equitable Life’s current arrangements.I hope that that provides clarification.

Jonathan Evans: Will my hon. Friend take theopportunity, perhaps later, to issue a fuller statement onhis very important announcement in response to myright hon. Friend the Member for Wokingham(Mr Redwood)? I intended to raise the matter on ThirdReading. There is no doubt that many policyholderswill be delighted to hear the news, and it should bemade more widely available to all policyholders so thatthey are aware of it.

Mr Hoban: My hon. Friend is right. The old saying isthat the best way of keeping a secret is to make a speechin the House of Commons. I am sure that those of myhon. Friends who are in contact with Equitable Lifepolicyholders will take the opportunity to write tothem, and I hope that the Equitable Members ActionGroup, which is the main lobbying organisation onbehalf of policyholders, will also take the opportunityto pass the information on to its members. It is importantinformation for them, and we will continue to makepolicyholders aware of it as we communicate furtherdetails of the scheme.


Before that series of interventions, I was reflecting onamendment 8, and I want to say a little about why weare treating the with-profits annuitants differently fromothers in regard to payments. We need to recognise thatthe nature of the policies of that particular group ofpeople is very different from that of other EquitableLife policyholders. Their losses relate not just to whathas happened in the past, but to what will happen in thefuture. They will continue to receive a stream of incomeover a number of years from their with-profits annuitypolicy. We are now able to match that stream of incomewith their historic losses and their future losses. Itmakes sense for them to receive their payments in a waythat reflects the income stream that they have lost,which is why they will receive their losses in regularpayments over their lifetime.

In the light of that, I hope that the right hon. Memberfor Holborn and St Pancras will decide not to pressamendment 8 to a vote, because the approach that hesuggests is not appropriate for with-profits annuitants.We are determined to make swift progress on makingpayments to other policyholders, however, and they willget lump sum payments that will be free of tax.

4 pm

Chris Leslie: The Minister has put on record somehelpful information about the timing of the paymentarrangements, and I do not think that it would add agreat deal if we were to press the amendment to thevote. I therefore beg to ask leave to withdraw theamendment.

Amendment, by leave, withdrawn.Amendment proposed: 7, page 1, line 7, at end insert—“In determining the amount of the payments that it is appropriate

for the Treasury to authorise under subsection (2), the Treasurymust have regard to such matters relating to the adverse effects ofthat maladministration on those persons and the proper calculationof their resulting losses as have been determined by the ParliamentaryCommissioner for Administration to be relevant to and appropriatefor that calculation.”.—(Frank Dobson.)

Question put, That the amendment be made.Question negatived.Amendment made: 6, page 1, line 20, at end insert—“( ) The functions of the Director of Savings include anything

the Director is appointed by the Treasury to do in connectionwith payments to which this section applies.”.—(Mr Hoban.)

Question put forthwith (Standing Order No. 68), Thatthe clause, as amended, stand part of the Bill.

Question agreed to.Clause 1, as amended, accordingly ordered to stand

part of the Bill.Clause 2 ordered to stand part of the Bill.The Deputy Speaker resumed the Chair.Bill, as amended, reported.Bill, as amended in the Committee, considered.Third Reading

4.3 pm

Mr Hoban: I beg to move, That the Bill be now readthe Third time.

The Government want to see justice for EquitableLife’s policyholders, and this is clearly reflected in theactions that we have taken since coming to office. In six

short months, the coalition Government have made realprogress towards implementing their pledge to make“fair and transparent payments to Equitable Life policyholders…fortheir relative loss as a result of regulatory failure.”—[OfficialReport, 26 May 2010; Vol. 554, c. 1WS.]

Since coming to power, we have published the first everestimates of losses suffered by policyholders, consideredrepresentations on them, and endorsed a relative lossfigure of £4.3 billion—in line with the parliamentaryombudsman’s findings. We have set aside £1.5 billion tomake payments, which is more than four times theamount that Sir John Chadwick’s methodology produced.This strikes the right balance between fairness topolicyholders and fairness to the taxpayer.

We have announced that we will cover the full lossesof those policyholders who have or have had with-profitsannuities. We have established an independent commissionto assess how best to allocate payments to policyholders.While giving the commission wide discretion, we havemade it clear that we do not expect payments topolicyholders to be means-tested and that we expectpayments to be made to the estates of deceasedpolicyholders. Our goal is to make the first payments topolicyholders towards the middle of next year. This is ahuge achievement, of which we can be rightly proud.

The Bill is a vital part of this work. It gives theTreasury the authority to incur expenditure to makepayments to policyholders. Without this Bill, redress forthose who have suffered so long would be impossible.That is why we have moved so quickly. To delay furtheraction would be unfair to those who have alreadywaited over a decade for a resolution. The sooner thislegislation is in place, the sooner we can bring theirsuffering to an end. I know that right hon. and hon.Members of all parties fully support us on that.

We announced as part of the spending review that itwas our intention to make these payments tax free.Today’s Bill gives the Treasury the power to make anorder allowing these payments to be disregarded fortax. The payments will also be disregarded for thepurposes of tax credits.

Finally, the Bill enables the Government to considerwhat effect, if any, these payments will have on people’seligibility for certain means-tested, state-funded support.I outlined in the debate on the final group of amendmentshow this treatment will apply to welfare benefits. We arestill considering how the payments will affect supportsuch as social care.

We have concluded that lump-sum payments made aspart of this scheme will be disregarded as income forthe purposes of assessing eligibility for means-testedbenefits. Instead, they will be classed as capital. Capitallimits do not immediately cut off eligibility for benefits;they work on a sliding scale, gradually reducing supportfor individuals with larger assets. It is unlikely thatmany recipients who would otherwise have been eligiblefor means-tested benefits will receive payments thatdramatically affect this eligibility. For with-profitsannuitants, regular payments will be treated as incomein a similar way to the lost income stream that thesepayments represent.

Earlier today, hon. Members debated in detail aGovernment amendment that gives National Savings &Investments the power to deliver payments. That beinga large and potentially complex task, it is essential that


[Mr Hoban]

the delivery partner has the experience and expertise todo the job properly and cost-effectively. When judgedagainst these criteria and the imperative for paymentsto begin as soon as possible, National Savings & Investmentswas the strongest candidate, which was the motivationfor including this amendment in the Bill.

I am aware of the concerns that hon. Members havevoiced about the Bill’s brevity. It is, indeed, a two-clauseBill and it does not include detail about the paymentsscheme that would allow Parliament to scrutinise anddebate the issue. I would like to point out that there isno requirement for the Bill to do so; it is simply anenabling Bill to give the Treasury the power to makethese payments to policyholders—and nothing more.The scheme design does not require statutory footingand, of course, before the scheme design is finalised, wefirst need to make progress on this Bill. If we hadwaited for the scheme design to be finalised beforeproceeding with the Bill, it would have taken far longerbefore we could start to make payments. What theTreasury has sought to do is to work on as manystreams as possible in parallel, within the constraints ofour legal powers.

Let me reassure all hon. Members that I am fullycommitted to transparency at every stage of this process.I understand and sympathise with Members’ concerns,and for this reason I will publish a document setting outthe scheme design in detail and lay it before Parliamentfor full scrutiny. Following the independent commission’spublication of its final advice, I will make a statementsetting out the Government’s response.

I also know that Members are keen to discover whethera robust appeals process will be in place, one that willallow policyholders who believe their payment has beenwrongly calculated to challenge this judgment. I amtherefore pleased to confirm that we will be appointinga review panel, independent of NS&I, with full powersto consider any such challenges and to overturn anydecision that it finds incorrect. As I said to the hon.Member for Nottingham East (Chris Leslie) in an earlierdebate, the costs of that appeal mechanism will not beborne by the compensation pot. We want to ensure thatpolicyholders get the full value of the money that we setaside for compensation payments.

In the interests of transparency, I should like to setout the next steps in the process of resolving this longand complex issue. As a starting point, I hope thattoday’s Bill will receive Royal Assent by the end of theyear. That will allow the delivery partner to startpreparations early in the new year, and to be well placedto make the first payments by the middle of the year, asis our ambition. It is important for the delivery partnerto start work early, in order to accelerate the timetableto make those payments. The independent commissionis due to report to me in late January and, followingthat, we will incorporate its recommendations in thedesign of the scheme, which will then be scrutinised byParliament.

As I said earlier, I would encourage hon. Members onboth sides of the House, whether they are new to theissue or have run with it for many years, as so many ofus have, to engage with the commission in its work. It isindependent of the Treasury, and the three commissionersare very experienced. I believe that they have the expertise

and skills to design a proper payments scheme forpolicyholders. However, they would welcome contributionsfrom everybody who has participated in the debate, notjust in the House but across the country over the pastdecade, to enable them to produce the best possiblescheme design, which meets as far as possible the aspirationsof people who have had policies with Equitable Life.

Since the Government took office in May, we havecome a long way. We have achieved far more in recentmonths than was achieved in recent years. We havequantified relative loss suffered because ofmaladministration. We have identified the losses thatpolicyholders have suffered on a bottom-up basis, bygroups of policies and by age. For the first time, aproper understanding has been established of the lossessuffered. That is a tribute to the hard work conductedby Towers Watson and others to develop that estimate.As a consequence of the spending review, we have beenable to assess the quantum of losses, to decide the lossfigure that we accept. We have accepted the ombudsman’sview that relative loss is the best guide. We set aside£1.5 billion of funding to cover the cost of the paymentsscheme. We have announced that the losses of post 1992with-profits annuitants will be covered entirely by theGovernment. We have also established an independentcommission to advise on the allocation of funding tonot-with-profits annuitants policyholders.

As a Government, we want to see a swift resolutionto this matter. We want the many policyholders whohave waited in financial purgatory for so many years,and who have campaigned so hard for justice, to receivethe payments that are rightfully theirs. No one coulddisagree that policyholders have waited too long forjustice. Although the debate has been relatively brief, itis not just the tip of the iceberg—to which the hon.Member for Nottingham East referred—as anyone whohas participated in the debate will recognise. Passingthis important Bill is essential to achieving justice, and Icommend it to the House.

4.14 pm

Chris Leslie: The short debate that we have had hascovered a set of specific issues, largely arising from theGovernment’s conclusions in the spending review abouthow to compensate those suffering injustice followingmaladministration by insurance and financial regulatorsin the case of Equitable Life. I am glad that we have hadthe opportunity to talk about the independence of thepayment scheme. We have been able to hold theGovernment’s feet to the fire on whether it will matchthe ombudsman’s model. I am glad that the Ministersaid that he would welcome further comments from heron the design of the compensation scheme. It will beinteresting to see whether she endorses it as being thefair and transparent scheme that many Members havepledged to deliver.

We have also discussed the appeals procedure and thetiming of payments. In response to the second ombudsman’sreport, the former Chief Secretary to the Treasury, myright hon. Friend the Member for Normanton, Pontefractand Castleford (Yvette Cooper), offered an apology forthe past failings of the regulators. That is an importantpoint, which is separate from the question of whetherthe regulators can be held fully or only partly responsiblefor the losses incurred by the maverick actions of EquitableLife’s management during the 1980s and early 1990s.


I am sorry that, at least during this debate, Ministershave not also expressed regret, clearly and on the record,for the part that their party played during the 1980s infailing adequately to establish a regulatory system toprevent the vast bulk of the Equitable Life problemsfrom arising in the first place. I know that it was a longtime ago and that none of the current Ministers were inany way responsible, but I think it would have been ahelpful gesture to draw a line under the failings that hadoccurred in the past. After all, Lord Penrose concludedin his inquiry report that Ministers in the late 1980s“did not regard the subject”

of updating life insurance regulation“as a high priority for legislation.”

He noted that“the Government’s objective was to deregulate, to reduce regulatoryburdens on business, to avoid interference in private companies,and to let market forces prevail.”

Mr Hoban: I appreciate that the hon. Gentleman isnew to this topic, but we have already clearly expressedour apologies. Unlike the last Government, we immediatelyaccepted all the ombudsman’s findings of failure. Thehon. Gentleman’s party did not even have the courageto do that.

Chris Leslie: I am glad that the Minister has been ableto reiterate points that he did not make in his ThirdReading speech. I do not necessarily want to reopen thebox entirely, but it is important for both parties torecognise that mistakes have been made, and that thingsshould and could have been done better by those onboth sides. In particular, however, I think it is importantnot to gain the impression that failings did not occur onthe watch of the Minister’s party. Lord Penrose foundthat Conservative Ministers“argued against reform in the… 1990s”,

and that the United Kingdom “led the resistance” toEurope-wide attempts to update the third life directive.Those who argue that Labour alone fell short in respectof reacting to the Equitable Life debacle should realisethat the ideological approach pursued by the Conservativeswas absolutely central to causing the mess in the firstplace.

As Members know, the last Government would havechosen a different route to compensation. We wereanxious that a poorly designed compensation schememight entail a person-by-person review aimed atdisentangling individual losses one by one, examiningmore than 30 million investment decisions by 1.5 millionpeople over 20 years. That would have been a mammothadministrative task. Moreover, the ombudsman hadimplied that individuals would need to prove that theyhad relied on the regulatory returns and had beenmisled as a result. The last Government did not believethat such an approach could be feasible.

It was for those reasons that Sir John Chadwick wasasked to explore a more realistic and reliable paymentscheme methodology. He concluded that the Treasuryshould deal with the issue by grouping cases into about20 broad categories of policyholders who were in similarcircumstances. The payment scheme would then deducethe relative loss in each category in comparison with theoutcomes of a basket of other policies that had notsuffered from the same regulatory failings. The Government

have clearly embarked on a different course, althoughthey have taken up some of Chadwick’s pragmaticsuggestions about the automaticity of compensation.We genuinely hope that that will work.

We are pleased that this short paving Bill is before theHouse, because we feel strongly that the matter shouldbe resolved. The Committee stage gave us an opportunityto question the Government on several aspects of theirapproach, and I am glad that we have had an opportunityto draw them out further today.

Let me end by simply raising a question mark overthe words of Ministers before May, when the generalelection took place, in comparison with their actionstoday. Many hundreds of thousands of Equitable Lifepolicyholders—possibly as many as 1 million—were ledto believe that in signing the EMAG pledge, Ministerswere supporting a particular outcome that may not nowarrive. Most Conservative Members signed that pledge.They pledged to their constituents that“if I am elected to Parliament at the next general election, I willsupport and vote for proper compensation for victims of theEquitable Life scandal and I will support and vote to set up aswift, simple, transparent and fair payment scheme—independentof government—as recommended by the ParliamentaryOmbudsman.”

As the payment decisions are made in the next fewyears and the cheques finally start to arrive, EMAGmembers and policyholders who are not in line toreceive 100% compensation for their full relative losseswill have to draw their own conclusions as to whetherthe Government have fulfilled their promises. So far thesigns are that many policyholders do not feel that thoseMembers who signed the pledge are keeping their word.They feel that the scheme will fall short of propercompensation and a fair payment scheme.

Jonathan Evans: Will the hon. Gentleman give way?

Charlie Elphicke (Dover) (Con) rose—

Mrs Main rose—

Chris Leslie: I will give way first to the hon. Memberfor Cardiff North (Jonathan Evans) as he has attendedthe entire debate.

Jonathan Evans: The hon. Gentleman seems to besuggesting that £1.5 billion does not amount to propercompensation. I came to watch the earlier debate whenthe Minister was the right hon. Member for East Ham(Stephen Timms), and he was standing by the Chadwickfigure, but the hon. Member for Nottingham East (ChrisLeslie) now seems to be saying that four times morethan the position the Labour party were defending backthen is not proper compensation.

Chris Leslie: The difference between the hon. Gentlemanand me is that I did not sign the EMAG pledge. I alwaysfelt, as did many of my colleagues, that there were realand practical difficulties in raising constituents’ hopesin the way that the hon. Gentleman perhaps did. That isa matter for him and his constituents. It is up to him toconvince them that the result of these deliberations hasbeen to put in place full and fair compensation inaccordance with the pledge. I am simply making thepoint that this is a matter of honour for those hon.Members who signed the pledge.


Mrs Main: Will the hon. Gentleman give way?

Chris Leslie: I think the hon. Lady was one suchMember.

Mrs Main: I rise to gently chide the hon. Gentleman.We have had discussions with EMAG representatives,and I do not think they were under any illusions thatthey were necessarily going to get back every singlepenny that was lost. I have talked to my local representatives,and I think they are realistic enough to realise that wehave done the best we possibly can. I am not happy withthe situation for the pre-1992 annuities, but even so,what we are giving them is 100 times better than previously.They look to us to deliver that, but they are realisticenough to know that, in these hard times we cannot givethem everything. I think for the hon. Gentleman to say,“I didn’t sign the pledge” is just copping out.

Chris Leslie: I disagree about the pledge, and I didnot sign it for particular reasons, but my point is simplythat the hon. Lady signed the pledge before the generalelection and it committed her to a number of things,one of which was somehow to fulfil the aspirations ofthose policyholders who interpreted the pledge in aparticular way. I, too, have met EMAG representativesand they are not as happy and understanding as thehon. Lady suggests.


Chris Leslie: Well, if the hon. Lady understandssomething different, I will give way to her again.

Mrs Main: Did those EMAG representatives give thehon. Gentleman some reason to suspect that they werehappier with his stance of delivering a much lesseramount?

Chris Leslie: The difference is that I did not raisepeople’s hopes for electoral purposes—because I wantedto harvest their support—only to dash them after thegeneral election. We are very used to ConservativeMembers making pledges on a whole series of things—notleast student finance, which is quite pertinent rightnow—and then breaking their promises. I am not sayingthat Members are necessarily in breach of their pledge.All I am saying is that it is for them to honour it, inaccordance with their consciences and what theirconstituents will say to them as to whether the compensationoutcome amounts to a fair payment scheme and propercompensation.


Chris Leslie: Having clearly touched a nerve, it will beinteresting to hear from other Members as well.

Margot James (Stourbridge) (Con): There is a keypoint for the victims of this scandal in my constituencyof Stourbridge. Most of those whom I have met understandthat the commitments that were given always had theproviso of the state of the public finances. That is a veryrelevant point.

I wish so much that we could have offered peoplemore, but given the difference between Chadwick’srecommendations, which were the baseline, and the£1.5 billion, as well as the state of the public finances,many people who have suffered in this scandal will feel

that they have been treated reasonably, although I acceptthe hon. Gentleman’s assessment that the EMAG pressuregroup is still battling for more. That is its role as apressure group.

Chris Leslie: A reasonable point from the hon. Lady.All I am saying is that the pledge that some Memberssigned did not say explicitly, “As resources allow.”[Interruption.] No, it does not say that in the pledge.The pledge simply says that they will have a fair andtransparent payments scheme. I doubt very much thatthe vast majority of those other policyholders who willnot be getting the 100%—clearly it will be welcomed bythose with-profits annuitants, who are receiving 100% oftheir relative losses—but may be receiving, I am told,between 15 and 20% of their relative losses will feel thathon. Members who raised their hopes are actuallyfulfilling them.

Jonathan Evans: I appreciate that the hon. Gentlemanis new to his role, but I would have hoped that he hadread the ombudsman’s report before representing theOpposition at the Dispatch Box. He would have seenthat the ombudsman says that the compensation figuremust take account of the effect on the public purse.

Chris Leslie: I completely accept that that is what itsays in the detail of the ombudsman’s report, but it doesnot say that in the pledge that the hon. Gentlemansigned. In an electoral context, he raised the hopes ofmany of his constituents. He may be able to face themand say, “Absolutely, I am fulfilling what I promised.” Ifhe feels that and they are happy with it, they will re-electhim, and everybody will be happy and ride off into thesunset, but I have a feeling that some policyholders willcontinue to be discontented with the Government’sposition. It certainly did not say, either in the manifestosor in the pledge that he signed, perhaps scribbled in alittle addendum, “Oh, by the way, we are going to giveyou only a fraction of the £4.5 billion to £6 billion thatyou understand as the relative losses.” That is simplynot there. I am not claiming, because I did not sign thatpledge, to have raised those hopes, but Members on theGovernment Benches did.

Sir Alan Beith: Is it the hon. Gentleman’s positionthat he did not promise anything, he was not going togive anything, Chadwick was the maximum and hemight as well vote against the Bill?

Chris Leslie: Liberal Democrats need to learn thatpeople should not make promises they cannot keep.There is a suggestion that Liberal Democrats in particularhave been growing used to making promises that theycannot keep, so the right hon. Gentleman should pausefor a moment because his political arguments arehaemorrhaging on a number of fronts. That is becausesome Members raised a series of aspirations before theelection, making suggestions and promises, and thereare some who will feel that he is now falling short ofthat. That is the only point that I seek to make. I am notclaiming perfection for my behaviour, nor am I claimingin any way that I could fulfil all the hopes of thepolicyholders, but my point is that Members on theGovernment Benches did, and they should be hoist ontheir own petard for signing that EMAG pledge.


Charlie Elphicke rose—

Chris Leslie: I give way to my good friend fromDover.

Charlie Elphicke: I thank the hon. Gentleman forgiving way. I know him to be a generous Member of theHouse. With his customary generosity, will he acknowledgethat the amount is nevertheless three times that whichthe previous Government said they would have given ascompensation?

Chris Leslie: We will not know that, because Chadwick’sreport was published after the general election. We hada series of steps that would have then been taken, buthistory went in a different direction because the spendingreview and the Budget were undertaken by a differentparty, not by our party in government. I am not sayingthat there are magic solutions to this issue. These arecomplex matters and there are technical reasons forboth the methodologies that are being used in thecompensation and the timings and the discussions aroundthem. It is important to bear in mind the wider needs ofthe public purse. We have consistently said that and nowthe Government have come round to that point of view.I understand why they did.

Mr Hoban: The previous Government took six monthsto dither over what they would do about the ombudsman’sreport, whereas we accepted her recommendations straightaway—there had been maladministration, there shouldbe compensation for relative loss, and affordability wasa key part of her recommendations. We accepted thatquickly, whereas his right hon. and hon. Friends sat ontheir hands.

Chris Leslie: I disagree with that. The hon. Gentlemancertainly did not say before the general election that thiswould be £1.5 billion—[Interruption.] Oh, did he? Wheredid he say before the general election that this would be£1.5 billion? I shall give way to him if he can give areference for that. Answer came there none—proof inpoint that after the general election a different set ofexpectations was set out by the Government than thosethat might have been an interpretation of the Minister’swords before the election.


Conor Burns (Bournemouth West) (Con): Will thehon. Gentleman give way?

Chris Leslie: I have given way to the hon. Member forSt Albans (Mrs Main) several times, so I shall give wayto the hon. Member for Bournemouth West (ConorBurns).

Conor Burns: Will the shadow Minister at least concedethat one of the greatest groups of victims—some werein my constituency—were those who died while waitingfor his Government to make any progress? This Governmentshould at least be congratulated for getting on anddoing something, because in this context something isdefinitely better than the nothing that was offered bythe Opposition.

Chris Leslie: I am not going to claim that everythingin the garden was rosy in the period that elapsed betweenthe findings of the various commissions. Suffice it to

say that Penrose spent some two and half years on hisinquiry and the ombudsman spent nearly four years onhers. This was not simply a Government issue. Therewere very complex issues in which a set of decisions hadto be resolved. There are perfectly good and soundreasons for some of the time that it took to come toconclusions on these questions. Things could certainlyhave been handled better; I have already said that thisevening.

Mr Marcus Jones: Will the hon. Gentleman explainthe inactivity on the matter while his party was ingovernment, particularly during the demise of the Icelandicbanking industry, when his Government bailed out manyinvestors who were affected by it at the drop of a hat?

Madam Deputy Speaker (Dawn Primarolo): Order.Before the hon. Member for Nottingham East (ChrisLeslie) answers, may I remind the House that this isThird Reading and that it is timed, which means that itwill conclude at three minutes past 5? Members whohave sat through the debate this afternoon and whowish to speak on Third Reading might not get theopportunity to do so. I shall call Mr Leslie back to theDispatch Box to respond to the intervention, but perhapseverybody in the Chamber could bear my point inmind.

Chris Leslie: Indeed, Madam Deputy Speaker. It iscertainly incumbent on us all to be brief as far as wecan. I have set out the position as I see it. I know thatGovernment Members will disagree, but I do not wishto impugn their intentions. I was simply seeking topoint out that they are held to a pledge that not allMembers are held to and that they will be judgedon that.

We are not minded to oppose the legislation thisevening. This is a necessary paving Bill, but we acceptthat the devil will be in the detail and we await thefurther scrutiny of the measures that will come subsequently.

4.33 pm

Nadhim Zahawi: The mere fact that it is 10 November2010 and I am standing here delivering a speech onThird Reading is something of which I am incrediblyproud. This is a sobering Bill, which is long overdue. Ithought in Committee that I heard the shadow Ministerapologise, but, sadly, I know from listening to his remarksthat he obviously has no remorse. Behind him are thehon. Members for Foyle (Mark Durkan) and for LeedsNorth East (Mr Hamilton), who have been passionateadvocates for the victims of Equitable Life and incrediblechampions for their cause, and they have had to listento their Front-Bench spokesman speak with forkedtongue. He says, on the one hand, that Labour wants tochampion the victims of Equitable Life, many of whomsadly have not survived to see this day, but on the otherthat it did not promise anything. Labour let the victimsdown in the previous Parliament and tried to get awaywith delivering what Chadwick recommended.

The Front-Bench spokesman for the coalitionGovernment is to be commended, because we are debatinga figure that is four times the amount that Chadwickrecommended. I remind the House of the economiclandscape that we have inherited. We are borrowing£500 million a day; every time we go to bed and wake up


[Nadhim Zahawi]

in the morning, we have been saddled with another£500 million of debt by the previous Government. Justpaying the interest on that debt costs £120 million aday—just to stand still. Against that background, andwithin six months of this Parliament, we have been ableto deliver the Third Reading of this Bill for victims ofthe Equitable Life tragedy.

I want to highlight some of the points that my hon.Friend the Member for Harrow East (Bob Blackman),chairman of the all-party group on justice for EquitableLife policyholders, has made. He has made some forcefulpoints, as have my hon. Friends the Members for Nuneaton(Mr Jones) and for Cardiff North (Jonathan Evans). Itis important to remember what we heard from theMinister about the additional money that will come as aresult of the tax treatment of the payments. He wouldbe right to say that he had already shared this informationwith us but that it was hidden in the detail. Thatimportant point needs further airing.

I repeat a recommendation that I made in Committee,although I know it would be complex: it would beincredibly helpful for us all if the additional benefit fordifferent tax bands provided by that tax treatmentcould be calculated. As my hon. Friend the Member forHarrow East rightly reminded us, many hon. Memberssigned the pledge on Equitable Life before the election.I am proud that I signed it and many of my colleaguesand I believe that we have absolutely delivered on it.There is a lot of detail to get through and we will allwork very hard to ensure that we deliver for the victimsof Equitable Life. I hope that the shadow Minister willreflect on his remarks and feel that he could take someof them back. I hope also that he will be much moreconsidered next time he speaks on this topic.

4.38 pm

Mr Fabian Hamilton: Given the shortage of time Ishall be brief. The hon. Member for Stratford-on-Avon(Nadhim Zahawi) reminds us of the daily interest paymentson the current national debt and I could respond that ifwe delayed payments by two days, we might have enough,by his calculations, to pay the pre-1992 annuitants, but Ishall not be frivolous.

In Committee, I might have been a little churlish inmy introductory remarks on my amendment, because Ireally do want to congratulate the Government on whatthey have done. They have not gone far enough, butthey have made progress and I do not want to appearreluctant in congratulating them. Many hon. Membersthought I was being reluctant, but my remarks wereslightly tongue in cheek. It is good that the Governmenthave introduced a scheme quickly, that payments will bemade from next year and that the quantum is nowroughly £1.5 billion instead of £0.5 billion—about threetimes more than Chadwick suggested. That is progress,and many Equitable policyholders will be very pleased.

I hope the Minister will accept that there is still someinjustice, not least for those pre-1992 annuitants, forwhom 76 right hon. and hon. Members voted for myamendment. As the Minister knows, I do not accept hisargument on that. I hope he will understand that injusticestill exists, that we will have to deal with it in some wayor another if we can, and that EMAG will continue to

fight its corner, as it must, until it sees justice for allpolicyholders and annuitants who took out policieswith the discredited Equitable Life.

I and my co-chair, the hon. Member for Harrow East(Bob Blackman), together with the secretary of theall-party group, have written to Ann Abraham, theombudsman, asking her a number of questions. Wehope that in due course we will receive a response,which we would want to share with the House or at leastwith the rest of the all-party group. On that subject, Ihope the Minister will be able to accept my previousinvitation to attend one of our meetings at a timeconvenient to him, so that we can discuss the details ofthe scheme, understand more clearly how it will workand perhaps add some thoughts of our own on how tomake it work more effectively.

Finally, I hope that in passing the Bill today andmaking it become law, and in paving the way for thecompensation scheme, we as parliamentarians all appreciatethe lessons that have been learned from the poor ornon-existent regulation of companies such as EquitableLife so that future annuitants and policyholders neverhave to suffer in this way again.

4.41 pm

Bob Blackman: I am privileged to follow my co-chairof the all-party group that is seeking justice for thepolicyholders who were so wrongfully treated by theprevious Government. We can see where interest insupporting the policyholders lies. It is on the coalitionGovernment Benches. Sadly, with the exception of thosehon. Members who are present, there is a total lack ofinterest among Opposition Members in listening to orparticipating in the debate. That is typical of what hasgone on for the past 10 years. It is not fair to compare apotential failure to regulate with the fact of connivingwith the regulator and the company to prevent peoplefrom receiving compensation. That is precisely what theprevious Government did.

I congratulate the Treasury team on taking swift,firm and transparent action to ensure that we can payswiftly those who have been wronged. That is not beingdone as quickly as I would like, but we have to gothrough the mechanisms of government and legislation.We must make sure that the people who have been sobadly wronged are compensated properly, and that thatprocess is fair and is seen to be independent of Government.

The debate that we had this afternoon in Committeeclarified a number of issues. I trust that the people whoare watching from home, thinking about how muchmoney they will receive and when they will receive it,will be more satisfied that the Government and theTreasury team have taken on board the lobbying andthe actions undertaken by Members, primarily on theGovernment Benches, to make sure that the scheme isput in place as swiftly as possible and pays the maximumpossible.

We should remember that the Bill will enable theTreasury to pay the money out as swiftly as possible. Itdoes not deal with the sums that are due to be paid out,although the Government accept completely theombudsman’s view that the compensation would be£4.6 billion if the public purse had permitted that. Thatis massively different from what Chadwick recommended.


Nadhim Zahawi: Does my hon. Friend agree that ifthe previous Government had acted, and acted sooner,more compensation would have been payable to the victims?

Bob Blackman: If the Labour Government had actedwhen they should have done, £1.5 billion would haverepresented 100% compensation for everyone that hadbeen so badly wronged. However, the dragging of feetover the past 10 years means that we are in the parlousstate in which people who should be due their compensationare dying every day, and every day that we delay meansthat, sadly, more people will not receive their compensation.

James Morris: Many Members have talked about themoral imperative behind sorting out the situation, butdoes my hon. Friend agree that moral interventionrequires practical Government action, which is what weare seeing today?

Bob Blackman: Indeed. That is the clear duty of thecoalition Government, and that is why I wholeheartedlypraise the Treasury team for demonstrating such action.

There has been no greater issue than the tax treatmentof the compensation that is due, and I congratulateonce again the Treasury on that measure, because it willadd to the compensation. Many people sitting at homewill have been calculating their compensation less theamount of tax that they regularly pay. Now they knowthat they will receive a far bigger tax-free income, andthat is something else of which we can be proud.

I would have much preferred more money to beprovided. Would not we all? But would not we all ratherbe in a position whereby the Treasury was not almostbankrupt and we had not been left with a massivedeficit? The all-party group will continue to ensure that,in this process, the Treasury will be able to communicatewith all parliamentarians, and EMAG will be able tolobby to ensure that, when individuals begin to receivetheir payments, which will be the acid test, they feelsatisfied that the wrong that has been done to them hasbeen compensated. That is something of which wewould all be proud. We can take great pride in the factthat the process is happening quickly, with purpose andtransparency, and that the pledge that we all signed isbeing honoured. Some people may say, “It is not beinghonoured in full,” but it is, and clearly the economiccircumstances of the day dictate what we can do.

As I said in an earlier intervention, we should revisitthe position in five years’ time when the economy willhave recovered and we will be in a much strongerposition because of the coalition Government’s decisions.There may be a case then for reconsidering whether thepeople who took out policies but will not retire for five,10, 15, even 25 years should receive a top-up. That is areasonable proposal, and it is sensible for the coalitionGovernment to consider it.

I commend the Bill to the House. I support it 101%,and the Treasury team are to be congratulated not onlyon what they have done, but on the clear answers thatthey have given to the points that have been made as wehave considered the Bill in detail.

4.48 pm

Mr Weir: No one is going to oppose the Bill’s ThirdReading, for the simple reason that, if it fell, no onewould receive any money. None the less, dealing with

the Bill has in many ways been a frustrating experience.It is a paving Bill, as others have said, and the bigelephant in the room is the cap and its effect on theoverall amount of money available.

It would be churlish not to acknowledge that theGovernment have moved swiftly, and that is welcome.After 10 years spent arguing about the matter, we arefinally getting somewhere with it, but to some extent theBill is a missed opportunity, because of the cap and theinability to do anything about the Treasury’s decision tointroduce one. The effect will be dramatic. Nobody isarguing that, in the current situation, everybody shouldreceive all the money to which they might be entitled.Even EMAG accepts that there will be, as the group putit, a “haircut”, but some people will lose 80% of thecompensation that they should have received, and thatis not fair.

There are other inequities involved. I was franklybaffled by the Minister’s mental contortions over theexclusion of pre-1992 with-profits annuitants. As Iunderstand his remarks, we are now in the positionwhere maladministration is okay as long as one doesnot know about it and where it becomes an issue onlywhen one does know about it. That seems utterly perverse.By resorting to these measures, the Government haveundermined what could have been a very good end tothis long-running matter.

The hon. Member for Harrow East (Bob Blackman)is right—had the previous Labour Government graspedthe nettle at an early stage, this issue could have beendealt with much more cheaply. A lot of the fault overthe cost lies with the previous Government’s unwillingnessto do anything about it. Many of us have spent years inthis House arguing that they should have done so; Ihave not changed my position over that period.

I think that there should be compensation, and Iwelcome what has been done. It is not sufficient, however,and many policyholders will still feel very aggrieved,and rightly so. It could have been dealt with better hadit been done differently, perhaps with a larger cap orpayments over a longer period. I can give half a thanksfor the Bill, but I think that the Government will faceproblems in future because of their failure fully to dealwith the issue.

4.51 pm

Sir Alan Beith: I must declare an interest in that Ihave a very small Equitable Life policy—so small that Ido not think I will qualify for any repayment. Myconcern is for the large number of my constituentswhose entire retirement is dependent on Equitable Lifepolicies. The list of the people who write to me includesmany of those who have contributed most to the communityover the years: that is a striking feature of the namesthat I see in the correspondence. Many of them will stillbe angry at how little they are going to get for all thesavings they put by.

The first thing to remember is that the primaryresponsibility for this situation rests with the utterlyirresponsible management of Equitable Life. In manyways, that was a disgrace to the mutual movement. Itunderlines a weakness in the mutual movement, ofwhich I am very supportive in general, which is thatexecutives who want to advance their own careers favourthe acquiring of new members at the expense of the


[Sir Alan Beith]

interests of existing members. It happened at EquitableLife, it happened at Northern Rock, and it happens inbuilding societies; it is something that the mutual movementhas to watch very carefully.

The regulatory failure that occurred is the basis ofthe Bill, which I hope we shall give a Third Reading.That regulatory failure has not led to action withinanything like the time scale that it should have done. Adecade has gone by: people have got older and peoplehave died while action should have been taken.

I very much welcome the action that the Governmenthave taken, very quickly, within a short time of theircoming into office. I welcome the further announcementsthat the Minister has made in saying that there will beno tax liability and no effect on tax credits, and thatspecial considerable will be given to the social caresituation, bearing in mind that quite a lot of EquitableLife policyholders are now in social care, either at homeor in residential care, and their cases need to be consideredvery carefully. I am grateful to the ombudsman for thework that she has put into this matter, and for herpersistence in doing so, and to EMAG, which has donesuch a tremendous job.

This is not full redress even for all the regulatoryfailure that occurred, and I would not expect policyholdersto be satisfied that they have got all that they aremorally entitled to. However, the fact that the Governmenthave moved quickly to ensure that payments will bemade makes me feel entirely justified in going into theLobby in support of the Bill. I am rather depressed thatthe response of Labour Front Benchers has been to sayto the Government, “You gave people the impressionthat they might get more, and even though you’re givingthree times more than Labour would even havecontemplated, we, the Labour party, did not promiseanything at all.” We had to act, and I am grateful for thefact that Ministers are doing so.

4.53 pm

Mark Durkan: This is a Third Reading debate, and Ido not believe that the House should, or will, divide onthe Bill at this stage.

As we have rehearsed in debates not only today buton other occasions, this is a can that was kicked in frontof the Government for a very long time, to the frustrationand disgust of very many people. I am glad that althoughnot everyone who has lost out will be doing handstands,we no longer have the degree of hand-wringing fromGovernment that we had for too many years.

In the earlier debates, I, like others, had some questionsand criticisms. Those criticisms were because of theinadequacies and arbitrary limits in the provisions thathave been put in place. Some of us have genuine concernsthat, notwithstanding how much better the provisionsare than those the previous Government were going tomake, we as a Parliament should be careful aboutcreating a situation in which we have a cap one on handand a cut-off on the other, which together will conspireto create a selective injustice against some people.

When the Financial Secretary responded to debateson amendments, he made it clear that assessments ofpre-1992 annuitants could be made to allow cases to beidentified in which people had benefited from the inadequate

regulation rather than losing out. In those cases, weshould better provide for a scheme that will deal witheveryone on a case-by-case basis, rather than risk classexclusion by assumption, which is what the cut-offprovides for. I ask the Government to consider thatfurther as they take the scheme forward.

I appreciate the Financial Secretary’s indications thatadded consideration has been given to tax treatmentand tax credits, and to the social care implicationscomplications that could arise. I give the Governmentcredit for that sensitivity and responsiveness.

My hon. Friend the Member for Nottingham East(Chris Leslie) rightly warned the Liberal Democrats tobe careful not to make promises that they cannot keep.As a friend of the Labour party, but someone who wasfrustrated sitting on the Benches with Labour Membersduring the last Parliament, may I say that I hopeLabour’s Front Benchers also learn to be careful aboutmaking arguments that they cannot sustain? He hasunfortunately been left in a position of trying to criticisethe Bill, but he could not even afford to divide theCommittee on straightforward, pure amendments. I feelsorry for him that the last Government’s record put himin that position, and that he was left to make argumentsthat ended up, with all due respect, veering towardscynicism while the rest of us were trying to keep ourarguments within the realms of legitimate criticism.However, I accept fully that he is not responsible forthat position.

It is important to remember that this is not just amatter of what one Government or another did. Thedebates have shown that many Members of all partieshave met constituents and carried their concerns. Peoplehave suffered compound distress, and that is what cannotbe quantified. Someone might quantify what amount ofmoney should be due to people and how much we canafford to give them, but we cannot calculate the compounddistress caused to people not just by their loss but by thelong indifference and inertia.

I acknowledged earlier the work in the previousParliament done by my hon. Friend the Member forLeeds North East (Mr Hamilton), and we all acknowledgethe work in this Parliament of the hon. Member forHarrow East (Bob Blackman), who has served noticethat he will continue it. It is also appropriate to acknowledgethe huge role played in the previous Parliament by thehon. Member for Shrewsbury and Atcham (DanielKawczynski). Perhaps it is right that a Member fromone of the smaller parties says so; as he is currently aParliamentary Private Secretary, he may not be in aposition to participate in the active, vocal way that he sooften did.

Many of us have criticised Sir John Chadwick todayand at other times. I remember the hon. Member forShrewsbury and Atcham reminding me of a line that Iused to hear about Fanny Craddock. Apparently sheused to offer some chicken recipe, and the first line ofthe recipe was, “First, catch your chicken.” The hon.Gentleman and the all-party Equitable Life group hadthat difficulty with Sir John Chadwick, in trying to gethim in and ensure that he and the Government properlyengaged with them. Although many people will seeshortcomings in the provisions, the fact is they representhuge and welcome progress. Some redress will now begiven to people, and the quicker that that can happenthe better.


None the less, we need to iron out any inconsistencies.Some of us are worried about something the Ministersaid earlier and the sort of precedence that it mightcreate. He said that because people did not know aboutthe maladministration, they can be deemed not to havesuffered the same loss as those who did know. That isnot an argument that I would ever want to become arule of thumb for any such scheme again.

5 pm

David Rutley (Macclesfield) (Con): Like many othershon. Members, I have had a huge amount ofcorrespondence on this issue. I have also met many ofthe policyholders and heard their sad tales and the wayin which this drawn-out saga has affected their lives. Icongratulate the Equitable Members Action Group onits hard-fought campaign and commend the great workthat has been going on in the all-party parliamentarygroup. That has given many of us in this House, particularlynew Members, an awareness of the situation. None theless, it has been a drawn-out saga, and I am delightedthat the Minister has taken very speedy action to addressthe outstanding issues. He has made this Bill a priorityand put forward £1.5 billion to assist with compensationat a very difficult time for the economy. Those aregenuinely positive developments. As my hon. Friendsthe Members for Harrow East (Bob Blackman) and forStratford-on-Avon (Nadhim Zahawi) have said, we havealso had clarity on the tax treatment, which is welcomedby all of us.

I congratulate the Minister on his quick choice ofNational Savings & Investment to lead forward thespeedy implementation. At the time of his ministerialstatement, I remember his assuring the House that therewould be a clear communication plan to help himinform policyholders on developments. I continue to

urge both him and his Treasury officials to learn fromprevious compensation schemes to ensure that this onehas flawless implementation. That is what the policyholdersdeserve after years of waiting. We cannot let them downat the point of implementation and operation.

Although it is essential to have clear informationavailable through e-mails and websites, we must notforget the age profile of the people whom we seek tohelp. They are, typically, older—much older—and willneed written communication and properly manned contactcentres to ensure that they get the customer service thatthey need.

Richard Graham (Gloucester) (Con): Does my hon.Friend not agree that it is a real scandal that no settlementwas made during the long years of the previous Governmentwhile many thousands of innocent victims, includingmy mother, died, and that that should remain on theprevious Government’s conscience for ever?

David Rutley: I agree. It is a tragedy that this hastaken this long. Today’s debate has been reasonable, butI felt let down by the uncharacteristic tone that wasstruck by the hon. Member for Nottingham East (ChrisLeslie).

5.2 pmOne hour having elapsed since the commencement of

proceedings on consideration, the debate was interrupted(Programme Order, 14 September).

The Deputy Speaker put forthwith the Question alreadyproposed from the Chair (Standing Order No. 83E),That the Bill be now read the Third time.

Question agreed to.Bill accordingly read the Third time and passed.


European Union Economic Governance

Madam Deputy Speaker (Dawn Primarolo): I mustinform the House that Mr Speaker has not selected anyof the amendments.

5.3 pm

The Financial Secretary to the Treasury (Mr MarkHoban): I beg to move,

That this House takes note of European Union Documents (a)9433/10, Commission Communication on reinforcing economicpolicy co-ordination, (b) 11807/10, Commission Communicationon enhancing economic policy co-ordination for stability, growthand jobs – tools for stronger EU economic governance, (c)14496/10, Proposal for a Council Regulation (EU) amendingRegulation (EC) No. 1467/97 on speeding up and clarifying theimplementation of the excessive deficit procedure, (d) 14497/10,Proposal for a Council Directive on requirements for budgetaryframeworks of the Member States, (e) 14498/10, Proposal for aRegulation of the European Parliament and of the Council onthe effective enforcement of budgetary surveillance in the euroarea, (f) 14512/10, Proposal for a Regulation of the EuropeanParliament and of the Council on enforcement measures tocorrect excessive macroeconomic imbalances in the euro area, (g)14515/10, Proposal for a Regulation of the European Parliamentand of the Council on the prevention and correction ofmacroeconomic imbalances, and (h) 14520/10, Proposal for aRegulation of the15 European Parliament and of the Councilamending Regulation (EC) No. 1466/97 on the strengthening ofthe surveillance of budgetary positions and the surveillance andco-ordination of economic policies; notes the Report from theTask Force on Economic Governance in the European Union;notes with approval that budgetary and fiscal information willcontinue to be presented to Parliament before being given toEU20 institutions; and approves the Government’s position, asendorsed by the Task Force that any sanctions proposed shouldnot apply to the United Kingdom in consideration of Protocol 15of the Treaty on the Functioning of the EU.

I welcome the opportunity to set out the Government’sposition on the Commission documents to be debatedthis evening and our broader position on the co-ordinationof economic policy in the EU. As right hon. and hon.Friends will be aware, the European Council last monthagreed the report of the EU Economic GovernanceTask Force chaired by Herman Van Rompuy, and wesupport its work and conclusions, none of which encroacheson Parliament’s economic sovereignty. I want to beclear about that so that there can be no confusion aboutour position.

Let me deal first with surveillance. Macro-economicsurveillance examines the budget plans of member states,and has been around for more than a decade. There isnothing new in that, and a number of internationalbodies do the same, such as the OECD and the InternationalMonetary Fund. Does the fact that the EU is doing somean that we will be subject to sanctions? No, it doesnot, because under protocol 15 of the existing treaty,sanctions do not apply to us.

Mr William Cash (Stone) (Con): Is my hon. Friendaware that the same Mr Van Rompuy has today issued avicious attack on Eurosceptics throughout Europe, sayingthat what they argued amounts to a national lie?

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

Let me continue to make the Government’s positionclear. Will we have to present our Budget to Europebefore we present it to the House? No. Will we have to

give Europe access to information for budgetary surveillancethat is not similarly shared with organisations such asthe IMF, or that is not publicly available on the internet?Again, the answer is no. Will powers over our Budget betransferred from Westminster to Brussels? Again, theanswer is no.

Philip Davies (Shipley) (Con): Does my hon. Friendunderstand that many people have lost confidence inassurances given whenever a new European treaty isdiscussed that there will be no loss of sovereignty? Eversince we went into the Common Market, the Britishpublic have been told at every stage along the way,“Actually, we’re not giving up any sovereignty. This newtreaty doesn’t give anything away,” but people havefound time and again that these treaties have done justthat. Does my hon. Friend understand people’s concernsthat although the powers in question do not apply tothe UK at the moment, they may well do so in future, asthe European Union is clearly looking at extendingsanctions to non-eurozone countries as well?

Mr Hoban: Nothing in the documents before ustoday does what my hon. Friend suggests. People shouldlisten and read the documents to which we have subscribed,and understand how firm and robust the Governmenthave been in defending our economic sovereignty.

Jacob Rees-Mogg (North East Somerset) (Con): Butdoes Mr Van Rompuy’s report not suggest that thereshould be a binding minimum set of requirements fornational fiscal frameworks that would apply to all memberstates?

Mr Hoban: I think my hon. Friend is reading anearlier draft of the report, because we amended thatlanguage at the latest ECOFIN. I will come to this pointin a minute, but we believe that fiscal frameworksshould be political agreements and should not be drivenby directives or regulations.

Mr John Redwood (Wokingham) (Con): Will the Ministerplease confirm that the directive on budgetary frameworksfor all member states will apply to the United Kingdom,that the second regulation on budgetary surveillance forall member states applies to the United Kingdom, andthat the regulation for enforcement for all memberstates also applies to the United Kingdom? There aretwin proposals in each case, some of which apply onlyto euro members and some of which affect all memberstates. Surely the Minister must confirm that that is amassive extension of European economic government,and the UK has to comply with a lot of it.

Mr Hoban: There is nothing new in the macro-economicsurveillance processes outlined in the document and, asI have said, we are exempt from the sanctions regimethat the Commission and others have proposed, whichapplies only to eurozone countries. Let me now makesome progress.

We need to recognise that there are lessons to belearned from the economic crisis, but one lesson thatstands out that is relevant to the debate this evening andto the documents is that in an open, global economy, noeconomy exists in isolation. The failures of economicpolicy in one country can be exported to other nations,and the imbalances in one economy can have an impact

359 36010 NOVEMBER 2010 European Union EconomicGovernance

on others. Imbalances such as excessive domestic demandand growth can lead to asset bubbles, an over-relianceon exports or divergence in competition across countries.It is in all our interests to improve co-ordination andco-operation in policy making, to tackle those imbalancesand increase the resilience and strength of the globaleconomy.

However, in our view, increasing co-ordination andco-operation has to be consistent with national sovereigntyand the accountability of Parliament. It is those principlesthat frame our response to the documents and ourresponse to the global economic crisis. There is anintense global debate about those topics in the G20, theIMF and the OECD, and in Europe. We take part inthose debates because, as an open economy, we have astrong interest in economic stability. We are acutelyaware that imbalances and problems in one economycan have a spill-over effect in another.

Mr Peter Bone (Wellingborough) (Con): Is the FinancialSecretary saying that the taskforce document that Ihave, dated 21 October, has been rewritten? It concludes:

“Endorsement by the European Council of the recommendationsin the present report will contribute to strengthening economicgovernance in the EU”.

It clearly says “in the EU” as a whole.

Mr Hoban: But the sanctions regime relates only toeurozone countries, and no sanctions can be imposedon the UK. All that the document is referring to iscontinuation of the macro-economic surveillance thathas been taking place over the past 10 years.

Mr James Clappison (Hertsmere) (Con): My hon.Friend is making his case persuasively, but will he assistme? The same document from Mr Van Rompuy, dated21 October—I take it that that is the latest report—clearlystates in paragraph 34:

“The Task Force recommends deeper macro-economic surveillancewith the introduction of a new mechanism underpinned by a newlegal framework based on Article 121”

of the treaty on the functioning of the European Unionalongside the stability and growth pact“applying to all EU Member States”.

Perhaps my hon. Friend will help the House by tellingus a little about that.

Mr Hoban: I know that that paragraph has causedsome interest, but many people stop reading after“by a new legal framework”.

I am grateful that my hon. Friend did not fall into thattrap. The provision is based on existing treaties, and it isabout macro-economic surveillance. A number oforganisations conduct macro-economic surveillance ofthe UK economy, and there is nothing new in that.

Michael Connarty (Linlithgow and East Falkirk) (Lab):I hope that the Financial Secretary realises that we arehere to support him in a sensible approach to economicsurveillance. Does it not seem rather silly for people tosay that a country that is in partnership with manyother countries should not be interested if any of thosecountries are profligate? Clearly, good surveillance andgood economic policies throughout the partnership aregood for the UK.

Mr Hoban: The hon. Gentleman makes an importantpoint, and I am about to come to that, so his interventionis timely. Given the degree of integration of the Europeaneconomy, it is in our national interest to support workthat looks at the causes of instability and to have inplace action to help to tackle them. Over the summer,there have been two parallel processes in Europe. TheCommission has its own work stream, which is summarisedin the documents before us. However, member stateshave participated in a separate strand of work on theco-ordination of economic policies under the chairmanshipof Herman Van Rompuy. Many of the issues coveredare the same, but there are essential differences betweenthe two streams. The Commission’s documents detailsolutions, and the Van Rompuy work reflects the politicalagreements reached between member states. The nextstep is to bring the Commission’s proposals into linewith the taskforce’s recommendations.

I shall deal in more detail with three aspects of thetaskforce’s work.

Mr Bernard Jenkin (Harwich and North Essex) (Con):Is my hon. Friend giving an assurance that not only arethere no sanctions—we understand that—but there isabsolutely no increase in EU jurisdiction over the BritishBudget-making process?

Mr Hoban: No, there is not, and I shall come to thatin more detail. As far as I am aware, there is nodifference in the power that the House has to set theBudget for the United Kingdom.

Mr Jenkin: I am sorry, but I must insist on theMinister giving way again. Is there any increase in EUjurisdiction over the British Budget-making process asa result of these arrangements? Yes or no?

Mr Hoban: I do not believe that there is.Let me deal with the three aspects. In every international

economic debate, the issue of increased co-operationand co-ordination arises. At last month’s G20 FinanceMinisters conference, the focus was on exchange ratesand current account surpluses. At the IMF annualmeeting in early October, there was considerable debateabout tackling deficits. Those discussions of macro-economic policy are not a new feature of the crisis. Forexample, since its inception, the IMF has undertakenregular reviews under article 4 of macro-economic policiesand made recommendations on policy response, butthey are not binding. The EU has had similar proceduresin place for a decade. It is in all our interests for there tobe economic stability in Europe, and the process needsto be strengthened. What we are doing is simply renewingthe existing framework in the light of the economiccrisis and updating that tools that we have, to ensurethat we can do what we need to do. The measure willbroaden the scope of surveillance, but, as far as the UKis concerned, it will not weaken the sovereignty of thisParliament.

Risks to stability often flow from imbalances in theeconomy, and it is important to look at factors such ascurrent account balances, labour market flexibility andcompetitiveness across the European Union and to beable to identify problems that could undermine stability.Macro-economic surveillance has an important role toplay as an early-warning system.

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Mark Hendrick (Preston) (Lab/Co-op) rose—

Mr Redwood rose—

Mr Hoban: I should like to make a bit more progresson this point.

It is right that we should co-operate with this process,but our co-operation should be consistent with thefiscal sovereignty of the UK. The information that weprovide to assist with the surveillance will always beinformation that has been made available to this Housebefore it is passed to the Commission. Everything thatthe Commission gets will have been in the public domain,to the extent that a member of the public will have beenable to unearth the same data using Google, albeit withless efficiency.

Mark Hendrick: The information might be availableelsewhere, but the Minister will know that, as a result ofthe proposed new regulation Com. (2010)526, there willbe an obligation for the UK to provide far more informationthan it has done in the past. There may not be penaltiesinvolved, and we may well run up budget deficits orlevels of debt that were unacceptable to the Commission—Iam sure we can do that—but the point is that thiscountry will be obliged to provide far more informationformally to the Commission than it has in the past. Inmy view, that constitutes a degree of transfer of powerto the Commission.

Mr Hoban: Let me repeat that this involves informationthat is already out there in the public domain. It isinformation that will already have been made availablethrough, for example, the House of Commons Library,the Budget documents, the Red Book or the GreenBook. It is information that is already out there, so I donot believe that supplying it will be a problem.

Mark Hendrick: The point is not that the informationwill have been made available elsewhere; it is that therewill be an obligation on the Government themselves tomake it available. If the Commission wanted to go outand find it elsewhere, I am sure that it would do so, butthere will now be a new obligation on the Government,as a result of a new treaty, to give it information thatthey were not previously required to give.

Mr Hoban: I simply do not take the view that givingthe Commission more information is going to be aproblem. This goes back to the intervention by my hon.Friend the Member for Harwich and North Essex(Mr Jenkin), who asked whether there is to be anincrease in EU jurisdiction as a result of this measure.No, there is not. All that the EU will do is makerecommendations, but they will not bind us or be imposedon us. We can simply ignore them. There will be noincrease in EU jurisdiction as a consequence of thismeasure.

Mr Cash rose—

Mr Redwood rose—

Mr Hoban: I am being bombarded by requests to giveway. I shall give way first to my hon. Friend the Memberfor Stone (Mr Cash).

Mr Cash: The explanatory memorandum dealingwith the jurisdictional question, which was supplied tothe European Scrutiny Committee on 23 October, states,under the heading “Impact on United Kingdom Law”:

“The Regulations once adopted would be ‘binding in theirentirety and directly applicable in all Member States’. However, inaccordance with Article 1 of the proposed Regulation, the Regulationon enforcement measures will apply (only) to the Member Stateswhose currency is the euro.”

That is made absolutely clear by the Minister’s owndocument that he supplied to the Committee.

Mr Hoban: Hon. Members should think about thiscarefully. All that we are doing is providing moreinformation to the Commission, and it is informationthat is already in the public domain and that has alreadybeen presented to Parliament.

Mr Redwood: Will the Minister confirm that there aretwo big new regulations that relate directly to the UnitedKingdom? One relates to budgetary surveillance on allmember states, and the other relates to enforcementagainst “macro-economic imbalances”, as the Commissionso elegantly describes them. These are new powers innew regulations. Why are the Government consentingto them?

Mr Hoban: The enforcement point does not apply tothe United Kingdom as a consequence of protocol 15of the existing treaty framework, because we have optedout of that part. My right hon. Friend is knowledgeableabout these things, and he will recognise that theCommission makes proposals, and that ECOFIN andthe European Council have set out a clear policy frameworkon this, as reflected in the conclusions of the VanRompuy taskforce, which make it very clear that sanctionsdo not apply in the UK.


Mr Hoban: Let me make some more progress; otherwise,hon. Members will not have the opportunity to participatein the debate. Let me continue for a few more moments.

Many organisations and individuals, including theIMF and the OECD, scrutinise our economy and ourbudgets. Many make recommendations or, as happenedrecently, praise our fiscal consolidation plans. We havenothing to hide from any of these bodies that want tolook at what we announce to Parliament or at theeconomic figures published through the Office for NationalStatistics or through Departments. It is our decisionwhether or not we listen to their advice. The UK willcontinue to prepare its Budget independently; otherscan make recommendations about it, but, crucially, weare under no obligation to take action and, by virtue ofour opt-out, we are not subject to sanctions. Anyrecommendations, as with those made by any otherbody, will remain just that. It will be down to theTreasury and Parliament, not to the EU, to constructour Budget.

Lady Hermon (North Down) (Ind): I am enormouslygrateful to the Minister for taking my intervention. Asthe hon. Member for Stone (Mr Cash) said, theseregulations are entirely binding on the United Kingdom.Can the Minister assure us that, if the Governmentdecline to give the information requested under these



regulations, the European Commission will not takeenforcement proceedings against the UK Governmentfor not complying with them?

Mr Hoban: I do not see the point of not sendinginformation that is already in the public domain. Whywould we be so churlish as not to send out stuff thatcould be got from Google or from the Library or bytabling a written question to the Prime Minister?

Andrew Percy (Brigg and Goole) (Con): I am gettinga little confused. If the information is already in thepublic domain and any organisation can find it, and ifwe do not have to listen to any recommendations made,what is the point of our agreeing to this?

Mr Hoban: Given that the process is very straightforward,I begin to wonder why it is causing so much excitement.The reality is that the information is already availableand the recommendations do not apply to us. Theenforcement mechanism applies to eurozone states; theyare subject to sanctions, but we have a carve-out fromthat because of protocol 15.

Michael Connarty: May I suggest to the Minister thatone of the attractions of the new procedure is that everycountry in Europe will have to carry this out? Theywould find out well before any crisis—as we saw inGreece, for example—that they were in trouble. It is alittle bit of information to give and a lot to get back. Ithink that the “Euro-loony party” contingent shouldleave the Conservative party, so that people with somecommon sense can deal with Europe sensibly.

Mr Hoban: I am not going to go down that route, butit is important that information be available. Over thecourse of the financial crisis—not just in the EU, butglobally—we have seen the importance of understandingstructural imbalances and their impact on other economies.This is an important strand of debate and it will becontinued when the G20 meets later this week. It wascertainly an important strand in the G20 Finance Ministers’meeting last month, and, indeed, in the IMF’s annualmeeting in October. There is nothing new in discussingthese issues.

There is an existing mechanism for surveillance inplace through the broad economic policy guidelines,but the warning mechanism has been used only twice: itwas used for Ireland in 2001, and Greece received awarning in February this year. An improved mechanismwould help towards achieving greater economic stabilityand it is particularly important for the eurozone, wherethe effects of imbalances and instability have a greaterimpact on its members, as has been apparent in recentmonths. That is why eurozone member states support asanctions regime, penalising eurozone members whoseeconomic policies undermine the stability of the currencyand the eurozone economy. The sanctions do not applyto us, as I have said. I give way—

Mark Reckless (Rochester and Strood) (Con) rose—

Mr Speaker: Order. Before the hon. Gentlemanintervenes, I note that the Minister has been on his feetfor 21 minutes and has attended most assiduously to anumber of interventions, and that is perfectly in order.However, I emphasise that there is an hour and a half

for this debate, and a substantial number of Back-BenchMembers have indicated to me that they wish to speak.It would be a very sad and unsatisfactory state of affairsif contributions from those on the Front Bench were toexceed in total those from Back Benchers. On that basis,I feel sure that the Minister, who is an adroit fellow, willbe bringing his remarks to a close ere long.

Mr Hoban: I thank you, Mr Speaker, for thatencouragement and guidance, and I apologise for beinggenerous in taking interventions. Let me make rapidprogress.

On the issue of sanctions, the same principle appliesfor those eurozone countries that are in breach of thestability and growth pact excess deficit procedures. Inthe run-up to the crisis, there was a lack of fiscaldiscipline, for those inside and outside the euro. Despitethe existence of the stability and growth pact and theexcess deficit procedure, the eurozone was still underminedby a failure to exert fiscal discipline, and a number ofmember states in the eurozone have to take toughaction to tackle the deficit.

To avoid a recurrence, the Commission and memberstates in the eurozone have sought to reduce the discretionon the application of the sanction process. The positionreached by eurozone countries is set out in the taskforcereport. Again, it is worth reminding the House that thesanctions regime does not apply to the UK by virtue ofprotocol 15 of the current treaty.

Mr Edward Leigh (Gainsborough) (Con) rose—

Mark Reckless rose—

Mr Hoban: I will not give way. I listen carefully to theguidance of Mr Speaker.

To secure fiscal discipline, strong fiscal frameworksare required, as our experience in recent years demonstrates.The fiscal rules developed by the previous Governmentfailed, because their flawed design and remarkable flexibilitymeant that, despite the rules being met, this country stillended up with a financial crisis. A strong fiscal frameworkis necessary if we are to have strong public finances. Wehave shown leadership on that, for example in creatingthe Office for Budget Responsibility, which has beenwelcomed by the IMF and the European Commission.Our reforms meet the highest possible standards, andwe support responsible fiscal rules at home and abroad.We have achieved that through the mandate the Chancellorset in his emergency Budget.

Mark Reckless: Will the Minister give way?

Mr Hoban: Although strong fiscal frameworks arevital, we also believe that fiscal sovereignty is crucial,and that is why the frameworks—the mandates, mechanismsand institutions—should be decided by nationalGovernments and not by European legislation. Thatposition is reflected in the taskforce report, and it is theposition that we will adopt in discussions with theCommission.

Mr David Davis (Haltemprice and Howden) (Con):Will the Minister give way?



Mr Hoban: We have protected the sovereignty of theHouse on fiscal matters, and our position on EU economicgovernance is clear. We need better macro-economicsurveillance and fiscal frameworks, because stable andsustainable economic growth across Europe is in thelong-term interest of this country. However, that shouldnot be at the cost of our fiscal and economic sovereignty.The Van Rompuy taskforce updates and strengthensthe existing framework. On surveillance, therefore, thetaskforce recognises, with explicit references to protocol15, that the UK’s opt-outs mean that we are not subjectto the sanctions regime.

Fiscal frameworks should be stronger, but should notbe dictated by Europe. It is the history of this House todefend fiercely our fiscal sovereignty. Through the agreementreached, the Government have achieved that. No sanctionswill be imposed on Britain, and we will be free to set theright fiscal policies for our country’s needs.


Mr Speaker: Order. Members are free to try to intervenewhenever they wish, and Ministers can respond accordingly.I simply want it to be understood that the House can doas it wishes, but it should do so with its eyes open.

Mark Reckless: On a point of order, Mr Speaker. Didnot the Minister agree to take an intervention, beforethe intervention from the Chair?

Mr Speaker: That is not a point of order at all. Thehon. Gentleman should resume his seat and not dilate.Mr Christopher Leslie.

5.29 pm

Chris Leslie (Nottingham East) (Lab/Co-op): Thankyou very much, Mr Speaker.

Lurking on the future business section of the OrderPaper for some weeks has been a motion for the Houseto note the European Union taskforce report on Europeaneconomic governance. Although that gestation periodseems to have been overtaken by the events that havetranspired following the European Council, it is a pitythat an urgent question from the hon. Member forStone (Mr Cash) was required before light began to beshed on any of the details being considered by the realpower brokers in Europe. Our Prime Minister wasclearly left on the sidelines in many of the discussions. IfI were generous, I might say that that was fair enough,given that we are outside the eurozone. However, theEuropean Council meeting at the end of October showedclearly that the Germans and the French are very muchin the driving seat, leaving the Prime Minister with afew scraps to hold aloft as pseudo-trophies in the EuropeanUnion budget discussions while clearly being unsurehow to cope with the prospect of a new treaty beingdropped in his lap.

Mark Reckless: As the Front Benches appear to be inagreement on this issue, may I ask the hon. Gentlemana question? Surely the point is that, as he said, Franceand Germany, which are in the eurozone, need somethingfrom us. We had a veto, yet we agreed to thisnotwithstanding the veto. The 2.9% had already beenagreed by the Council. We had a veto on the NextPerspective. What do we get in return?

Chris Leslie: I shall deal with the nature of thechanges in a moment—and there are changes. It wouldbe a bit disingenuous to suggest that nothing is changingin this regard.

From our point of view, eurozone stability and asensible crisis mechanism are worthwhile, and it is clearlyin our national interest to engage strongly in discussionsand reforms that promote economic stability acrossEurope. We will support sensible changes that benefitthe United Kingdom. The core idea of improving therescue mechanisms for eurozone countries facing severeeconomic difficulties makes logical sense, and it is alsowise to find a permanent footing on which to base anynew rules rather than relying on temporary arrangementsthat might either expire or be subject to legal challenge.However, the Prime Minister and the Government areprotesting just a little too much that this is entirely amatter for the eurozone, and absolutely nothing to dowith us. In fact, there are indirect implications for oureconomy because of changes that might affect economicgrowth in the eurozone, as well as direct policy implicationsthat could change the way in which we operate in theUnited Kingdom.

Mr Jim Cunningham (Coventry South) (Lab): Myhon. Friend will recall that the previous Prime Ministerand his Government drew up five economic tests. Had itnot been for him, we would not be debating the motiontoday, because we would be part of the eurozone.

Chris Leslie: It was certainly worth punctuating thedebate with that point, which my hon. Friend madeforcefully and well.

Mr Leigh: Will the hon. Gentleman now kindly respondto the intervention from my hon. Friend the Memberfor Rochester and Strood (Mark Reckless)? Is the Labourparty prepared ever to fight for a repatriation of powers,and would it be prepared to use the veto that it has usedfor the purposes of this measure as a bargaining chip togain that repatriation of powers?

Chris Leslie: Our perspective is clearly different fromthat of the hon. Gentleman. I want to consider what ison the table. There are details still to come when theEuropean Council meets in December, and we shallhave to look at those proposals then. It seems to me thatthere is a case to be made for some sort of objectiveanalysis of just what transfers of policy may or may notbe involved in the proposals that are before us today.

Philip Davies: Does the hon. Gentleman think itmakes sense for an organisation whose accounts havenot been signed off by auditors for 16 consecutive yearsto be given more powers over economic and financialgovernance?

Chris Leslie: The hon. Gentleman has made his pointin his own inimitable way, but I do not want to bediverted from the substance of what is before us. Thereis a substantial proposition on the table, and I think it isimportant for all Members to understand it. The detailthat will eventually emerge from the final taskforcereport is important, and it would be useful if theMinister could deal with some of the question marksthat hang over some of the detail, to which Membershave already alluded.



For example, a series of new fiscal disciplines—asthey are called—will be pursued across the EuropeanUnion but, of course, largely for eurozone countries;yet the adoption of enforcement measures will apparentlybe subject to the negative qualified majority votingprocedure. That presumably means that the UnitedKingdom will take part in any of those decisions. If thatis so, can the Minister say how we will inform our policyposition if we are involved in votes on enforcementmeasures? While we may not have a vetoing power here,our role could be strategically significant.

Kelvin Hopkins (Luton North) (Lab): My hon. Friendis using terms like “largely” and “presumably”. Theseare not definite enough for me. Please will he be firmerand clearer in what he is saying?

Chris Leslie: I wish I could be firmer and clearer, butwe are dealing with a malleable set of proposals. Thebundle of directives keeps changing, moving andmorphing from phase to phase, and the directives willclearly go into a different phase when the EuropeanCouncil meets in December, but we can discern therough direction of travel, and many Members will takea firm view on that.

The Minister talked about the sanctions. Yes, it is thecase that they may not apply to the UK because of ouropt-out from the euro, but the range of non-bindingstandards and early warning requirements in the eventof significant deviation from the adjustment path apparentlywould apply to the UK; I should be grateful if theMinister would confirm that that is the case. Even if theUK is to be subject only to such commentaries, publicobservations or other non-binding standards, the Ministershould tell the House how they would work and whatthe implications for us would be. Clearly, what thetaskforce report calls the new reputational and politicalmeasures will be phased in progressively, but is it correctto read the proposals as also applying to the UK? Inother words, is it not true that we will be subject toreporting requirements, potential formal reporting tothe European Council in certain circumstances andenhanced surveillance—whatever “enhanced” maymean—if the situation dictates? Is it not also true thatwe will be subject to onsite monitoring from a missionof the EC—which I thought was curious, and whichcertainly might be of interest to some ConservativeMembers—and possible publication in the public domainof these reports and surveillance? Will the proposedregulations to strengthen the audit powers of Eurostatalso apply to the UK, and what are the anticipatedcompliance costs of those changes for the UK and theTreasury? If we fail to comply with the proposedrequirements, is it not the case that sanctions could beapplied to the UK?

Mr Redwood: If this House and a properly electedBritish Government have chosen a certain course ofaction on the deficit or the balance of payments—or onwhatever—how does it help to have the EU marking thehomework, condemning it and using moral suasion tosay that this House is wrong?

Chris Leslie: Well, my point is that it may or may notbe a sensible move—and as a pro-European I thinkbenefit could come from it—but what is important isthat we get clarity from the Government about what

exactly is on the table. If there are to be treaty changesand other new regulations, the Minister has to be straightabout that with the country and the House. The latestsanctions in the framework—in terms of interest bearingdeposits, non-interest bearing deposits and eventualfines—may not apply to the UK, but there is a firstphase to that process which is the application of standardsand assessments of our economic and fiscal position,and that will apply to the UK. The motion seeksapproval for the Government’s position that any sanctionsshould not apply to the UK because of our euro opt-out,but there are developments here that strengthen the roleof the EU in respect of our economic policy, and whilethat may be a good thing, some Members of this Housewould be wary of it.

There are also wider implications for our economyand our growth trajectory. For example, I am particularlyintrigued by the German argument that bondholdersshould have greater liability—such as in the form ofinterest payment holidays, or bond value haircuts, asthey are known—for potential future eurozone bail-outs.The implications for UK banks and bondholders couldbe significant if they are embroiled to a larger extent inthe crisis management mechanism. UK banks holdparticularly high proportions of Irish and Spanish liabilities.A recent Bank for International Settlements reportfound that 22% of Irish bonds and 11% of Spanishbonds are in UK hands. There has been much discussionof whether City investors are therefore subject to higherrisk, or whether the markets have already priced that in.Either way, there are indirect implications for Britishinvestors. Moreover, the new suite of policy changesaffecting eurozone economic governance will not justbe on paper; the changes will bite in the real economiesin each of the eurozone countries and could have abearing on their own internal growth and investmentplans.

Mark Hendrick: My hon. Friend hits the nail on thehead. While the UK may not be signed up to thestability and growth pact and we may not be subject toEU deficit procedures, stability and growth in the eurozoneare very important to the British economy. Moreover,the way in which the Government are dealing with ourdeficit will put British growth at risk, and that is partand parcel of how we interact with the other economiesin Europe.

Chris Leslie: My hon. Friend makes a strong point. Iffiscal policies across the eurozone are simultaneouslyshifted towards a marginally more deflationary stanceas a result of the new policy framework that we aredebating tonight, the resulting contraction in economicactivity and consumer spending could impact on thesale of British goods and services in those countries. Inother words, the eurozone—which, as we know, is by farthe UK’s largest trading partner, accounting for morethan 50% of our exports—could face economicchallenges and, in turn, it is likely that UK companieswill face problems exporting to those markets. Add tothat the G20 discussions on international currency issuesand an influx of capital to the eurozone followingworries over the dollar and the Chinese renminbi andwe can imagine a relative appreciation of the euroafflicting our exporters still further. We will have to seehow that latter issue pans out in particular, but this is ofsignificance to the UK.



Mr Jenkin: Is the hon. Gentleman arguing that somehowthese arrangements will give us more influence andmore control over the economies of other memberstates? On that basis, should we therefore not be seekingto enter into arrangements of the same sort with, say,the United States, so that we can control its deficit? TheUS deficit will have far more effect on our economythan any individual deficit in any individual memberstate of the EU.

Chris Leslie: Those of us in opposition are merelyasking questions and scrutinising what is on the table,but we are trying to find out what will be the impact onthe UK. Ministers are arguing, “Don’t worry, absolutelynothing changes and there is no impact whatever.” Asfar as I can see, there are strands and suggestions thatthere will be an impact, both direct and indirect. In thatrespect, although we might have different views, theremight be a point on which we can agree.

If the eurozone deflation and the shrinkage of Europeaneconomic markets affect our exports, that matters, becausethe Treasury has depended on them so greatly. The JuneBudget and the spending review were predicated on areturn to strong economic growth here in the UK,based principally on higher business investment andstrong export growth. The Office for Budget Responsibilityanalysis shows that the cuts imposed because of theChancellor’s austerity programme and his overly speedydeficit reduction strategy will see private consumptionshrink rapidly and Government consumption doingthe same.

Cuts in domestic expenditure will hit growth—thatmuch is clear—but the Chancellor has bet the shop onthe countervailing growth in trade and business investment.The Treasury states clearly that it needs £100 billion ofgrowth in exports and business investment, yet the lasttime we saw such a massive rate of growth for exportswas in 1974 and we achieved that rate of improvementin business investment only in 2005, but the Chancellor’ssums depend on the UK achieving both those recordlevels in each of the next three years—a very tall orderindeed, equivalent to tripling our exports to the US andseeing our exports to China grow 20 times or to India40 times.

Clearly, our reliance on the eurozone’s appetite forour exports is central to the Chancellor’s strategy, sothere are implications for British fiscal policy here.

Kelvin Hopkins: I thank my hon. Friend for givingway yet again. He focuses on trade, but it is in trade thatwe have our worst possible relationship with the rest ofthe EU. We have a gigantic trade deficit. We buy billionsmore from them every month than they do from us. Theonly advantage we have had in the last year or two isthat we have depreciated the pound relative to the euroand we have started to see a slight improvement in ourtrade balance with the EU.

Chris Leslie: If we see growth dented here in the UKbecause those ripples flow from the eurozone—changesas a result, perhaps, of the measures we are debating—wecould see further implications for spending cuts here inthe UK in respect of vital public services and moreausterity when perhaps stimulus would be the order ofthe day. However, there is a balance of risks here and itis clearly important for fiscal discipline to be exercised,

but responsibly so. We have argued for a sensitive andmeasured approach to deficit reduction in this country,rather than the doctrinaire approach of steep and swiftcuts favoured by the parties whose Members sit on theGovernment Benches.

I am glad to note the ironic analysis of the Ministerin the explanatory memorandum that was referred to,which he signed last week. He said that he believed“that the main consideration should be whether a Member State’sdebt is on a downward trajectory, rather than the specific pace ofannual debt reduction”.

He also said that the numerical pace should remain“only as an indicative benchmark…that…is not used as a concreterule by which Member States’ debt reduction plans are judged.”

How right he is—if only he applied such pragmaticsense to our economy and public services in the UK, too.

Claire Perry (Devizes) (Con): I am enjoying the hon.Gentleman’s measured canter around the potential risksassociated with this legislation and I am also entertainedto hear the words “stability and growth” coming fromthe Opposition Benches—something that perhaps theydid not achieve towards the end of their time in office.However—perhaps I am front-running his conclusion—ishe going to vote for or against the legislation tonight?

Chris Leslie: As I see it, it is difficult to know yet whatpropositions are before us. I want to hear the Minister’sanswers to our questions and we will make up ourminds then. The substance of the regulations and theeventual treaty changes might be beneficial, but we alsohave to wait and see what President Van Rompuyproposes in his eventual treaty amendment and whatemerges from the December Council meeting. We arenot at the end of a process; we are in it. There arefurther propositions to be put on the table.

Mark Hendrick: One regulation that might well be onthe table is for any member state of the EuropeanUnion, within or outside the eurozone, that has a debtlevel of greater than 60% of GDP to reduce that debt ata rate of at least 5% per annum. That could well be aregulation that the Government sign up to, even thoughthey might not be subject to penalties if they do notkeep to it.

Chris Leslie: Indeed. There could be significant directpolicy changes as regards transfers of policy and alsoindirect economic impacts on the UK. We have to seemore detail about what will emerge from those who arein the driving seat—unfortunately, that does not seemto be either our Chancellor or our Prime Minister.

Matthew Hancock (West Suffolk) (Con): Will thehon. Gentleman give way?

Chris Leslie: I want to make a bit of progress—but itis too tempting.

Matthew Hancock: I am extremely grateful. The Ministermade a clear statement that this House, under thisGovernment, will retain fiscal sovereignty. Would thehon. Gentleman?

Chris Leslie: We take the view, as we always have, thatwhere it was in the British interest to co-operate withour European colleagues, we would do so. The hon.Gentleman’s continuing loyalty to the Chancellor is



laudable—he has a record of that—but I am not surethat he has convinced the colleagues on his own side.The coalition remains precarious on Europe, straddlingso many major divisions on how to proceed. It is littlewonder that the Prime Minister is on the margins ofthese discussions in Europe when he is buffeted betweenthe margins of his own Government. He is caughtsomewhere between the pro-European enthusiasms ofthe Deputy Prime Minister—at least, that used to be hisposition before the general election, and I am not quitesure what his position is now—and the anti-EuropeanUnion noises from a sizeable chunk of his party. Willthe Prime Minister persuade his colleagues that anytreaty should not require a referendum? We shall haveto wait and see. Although the Government might beconcentrating on papering over the cracks in the coalition,the Opposition will monitor closely the impact of thesechanges on exports, growth, jobs and the prosperity ofthis country. Those are the issues that matter to ourconstituents and they are our priorities.


Mr Speaker: Order. We have fewer than 45 minutesand approximately 15 Members are seeking to catch myeye. Right hon. and hon. Members can do the arithmeticfor themselves, but a certain economy will be required ifmany are to be satisfied.

5.48 pmMr William Cash (Stone) (Con): This debate and the

Minister’s remarks remind me of what Alice said in“Through the Looking-Glass”, when she referred toHumpty Dumpty and his rather scornful tone:

“‘When I use a word,’ Humpty Dumpty said…‘it means justwhat I choose it to mean—neither more nor less.’

‘The question is,’ said Alice, ‘whether you CAN make wordsmean so many different things.’

‘The question is,’ said Humpty Dumpty, ‘which is to be master—that’s all.’”That is the essence of the question of European economicgovernance. We have been told that it is good for us,that it does not affect us and that it does not make adifference. However much one gets into the interpretationof those words, the European Scrutiny Committee’sreport makes it clear that there are significant differences,in aggregate, between different parts of the regulationsand directives. If the proposal is accepted by theGovernment, they will effectively cross the Rubicon andsimilarly, by acquiescing in ever-greater Europeangovernance over our economy, they will significantlyundermine our ability to govern ourselves. We need lessEurope, not more.

The proposals extend to the United Kingdom, as amember of the European Union, thereby raising questionsof sovereignty. Under the aegis of the forthcoming Billon the European Union, my Committee will hold aninquiry so that we can sort out once and for all whetherit is the House of Commons, Parliament and thatsovereignty which governs the country, or whether it isthe European Union. Under Standing Orders, theCommittee’s duty is to report to the House, not to theGovernment, on matters that we regard as requiringdebate by reason of their legal or political importance.The scrutiny reserve remains in place until the debatehas taken place, and thereafter Ministers can, and nodoubt will, vote and/or agree the proposals, but maycontinue negotiations.

I was glad that the Minister’s explanatory memorandumstated specifically, on several vital matters, that theGovernment would“seek to ensure in negotiations”

that matters of concern would be improved. In doingso, the memorandum by definition conceded that theseissues have not been resolved entirely, that negotiationscould improve them, that they do make a difference tothe United Kingdom, its Government and its Parliamentand that they have to be remedied. As Chairman of theCommittee, I have placed in the Library a note in myname on all these matters, so anyone who wishes tolook at them may do so.

I was puzzled by the Prime Minister’s response to aquestion that I asked during his statement to the Houseon the outcome of the European Council meeting. Heaccepted that the matter was complex and required agreater opportunity for exchange of opinions andexplanation, but he also said:

“This is not a new framework.”—[Official Report, 1 November2010; Vol. 517, c. 614.]

I find that extremely puzzling, however one construes it,given the evidence before us and the specific referenceto a new surveillance framework in the taskforce reportand in the presidency conclusions that he signed off.The truth is that the Commission intends to exert peerpressure on all member states of the European Union.The taskforce report of 21 October preceded documentsbeing placed in the Library, following an urgent questionI asked, emblazoned with the word “limité”, whichmeans very restricted circulation. They included a letterof 9 July from the Chancellor of the Exchequer to othermember states. It might be thought that there was everyreason to present those documents to the EuropeanScrutiny Committee, even if they were not specificallydepositable. The Committee does not operate by website.

A substantial question on whether the UK is affectedhas been dealt with in a note that I received from theLibrary, from which I shall quote, on increasedmacroeconomic surveillance. It says:

“It is proposed that a greater role is played by the Commissionin macroeconomic surveillance. This surveillance mechanism wouldbe distinct from that currently taking place under the SGP”—

the stability and growth pact—“because it is non-fiscal in nature; it will focus on countries’broader macroeconomic positions in relation to the rest of theEU.”

The note goes on:“The idea of deeper macroeconomic surveillance was put

forward in March this year as part of the…Europe 2020 proposals”,

which were, of course, under the previous Government.The note continues:

“As originally envisaged, the deeper surveillance frameworkwould apply only to the euro area countries; however, the Commissionproposals of 30th June”—

after the general election—“and the Task Force Report of 21st October”

both apply to “all Member States”. That is a matter ofconsiderable concern. Why have the coalition Governmentagreed to extend the framework to all the memberstates, whereas the previous Government appear tohave confined it exclusively to the euro area? As myhon. Friend the Member for Hertsmere (Mr Clappison)said, the taskforce recommends deeper macroeconomicsurveillance, with the introduction of a new mechanism



[Mr William Cash]

underpinned by a new legal framework based on article121. The Minister’s explanatory memorandum specificallyrefers to the legal impact and therefore the jurisdictionof these matters, as I have already mentioned, whichclearly shows that there is a legal impact on the UK.Therefore, by definition, the proposed mechanism affectsthe UK and hands over jurisdiction in these matters tothe European Court of Justice for interpretation andconstruction.

Furthermore, it is possible, and even likely, that thestricter reporting requirements will apply to the UnitedKingdom under the macroeconomic surveillance proposals,particularly if the UK were placed in an excessiveimbalance position. We have always conceded, rightfrom the beginning, way back to the time of the Maastrichtrebellion, that there would be no sanctions because ofthe opt-out that we achieved. The fact that the Governmentcontinuously state that it is a victory not to have hadsanctions imposed is merely a statement of the obvious.I go further. I would be grateful if someone could tellme which member states have ever paid any fines or hadany sanctions imposed upon them under any of thesearrangements. The answer is none, and there are thosewho argue that there never will be.

We are in a difficult situation with regard to how wewill vote on the motion. Serious questions arise, and Iwas concerned when I read the letter and the appendeddocument from the Chancellor of the Exchequer, whichI had to extract by way of an urgent question, for whichI was most grateful, Mr Speaker. In that, there is adescription of economic governance, the words of whichwould not be easily understood. It states:

“Democratic legitimacy is vital to everything that the EU does,and Ministers need to be accountable both to other MemberStates and to their electorate.”

I find that a new and strange doctrine, and a ratherdangerous one. I had no idea that Ministers wereaccountable to other EU member states. It is conceded,and I agree, that the United Kingdom Budget will bepresented first to the UK Parliament, but the essence ofthe problem is that in the compilation and the constructionof the Budget, a series of data and statistical informationwould have to be provided. That in itself creates theframework that constricts our ability within ourparliamentary process to act on our own terms and inline with the principles that underpin our parliamentaryGovernment—that matters of taxation and spendingand the formulation of them depend upon the House ofCommons, not upon the European Union.

Given the significance that has been attached to theseideas, they represent a drift and an acceptance of Europeaneconomic government through the surveillance frameworkby increasing the powers available to the Commission.This does not in any way alter the degree of intrusioninto the construction of our Budget before it is presentedto Parliament. One of the most difficult aspects is thatfar from our having a need for much less Europeaneconomic governance, we are having more. As we movefurther forward and become more absorbed into thisarrangement, we have to ask what is actually happeningin the EU itself. As one of the other national Europeanscrutiny committee chairmen said to Mr Van Rompuywhen I was in Brussels the other day, “Will the EuropeanUnion go bankrupt if we refuse to obey your rules?”

Other member states are beginning to get the message,which is why I think Mr Van Rompuy issued thatassault on Euroscepticism throughout Europe. He isgetting the message that people in national Parliamentsare not prepared to accept, for example, the fact thattheir economies have failed because of the EU’s refusalto deregulate and repatriate. I mention in brief theDeputy Prime Minister’s remarks on that subject, becausehe clearly stated that there would be no repatriation,despite what my right hon. Friend the Prime Ministerasserted in his speech to the Centre for Policy Studiesin 2005.

We need to generate enterprise for small and medium-sized businesses. There is the failure of the Lisbonagenda, massive unemployment, of more than 20% insome countries, riots, protests and a sense of failure,despair and democratic hopelessness. This is reflected—

Mr Speaker: Order. The hon. Gentleman is strayingvery considerably wide of the matters under discussion.I know that he is a sensitive fellow and will be aware ofthe significant number of other Members who wish tocontribute, so I feel sure that, in bringing his remarks toa fairly early close, he will focus on the matters that arebefore us, rather than those that are not.

Mr Cash: I entirely accept that and will bring myremarks immediately to a conclusion.

Rules and regulations will not turn the EuropeanUnion into a thriving economy with which we trade. Itis said that 50% of our trade is with the EuropeanUnion, and that the proposals before us are necessaryto achieve stability in the European Union. The crucialpoint is that, underneath all those rules and regulationsand the determination to achieve European economicgovernance, we are going the wrong way, not the rightway. The measures do affect us. We need more enterprise,more small businesses, more deregulation and repatriation.I am not surprised, therefore that in a recent opinionpoll 80% of people said that they wanted the repatriationof powers from the European Union.

We are being more and more absorbed by a failedEuropean Union. Under this coalition, roadblocks arebeing put up to prevent us from sorting that out, andthe new surveillance framework is part of the problem,not the solution. I shall vote against the motion.

6.2 pm

Austin Mitchell (Great Grimsby) (Lab): I shall jointhe hon. and long-winded Member for Stone (Mr Cash)in the Lobby tonight, because, whatever our FrontBenchers say, there is enough lead in my pencil to realisethat the proposals should be opposed, and that theGovernment’s long-winded motion is unacceptable.The measures will impose additional obligations on theUnited Kingdom, but I shall not go into them, becausemy hon. Friend the Member for Nottingham East(Chris Leslie) made the main point. It is a question notso much of the obligations, but of the economic effectsof the measures on European markets.

Even if, as the Minister said, the measures are enforcedonly on eurozone states, they will still have an economiceffect on us, because when discipline is tightened in theeurozone, there is eurozone deflation. That is already inprogress. It was built into the exchange rate mechanism,and it is now built into the euro, because Germany hasabnormally low inflation. Germany has a marvellous



co-operative arrangement with the unions and withindustry. It has heavy investment, powerful producersand abnormally low inflation, but because all the othereurozone states, which have customarily had higherinflation, wage inflation and costs, are involved in thesame currency, they are forced to deflate to Germanlevels. In other words, the euro is a deflationary mechanismthat forces other nations down to the abnormally lowrate of inflation in Germany, and that has consequences.They are all increasing unemployment, cutting publicspending and deflating their economies, and thereforethe demand for Germany’s powerful exports falls.

Our exports are also affected. We now need a periodof export-led growth, having not had that and havingbuilt up an enormous deficit in the European EconomicCommunity. The 25% devaluation that we have experiencedbecause of the previous Prime Minister’s wisdom inkeeping us out of the euro allows us to take the adjustmentson the exchanges, which Greece and the other countriescannot do, but we are not getting the benefit of thatbecause of the deflation in European markets. Deflationhas been forced on Greece, Portugal, Italy, Spain andIreland, which are all very seriously deflated. Demandin Europe is therefore cut, and it will be cut further ifthese measures are introduced. We need export-led growthand we are not getting it. That is my main argument; Iwill be very brief.

I am frightened that the Minister’s approach, and theapproach involved in the motion, means that on anotherissue we will fudge, not fight. Fudge is built into thisGovernment because it is a coalition between the LiberalDemocrats, who are Euro-daft, and my friends andallies the serried ranks on the Conservative Benches,whom I hope to join in the Lobby. There is a built-intendency to fudge that we have already seen in theapproach to the European budget, where without opposing,fighting or contesting it, we have agreed a 2.9% increasewhich will mean an increase of £440 million in ourcontribution to £7 billion next year. This country can illafford that when we are cutting public services. I wantto avoid the tendency to fudge that is built into thisGovernment and to encourage them, by our votes tonight,instead to fight on these issues.

6.6 pm

Mr James Clappison (Hertsmere) (Con): Let me beginby congratulating my hon. Friend the Minister on hisvery full opening speech. I want to say a few wordsabout one or two things that perhaps did not creep intohis remarks.

I should like to pay a compliment to the President ofthe European Union; I suppose that he does not oftenget that in this place. The words in his report are veryclear about what he was trying to do—to put in place anew mechanism. That is what he was charged withdoing by the European Council, and that is indeed whathe did. It will be no surprise that the President of theEuropean Union should seek to discharge that duty byputting in place a whole raft of new measures giving newpowers and responsibilities to the European Commission.

The Minister helpfully set out those new powers inthe Government’s explanatory memorandum. That makesit clear that the European Commission, whether we saythat it has new responsibilities, new roles or new powers,is going to be very busy giving a good going over to this

country’s economic performance, reaching public judgmentsthat could well have an effect on our economic reputation.It sets a scoreboard for how well the country is doing,and judges the country by that scoreboard. It carriesout reviews and investigations and sends delegations,and if the country in question is not respondingappropriately, the Commission has the power to recommendto the Council that that country be placed in the excessiveimbalances procedure—something that I think the Ministerdid not have quite enough time to mention.

Whether one regards that as a sanction depends onan interesting choice of language. In my previous careeras a member of the Bar, I never thought to console aprisoner who had just been sentenced to immediatecustody by saying to him, “Well, at least you didn’t get afine.” The excessive imbalances procedure could well beborne in mind by those who frame economic policy andwish to avoid such a consequence. Other Members willhave far more experience of financial services and themarkets than me, but I do not think that anybody inthe markets would be dancing with glee at the news thatthe country was just about to be placed under such aprocedure. This is all down to the very wide range ofnew responsibilities of the European Commission, whichis being allocated a much more intrusive role by thisdocument.

The alternative argument is that it is a good thingthat this is happening; we heard shades of that from theLabour Front Bench. However, how much confidencecan we place in the economic management and judgmentof the European Commission, considering matters startingwith its rather cavalier treatment of recommendationsfor the European budget in the current economiccircumstances, and going all the way back to the fudgedcriteria for European economic and monetary union?

Even if one does have great confidence in the EuropeanCommission, there are bigger questions that shouldloom in all our minds. To whom is it accountable? Canwe ask it questions? Can we hold it to account in thisHouse, and who does hold it to account? What can theman in the street, the voter, do if he is not happy withthe economic criteria that it has fashioned for this country?

Ministers should be very careful indeed about theresponsibilities that are allocated to the EuropeanCommission. I know that there is a choice of languageand a judgment to be made, but after looking throughthe long list of new responsibilities that have been givento the Commission, I think we should be very careful.We have heard talk of surveillance and informal discussions,but Ministers should remember that not all that longago, justice and home affairs, and the common foreignand security policy, were said to be matters on whichMinisters would simply carry out informal discussionsbetween themselves. It was said that they would nevercome within the purview of European institutions.Today, of course, justice and home affairs are verymuch within the grasp of European law makers and theEuropean Union, and we now have a European ForeignMinister and a European diplomatic service. Not thatlong ago, those things were the subject of informaldiscussions.

We should be very careful indeed before setting footdown this path. We should consider the matter carefullythis evening and face up to the enormity of theresponsibilities that we are placing upon the EuropeanCommission.



6.11 pm

Michael Connarty (Linlithgow and East Falkirk) (Lab):First, I wish to put on record what we are supposed tobe debating, because Members have wandered all overthe place. We are debating a series of six documentssent to the Government by the European ScrutinyCommittee, on which the Government have now takena position. Four are about the stability and growthpact—our Committee reference numbers for them are32036, 32043, 32044 and 32047. The other two relate tothe excessive imbalances procedure—documents 32045and 32046.

In the main, those documents make no differencewhatever to procedures that the UK has to carry out.However, a lot of heat has been made about the factthat they affect other countries, and that if the conspiracytheory of the hon. Member for Hertsmere (Mr Clappison)is borne out, they may affect our Government, who willhave to give up their fiscal veto. The same was said inthe exchanges on the recent urgent question asked bythe hon. Member for Stone (Mr Cash). However, we arequite clearly protected in the Lisbon treaty and do nothave to go down that road.

The documents will not have any effect on us, becausewe are not a member of the eurozone. They can be readin detail, and Members will find that the coercive measuresset out in them do not relate to anyone outside theeurozone. The Government’s position is therefore tonote the documents.

On 27 October, the Government made their positionclear in response to the hon. Gentleman’s urgent question.The Financial Secretary quoted the report of the taskforceon strengthening economic governance in the EU, whichhas been referred to today as though it were a conspiracydocument. It states that“strengthened enforcement measures need to be implemented forall EU Member States, except the UK as a consequence ofprotocol 15 of the Treaty”.

That is quite clear. The hon. Gentleman reiterated that“we will not agree to any changes to EU treaties that move morepowers from this country to the EU. The UK’s exemption fromthe sanctions proposal will be explicit, and there will be no shift ofsovereignty from Westminster to Brussels.”—[Official Report,27 October 2010; Vol. 517, c. 319.]

It is important that we are clear about what we aretrying to do.

We should be sensible in our debates, and I say toMembers to whom the EU is anathema, or who areEurosceptic to a great degree, that they should notdiminish what they have to say about important mattersrelating to the Government’s position on the EU byarguing that somehow we are selling out if we do whatis asked in document 32047, which is about the surveillancemechanism in the reporting regime. If we do not knowwhat 26 of the 27 countries are doing in their budgets,we must agree on a proposal for everyone to put ininformation, so that both we and the Commissionknow what other Governments are doing. If we haddone that we would have known how badly Greece’seconomy was faring when it was suddenly found not tobe putting accurate figures in to the European Commission.

Mr Jenkin: Just for the convenience of the House,will the hon. Gentleman explain why the numbers ofthe documents that he has read out do not correspondwith the numbers in the Government’s motion, becausethose are the documents that we are scrutinising?

Michael Connarty: The Government use thenomenclature of the EC reference and I am giving theCommittee reference. When people want to find things,it is much easier to look at what the European ScrutinyCommittee does under its numbers than to try to find itin EU documentation. They are, in fact, the samedocuments.

There is a very good advert on television—“Calmdown, dear, it’s only an advert.” To people who try tosay that this motion is a major sell-out by the Government,I say, “Calm down, dear, it’s only an information exchange.”Frankly, if there is a vote tonight, I will be voting withthe Government. I will not be voting for any of theabsurd amendments that have been tabled. The Governmentare doing the right thing. I am not out to score pointson behalf of my party against another party. Ourrelationship with the other 27 countries with which wedo most of our trade is far too serious for that. We mustnot kid people. The hon. Member for Hertsmere, withwhom I sit in the European Scrutiny Committee, didnot complete his quote from paragraph 34, page 8 ofthe taskforce report, which said:“taking into account the specificity of the euro area.”

Paragraph 35 talks about the Commission conductingin-depth analysis and surveillance missions“in liaison with the ECB for euro area…states.”

It is quite clear that these documents are about theeurozone. I know that there are problems in the eurozone,but when signing up to the euro one takes on suchresponsibilities.

Mr Clappison rose—

Michael Connarty: Given that we are trying to letpeople speak, I will not give way.

Let us be sensible. To give and exchange informationis sensible, as is surveillance. Without any wish to criticiseanyone in this or the previous Government, I say thatwhen comments were being made about our imbalances,perhaps our Government should have listened, andthen we would not be living in such straitened times.

6.17 pm

Mr Peter Lilley (Hitchin and Harpenden) (Con): Thequestion that this House must face is this: do thesemeasures and the possible treaty change that they presageconstitute a threat to the sovereignty of this country oran opportunity for us to regain a little sovereignty? Ifthe measures envisage a substantive transfer of sovereignty,restricting our fiscal and economic freedom, then theissue is clear: we should veto them or seek a full exemptionfrom them. If the Government were to contemplateaccepting them without a full exemption, there wouldhave to be a referendum. Indeed, the very prospect of areferendum would be enough to gain us full exemption.My hon. Friends have concerns, which I fully understandand respect, that although limited to giving informationand possibly signing up to targets that we could not becompelled to meet, these measures may be the thin endof a Trojan horse—if I may mix my metaphors.

We have seen in the past how wording that has beenglossed over has led to the transfer of powers. So far, Iam not persuaded that the measures and what is envisagedin the treaty changes would result in a substantialtransfer of sovereignty. However, I shall listen closely,



and advise others to inspect thoroughly and scrutinisedeeply. If at the end of the day we are signing up just tothe sort of surveillance that we already receive from theIMF, that would not worry me too much. Indeed, then Iwould say to myself, “This is an opportunity.” If themeasures solely concern the members of the eurozone,but none the less require our assent before they can goahead, we should say to them, “We will let you do toyourselves what you want. We will give you the necessaryapproval, if in return you let us do some things that wewant to do, which won’t concern you, by repatriatingsome powers.”

We on the Conservative Benches were elected on amanifesto that said:

“We will work to bring back key powers over legal rights,criminal justice and social and employment legislation to theUK.”

We have a target, and this is an opportunity, so weshould seize it. However, we are, of course, a coalitionGovernment, so we should seek modest returns ofpowers that are compatible with the objectives of thewhole coalition. Liberal Members in the west countryexpressed their hope for a return of powers over fisheries;indeed, they stood at the election on it. Fisheries are nota big issue in my inland constituency, but I would beprepared to work with those Members for a return ofpowers.

However, the coalition agreement is quite specific. Itsays not only that we will“ensure that there is no further transfer of sovereignty or powersover the course of the next Parliament,”

but that we will“examine the balance of the EU’s existing competences and will,in particular, work to limit the application of the Working TimeDirective in the United Kingdom.”

I therefore have a simple question for the Minister,which I hope he will answer in the affirmative in hiswinding-up speech. Will we be using this opportunityboth to meet the objectives laid out clearly in thecoalition agreement and, in return for our consent tosuch measures, to seek to limit the application of theworking time directive to the United Kingdom?

6.22 pm

Kelvin Hopkins (Luton North) (Lab): I shall speakbriefly, but it is important for the House to know thatthere are also Members on the Opposition Benches whowill be voting against the Government motion, and onsimilar grounds to do with the implicit transfer ofsovereignty in the Commission’s initiative. I congratulatethe Chair of the European Scrutiny Committee, thehon. Member for Stone (Mr Cash), on ensuring that theHouse is fully aware of the concern about such mattersand on the fact that we are having this debate, as it islargely down to him.

There is serious confusion about the wording of thedocuments. The terms “all member states”, “eurozonestates” and “non-eurozone states except the UK” areused at different points throughout. It would be simplerif only the term “eurozone states” was used throughout,so that we could be absolutely clear that the provisionsapply only to the eurozone states. In the first draftregulation—on the preventive arm of the stability andgrowth pact, as it is called—reference is made to allmember states. In the second draft regulation—on what

is known as the excessive deficit procedure—reference ismade to all member states, but a little later it refers intwo places to the eurozone. The third draft regulationtalks about eurozone states. The two further regulations,on macro-economic imbalances, refer to member states—not “all member states”—or, alternatively, to eurozonemember states, but right at the end there is a referenceto non-eurozone member states except the UK. I wantto be clear that the provisions apply to the eurozone,not to the United Kingdom, so that we can know preciselywhere we stand on sovereignty over our own economy.

Stephen Williams (Bristol West) (LD): I, too, had toread the documents several times before I began tounderstand what was being proposed, but is not thesimple distinction that the information-sharing provisionsapply to all EU member states, whereas the sanctionsunder the stability and growth pact apply only to eurozonemembers?

Kelvin Hopkins: The Minister himself said that anyinformation about the economy that was needed couldbe found by googling it, and there is also the Librarynote on economic indicators, which I use regularly. Allthe information is there—for example, in the Budgetstatements and so on—and we do not need to providemuch more than that. There is masses of public information.We do not need to have it in regulations. It can beprovided as a matter of course. We must put down amarker for the European Union saying that we will notgo this far, and that we do not want changes that showpolitical creep or gradual encroachment of the EuropeanUnion into British sovereignty over our own economy,going beyond the treaties.

I agree with my hon. Friend the Member for GreatGrimsby (Austin Mitchell) about the nonsense of theeurozone and the economic arrangements that it entails.There is a reference to “surveillance of macroeconomicimbalances”, but the trade imbalance that I focused onearlier in the debate is serious. We have a massive tradedeficit with the rest of the European Union, particularlyGermany, which sustains a massive trade surplus. Willthe European Union focus on that imbalance?

In 1944, Keynes said that countries running massivetrade surpluses should be required to appreciate theircurrencies to bring them into line. Will that be suggestedto Germany? That cannot happen because Germany isin the eurozone, and all those other countries thatcannot compete and cannot inflate at a greater rate arehaving severe difficulties, which are becoming worseyear by year. Will that imbalance be addressed? When itis, I will start to take the European Union a little moreseriously on economic matters.

I have probably said enough. I intend to vote againstthe motion, and I hope that the Government will challengethe European Union to make the wording of itsdocumentation right and acceptable to the UnitedKingdom.


Mr Speaker: Order. I intend to call the Minister towind up the debate no later than 6.31 pm, and I am surethat that will be borne in mind.



6.26 pm

Mr Douglas Carswell (Clacton) (Con): I shall bebrief, and I shall vote against the motion. The House isbeing asked to endorse an agreement that would strengthenEuropean Union economic governance. It is not indispute that the new measures would give EU institutions,the Commission and the Council greater powers. Whatis in dispute is, first, the extent to which such changeswould involve the United Kingdom, and whether thenew arrangements would apply only to the 16 membersof the eurozone, or to all 27 member states, includingBritain.

The second point of contention is the extent to whichBritain is now subject to EU oversight when we set ourown Budget. Having gone to Brussels promising not togive away so much of our money, Ministers seem tohave returned having given Brussels the right to have asay in how we spend the rest of our Budget.

No one was more heartened than I to hear the PrimeMinister tell the House back in June that any new dealwith the EU“should not interfere with national competencies”.

He also said:“On budget surveillance, let me be clear: the UK Budget will

be shown to this House first and not to the Commission…co-ordination and consultation, yes; clearance, no, never.”—[OfficialReport, 21 June 2010; Vol. 512, c. 35.]

Such assurances were welcome, yet within a couple ofweeks we heard Olli Rehn, the Economic and MonetaryPolicy Commissioner, spell out the details. He said:

“All member states would submit their fiscal programmes atthe same time in April to allow the Council to issue countryspecific policy guidelines”.

Is it any wonder that when the Chancellor appearedbefore the Treasury Select Committee he was able toreveal the date of the next Budget? It is now part of atimetable set in Brussels.

Ministers have claimed that the level of disclosure isnothing new, and that it is no more than what a think-tankmight find out about UK fiscal policy via Google.Indeed, but think-tanks do not have the power to issueguidelines, and they cannot pass legislation on the basisof the analysis that they then make.

Ministers are keen to tell us that as a result of the newarrangements Britain would not at this time be subjectto sanctions. To the best of my knowledge, no one issuggesting otherwise. The issue at stake is not whetherthe new EU regulations apply sanctions to the UK, butwhether, from now on, the EU has the right to makelaws on UK fiscal policy in the first place.

At his press conference on 17 June, the Prime Ministerassured us that because we are outside the eurozone ouropt-outs would be safeguarded. He talked of Van Rompuy’sefforts to “strengthen Eurozone governance arrangements”.He referred to the eurozone, not the EU. Since then, thetalk has been not of eurozone economic governancearrangements, but of EU governance arrangements.Within a couple of weeks of the Prime Minister’s assurances,talk shifted from measures that would affect just the16 eurozone members to measures that would apply toall 27 member states, including Britain.

Angela Merkel made it clear that economic governanceshould apply to all EU states, not just the eurozone.Barroso declared with reference to economic governance:

“Europe must show it is more than 27 different nationalsolutions”.

He said 27, not 16. It is clear that his intention is thatthe new arrangements apply to the UK. Van Rompuywent out of his way to warn against creating what hecalled “dividing lines” between 27 member states and16 eurozone countries. What were clear assurances to bewelcomed and embraced in early summer had, by theonset of autumn, become dividing lines to be doneaway with.

Paragraph 34 of the Van Rompuy report states thatthere will be a new legal framework“applying to all EU Member States”.

Can the Minister explain what part of “all” excludesBritain? Regardless of paragraphs 35 and 39, or referenceto protocol 15 of any treaty, such wording createsambivalence at the very least. It suggests that EU institutionswill now be able to legislate in areas of UK nationalcompetence in which they could not previously legislate.Has the precedent now been set? Is the field occupied?Is not the stage set for the day when some other Ministerreturns from Brussels to explain to the House how wehave been sadly outvoted?

So who is right? Ministers who assure us, or Eurocratswho do not? How can we explain the differences betweenMinisters’ assurances and what lies in the small print ofwhat is before the House today? At best, this can beexplained by sloppy drafting by officials, but if that isthe case, why are we employing sloppy drafters tonegotiate matters of such fundamental importance?Are those officials the ones on whom we will depend toturn the contents of the Van Rompuy report into thetreaty changes? I cannot support the motion, as it willmean a further transfer of powers from this country toBrussels. I urge colleagues to oppose it.

6.30 pm

Mr Hoban: I have listened carefully to hon. Members’concerns tonight, and I want to state yet again that theproposals from the Van Rompuy taskforce strengthenan existing framework, crucially without encroachingon fiscal and economic sovereignty. There is much morework to be done on this, but let me assure my right hon.and hon. Friends that the Government are committedto securing the best outcome from the proposals, todefending Britain’s interests and to protecting thisParliament’s right to set and scrutinise our fiscal policy.Anything less would not be acceptable.

I shall deal with some of the issues that have beenraised in the debate. Does the fact that the EU, alongwith other organisations, undertakes surveillance meanthat we will be subject to sanctions? No, it does not.Does the measure mean that we will need to follow anyof the recommendations made? No. Will we have topresent our Budget to Europe before we present it tothis House? No. Will we have to give the EU informationthat has not been presented to this House first? No. Willthe provision of information erode our sovereignty?No. Perhaps more importantly, will any powers overour Budget be transferred from Westminster to Brussels?Again, no. I hope that I have been clear and explicit onthose points, and it is for those reasons that I askMembers to support the motion tonight.

Question put.



The House divided: Ayes 296, Noes 40.Division No. 115] [6.32 pm

AYESAdams, NigelAldous, PeterAmess, Mr DavidAndrew, StuartArbuthnot, rh Mr JamesBacon, Mr RichardBagshawe, Ms LouiseBaker, NormanBaldry, TonyBaldwin, HarriettBarker, GregoryBarwell, GavinBebb, GutoBeith, rh Sir AlanBellingham, Mr HenryBenyon, RichardBeresford, Sir PaulBerry, JakeBingham, AndrewBirtwistle, GordonBlackman, BobBlackwood, NicolaBlunt, Mr CrispinBoles, NickBottomley, PeterBradley, KarenBrake, TomBray, AngieBrazier, Mr JulianBrine, Mr SteveBrokenshire, JamesBrooke, AnnetteBrowne, Mr JeremyBruce, rh MalcolmBuckland, Mr RobertBurley, Mr AidanBurns, ConorBurns, Mr SimonBurrowes, Mr DavidBurstow, PaulBurt, AlistairBurt, LorelyByles, DanCairns, AlunCampbell, rh Sir

MenziesCarmichael, Mr AlistairCarmichael, NeilChishti, RehmanClark, rh GregClarke, rh Mr KennethClegg, rh Mr NickCoffey, Dr ThérèseCollins, DamianColvile, OliverCrabb, StephenCrockart, MikeDavey, Mr EdwardDavies, David T. C.

(Monmouth)Davies, Glynde Bois, NickDinenage, CarolineDjanogly, Mr JonathanDorrell, rh Mr StephenDorries, NadineDoyle-Price, Jackie

Duddridge, JamesDuncan, rh Mr AlanDuncan Smith, rh Mr

IainDunne, Mr PhilipDurkan, MarkEllis, MichaelEllison, JaneEllwood, Mr TobiasElphicke, CharlieEvans, GrahamEvans, JonathanEvennett, Mr DavidFabricant, MichaelFallon, MichaelFeatherstone, LynneField, Mr MarkFlynn, PaulFoster, Mr DonFrancois, rh Mr MarkFreeman, GeorgeFreer, MikeFullbrook, LorraineFuller, RichardGale, Mr RogerGarnier, Mr EdwardGarnier, MarkGauke, Mr DavidGibb, Mr NickGilbert, StephenGillan, rh Mrs CherylGlen, JohnGoodwill, Mr RobertGraham, RichardGrant, Mrs HelenGrayling, rh ChrisGreen, DamianGrieve, rh Mr DominicGriffiths, AndrewGummer, BenGyimah, Mr SamHalfon, RobertHames, DuncanHammond, rh Mr

PhilipHammond, StephenHancock, MatthewHancock, Mr MikeHands, GregHarper, Mr MarkHarrington, RichardHarris, RebeccaHart, SimonHaselhurst, rh Sir AlanHayes, Mr JohnHeald, Mr OliverHeath, Mr DavidHeaton-Harris, ChrisHemming, JohnHendry, CharlesHerbert, rh NickHinds, DamianHoban, Mr MarkHollingbery, GeorgeHopkins, KrisHorwood, MartinHowarth, Mr Gerald

Howell, JohnHughes, SimonHunt, rh Mr JeremyHunter, MarkHuppert, Dr JulianHurd, Mr NickJames, MargotJavid, SajidJohnson, GarethJohnson, JosephJones, AndrewJones, Mr DavidJones, Mr MarcusKawczynski, DanielKennedy, rh Mr CharlesKirby, SimonKnight, rh Mr GregKwarteng, KwasiLaing, Mrs EleanorLamb, NormanLancaster, MarkLansley, rh Mr AndrewLatham, PaulineLaws, rh Mr DavidLeadsom, AndreaLee, JessicaLee, Dr PhillipLefroy, JeremyLeslie, CharlotteLetwin, rh Mr OliverLewis, BrandonLiddell-Grainger, Mr

IanLidington, Mr DavidLilley, rh Mr PeterLong, NaomiLopresti, JackLord, JonathanLoughton, TimLucas, CarolineLuff, PeterLumley, KarenMacleod, MaryMaude, rh Mr FrancisMay, rh Mrs TheresaMaynard, PaulMcCartney, KarlMcIntosh, Miss AnneMcLoughlin, rh Mr PatrickMcPartland, StephenMcVey, EstherMenzies, MarkMercer, PatrickMetcalfe, StephenMiller, MariaMills, NigelMoore, rh MichaelMordaunt, PennyMorgan, NickyMorris, Anne MarieMorris, DavidMorris, JamesMosley, StephenMowat, DavidMulholland, GregMundell, rh DavidMunt, TessaMurray, SheryllMurrison, Dr AndrewNeill, RobertNewton, SarahNokes, Caroline

Norman, JesseOfford, Mr MatthewOllerenshaw, EricOpperman, GuyOttaway, RichardPaice, Mr JamesParish, NeilPaterson, rh Mr OwenPawsey, MarkPenning, MikePenrose, JohnPerry, ClairePhillips, StephenPickles, rh Mr EricPincher, ChristopherPoulter, Dr DanielPrisk, Mr MarkPugh, Dr JohnRandall, rh Mr JohnReid, Mr AlanRifkind, rh Sir MalcolmRobathan, Mr AndrewRobertson, HughRogerson, DanRosindell, AndrewRudd, AmberRuffley, Mr DavidRussell, BobRutley, DavidSanders, Mr AdrianSandys, LauraScott, Mr LeeSelous, AndrewShapps, rh GrantSharma, AlokShelbrooke, AlecSimmonds, MarkSimpson, Mr KeithSkidmore, ChrisSmith, Miss ChloeSmith, HenrySmith, JulianSmith, Sir RobertSoames, NicholasSoubry, AnnaSpelman, rh Mrs CarolineSpencer, Mr MarkStanley, rh Sir JohnStephenson, AndrewStevenson, JohnStewart, BobStewart, IainStewart, RoryStreeter, Mr GaryStride, MelStuart, Mr GrahamStunell, AndrewSturdy, JulianSwales, IanSwayne, Mr DesmondSwinson, JoSyms, Mr RobertTeather, SarahThurso, JohnTimpson, Mr EdwardTomlinson, JustinTredinnick, DavidTruss, ElizabethTyrie, Mr AndrewUppal, PaulVaizey, Mr EdwardVara, Mr Shailesh



Villiers, rh Mrs TheresaWalker, Mr RobinWallace, Mr BenWard, Mr DavidWatkinson, AngelaWeatherley, MikeWebb, SteveWharton, JamesWheeler, HeatherWhite, ChrisWhittaker, CraigWhittingdale, Mr JohnWiggin, Bill

Williams, RogerWilliams, StephenWilliamson, GavinWillott, JennyWilson, Mr RobWollaston, Dr SarahWright, SimonYeo, Mr TimYoung, rh Sir GeorgeZahawi, Nadhim

Tellers for the Ayes:Mr Brooks Newmark andJeremy Wright

NOESBaker, SteveBinley, Mr BrianBridgen, AndrewCampbell, Mr RonnieCarswell, Mr DouglasCash, Mr WilliamChope, Mr ChristopherClappison, Mr JamesCorbyn, JeremyCryer, JohnDavies, PhilipDavis, rh Mr DavidDobson, rh FrankDodds, rh Mr NigelDonaldson, rh Mr Jeffrey M.Drax, RichardGodsiff, Mr RogerGray, Mr JamesHenderson, GordonHoey, KateHollobone, Mr PhilipHopkins, Kelvin

Lewis, Dr JulianMcCartney, JasonMcDonnell, JohnMitchell, AustinNuttall, Mr DavidPaisley, IanPercy, AndrewRaab, Mr DominicRedwood, rh Mr JohnShannon, JimShepherd, Mr RichardSimpson, DavidSkinner, Mr DennisStringer, GrahamTapsell, Sir PeterTurner, Mr AndrewVickers, MartinWood, Mike

Tellers for the Noes:Mr Peter Bone andMark Reckless

Question accordingly agreed to.Resolved,That this House takes note of European Union Documents

(a) 9433/10, Commission Communication on reinforcing economicpolicy co-ordination, (b) 11807/10, Commission Communicationon enhancing economic policy co-ordination for stability, growthand jobs – tools for stronger EU economic governance, (c)14496/10, Proposal for a Council Regulation (EU) amendingRegulation (EC) No. 1467/97 on speeding up and clarifying theimplementation of the excessive deficit procedure, (d) 14497/10,Proposal for a Council Directive on requirements for budgetaryframeworks of the Member States, (e) 14498/10, Proposal for aRegulation of the European Parliament and of the Council onthe effective enforcement of budgetary surveillance in the euroarea, (f) 14512/10, Proposal for a Regulation of the EuropeanParliament and of the Council on enforcement measures tocorrect excessive macroeconomic imbalances in the euro area, (g)14515/10, Proposal for a Regulation of the European Parliamentand of the Council on the prevention and correction ofmacroeconomic imbalances, and (h) 14520/10, Proposal for aRegulation of the European Parliament and of the Councilamending Regulation (EC) No. 1466/97 on the strengthening ofthe surveillance of budgetary positions and the surveillance andco-ordination of economic policies; notes the Report from theTask Force on Economic Governance in the European Union;

notes with approval that budgetary and fiscal information willcontinue to be presented to Parliament before being given to EUinstitutions; and approves the Government’s position, as endorsedby the Task Force that any sanctions proposed should not applyto the United Kingdom in consideration of Protocol 15 of theTreaty on the Functioning of the EU.

Business without Debate

DELEGATED LEGISLATIONMotion made, and Question put forthwith (Standing

Order No. 118(6)),

FREEDOM OF INFORMATION

That, at this day’s sitting, Standing Order No. 41A (Deferreddivisions) shall not apply to the Motion in the name of MarkHoban relating to European Union Economic Governance.—(Mr Dunne.)

Question agreed to.

HOUSE OF COMMONS MEMBERS’ FUND(DISCRETIONARY PAYMENTS)

Motion made, and Question put forthwith (Order,2 November, and Standing Order No. 118(6)),

That, pursuant to section 4(4) of the House of CommonsMembers’ Fund Act 1948 and section 1(4) of the House ofCommons Members’ Fund Act 1957, in the year commencing1 October 2010 there be appropriated for the purposes of section 4of the House of Commons Members’ Fund Act 1948:

(1) The whole of the sums deducted or set aside in that yearunder section 1(3) of the House of Commons Members’ FundAct 1939 from the salaries of Members of the House of Commons;and

(2) The whole of the Treasury contribution to the Fund in thatyear. —(Mr Dunne.)

Question agreed to.

PETITIONFactory Farming

6.48 pmMr Jim Cunningham (Coventry South) (Lab): The

petition states:The Petition of residents of the Coventry South constituency,Declares that the Petitioners believe that animals in British

factory farms are pumped full of protein to speed up theirgrowth; notes that soy is a major source of protein; further notesthat, in order to produce enough protein, precious habitats likerainforests are cleared in South America to make way for vast soyplantations; and further declares that this increases climate changinggases in the atmosphere, damages the Earth’s free life-supportsystems, which provide us with clean water, healthy soil and air tobreathe, forces small farmers off their land, making them unableto grow food for their families, and fails UK farmers, leavingthem vulnerable to fluctuating commodity prices.

The Petitioners therefore request that the House of Commonsurges the Government to take steps to shift subsidies away fromfactory farming, to support farmers to grow their own animalfeed and to ensure supermarkets offer fair deals to everyone.

And the Petitioners remain, etc.[P000866]


BBC Funding (CSR)Motion made, and Question proposed, That this House

do now adjourn.—(Mr Dunne.)

6.49 pm

Ian Murray (Edinburgh South) (Lab): Mr DeputySpeaker, all day long colleagues have been tempting meto say, “Nice to see you, to see you—”

Dr Thérèse Coffey (Suffolk Coastal) (Con): Nice!

Ian Murray: I thank the hon. Lady for that sedentaryintervention.

Ever since the BBC’s inception in 1922, it has playeda major role in this country. The public not only admirethe BBC; they trust the corporation to deliver real valueand quality while they watch and listen to its channelsor, more recently, surf its online content. Indeed, thequality of the BBC output could only be improved byyou, Mr Deputy Speaker, appearing as the guest presenteron “Have I Got News For You” or by light-footedformer Conservative Members appearing on “StrictlyCome Dancing.”

We must, however, protect what the BBC providesand how it is paid for. The licence fee enables ournational public-sector broadcaster to provide 10 TVchannels, 10 UK-wide network radio stations, 46 nations’and local radio services, regional options, interactiveservices on BBC iPlayer, and high definition television,as well as the ever-popular BBC websites which attract22 million unique users in the UK every week. On topof all that output, the BBC is the engine room of thecountry’s hugely important creative industries.

Let us consider the value of the licence fee. It costsabout 40p per day, which is less than half the cost ofmany daily newspapers and about the same as the priceof a pint of milk or a first-class stamp. It costs less thanthe price of half a loaf of bread, 20 times less than theaverage cinema ticket, and a 25th of the cost of joiningthe Liberal Democrats. The licence fee also enables theBBC to invest in the UK as a whole, with a commitmentto 50% of network production coming from outsideLondon by 2016 as well as a commitment to the BBCregions in Scotland, Wales and Northern Ireland.

Most importantly, the BBC delivers a significantcontribution to the creative industries and the UKeconomy. Britain’s creative sector, which accounts forabout 6% of the UK’s GDP, can make a significantcontribution to economic growth and employment. Havinggrown at a faster rate than the general economy inrecent years, the creative industries are now expected togrow by 4% on average in the next five years. Thebeneficial impact of the BBC to that is some £7.6 billiona year, including more than £150 million through BBCWorldwide.

Robert Halfon (Harlow) (Con): I congratulate thehon. Gentleman on securing this important debate. Hehas made the case for the licence fee, and there isobviously a case for it, but does he not agree that the bigproblem with it is that no licence fee payer has a say inhow the BBC is run? We need to democratise the licencefee and give licence fee payers the vote, at least inrespect of the board and trust and the BBC’s direction.

Ian Murray: I think the BBC has a lot to learn onthose principles. However, I will talk shortly about whatthe Government have done by not including licence feepayers in the comprehensive spending review and thefuture of the BBC.

The BBC is a globally respected brand, which is whythe House should be concerned for its future, and it hasbeen described as a national treasure, which is whyLabour Members will always stand up for it as a friend,although a critical friend. I must state clearly at theoutset that the BBC should not be immune from reformor cuts at a time when we are all supposed to be in thistogether, but that reform process has to be done throughnegotiation and with respect for what the BBC deliversand the people—its staff—who deliver the service onbehalf of us all.

The outcome for the BBC from the CSR has showncontempt for the corporation, and the opportunity hasbeen lost truly to change the organisation in the contextof a new digital age, changing and fast-moving marketsand, significantly, shrinking budgets across the sector inprogramme making.

The BBC also has a responsibility to consolidate itsown activities within the continual pursuit of excellencealongside an honest examination of the role of both theBBC and, more importantly, public sector broadcasting.The final settlement for the BBC through the comprehensivespending review is yet another example of the Government’sundue haste. We have seen that with the dangeroustoo-deep, too-soon, too-quick cuts that will harm jobs,harm growth and threaten the already fragile UK economy.

The CSR deal for the BBC was put together in72 hours. It was a dubious deal, with Ministers embarkingon a strategy to intimidate the BBC into acceptingwhatever came its way. Why? Because the outrageousproposal that the BBC take responsibility for free TVlicences for the over-75s hung over it like a guillotine.What would be next? The licence fee paying for thewinter fuel allowance, child benefit or perhaps even thePrime Minister’s new personal photographer?

That threat ensured that the BBC would grab the dealgiven to it through the CSR quickly and with bothhands. Let us look at the settlement it was given. Itincludes a freeze in the licence fee for the remainder ofthe charter period and the BBC taking on funding forthe BBC World Service, BBC Monitoring and the Welshlanguage channel S4C. In addition, the BBC will besupporting the Secretary of State’s pet project, the newCity TV, through a £25 million ring-fenced partnershipfund. It will also be given responsibility for deliveringbroadband services. All in all, there is a £340 million billalongside a 16% real-terms reduction in licence feeincome over the period.

This “delicious” deal, as the Prime Minister describedit, was so hastily contrived that it prevented properconsultation and debate with licence payers, stakeholdersand, most importantly, BBC staff themselves to theextent that we are left with no real way of knowing thetrue impact on the BBC. Will it affect the quality ofprogramming? Will it mean the BBC stopping services?Will it mean significant job cuts? Will it damage theindependence of the BBC and the BBC World Service?Will the board of S4C take the Government to court,due to it not being consulted about its funding beingtransferred to the BBC?

389 39010 NOVEMBER 2010 BBC Funding (CSR)

[Ian Murray]

Conversely, this rushed deal has also restricted theopportunity to keep the pressure on the BBC to continueon its programme of reform in terms of bureaucracyand excessive executive pay.

Graeme Morrice (Livingston) (Lab): I am grateful tomy hon. Friend for giving way. Has he, like me, receivedmany representations from constituents arguing againstany freezing of, or indeed cuts in, the licence fee andsupporting its retention so that a quality service cancontinue to be provided by the BBC?

Ian Murray: I welcome the intervention from my hon.Friend, who raises an important point. Many Members,I am sure, will have received dozens, if not hundreds, ofe-mails, letters and telephone calls from people who areconcerned about the BBC, cuts to it and what it delivers.Constituents have raised that point with me on numerousoccasions.

To go back to the missed opportunity, the BBC wasentering into a new culture of transparency andaccountability—a programme that was, on its ownmeasurement, to save £2 billion by 2014. I want to askthe Minister some questions about the future of theBBC. Is this deal on top of the BBC’s current strategyto save £2 billion by 2014? What criteria will be appliedto where the cuts will fall? Will there be job losses and areduction in quality? What impact will the cuts have onthe move to the media city in Salford and the programmingbeing transferred to the regions—50% by 2016, I think?Who is now responsible for the roll-out of broadband—theDepartment for Culture, Media and Sport, the Departmentfor Business, Innovation and Skills or indeed the BBC?What will the future hold for the BBC World Service?What budget protection will the World Service have?Will that critical service have to compete with otherparts of the BBC budget in due course?

Anna Soubry (Broxtowe) (Con): Is not the real problemwith the BBC the fact that it has expanded into areasthat it should not have expanded into, and that it haslost sight of the fact that it is a maker and broadcasterof programmes? In moving into websites, it is takingaway from other websites. Most importantly, it is takingaway the ability of people to work in print journalism.It is really threatening newspapers and other websites.

Ian Murray: I appreciate that intervention, but theBBC has been involved in a programme of reform ofwhat it supplies on the website. The list of duties thathas been placed on the BBC by the comprehensivespending review has given it more responsibility, notless. It is the opposite idea to that which has been givenby the—

7 pmMotion lapsed (Standing Order No. 9(7)).Motion made, and Question proposed, That this House

do now adjourn.—(Mr Dunne.)

Ian Murray: I will get used to the procedures in thisChamber, I am sure, Mr Deputy Speaker.

On the World Service, will the BBC have budgetprotection or will the World Service have to competewith other parts of the BBC budget in due course?What role will the Foreign Secretary have in that process?The Secretary of State mentioned that the BBC would

have to seek the Foreign Secretary’s approval for WorldService closures. The fact that the word “closure” isused must concern staff and lovers of the service.Furthermore, the BBC World Service is well regardedas the best international diplomacy and peacekeepingdevice that the UK has—more effective, indeed, thanthe UN or any military might.

Indeed, if you will indulge me, Mr Deputy Speaker,the BBC World Service won several awards just lastnight, demonstrating the distinctive programming thatit can provide. At the Association for InternationalBroadcasting awards, the BBC World Service won thebest current affairs documentary on radio award andthe best single news event radio award for its “ConnexionHaiti” team and a drama award for the best creativefeature on radio for “The Day that Lehman Died”.That shows that listeners the world over appreciate therole of the World Service.

Will the Minister tell the House what the future is forS4C, given that the Secretary of State recently wrote tothe chair of the BBC Trust stating that“if the new partnership model between S4C and the BBC provesunviable…the BBC contribution required for S4C will be takenfrom the licence fee”?

I read that to mean that S4C could potentially be closedif it becomes unviable. Crucially, how will licence payers,BBC staff and stakeholders be consulted in that process?

If the economic situation changes, will the Governmentassure the House that the Government do not reservethe right to go back to the BBC licence fee issue in thecourse of this licence charter period? If the Secretary ofState cannot answer those questions this evening, willhe be willing to provide me with a written answer tothose points?

The comprehensive spending review reduced the BBCto the status of just another arm of government wherethe veil of deficit was used to disguise rash decisionsfree of proper scrutiny or credible analysis, leaving thequestion of where the axe will fall. We have seen theresponse of the public to decisions on axing BBCservices—we need merely look back to earlier this year,with the campaigns to save the Asian Network and6 Music. Those services were seen by many as benchmarksof diversity, equality and innovation in public sectorbroadcasting.

There has been no statement in the House on theissues to do with the comprehensive spending reviewand the BBC. I respectfully ask the Government toprovide space in their time for proper debate on andanalysis of the consequences of the CSR, the future ofthe BBC and the future of public sector broadcasting inthe UK. This situation shows the Government’s attitudetowards the BBC. The “delicious” cuts comment by thePrime Minister was, as he later admitted, “ill conceived”and disrespectful to the BBC and showed a callousdisregard for the potential job losses at the corporationakin to the Government’s ideologically driven 1 millioncuts through the CSR in general.

The future of the BBC is a matter of significantpublic interest. Opposition Members will stand up forthe BBC, for what it provides for the cultural make-upof this country and for the contribution it makes to theUK economy. It projects the best of the UK abroad andis undoubtedly a national treasure that is well loved,respected and should be protected for the future atall costs.

391 39210 NOVEMBER 2010BBC Funding (CSR) BBC Funding (CSR)

7.4 pm

Graham Jones (Hyndburn) (Lab): I congratulate myhon. Friend the Member for Edinburgh South (IanMurray) on securing this vital debate. We all recognisethe role of the BBC in the world. The then shadowForeign Secretary, my right hon. Friend the Member forSouth Shields (David Miliband), said that the Worldservice is an independent“credible voice in parts of the world where the only other messagesblend threats and propaganda”.

That is quite true. I echo those worlds and support theWorld Service, which is a vital service.

The changes being made following the comprehensivespending review raise serious concerns about the futureof the BBC World Service and about the BBC’s abilityto continue providing a public broadcast service that isinformative and represents value for money. Transferringbudgetary responsibility from the Foreign andCommonwealth Office or the Treasury to the BBCopens the door to editorial cuts. There has been concernrecently that the BBC World Service could be forced topull out of certain countries, which would be a tragedygiven the turbulence in Burma and Iran. I know that theBBC has reinstated its World Service in those areas, butwe do not want future cuts to compromise Britain’sinterests.

I recognise that the BBC, as a publicly funded body,is obliged to consider its expenditure and whether savingscan be made, but that cannot be at the expense of apublic service that is valuable at home and abroad. TheBBC World Service is one of Britain’s most effectiveand vital assets and we should protect and promote it.We should not reduce our investment in internationalbroadcasting. The National Union of Journalists hassaid it will fight any proposed cuts, adding that the BBCWorld Service is a “clear success story”. The cuts representa threat that we can ill afford to that vital service and tojobs. We have to think of the BBC as a world employerbecause it does not operate only in the UK.

I am a passionate defender of the organisation and Ibelieve not only in retaining the licence fee but inextending the BBC as a British institution. I haveexperienced television in many countries, most notablyin the USA where freedom and open markets haveresulted in massively dumbed-down television and arace to the bottom, with programmes between adverts.The quality of BBC broadcasting provides a high watermark for others to match and raises the bar of programmequality. The BBC leads the world in quality, innovationand impartiality.

Steve Rotheram (Liverpool, Walton) (Lab): Does myhon. Friend agree that the BBC is the envy of broadcastinginstitutions the world over and that we parliamentarians,who are being broadcast live as we speak, should bevery proud of it?

Graham Jones: My hon. Friend is quite right: theBBC is the envy of the world and is a good business thatwe should promote. We should see it in that way ratherthan as a drain on public resources. It is one of the lastgreat vestiges of British influence abroad. BBC onlineand BBC news provide the world with a British perspectiveand a brand that should be protected at all costs. Acommercial, or part-commercially dependent, BBC would

need to survive from advertising revenue and wouldhave to focus on mass-market universal appeal, but thatmarket is filled by ITV, Sky and Channel Five domestically.That would involve, in short, a dumbed-down, broadest-appeal schedule. I cannot support anything that underminesthe BBC and I congratulate my hon. Friend the Memberfor Edinburgh South again on securing the debate.

7.8 pm

Dr Thérèse Coffey (Suffolk Coastal) (Con): I, too,congratulate the hon. Member for Edinburgh South(Ian Murray) on securing the debate. Let me declare aninterest: I worked for the BBC before coming to Parliamentand I am still engaged in a financial transaction with it.That aside, I want to pay tribute to the Secretary ofState for Culture, Media and Sport for the role he hasplayed in working with the BBC, as well as to theMinister answering the debate, the Under-Secretary ofState for Culture, Olympics, Media and Sport, my hon.Friend the for Wantage (Mr Vaizey).

I am a passionate defender of the BBC and I valuewhat it brings to our country and our worldwide reputation.I have heard the points in favour of the World Serviceand similar services, and I want to give some assurances.I appreciate that a little knowledge is a dangerous thing,but I believe that the BBC can perfectly well survive onthe comprehensive spending review settlement of afrozen licence fee for the next few years. It has made agood start with the executive board deciding to slimdown. That is good news and will help the BBC tocontinue to be a dynamic organisation. It has tackledthe difficult pension dispute, although I must admit thatif I still worked there, I would have bridled at theoriginal pension deal. It has now come up with asensible solution and I hope that the NUJ will eventuallyrecognise that.

The BBC still has a lot to offer our country, not onlythrough programmes such as “Strictly Come Dancing”,with a former Member of the House doing rather well,but by continuing to provide excellent programmes ofwhich we can be genuinely proud and that are soldaround the world through BBC Worldwide. The BBCnow recognises that its role is not to go off and buythings like the “Lonely Planet” guide, which it will notdo again, but to make use of the licence fee to subsidiseprogrammes going forward.

Ian Murray: The hon. Lady has mentioned examplesof the BBC slimming down, to use her words. The BBCwas already undertaking such a programme, and thecomprehensive spending review settlement may havetaken its eye off the ball. Will she comment on that?

Dr Coffey: I do not work there any more, so I cannotgive a personal comment on that, but the settlementconcentrates the mind. I know that when I was thereand we were talking in staff meetings, scenario planningwas going on—for example, if there was a 20% cut, or afreeze—and there was genuine debate about what thatwould mean for the BBC in future. The settlement willforce the board to think through what it is trying toachieve, what makes the BBC special, what it has to doand what it is nice to do. I welcome that journeybecause we also have to do in government—let us behonest about it—when we are trying to ensure that welive within our means.


Anas Sarwar (Glasgow Central) (Lab): Will the hon.Lady give way?

Dr Coffey: I can speak for only two minutes, so I willcarry on, if the hon. Gentleman will forgive me.

The hon. Member for Edinburgh South asked whatthe BBC licence fee would pay for in future. Let usremember that a certain part of the licence fee washypothecated for the digital switchover. The success ofvarious schemes has meant that that part of the licencefee now does not need to be used; it might be said that itis being used only for broadband. However, YouView,which is coming, will be one of the game-changingthings that the BBC delivers to this country, in conjunctionwith its media partners, and broadband is required todeliver that. It is right that the BBC is involved in theprovision of broadband to the country. That is a rathergood use of the licence fee.

Given that I was an unexpected participant in thedebate tonight, I will not continue further. The BBC issafe in the Government’s hands through its relationshipwith the Secretary of State. A large amount of reconciliationgoes on between the World Service and the BBC tomake sure that each part does not subsidise the other.That is wasteful work, and those costs will not have tobe borne any more, so they can go into protecting theoverseas bureaux. There are opportunities for economies,and I know that the board is working hard on them.

I am confident that the Government, with the Ministerand the Secretary of State, will continue to have afruitful partnership. I look forward to the next debatewhen we discuss the future governance of the BBC. Ihave been delighted to participate in the debate and Iwish all my former colleagues at the BBC well.

7.12 pm

The Parliamentary Under-Secretary of State for Culture,Olympics, Media and Sport (Mr Edward Vaizey): I amgrateful for the chance to respond to this importantdebate. I congratulate the hon. Member for EdinburghSouth (Ian Murray) on securing it and on making suchan eloquent speech setting out his views and support forthe BBC, as well as his concerns for its future.

I thank the hon. Member for Hyndburn (GrahamJones) and my hon. Friend the Member for SuffolkCoastal (Dr Coffey) for their excellent contributions,with the hon. Member for Hyndburn focusing on theimportance and value to him of the BBC World Service,and my hon. Friend bringing to bear her experience asan insider who has worked in the organisation. I waspleased to hear from a former BBC employee about herconfidence in the BBC’s ability to continue to moveforward on the basis of the superb licence fee settlement.

Anas Sarwar: The Minister speaks of a superb settlement.The BBC is one of the largest employers in my constituencyin Glasgow. Does he accept that as a result of thedecisions taken in the comprehensive spending review,there will be job losses in the city of Glasgow?

Mr Vaizey: The BBC has already significantly slimmeddown. Job losses or future jobs will be a matter for it.The debate has been suitably non-partisan. I hate tobring it down a level or two, but I am always pleased tohear from Opposition Members about their conversionto supporters of the BBC. For those of us who rememberthe previous Government hounding out the BBC’s chairman

and director-general over the David Kelly and AndrewGilligan affair, such conversions always ring ever soslightly hollow. That was the greatest crisis of BBCindependence in living memory, so it is worth rememberingthat it is not always bad news with the Conservatives.Other Governments have behaved very badly indeedtowards the BBC, in my view.

However, I want to put on the record this Government’sstrong support for the BBC—a complete commitmentto the independence of the corporation, which, as thehon. Member for Edinburgh South said, has formed thecornerstone not only of public service broadcasting inthis country, but of the success of our creative industries.I never tire of pointing out that many of our successfulindependent production companies and, indeed, othercompanies in the creative industries are often filled withpeople who received their training from the BBC.

The BBC is not set in aspic; it remains a dynamic andforward-looking organisation. Not only is it one of themost respected broadcasters in the world, but it continuesto innovate with the BBC iPlayer; YouView, a consortiumin which the corporation is the cornerstone partner;BBC Worldwide, which has taken the BBC all aroundthe globe; and even the pioneering archive and digitalarchive work being taken forward by Tony Ageh, whichwe all admire. We also fully respect, of course, theBBC’s editorial and operational independence.

Graham Jones: Does the Minister approve of BBCWorld Service television and its commercial success?Does he think that it should be expanded as a business,or that the service should be reduced because it is notwhat the BBC is about?

Mr Vaizey: BBC Worldwide, which has a superb chiefexecutive in John Smith, who really has transformedthat organisation, occasionally causes controversy inthe House. Its business is to maximise the value of theBBC’s assets, and it does so very well, but we in theHouse and individual politicians take views, such as onthe purchase of Lonely Planet, and, as I shall say at theend of my speech, the BBC Trust has made it clear thatit wants the BBC to divest itself of its magazine business,because it is very important that it leaves room forcommercial operators to make a living in the media.One of the great ironies is that the BBC is so successfulthat it can often easily squash its competition.

Charlie Elphicke (Dover) (Con) rose—

Graham Jones rose—

Mr Vaizey: I shall take an intervention from my hon.Friend, who has not yet spoken.

Charlie Elphicke: We have heard much about theexcellence of the BBC, but does my hon. Friend agreethat we should also pay tribute to the excellence of ITVand of BSkyB? They have outstandingly good output,too, and it is important to ensure that the BBC’s statesubsidy does not crowd them out.

Mr Vaizey: I absolutely accept my hon. Friend’spoint, and I congratulate him on his excellent work totry to secure the future of Dover port, working withDame Vera Lynn, who broadcast her great songs that


lifted the morale of British troops during the secondworld war via the BBC. I also pay tribute to the manysuccessful media companies that operate in the UnitedKingdom.

The hon. Member for Edinburgh South was concernedabout the speed of our negotiations. I was slightlysurprised by that, because I read in his biography thathe used to work for an organisation called 100mph Events.I thought that he was a man who felt the need for speed,but now he wants to be in the slow lane. A year-longnegotiation of the licence fee would have taken theBBC’s eye off the ball in respect of running a successfulmedia organisation, and there would have been a yearof sniping from the BBC’s competitors, with peoplecalling into question the licence fee and so on.

Graham Jones: The Minister and other GovernmentMembers have mentioned crowding out, but is it not thecase that The Times and The Sunday Times have apaid-for service that is beginning to wipe its face? If theBBC were impinging on the profits of the online printindustry, would The Times and The Sunday Times beable to wipe their face with that paid-for service? Itseems to be quite successful, and there does not seem tobe any evidence of crowding out. Does he accept that point?

Mr Vaizey: I suggest that the hon. Gentleman talks tothose at The Guardian, as it is they who usually complainabout the BBC crowding them out. The Guardian websiteremains free, and they claim that one of the difficultiesthey are finding with monetising its website is thepresence of the BBC.

The agreed settlement that we reached with the BBCis a good deal for all parties that reflects the currenteconomic environment. Most importantly, of course, itis an excellent deal for licence fee payers, delivering afreeze in cash terms in the £145.50 colour licence fee forthe next six years. I was interested to hear the hon.Member for Livingston (Graeme Morrice) suggest thatmany of his constituents are writing in, wanting to paymore for the licence fee. I am not sure that that view isheld nationwide.

Julie Hilling (Bolton West) (Lab): I am concernedthat a freeze for four years in fact represents a year-on-yearcut, particularly when inflation is predicted to rise muchhigher than was expected, and with VAT increasescoming in as well. Does the Minister agree that morethan the initial cuts will need to be made because of thebudget restrictions, but we will then face year-on-yearcuts in the BBC that reduce its services and its ability tobe the wonderful broadcaster that it currently is?

Mr Vaizey: As I say, the BBC will have to findsavings; I shall come to that in a moment. It is importantfor Labour Members to make their position clear. Ifthey think that the BBC licence fee should be increased,they should say so, and they should state the level atwhich they think it should be set.

The current licence fee settlement remains at £145.50.It is important to remember that for the first year thiswas volunteered by the BBC and the BBC Trust, and itwas likely to be volunteered for the second year, andthen we negotiated a freeze for the four years after thatuntil March 2017. Within that settlement, as the hon.Member for Edinburgh South pointed out, the BBC

has agreed to play an active role in supporting new localtelevision services through a partnership fund providingcapital costs of up to a total of £25 million in 2013-14for up to 20 local TV services—city TV stations toprovide truly local content rather than the regionalcontent people have at the moment. The BBC will alsocommit to ongoing funding of up to £5 million per yearfrom 2014-15 to acquire content for use on its ownservices from these new services. Should capital costs berequired earlier, this will be facilitated by access to theexisting digital switchover underspend by mutual agreement.

Robert Halfon: Does my hon. Friend agree that this isnot just about the level of the licence fee but the factthat licence fee payers have no real say over what goeson in the BBC, whether it is salaries, the make-up of theBBC Trust, or the number of stations? The answer,surely, is to democratise the licence fee by giving licencefee payers a vote.

Mr Vaizey: My hon. Friend is a pioneer in thisHouse. He is already proposing and taking forward aninternet bill of rights, which has enlivened the blogosphere,and he has radical proposals for the democratisation ofthe BBC. Given his campaigning record, I will leave himto take those forward.

The BBC World Service will now become part of thelicence fee-funded BBC from 2014-15, but the BBC willremain independent in all matters concerning the contentof World Service output as regards times and the mannerin which it is supplied and the management of itsaffairs. The BBC’s editorial guidelines, values and standardswill be set by the BBC Trust and will continue to applyto the BBC World Service. The BBC will continue, asnow, to set the objectives, priorities and targets for theBBC World Service with the Foreign Secretary, and willobtain written approval from the Foreign Secretary forthe opening or closure of any language service. TheBBC will also assume responsibility for funding BBCMonitoring from 2013-14.

The hon. Gentleman asked about S4C. The BBC hasundertaken to provide the majority of funding to theWelsh language service, S4C, from April 2013. We in theGovernment remain absolutely committed to a strongand independent Welsh language TV service, which wasof course set up under the last Conservative Government.

Charlie Elphicke: Opposition Members are arguingfor an increase in the licence fee. [Interruption.] Theyare as far as I can tell—they say that they have receivedrepresentations to that effect. In my experience a lot ofolder people, particularly those who get by on theirpensions, have trouble affording the current licence fee.Can anything more be done to help people in thatposition, and should the BBC take a greater role infunding such help?

Mr Vaizey: My hon. Friend makes an interestingpoint in his forensic intervention, which secured animmediate U-turn from Opposition Members on a licencefee increase. Perhaps he and I should talk later aboutwhat further help can be given to the elderly, but Iwould say that freezing the licence free is substantialrecognition of people’s difficulty in paying it.

The Government have put forward a new partnershipmodel between the BBC Trust and S4C as the best way


[Mr Vaizey]

of securing the latter’s future. Under that model, fundingfor S4C will come from three sources in future: thelicence fee, a continued subvention from the Governmentand commercial income. The BBC will contribute£76.3 million to S4C in 2013-14 and £76 million in2014-15. The Government will contribute £6.7 millionand £7 million respectively. The service will be operatedby a joint management board, with a majority ofindependent directors appointed by the BBC Trust.

I am aware that I am running out of time, but I wishbriefly to mention broadband. The current ring-fencedfunding for digital switchover of approximately £133 millionper annum will be raised to, and capped at, £150 millionper annum to fund broadband. It is important to saythat the switchover money was never part of the licencefee funding for the BBC, so in effect the £150 million ayear broadband money simply continues an arrangementmade under the last Government whereby part of thelicence fee is used for what could broadly be called“digital switchover”. When one talks about the BBCtaking on £344 million of extra liabilities, one is reallytalking about only £200 million.

Graeme Morrice: The point that I was trying to makeearlier was that I and other Members have receivednumerous representations from constituents expressingconcern about the freezing of the licence fee for the nextfour years, because in effect it will mean a real-termscut. People are concerned about a reduction in thequality of the service. The hon. Member for Harlow(Robert Halfon) made a point about democratisation.What consultation has there been with the licence feepayer about that real-terms cut?

Mr Vaizey: As I have said, we felt that there was ameeting of minds between us and the BBC, and that it

was best to get on with it rather than detain the BBC fora year in negotiating the licence fee.

We welcome the BBC’s plans to enhance its nationalDAB coverage, although we remain in discussions withit about its obligations as regards local DAB. I hopethat we can take forward developments on local DABcoverage with the BBC and the commercial radio sector.

Outside the formal licence fee agreement, the BBChas also made assurances to the Government about thescale and scope of its future activities in three areas.First, the BBC Trust has assured us that it considers itdesirable to dispose substantially of BBC Worldwide’smagazine business. Secondly, the trust recognises theprinciple that the BBC should not launch services thatare more local than its current offerings on radio, theweb and television, to give our local newspapers achance to survive and thrive. Thirdly, it has assured theGovernment that it will pursue a 25% reduction in thebudget of BBC Online, which will please The Guardian.I hope that those assurances from the BBC will beviewed in a positive light by those who have expressedconcerns about its income—sorry, impact—on the market.That was a Freudian slip.

I end by reiterating the Government’s full commitmentto the BBC’s independence. We regard it as a fantasticorganisation and a beacon of excellence in Britain. Ithank the hon. Member for Edinburgh South for securingthe debate. In my opening remarks, I forgot to thankhim especially for one of the reasons he will now remainmy favourite Labour MP—during his speech, he promotedme from Under-Secretary to Secretary of State. Forthat I will always remain grateful.

Question put and agreed to.

7.29 pmHouse adjourned.


Westminster Hall


[MR MIKE WEIR in the Chair]

UK Software IndustryMotion made, and Question proposed, That the sitting

be now adjourned.—(Angela Watkinson.)

9.30 am

Bridget Phillipson (Houghton and Sunderland South)(Lab): It is a pleasure to serve under your chairmanshipfor the first time, Mr Weir. I am grateful for the opportunityto hold the debate. I take a keen interest in the UKsoftware industry, and I am proud that SunderlandSoftware City, which is a centre of excellence, covers myconstituency.

I thank the Minister for coming to the Chamber toput the case for the Government—I am sure that we areall eager to hear what he has to say. I would like toextend to him and his colleagues an invitation to meetme after the debate to address any points that we mightbe unable fully to thrash out in the time available to us.

The UK software sector has compound growth of5.6% and is now worth £100 billion to the UK economy—almost as much as the financial services sector. Theindustry benefits from low capital costs, and its productsare instantly exportable. Its technology can also makenon-software companies more efficient, further addingto its worth to our economy. Figures from the UK’sTechnology Strategy Board show that 29% of the$3.4 trillion of worldwide spending on information andcommunications technology in 2007 was spent on ICTsoftware. Such spending is expected to reach some£2.6 trillion in 2011. I am sure we can all agree thatBritain needs to be at the heart of that new wave of ICTinnovation and investment.

The US is currently the world’s largest software market.We are all familiar with some of its major exports. Weall use Microsoft operating systems and office softwarein our parliamentary offices, and I am sure that we allknow of the success of Apple’s iPhone and iPad. However,I am proud that behind that American muscle is Britishinnovation. Specifically, the technology of Britain’s chipmaker ARM Holdings—including firmware, which is asubset of software—is in 95% of the world’s mobilehandsets, including products such as the iPhone andBlackBerry, and in more than a quarter of all electronicdevices.

The Labour Government left Britain in a good positionto become the world’s leading exporter of ICT softwareand services. From the story of ARM, it is clear thatBritain has what it takes to compete in the globalmarket, as long as the Government provide the toolsand support that the industry requires.

According to “Resilience amid turmoil: BenchmarkingIT industry competitiveness 2009”, the EconomistIntelligence Unit’s third annual study into informationtechnology sector competitiveness, Britain was rankedthird for human capital in the world, and fourth forsupport for the IT industry as a whole. However, I wantBritain to do even better. The report found that access

to broadband networks, investment in skills and businesssupport, and an adequate legal framework that strikesthe right balance between promoting technology andallowing market forces to work were vital for the industryto prosper.

It was the Labour Government who developed theframework that pushed Britain to become the fifthlargest ICT market behind the United States, Japan,China and Germany. However, I fear that the actions ofthe coalition Government since the election will jeopardisethat. I hope that the Minister can alleviate some of myfears in his reply.

Let us consider the record of the coalition Governmentso far. Labour promised universal access to broadbandby 2012, but the coalition has scrapped that pledge. Ajoint report by the Boston Consulting Group and Googleshowed that the internet economy in the UK represented7.2% of our gross domestic product, and that we led theworld in e-commerce, exporting nearly £3 for every£1 imported. The report also found that 250,000 jobswere dependent on the internet. The future of thesoftware industry in Sunderland will rely on the abilityto communicate digitally, and a strong broadband networkis at the heart of that. It is estimated that it would costmore than £500 million to bring superfast broadband tothe north-east. Without it, creative industries couldmove their business elsewhere. Will the Minister tell mehis plans for broadband, particularly in the north-east?

The coalition has announced a review of our intellectualproperty laws with the aim of relaxing the rules, butthat could leave Britain’s intellectual property exposedand unprotected. What assurances can the Ministergive me, as well as UK software and new media industries,that that will not happen?

The Tories and Liberal Democrats previously committedto providing tax breaks to the computer games sector. Iknow that many of my colleagues have spoken aboutthat in this Chamber and on the Floor of the House onmany occasions, and that there are strong feelings aboutit. I support their views on the need for tax breaks forthe industry. The industry body states that, withoutthem, the UK will be at a disadvantage compared withforeign competitors. What is the coalition’s justificationfor reneging on that promise?

On education and training, instead of incentivisingsoftware development as a viable career, the coalitionwill increase tuition fees for students taking mathematicsand ICT-related degrees, despite pledges to the contraryfrom some of coalition Members before the election. Ithas even cut the body tasked with buying computerequipment for schools. Will the Minister tell me howchildren in this country can be expected to use ICT inthe school environment and go on to become a futureSteve Jobs, Paul Callaghan or Chris Curry without anyco-ordinated approach on ICT provision?

Support for the software industry is about not justinvestment in business and education, but a wholepackage of measures. Another consideration of businessesthat I wish to draw to the Minister’s attention is theavailability of conventional transportation: road andrail. He might not be aware that two large capitaltransport projects in Sunderland—the central route andthe strategic transport corridor—are in jeopardy. Thesuccess of those projects is vital for the north-east toaccess the rest of the UK, but also for the UK to access

75WH 76WH10 NOVEMBER 2010 UK Software Industry

[Bridget Phillipson]

the north-east. Does the Minister agree that if we makethe north-east as interconnected to the rest of the UKas possible, we will have a more balanced economy?

I wish to dedicate the concluding part of my speechto a success story: Sunderland’s developing softwareindustry. Thanks to some remarkable people, Sunderlandhas more tech start-ups than any other region in theUK, with the exception of London. Almost 50 softwarecompanies operate in Sunderland, and almost 300 acrossthe north-east, and the number grows every week. OneNorth East estimates that the annual size of the north-east’snew media, games and software industry is more than£250 million. Sunderland city council’s business teamhas opened the e-volve centre in my constituency, whichprovides start-ups with vital tools for their developmentsuch as office and server space, and a bespoke packageof advice and support. It also works with Sunderlanduniversity to offer internships to ICT students. It is vitalthat the region can offer highly skilled jobs to graduates,particularly to allow our young people to remain in thearea rather than feel that they have to move elsewhere,often after they have studied at our world-renowneduniversities.

The software industry provides an ideal opportunityfor growth to provide the highly skilled jobs that thenorth-east needs to continue to attract investment anddevelop. However, that potential for growth anddevelopment faces significant challenges. The coalitionhas cut One North East, the region’s hugely successfuldevelopment agency, but let me tell the Minister whatOne North East achieved for the UK software sectorand the region.

Fifth Generation Technologies, an Indian companythat produces business intelligence tools for companies,came to Sunderland thanks to One North East. Codeworks,a centre for digital innovation based in the north-east,and DigitalCity, a successful and self-sustaining digitalmedia, digital technology and creative supercluster basedon Teesside, are what they are today thanks to OneNorth East.

The best example of the success of One North East,however, is Sunderland Software City. This innovationwas developed in partnership with Sunderland city council,the university of Sunderland and private sector partners.It inspires and supports the growth of the softwareindustry across the north-east, and makes the region thelocation of choice for software businesses.

From a single, easily accessible point that local companieshave found invaluable, Software City provides localcompanies of all sizes, from the smallest start-up tofirms with multimillion pound turnovers, with the supportthat they need to succeed. It helps companies to raisecapital and find investors and customers, provides one-to-one business and technical support, and helps withaccess to foreign markets such as India, China and theUS. More than 80% of participants in its student placementscheme have gone on to permanent jobs with the companiesto which they were assigned. Since Software City startedin 2008, it has helped almost 200 companies, includingTest Factor, Raise a Tree, and Guroo, which has managedto get almost 500 clients in just two years.

I shall conclude by offering the Minister an opportunityto recognise the software industry and to invest in thenorth-east. Software City was made possible by One

North East, but its £6.5 million grant will run out inMarch 2011. I welcomed the Government’s announcementlast week of a £200 million fund to invest in high-techhubs. Will he support the use of part of that fund tosecure funding for Software City up to and including2015?

9.39 am

Dr John Pugh (Southport) (LD): It is a pleasure toserve under your chairmanship, Mr Weir. I congratulatethe hon. Member for Houghton and Sunderland South(Bridget Phillipson) on having started an importantdebate on an important theme. She will understand thatI cannot comment on the situation in the north-east, soI shall concentrate my remarks on the contentious issueof video games—that has been the matter of someparliamentary discussion—and on Governmentprocurement, which is an issue that interests me evenmore.

I am not especially interested in video games per se.I have not played them since the days when I had aCommodore 64 and played a game called “Pesky Painter”,which unfortunately I have not been able to obtainsince. If anyone listening to this debate has a copy, Iwould be pleased if they wrote to me so that I couldhave access to the game again. Gaming is an addictivepursuit that takes up a lot of time, and someone whohas other interests in IT—as I do—finds other things todo. There is, however, an argument in favour of Governmentsupport.

There are basically two extreme views on Governmentsupport. One is that the Government should alwayssupport successful and/or sometimes failing industries,and the other is that the Government should neverinterfere in the market. A friend of mine who is asoftware engineer alleges that any IT company thatneeds Government investment ought not to be backedin the first place, because there is enough venture capitalout there and IT is a progressive and successful market.

I do not think that anyone seriously believes in eitherof those extreme positions. People who do not believein state intervention at all are a bit like the people whodo not believe in censorship at all. A case in whichcensorship was needed can always be cited, as can a casein which the state needed to intervene. The argumentsusually centre on not the principle of state intervention,but the degree of it and the method used. I thinkeveryone accepts, including the video games industryand all other branches of the software industry, thatthere is a role for the Government in incentivisingeconomically useful behaviour. The video games industrysupports the continuing policy of research and developmentcredits, and of such credits that are specifically aimed atsmaller businesses, presumably smaller software housesand the like. New starts are plentiful in the industry, andnew starts can often become very big companies.

All the companies that we are talking about, includingall those in the north-east, favour a sensible regime ofbusiness taxation. We can all talk about that, and aboutlevels of corporation tax and the like. I guess thateveryone nowadays accepts that tax incentives and breaksare better than direct subsidies, because they are a moreeffective way of encouraging winners and of getting thekind of behavioural impact that people want. I acceptthat a tax incentive is a form of sectoral subsidy, as

77WH 78WH10 NOVEMBER 2010UK Software Industry UK Software Industry

essentially an amount that is due is not being paid, butthe issue here seems to centre on whether a sectoralsubsidy is, on the face of it, justifiable and necessary. Ithas to be necessary to be justifiable. On the face of it,there seems to be a pretty good case. I think we allaccept that the industry has huge potential. The hon.Lady laid out very well what kind of potential it canoffer, not only for the country as a whole but in areas ofsubstantial deprivation. An area such as Sunderland isnot necessarily associated, in the way that California is,with the IT industry, but the association is certainlyhelpful to Sunderland.

There is obviously a huge native skill-base in thiscountry. I was surprised when, during the general election,individual constituents of mine e-mailed me to say thatthey were very much involved in a video games orsoftware business, and they made representations onbehalf of the industry. I was surprised at how many ofthem there were, and I was also surprised, in these daysof the internet, that they did not know one another verywell. I felt that after the election I could perform theuseful function of putting them all in touch with eachother. The hon. Member for Liverpool, Wavertree (LucianaBerger)—who has just arrived—is well aware that Liverpoolhas a burgeoning software industry involving a lot ofsmall companies. We should support that industryemphatically, because it is very green, forward-lookingand progressive.

Luciana Berger (Liverpool, Wavertree) (Lab/Co-op):Does the hon. Gentleman agree that we should introducesome kind of domestic tax incentives and support notonly to boost the industry, but so that we can competeon an equal playing field? Other countries across theworld that produce software and video games haveadditional incentives for the industry, in both researchand development and in the wages of people who comefrom abroad. Because we do not, we have dropped fromsixth to fourth place in the world in video games production.We have so many people leaving the UK to go to othercountries, such as Canada, the United States—

Mr Mike Weir (in the Chair): Order. I remind thehon. Lady that interventions should be brief.

Dr Pugh: I am not sure that the causal chain is asemphatic and clear-cut as the hon. Lady represents it,but later I shall come to the business of a level playingfield.

It could be argued, could it not, that the indicatorsfor what the industry offers and its potential are sogood that the case for state investment is almost beingundermined? If it is that good and there is that muchpotential, why would the Government be needed? Whyshould venture capital not be there; why would it not bethere? I suppose there are some answers to those questions.It could be argued that this country’s financial sector isnotoriously short term, which indeed it is. It is somewhattax averse, and we have seen plenty evidence of companiespreferring to go to places where the tax burden is less.The companies are certainly not patriotic and if theyhave scope elsewhere in places such as Canada, theymight well decide that they want to place their fundsthere.

There are other strong arguments against the stategetting too heavily involved in managing the industry.One is that the IT industry is notoriously volatile andunpredictable. One only has to look at the giants of the

past that have crashed in the night—the IBMs, theLotus Notes and the strange fall and rise of the Mac.One need only consider what would have happened hadthey put their money into floppy disc manufacture afew years ago, or into CD-ROM manufacture in thepast five years. When someone puts money into thesoftware industry or the IT industry more generally,they do so at an appreciable risk.

It cannot be in the long-term interest of the nation—ofall nations—to base national taxation, for any sector,on the lowest common denominator of internationaltaxation. Although the video games industry has said alot about Canada, I would like to see what is happeningin other areas where the software industry is also thrivingand is competitive with Canada. I shall not rehearse thearguments that we could have about state aid andprotectionism. I do not understand, however—the Ministercan help me here—the argument presented by theChancellor for not giving tax relief to the video gamesindustry. He said that it could not be well targeted. I donot grasp that, and some evidence in the notes that havebeen provided makes it less than clear what is beingsaid, meant or agreed by the Treasury.

Jim McGovern (Dundee West) (Lab): I think theChancellor actually said that the tax breaks were poorlytargeted, rather than not well targeted. I have since hadmeetings with Ministers who have said that it is Governmentpolicy no longer to target any industry for tax breaks.Does the hon. Gentleman have a view on that?

Dr Pugh: The second answer that the hon. Gentlemanwas provided with seems to possess greater clarity thanthe first, because the first is, I guess, contestable. We canhave a long discussion about how we can and cannottarget breaks. A rational argument can quite decentlybe made that the software industry, given its potentialfor the capital venture market, is a lower priority thansome other industries in a context of scarce resources;or it could be said that a break would be an unnecessaryfiscal discount. The Minister can perhaps explain laterexactly what is meant by the poverty of targeting in thiscase.

It is true that under our existing taxation policy someindustries have failed, but even some of those mentionedin the notes we have been provided with have failed notbecause of the taxation policy, but because other thingshave gone wrong in the software development worldand the product simply has not taken off. It is anintrinsically risky market, and the state ventures into itwith some caution.

Just to extend the debate, there are other things thatwe should be talking about. I do not think the Government’srole in encouraging the software industry simply startsand finishes with tax breaks. They have a definite role ineducation. The hon. Member for Houghton andSunderland South underplayed the continuity of Britisheducation between one Government and the next withregard to developing the software engineers of thefuture. In that context, I have a general worry abouthow the curriculum shapes up. In the initial phases ofIT education, children were taught about programmingand so on, but a great deal of recent IT education issimply about how to use applications. The peoplewho are going to produce the applications of the future


[Dr Pugh]

will not be the British: they will be Indian, Chinese andpossibly American. There is a decline in IT education inthis country—or, rather, it is not what it could be.

On the Government’s role, there is a further aspect toconsider. The Government are probably the biggestcustomer for IT. Some 40% of all IT products, softwareincluded, are ordered by Departments. Governmentprocurement is extraordinarily difficult for small softwarecompanies to work with, the process often being soprolonged that they cannot sustain their interest inapplying for work, which the big companies ultimatelyget. The Cabinet Office and the Department for Culture,Media and Sport should consider how that processoperates.

Labour Members must forgive me for going in thisdirection, but I have to say that huge software projectsthat were going to be embraced in the Building Schoolsfor the Future programmes were, by and large, built byallowing the biggest players—the big American softwarefirms—to engage with the process. Small British softwarefirms found it difficult to get on the British EducationalCommunications and Technology Agency list. I havecomplained about BECTA in this Chamber in the pastand I am glad that, as a result of my representations, ithas been abolished.

There is a close and unattractive relationship betweenbig government and big IT. We are blessed with theConnecting for Health project, with all its problems,ramifications and extra costs, largely because of closeconnections and conversations between the previousPrime Minister and Bill Gates. There has been a slowcommitment to interoperability, open standards andopen source in IT procurement in this country—particularlystate and government IT procurement—all of whichhas effectively shut out the burgeoning British softwareengineering companies and favoured the large players,including Microsoft and Oracle.

I noted the Chancellor’s suggestion before the election—Iam sure the Minister can comment on this—that byadopting a more favourable position towards open sourceand open standards, the country would save £500 million.I have not seen that in the comprehensive spendingreview so far. I can provide the press releases if any hon.Member doubts it, but I am sure we would all want tofollow that up. That must surely be better than fallingfor the trick, as has happened in the past, where wereceive memorandums of understanding and order shed-loads of products from big software houses abroad,simply because they give us the licenses at slightly lessthan the exorbitant prices they would charge a privatecustomer.

The Government can do a huge amount in monitoringhow taxation policy plays out. If there is a case, andserious empirical evidence is produced, showing thatthe video games industry is deserting the UK purely offthe back of current taxation policy because the Governmentare reluctant to follow through on some suggestionsmade prior to the election, they will need to look atthat. We cannot afford to stand by and let the industrygo, because that would be a serious loss to the country.

We need to keep an open mind on fiscal measures andwhat will work, and to take a hard, prolonged look atboth our education—

Jim McGovern: Before the general election, theConservative and Lib Dem spokesmen on this subjectboth said unequivocally that they would support taxbreaks for the video games industry. Why has thatchanged?

Dr Pugh: I am not party to the discussions that haveled to that change. Clearly, there were opportunities forprevious Governments to do precisely that.

The opportunities for the British software industryare huge. The Government just need to make the rightmove. Some of the right moves are plain and obvious,and I hope they will make them.

9.55 am

Mike Weatherley (Hove) (Con): I congratulate thehon. Member for Houghton and Sunderland South(Bridget Phillipson) on securing this debate.

The Government have made a number ofannouncements in the past weeks emphasising theimportance of innovation to the UK economy. In particular,I welcome the Prime Minister’s “Blueprint for Technology”and the specific measures set out to support technology-based innovation. The UK software industry is at theheart of such innovation, and none more so than thevideo games and interactive entertainment industry.

The UK video games industry—the fastest-growingcreative industry in Britain—is one of the biggest in theworld. More video games than ever before are beingplayed on an ever-growing range of platforms: consoles,online, mobile phones and interactive TV, to name afew. One in three voters consider themselves gamers.My hon. Friend the Member for Southport (Dr Pugh)mentioned his preferred game; mine is “Command andConquer: Red Alert 2”.

A large part of the industry’s strength lies in itsdevelopment of original intellectual property. The UKvideo games industry excels in innovation and researchand development. It is anticipated that the growth inmobile and online gaming in particular will providenew opportunities for original IP development. Sussexis home to a number of content creators and digitalmedia companies, poised to play their part in the UK’seconomic recovery. In my constituency—Hove andPortslade—and in the wider Brighton and Hove area,companies such as Black Rock Studios, NCsoft, Eurogamerand Futurlab are meeting demand from a thrivinghome and export market.

Government support is needed to ensure that the UKremains at the forefront of this thriving industry and toensure that it continues to grow. IP protection is crucialin that regard. I am sure that I do not have to remindhon. Members of the importance of intellectual propertyrights, particularly in the online space. I welcome, and Ihope other hon. Members do, the Government’scommitment to IP and the Gowers report, and topursuing infringers through the Digital Economy Act2010, although it is not perfect in respect of the appealsprocedure. It is right that the Government continue thisgood work, making the IP framework more conduciveto innovation.

As the Prime Minister reflected this week, IP is notjust about protecting the end result; it is also aboutensuring originality in creation. Will the hon. Lady joinme in welcoming innovations in the video games sector


that are allowing the UK to harness its talents andexploit its advantage? For example, the university ofAbertay Dundee, is achieving great things with Governmentsupport. With support from the Department for Business,Innovation and Skills and from the European regionaldevelopment fund, Abertay university is establishing avideo games centre of excellence and a prototypingfund, allowing small games developers throughout theUK to apply for grants of up to £25,000 to support thedevelopment of fully working prototypes.

Jim McGovern: When will a member of the coalitionGovernment visit Abertay university?

The Parliamentary Under-Secretary of State for Business,Innovation and Skills (Mr Edward Vaizey): On 3 February.

Jim McGovern: The Secretary of State for Scotlandhas visited, but no Conservative Member has done so.

Mike Weatherley: I thank the Minister for hisintervention.

Commercialisation and project management supportwill also be provided from Abertay’s business and computergames experts, giving each successful applicant the bestchance of establishing or developing a thriving business.The spill-over effects into other areas are plain. Forexample, talented students and graduates will gainimportant work experience opportunities on projectteams, working in the same studio environment as computergames companies. Overall the project can be describedas a pipeline for the creation of new intellectual propertyand it is expected to stimulate the economy by attractingprivate sector investment.

Similarly, a partnership between Cardiff schools ofcreative and cultural industries at the university ofGlamorgan and Swansea Metropolitan university willsupport companies holding creative IP in exploitingthat resource through identifying routes to market anddeveloping capacity. The DigiLab will ensure that gamesprototypes for further investment are generated, andthat subsequent end products reach the key gamespublishers quickly to the benefit of participating companiesand sponsors.

I call on hon. Members to support those and otherinitiatives, which are providing crucial commercial andintellectual partnerships to spur innovation and sustaina sector that is at the heart of our economic recovery. Iwelcome recent announcements about the Government’sintention to establish technology and innovation centresand to use Intellectual Property Office savings to supportUK business, helping companies to develop newtechnologies and offer advice in developing their intellectualproperty. I look forward to seeing how those projectsdevelop in the coming months.

Finally, the Government have signalled that they willconsult business later this autumn on the taxation of IP,and the support that research and development taxcredits provide for innovation. That area is of vitalimportance to the software industry, and I urge my hon.Friends to engage with industry bodies such as theAssociation for UK Interactive Entertainment, and providea framework for the industry to flourish.

10 am

Justin Tomlinson (North Swindon) (Con): I rise tosupport the principle of this excellent debate secured bythe hon. Member for Houghton and Sunderland South(Bridget Phillipson). Let me provide a little context onwhy I have come to support the debate. At midnight onMonday, “Call of Duty: Black Ops” was launched asthe latest product in a series of the world’s best-sellingcomputer game. More than 100 HMV stores were open,and queues of people were waiting to get hold of thegame. About £1.5 million of sales were expected on thefirst day, and worldwide sales are expected to exceed£1 billion, which will make it the best-selling computergame ever. It was my birthday on Friday, and I amhopeful that when I return from Westminster at the endof the week, a copy of the game, along with “FootballManager 2011”, will be waiting for me. I must, however,confess that I am exceedingly average at both games.

I have spoken to a lot of hon. Members about thisdebate, and the average level of knowledge about computergames among MPs is not fantastic. I have done a littleresearch, and found that Positech Games has launchedgames called “Democracy” and “Democracy 2”, wherethere is the opportunity to be the Prime Minister. I amsure that the Leader of the Opposition will soon beordering a copy.

I have taken part in many debates in which we soughtto identify new markets to allow the UK economy toexpand and diversify. The information and technologymarket is happening now. As has been mentioned, theworldwide ICT market is expected to reach $4.3 trillionin 2011. UK studios already generate global sales of£1.7 billion a year, with the UK market in the region of£3.5 billion a year. It is essential that we are best placedto benefit from that.

Interestingly, the market is changing and in manyways it is going full circle. Although big budget gamescan cost around £25 million to develop and are thereforedominated by the big players, many of the early softwareindustries in the ’80s initially expanded from a bedroomindustry to become the multi-million pound industriesof today; for example, Codemasters, which was set upin 1986 by Richard and David Darling. With iPads,iPhones and Facebook applications, once again, newplayers can enter the market. We should encourage andsupport that.

My constituency can play a part in helping the UK tobenefit from that growing market. The head office ofthe Technology Strategy Board is based in Swindon,and I had the pleasure of meeting its chief executive acouple of weeks ago. Part of the company’s remit is toinvest in stimulating business innovation in ICT, and itsprimary role is to work with e-skills UK, professionalsocieties, and research councils—many of which are basedin Swindon—the Department for Business, Innovationand Skills and the Department for Education. Throughits co-ordination, expertise and funding, the UK should,and can, fully benefit from that crucial market.

I extend an invitation to the Minister to meet theTechnology Strategy Board. As an incentive, Swindon—inits second role in the industry—is home to the Museumof Computing, which I support. All hon. Members whohave referred to computer games, or to their originalcomputers, can go and see those things proudly ondisplay, and the museum would be delighted to welcomethem.


10.3 am

Ian Lucas (Wrexham) (Lab): It is a pleasure to serveunder your chairmanship once more, Mr Weir, and tohave listened to the various hon. Members who havecontributed to our debate about an extremely importantindustry for the United Kingdom. The ICT industryhas developed hugely over recent years. I remember thatwhen I was a bright-eyed, bushy-tailed candidate in1997—I was one of the few Labour candidates tolose—we talked about giving computer internet access,as we then called it, to schools. Now, 13 years later,much of that optimism and much of the commitmentmade by the previous Government to putting schoolsonline and introducing computers into schools has beenrealised. We easily forget the scale of the change thathas taken place in our schools as a result of investmentover the past 13 years.

There is no doubt that when the Labour party leftoffice, the British software industry was strong on thenational stage with 1.2 million people working in it toservice the 22 million people throughout the UK whoaccess IT and use computers every day in their work.We must try to ensure the continuation of our competitiveadvantage and knowledge base that has enabled thesuccess of the international UK computer industry.

Today, thousands of students are marching in Londonin response to the Government’s proposals for universitytuition fees. That is relevant to today’s debate, becauseover the past 13 years, there has been major investmentin higher education and an increase in the number ofstudents going to university. If one industry is knowledge-based, it is the IT and software industry. Those studentswho went to university and were attracted by all thegames—of which hon. Members know much, and Iknow very little—have grown our IT industry. Manyimaginative and successful small companies in the UKhave come out of universities. My fear is that as we goforward, given that it is proposed that student tuitionfees will rise to £9,000 a year, many people similar tothose who went to university over the past 13 years willbe discouraged from attending university and thereforefrom going into an educational, innovative atmospherethat could lead them into that innovative industry.

Dr Pugh: The hon. Gentleman will recall that hevoted for tuition fees in the last Parliament and I didnot. I say nothing about the current policy, but at thetime I said that the introduction of tuition fees andtop-up fees would reduce the number of people applyingto university. As a matter of empirical detail, I turnedout to be wrong. There is an outside chance that,regardless of the merits of this policy, the hon. Gentlemancould also turn out to be wrong, as I was.

Ian Lucas: The hon. Gentleman is wrong to state thatI voted in favour of tuition fees—I did not. I havealways opposed tuition fees. There is a difference inkind between the tuition fees introduced through legislationin 2003-04 and the present position. The fees introducedin 2003-04 were supported by a generous bursary schemethat the Government put in place, which was the mainreason why the proposals went through. We now have asituation in which fees of £9,000 a year are beingproposed. Before the introduction of those fees, whenParliament will be asked to increase the cap to £9,000,we will not have any discussion about the bursariesthat will be put in place. The White Paper on higher

education—one of the most important subjects for ournation—will not be produced until after we have votedon the cap, and that is a matter of profound concern. Ihave always shown a great interest in this issue and, forthe benefit of the hon. Member for Southport (Dr Pugh),I can say that it is one of two occasions when I votedagainst the Labour Government. The matter goes to theheart of whether the UK software industry succeeds inthe future.

Of all the countries that compete with us, we arealone in cutting back on investment in higher education.Teaching grants for most of the subjects that will leadto people studying IT at university will be removed.That cannot make us more competitive as a nation,because it will make our students less knowledgeable. Itis therefore necessary that we say that the removal ofthose teaching grants will have profound effects.

In its 2008 “Developing the Future” report, Microsoftstressed explicitly the importance of industry placementsfor students. When talking about the lower level oftuition fees, it stated:

“The introduction of tuition fees may have created a deterrentto students considering taking up a placement as they are likely tobe more anxious to finish their studies as soon as possible in orderto repay their loans and avoid further debt.”How much greater will that deterrent be as tuition feesare set to triple?

That is not the only area of uncertainty created bythe present Government. Labour made a clear commitmentto universal broadband by 2012, but it has been scrappedby the Tory-Lib Dem Government. That will create acompetitive disadvantage for many companies awayfrom the south-east of England and centres of populationin general. It will inhibit the development of innovativesmall businesses, which are so evident in the softwareindustry. Even more serious is the uncertainty about theexpansion of high-speed broadband services, which arekey to the development of software companies. We allknow that the £530 million docked from the licence feewill be insufficient to pay for universal high-speedbroadband across the UK. Will the Minister please tellus where the Government believe the money for thatwill come from?

The Government have set their face against supportfor the video games industry by scrapping Labour’sgames tax relief. We heard today that we need a clearerexplanation of why the Government believe that thatstep—it contradicts the Conservatives’pre-election stance,although we have come to expect that from the presentGovernment—should be taken. My hon. Friend theMember for Dundee West (Jim McGovern) has beendoggedly pursuing the matter for as long as I canremember, but he is still to receive straight answers tothe straight questions that he has been putting. Why isan industry that we know is successful and that is in avery competitive environment not receiving the supportfrom the Government that the Conservatives statedbefore the election that they would provide?

Justin Tomlinson: Will the hon. Gentleman clarifywhether it is still Opposition policy to support those taxincentives? If so, how would they be funded and wherewould that funding come from?

Ian Lucas: Let me give the hon. Gentleman oneexample of what the Government whom he supportshave chosen to do. They have chosen to reduce corporationtax rates year by year, and they are paying for that by


taking away tax incentives for industry to make capitalinvestment. The Labour party believes that that approachis wrong, because lower corporation tax has a hugeeffect on banks’ income, and the approach detrimentallyaffects investment and manufacturing in this country.We want to support investment and manufacturing inthis country, so we favour tax incentives and relief forinvestment made by business. That is the line that we aretaking. We took it in government, and we believe that itis correct.

Luciana Berger: Is my hon. Friend aware that the RedBook cites the amount involved in not introducing thevideo games tax relief as £200 million, but that thatdoes not take into account the net benefit of introducinga video games tax relief, which conservative estimateshave put at an additional £200 million?

Ian Lucas: I am very grateful to my hon. Friend. Thatsounds like a good deal to me, so perhaps such anapproach that should be followed. We have a successfulindustry. We should be encouraging it to prosper, nottaking away its advantages.

Last week, the Prime Minister made a speech aboutinformation technology. Interestingly, he chose to makeit in east London. I note that this debate was secured bymy hon. Friend the Member for Houghton and SunderlandSouth (Bridget Phillipson). We want innovative companiesthroughout the UK—in England, including the north-eastof England, in Scotland, in Wales and in NorthernIreland.

My hon. Friend made the excellent point that thenorth-east had one of the best regional developmentagencies in the country in One North East. She talkedabout Sunderland, its Software City and its computercity-approach. We all know about the success of theinvestment levered into the UK from Nissan by OneNorth East, working with Her Majesty’s Government.That £400 million of investment came at a cost of£20 million. That is the type of work that has beengoing on in the north-east to bring innovative newcompanies and investors from abroad to the UK.Unfortunately, One North East has gone and, as wespeak, Sunderland does not have a local enterprisepartnership.

We heard the Prime Minister talk last week about afund of £200 million for new technology and innovationcentres, so I would like some information from theMinister about the money. Is that sum separate fromthe regional growth fund? If so, who will administer itand how does one access it? If part of the country, suchas Sunderland, does not have a local enterprise partnership,how will it access finance from the fund? Is the fundintended to be solely for the benefit of east London or isit a national fund? [Interruption.] The Minister chuckles,but it tells us something that the Prime Minister shuttlesacross to the east of London to make such anannouncement instead of going, for example, to thenorth-east of England, which has many great industrialstories to tell.

I would also like to pick up the point that the hon.Member for Southport made about Microsoft having aclose relationship with the previous Prime Minister—orwas it the Prime Minister before? There was evidence inlast week’s announcements of another close relationshipbetween a Prime Minister and a major multinational

software company—Google. Strangely, however, the hon.Gentleman did not refer to that. In particular, there wasan announcement of a review of the intellectual propertysystem, which the Prime Minister himself said frustratedGoogle in this country. It is interesting that on the veryday the Prime Minister announced that there would bea review of intellectual property rights in the UK,Google announced that it would be taking part in theeast London high-tech city project.

Dr Pugh: We all need to be cautious about suchthings, and I must add to that the fact that my righthon. Friend the Deputy Prime Minister made somesignificant announcements the other day at the eventinvolving Microsoft. We all need to be wary about theseissues.

Ian Lucas: We do indeed, but the hon. Gentlemanraised the issue initially—specifically in connection withthe Labour party and Labour Prime Ministers. I thoughtit only fair to illuminate the debate by highlighting theannouncements that were made only last week.

When examining issues such as intellectual property,which is extremely important and does need to beexamined, we need to be conscious of not only freedomof expression and access to information, which are ofcourse vital and needed to make our nation competitive,but the rights of those who create original material,who are often the small people in all this and do nothave access to Prime Ministers, and sometimes havedifficulty gaining access to MPs. Their rights concerningtheir intellectual property need to be retained. I shalltherefore be watching the review with great interest. It isimportant that there is broad input into the review and Iencourage anyone who has interest in this area to contribute.We are at a positive stage for the UK software industry.We have great talent, great innovation and great originality.My contention is that much of that arises from thepositive intellectual atmosphere that has been fosteredgenerally in the UK, and specifically in our universities.I am worried that that atmosphere might disappearbecause of the environment in which we operate.

Jim McGovern: I thank my hon. Friend for givingway; I went to my usual seat in the Chamber over here,so I seem to have split from the Opposition.

On the subject of access to MPs, prior to the previousLabour Government’s March Budget statement, numerousMinisters—the Chancellor, the Secretary of State forScotland, and Ministers from the Department for Business,Innovation and Skills and the Department for Culture,Media and Sport—visited Abertay university. They sawfor themselves just how important the industry was toDundee and, on the back of that, the Chancellor announceda tax break for computer games. However, since thegeneral election, there has been not one visit to Dundee.

Mr Vaizey: Just the Secretary of State for Scotland.

Jim McGovern: Prior to the withdrawal of tax breaksfor the computer games industry, not one Ministervisited Dundee. Does my hon. Friend the Member forWrexham (Ian Lucas) agree that that was unfair, at thevery least?

Ian Lucas: We all benefit from close contact with notonly our constituents but, for example, universities. Iam delighted that the Minister will be visiting theuniversity in Aberdeen—[Interruption.] Dundee; I am


[Ian Lucas]

corrected. I am sure that he, like all of us, would benefitfrom such a visit. It is important that we understandhow different universities are from when some of usattended university.

As I mentioned, another area about which I haveparticular concern is high-speed broadband. I speak asa Member of Parliament for Wrexham and for Wales,and I am worried that uncertainty around the proposalsfor developing high-speed broadband, and indeed universalbroadband before that, is leading to an atmosphere inwhich businesses away from the south-east of Englandwill suffer a competitive disadvantage. In an area suchas software, that will be crucially important.

Justin Tomlinson: Will the hon. Gentleman clarifywhat speed he would classify as high-speed broadband?

Ian Lucas: Speeds of 10 megabits-plus are commonlyperceived as high speed, although figures of up to50 megabits are valued in some areas of the computerindustry. Those are the sorts of speed that I would liketo see. The problem is that there are many parts of thecountry—rural areas, which are not normally representedby Labour MPs—that do not as yet have even 2 megabits.Under this Government, there is no commitment toensure that individuals from these areas will receivesuch support for broadband services in the future.

YouView will be introduced into this environmentnext year and demand for broadband services will increaseas a result. This important area is at present below theradar—if I may mix all my metaphors and technologicalexpressions—but it will become more evident in thenext year or so because of the expansion of suchservices. If we are to maintain a broad-based industryacross the country, it is important that we focus hard onthis and also that we get some detail and certaintyabout how the investment will be delivered right acrossthe United Kingdom.

10.24 am

The Parliamentary Under-Secretary of State for Business,Innovation and Skills (Mr Edward Vaizey): I am grateful,Mr Weir, to be serving under your chairmanship today,instead of serving with you on Committee as we wereyesterday, and will be again tomorrow.

I congratulate the hon. Member for Houghton andSunderland South (Bridget Phillipson) on securing thisimportant debate. May I give her one quick, straightanswer, which is that I would be delighted to meet her ata later date if she finds my speech unsatisfactory? I canmake a safe prediction that because I am a Minister andshe is member of the Opposition, my speech will almostcertainly fall short in some respects of what she wishes.

I would also be only too delighted to visit Sunderlandand see some of the innovation and technology happeningin that city. The hon. Lady used her speech to highlightbrilliantly the sort of technology expertise that nowexists in Sunderland. In fact, as pointed out, in thenorth-east alone it is said that the software and ITindustry is worth something like £800 million; there arealmost 2,200 businesses, 27,000 people and companiessuch as 5G, which she mentioned, and, in other parts ofthe north-east, Sage, Reflections and Eutechnyx. Sunderlandis a hub of high-tech industry.

I am grateful to some of the other hon. Memberswho have contributed to the debate. The hon. Memberfor Southport (Dr Pugh) made a thoughtful speech,which was not partisan but reflected on many of theissues that affect the software industry. He effectivelyturned the debate, for a moment, into one on the videogames industry. Another point, which I shall return to,and which I absolutely support him on, was his reflectionthat in schools children today are learning how to useapplications rather than learning how to programme.

In fact, the hon. Gentleman might have shared withme some of the anecdotal experiences of talking tosome of our top games developers, many of whomlearned their trade, as it were, on the BBC Acorncomputer in the ’80s. We simply do not have such accessto the nuts and bolts of technology. One of the thingsthat I want to work on, in a big society kind of way—Iam one of those Ministers who fully understands whatthe big society is—is some sort of after-school clubwhere children can sit down with developers and learnhow to programme. I also took on board the hon.Gentleman’s points about big IT and big government.He will be well aware that many members of the newGovernment, particularly the Chancellor, are keensupporters of open source software. The Governmentare very focused on ensuring that small and medium-sizedenterprises get a fair share of the cake from the Government.

I was pleased that the hon. Gentleman took a realisticview about the fate of BECTA—we should not alwaysfocus on the quango as the be-all and end-all ofGovernment policy. I am sure that schools will continueto access excellent high-tech IT equipment for theirchildren, not least from RM plc, one of the foremosteducational technology providers in this country, basedin my constituency, at Milton park in Didcot.

It was good to hear the speech of my hon. Friend theMember for Hove (Mike Weatherley), whose soon-to-beconstituency I visited during the election. I am not surewhether I made a big impact; I suspect it was his hardwork and dedication to his now constituents that securedhim the seat. He has already made a name for himself inthe House with his passionate support for the creativeindustries. He used to work in the film and musicindustry. His focus is on piracy, to ensure that there is abalanced debate and that we remember that rightsholders deserve to make money from their creations. Itake on board his points about the R and D tax credits.

I am delighted to see my hon. Friend the Member forNorth Swindon (Justin Tomlinson) in the Chamber,having won his seat at the election. His remarks reflectedthe change of tone in the House on video games. WhenI was an Opposition spokesman and talked about theimportance of video games, the only Labour Memberwho would talk about video games was the right hon.Member for Leicester East (Keith Vaz), who regularlycriticised them for their violence and their effects onsociety—he alleged. It is good that my hon. Friends arenow standing up and saying proudly that they areplayers of video games.

Jim McGovern: Does the Minister accept that “videogames” is perhaps the wrong title for the subject? Anyonewho has visited Abertay university would see that whatare called video or computer games can be applied toconstruction, architecture or medical science. It is wrongto say that “video games” just involve young lads sittingat a computer playing “APB” or “Grand Theft Auto”.


Mr Vaizey: Obviously, the software industry is farwider than simply video games. We tend to call it thevideo games industry in the vernacular, although somepeople call it the interactive entertainment industry.However, I have said consistently over many years thatwhat one loosely calls the video games industry is at theheart of a whole range of technologies in defence,education, health and the wider creative industries, suchas architecture. That is why it is so important to supportthe core skills and companies in the industry.

My hon. Friend the Member for North Swindoninvited me to meet the Technology Strategy Board. Ihave done so. It is incredibly important to the debateabout the future of the software industry, as well asacross a range of other areas. I am delighted that it is inSwindon, just down the road from my constituency;indeed, several of its employees are constituents, so theyare clearly people of great judgment. Let me take thisopportunity to wish my hon. Friend a happy birthdayfor last Friday.

Last but not least, I welcome to our Benches the hon.Member for Dundee West (Jim McGovern). I cannotwork out why he is sitting where he is, and I had bettertread carefully in making an analogy, but he resemblesone of those soldiers from the last war who was sodedicated to his craft in taking on the enemy that he dugdeep, burrowed down, hid and covered himself incamouflage. In coming to his usual seat, he is as yetunaware that the last war has concluded, victory hasbeen declared and there is a new Government. Alternatively,his choice might simply reflect the huge success of thecoalition’s policies over the past six months, particularlypertaining to the software industry, to which I am aboutto turn.

Jim McGovern: Let me say in response that I mightbe the first, but I will certainly not be the last, to splitthis coalition.

Mr Vaizey: The hon. Gentleman indicates that he issimply acting as a buffer between Conservative andLiberal Democrat members of the coalition. I wonderwhat other conflict spots we could send him to, giventhat he is doing such an excellent job this morning.

I have mentioned the huge importance and success ofthe software industry in Sunderland. The hon. Memberfor Wrexham (Ian Lucas) talked of the success of theUK software industry, and I heartily endorse what hesaid. More than 500,000 people work in it, and there aremore than 100,000 enterprises, generating more than£39 billion of gross value added. The UK market forsoftware products and services is the largest in theEuropean Union and has sophisticated leading-edgeconsumers in sectors such as logistics and financialservices. As a result, almost all the world’s major softwarebusinesses have a substantial presence in this country,whether in research and development, logistics or salesand marketing.

The software industry is not immune to the pressuresbeing felt across the UK economy. In the longer term,globalisation will create additional pressures, as routinetasks and activities continue to be relocated to lower-costeconomies. However, there are also tremendousopportunities for the sector, and I am certainly from theschool that sees the glass as half full, rather than halfempty. Innovative software technologies will underpin

many of the fundamental shifts that we see in oursociety and our economy—everything from how weshop and access entertainment such as television andvideo to how we improve our transport networks andmanage our scarce natural resources. In all those areas,new software systems will be the key enabler and driverof growth and innovation. As a result, the sector’simportance extends far beyond its direct contributionto UK GDP and employment, vital though that is. Thesector will be in the vanguard of our broader economicrenewal.

The coalition Government are absolutely committedto creating the right conditions to allow software andother UK technology companies to flourish. That meansresponding to the sector’s distinct requirements to ensurethat the software businesses of tomorrow are nurturedtoday. Last week, the Prime Minister launched “Blueprintfor Technology”, which clearly stated the Government’sambition to make the UK the No. 1 place in the worldto start and invest in a technology company, as well asour ambition to be the most technology-friendlyGovernment in the world.

The hon. Member for Wrexham took huge exceptionto the fact that the blueprint was launched in Shoreditch,not Sunderland, and I assure him that I will be writingto the hon. Member for Hackney South and Shoreditch(Meg Hillier) to tell her that one of her party’s spokesmendeems her constituency unworthy of the prime ministeriallaunch of a technology blueprint. The hon. Gentlemangave no reason, but if he wants to clarify why he has adowner on Shoreditch, he has only to intervene.

Ian Lucas: I would be delighted to intervene. I madeit absolutely clear to the Minister, who clearly was notlistening to my speech, that a commitment to the regions,which is so important to the future of the softwareindustry across the UK, is lacking. I am sorry that HerMajesty’s Government, and particularly the Prime Minister,have not, for example, put in place a local enterprisepartnership in Sunderland, which is an extremely importantindustrial city in the north-east, where one of the world’smost important automotive companies is based. I wasillustrating the fact that the Prime Minister’s prioritiesappear to be focused on the south-east, which is wherehe launched the blueprint.

Mr Vaizey: The hon. Gentleman might as well saythat the fact that we are having this debate in Westminsterindicates that the Opposition’s priorities are focused onthe south-east, rather than on Sunderland. It is slightlycrass to rubbish the technology blueprint on the basis ofwhere it was launched. It was launched in a Labourconstituency, and the Government were absolutely adamantthat it would be, to show our support for the Opposition.

As for the LEP, the hon. Gentleman well knows thatindividual local authorities and areas were invited tobid for an LEP. Sunderland’s bid did not get throughthe first phase, and it is now part of a wider bid for theTees valley. I am certain that it will be constructivelylistened to and will progress. The idea that the north-eastis somehow not getting LEPs is another complete myth;indeed, the hon. Gentleman’s speech was full of myths,to which I will return from time to time in my remarks.

For example, if the hon. Gentleman wishes to interveneagain, perhaps he could elaborate on his remark thatGoogle was rewarded for coming on board the east


[Mr Vaizey]

London project—along, I have to say, with importantBritish companies such as Vodafone and BT—with areview of intellectual property. Is it his allegation thatthere is some corrupt deal between Google and theGovernment? If it is, he is free to intervene to make thatpoint. I notice that he is not going to.

Software companies have said that their top priorityis the ability to access the right skills in the right place atthe right time. Those skills range from specialist capabilitiesin science and engineering through to practical know-howin systems maintenance. The relevant sector skills councils,including e-skills UK—the sector skills council for businessand information technology—are working closely withsoftware employers and the Government. The aim is tobring together the education system and workplacetraining to create the pool of skilled workers needed togenerate and exploit innovative technologies. It is importantto note that the Government announced early in theirtime in office the Livingstone-Hope review of skills forthe video games industry, which is progressing extremelywell and has generated enormous support from thesector. It will no doubt complement the other reviewthat I mentioned.

The Government recognise that the software andtechnology sectors are globalised and highly mobile. Wewill therefore ensure that investors and entrepreneurswho want to operate in the UK can enter, while we arereducing the overall level of immigration to a manageablelevel. That is why the technology blueprint introduces anew entrepreneur visa to make sure that someone with agreat business idea who receives serious investmentfrom a leading investor can base their business in theUK.

Ian Lucas indicated dissent.

Mr Vaizey: The hon. Gentleman shakes his head. Weall know the Labour party’s record on talking aboutimmigration, and we have been only too interested tosee the leaflets that it was putting out during the election.Our policy takes a slightly more sober and reasonableapproach to what can sometimes be an emotive issue.

Bridget Phillipson: The Minister may be aware thatthe Select Committee on Home Affairs, of which I am amember, gave careful consideration to the immigrationcap. Some of the concerns that were raised, particularlyfrom ICT companies, were about how it would workand whether it would be a deterrent for business investment,particularly in relation to highly skilled jobs such asthose in scientific industries. I know that the Minister ismaking a party political point, but there are seriousissues for the Government to consider about the workingof the cap and the impact that it may have on the UKsoftware industry.

Mr Vaizey: I should love the hon. Lady to point outwhat party political point I made. I was simply settingout our policy and the fact that we responded to theconcerns in question with an entrepreneur visa. I notedthat the hon. Member for Wrexham was shaking hishead. Clearly, he simply opposes the policy for the sakeof it, rather than considering what it does.

The blueprint also announces a review of the intellectualproperty framework, to ensure that its design will supportthe growth of both new and existing businesses. Thatreview is incredibly important, because it will focus onthe needs of small and medium-sized enterprises. Wewant to give our full backing to the high-growth, innovativecompanies of the future, whether they specialise insoftware or other disciplines. Part of preparing for thefuture is looking critically at the frameworks that wehave in place to protect innovators. The review willfocus on identifying and dismantling barriers to growthin the IP system, and will look at how the IP frameworkcould better support new business models as they develop.

The third important element of our blueprint is theframework for supporting future technological innovationin software and other disciplines. We are now pledgedto establish a network of elite technology and innovationcentres, based on the model proposed by HermannHauser and James Dyson, to commercialise new andemerging technologies in areas where there are largeglobal market opportunities and a critical mass ofexisting UK capability. The recent comprehensive spendingreview has provided £200 million of funding for thetechnology centres over the next four years. The networkwill be overseen—in answer to the questions of the hon.Member for Wrexham—by the Technology StrategyBoard. Individual centres will operate with a high degreeof autonomy, to give them the flexibility to respond tobusiness needs and emerging opportunities, but theboard will provide the overarching framework.

Our vision for technology and innovation centres isthat they should help industry sectors to exploit newand emerging technologies, and bridge the gap betweenoriginal research and technology commercialisation,reducing some of the attendant risks to business. I amaware of the issue from my constituency where there areseveral high-tech companies that can benefit from spin-offresearch. Each idea appears to me to be potentiallyworld-changing, but the struggle they have to take thatresearch to market and commercialise it cannot beunderestimated. The centres will support projects thatbusinesses and universities often cannot undertake, orthat they do not have sufficient incentive to undertakeon their own. They will help new technologies get toinvestment readiness so that they are a viable propositionfor venture capital or other forms of investment, andwill help, we hope, to accelerate their journey to market.

We want to get the network up and running as soonas possible, so the Technology Strategy Board will workclosely with industry, stakeholders, and the Governmentto identify the priority sectors, the scale of initial investmentrequired and the governance structure for the networkof centres by April 2011. I urge the hon. Member forHoughton and Sunderland South and any other hon.Members who are interested in the issue to contact theboard to discuss it.

The Technology Strategy Board plays an importantrole in supporting the software sector. It already supportsinnovation among software-intensive firms in a numberof ways, either through sector-specific programmes orthrough cross-sector projects designed to deal with aparticular challenge, such as low carbon. It also backsthe software sector via initiatives such as knowledgetransfer partnerships. Several of the Technology StrategyBoard’s programmes routinely invest in initiatives where


more than 90% of the business activities are software-related. That is true of its information technologyprogramme, as well as its creative industries, intelligenttransport and network security programmes. In addition,the board has identified its recently formed digitalprogramme as one of its five strategic priorities in theperiod ahead. In total, over the past year the board haslaunched 13 software-intensive competitions for projectswith a combined value of around £100 million, including£50 million of private investment.

Some other issues were raised, including broadband.Again, some myths were propagated by the Opposition.I think that we all agree that superfast broadband andthat kind of infrastructure is essential to the future ofthe economy. However, I find it odd that the Oppositionseem to believe that we have reneged on a promise, orthat we do not share their view of its importance. Theprevious Government had a very poor ambition, whichwas simply to get universal broadband of 2 megabits atthe end of 2012. They proposed to pay for that with atelephone tax that would have hit some of the poorestin society, as well as being a disincentive.

Jim McGovern: Will the Minister give way?

Ian Lucas: Will the Minister give way?

Mr Vaizey: I will take the intervention of the moresenior Member first.

Jim McGovern: On the subject of promises, prior tothe general election, the Minister was quoted—I shallhave to paraphrase—as saying that his party unequivocallysupported tax breaks for the computer games industry.What has changed his and the Chancellor’s mind?

Mr Vaizey: As to promises, the hon. Gentleman’sparty said in, I think, the 2001 election manifesto, thatthey would not introduce tuition fees. So if the hon.Gentleman wants to accuse me of broken promises,perhaps he should look to his own party’s huge recordof broken promises, not the least of which is leaving theBritish people with the biggest deficit in peacetimehistory, having promised to end boom and bust.

As I said, the telephone tax would have been a hugedisincentive to investment. It would have hit small businessesand the poor—all for the paltry ambition of 2 megabitsuniversal broadband.

Ian Lucas: Will the Minister give way?

Mr Vaizey: Let me develop the policy. Then the hon.Gentleman can come in. He does not have a broadbandpolicy, so perhaps he should listen to someone whodoes. Then he can make his point—if I may set out ourpolicy.

Ian Lucas: On a point of order, Mr Weir. Is it in orderfor a Minister to misrepresent the stated policy of HerMajesty’s Opposition and not to allow an interventionso that he can be corrected about that?

Mr Mike Weir (in the Chair): It seems to me that thatis a matter for debate, not for the Chair.

Mr Vaizey: Thank you, Mr Weir, for reminding thehon. Gentleman that he has plenty of opportunities tomake his point. It is a bit rich for a Labour politician totalk about the misrepresentation of other parties’ policies,given what we have seen in the news this week, after the

first election court for almost a century was called onthe basis of Labour party leaflets in the general election.Sheer brass neck does not even begin to describe it.

This is a debate in which I have an opportunity to setout our policy on broadband in response to the commentsof the hon. Member for Houghton and SunderlandSouth about its importance. That is what I intend to do.

As I said, we want the best superfast broadband inEurope by 2015. We have secured the funding for it—£530million to the end of the spending review, and a further£300 million after that. We have launched four super-fastbroadband pilot projects, in the highlands and islands,Herefordshire, Cumbria and North Yorkshire, so thatwe can identify early lessons and work out how toproceed in the most cost-effective way. We shall alsolaunch in more detail at the end of the year our policyon broadband, setting out some of the nuts and boltsissues. We have made huge progress on regulatory issues,such as duct access for competitors to BT and theopportunity to roll out broadband on telegraph poles.

Justin Tomlinson: On new developments, are thereany thoughts about treating broadband in the same wayas utilities such as gas, electricity and water? Havingbeen a councillor representing new developments thathave waited years for broadband access, I know that theintroduction of that would be welcome.

Mr Vaizey: That is certainly a very important elementof the question. I hope that we shall shortly be able,with the Department for Communities and LocalGovernment, to publish a code for developers, to ensurethat broadband is at the heart of their thinking.

Ian Lucas: I want to correct the Minister simply on apoint of fact. The change to 2-megabit broadband wasto be funded out of the money that he is using fromthe BBC licence fee—money that was left over fromthe digital switchover. The telephone tax was for thedevelopment of high-speed broadband. That was theposition, and if the Minister wishes to, he can readabout it in “Digital Britain”.

Mr Vaizey: I have read that report, and I am happy tostand corrected. We are in a similar position, except forthe fact that the Government are not imposing a tax; weplan to get superfast broadband to as many people aspossible by 2015, while the Labour party remains stuckin the slow lane at 2 megabits.

I now tackle the thorny issue of video games and taxbreaks. Again, I shall try to knock down a few of themyths that have been propagated. To hear LabourMembers speak, one would have thought that the landof milk and honey had arrived with the last LabourGovernment. When I was Opposition spokesman, Isometimes felt like a lone voice when talking about thesuccess of the video games industry over the last threeor four years. However, I pay tribute to the hon. Memberfor West Bromwich East (Mr Watson), who has been afantastic advocate of the video games industry.

I remember that the Labour Government ruled out avideo games tax break. When in opposition, we mentionedcompetition from Canada, and were told that theGovernment were going to refer the matter to the WorldTrade Organisation. However, a chance conversation


[Mr Vaizey]

with an insider revealed that that was a red herring.When I tabled a parliamentary question about it, theGovernment were forced to perform a U-turn andreveal that the reference to the WTO was an excuse forinaction. Finally, they were converted to a video gamestax break.

At what point did that amazing conversion come?Was it at the beginning of a Parliament, when theGovernment had a strong majority and a lot of energy?No; it came with the last Budget of a discreditedGovernment who were about to lose an election. Theyknew that they would not have to implement that taxbreak—and it was not implemented. It was an extraordinaryU-turn; despite the comprehensive spending review ofOctober the year before, that decision would still havehad to go to Brussels for approval. The sound ofLabour MPs clambering on to bandwagons now thatthey have no public policy responsibility for the matteris quite extraordinary.

Jim McGovern: I resent the Minister’s comment thatLabour Members are jumping on a bandwagon. I havesupported the computer games industry in Dundee fora number of years, and several Ministers have visited us.Why did Ministers not visit Dundee prior to withdrawingthe tax break?

Mr Vaizey: Dundee is an incredibly important part ofthe video games sector in the UK. We have invested£2 million in the university of Abertay to support videogames, but video games do exist in other parts of thecountry, and it is not essential to visit Dundee to decidewhether we should have a tax break. But I intend tovisit because it is a pioneering area with a world-classuniversity. I am raring to get up there. Indeed, given theaustere times that we live in, I hope that the hon.Gentleman will put me up for the night. It is a bit oddfor Labour MPs to claim that if you cut them open,“video games tax relief” will be written on their hearts;the relief was a political ploy to win support from theindustry in the run-up to the election, and they knewfull well that they would not have to implement thepolicy.

Let us be clear about it: people want a video gamestax break because of the competition that we face fromCanada. A tax break is not a panacea; France has a taxbreak, but we have a more successful video gamesindustry. Canada does not have a national tax break forvideo games. It has two strong regional Governmentswho actively compete for the video games industry;they made that decision 10 or 15 years ago and they arethrowing money at the industry. They are handing overmillions of dollars—there is nothing wrong with that—totempt developers and publishers to base themselves inCanada, and that means salary holidays, rent holidaysand other kinds of support.

I want to put in place a strategy for the video gamesindustry—for example, so that it can access the regionalgrowth fund that we announced, and can take advantageof the numerous funds that I have discovered in theDepartment for Business, Innovation and Skills. Partlybecause of exchange rates, we are close to Canada, evenwithout a tax break. One company that has invested inCanada showed me the numbers; without breakingcommercial confidentiality, I can say that there was adifference of about 10 or 15% in costs per employee.However, as the hon. Member for Southport mentioned,we have a fantastic skills base, and that is anotherimportant reason to invest here.

This has been a good-natured and good-humoureddebate in which we have found a great deal of commonground, huge support for the software industry and apassion for the video games industry. There has beenrecognition of the pioneering role of the north-east andSunderland in ensuring that the UK remains a worldleader in this important industry. I set out our policies—thetechnology blueprint, our plans for technology innovationcentres and entrepreneur visas, and our plans to reviewintellectual property law. However, there is broadersupport, too.

I was disappointed to hear that it is now the Labourparty’s policy to push up corporation tax. Under thisGovernment, corporation tax will fall year on year; thatis an important point to make. We have also increasedentrepreneurs’ relief for capital gains tax. Our tuitionfees policy is progressive, and it will mean people payingback their debt when they are at a higher income levelthan applied under the Labour Government. We havemade significant progress to empower our universities.As the hon. Member for Southport pointed out, despiteLabour’s U-turn on tuition fees the introduction oftuition fees did not stop people wanting to go to university.

I was privileged to be at the graduation of fourapprentices at Culham Science Centre in the constituencyof my hon. Friend the Member for Henley (John Howell).It is worth remembering that we have a fantastic Ministerfor Further Education, Skills and Lifelong Learning inthis Government; he has put together a nationalapprenticeship policy, which is important for high-techindustry. People leave school and go on to be apprentices,and the four whom I met were formidable. As the headof the Culham Science Centre said, they are as qualifiedas any graduate, but have been paid for four years andhave no debt. Many will be going on to do higherdegrees. They will be at the heart of a high-tech industryin Culham. Thanks to that Minister, this Government,unlike the last, have—at long last—a clear policy topromote apprenticeships and skills, which are importantto both the IT and software industries.

I cannot read the face of the hon. Member forHoughton and Sunderland South, and I am not surewhether I have allayed all her fears, but she seems to bein a slightly happier mood than when the debate began.I am happy to sit down with her and talk through theissues at a later date, and to visit her in Sunderland.


Local Enterprise Partnerships(South-West)

10.59 am

Mr Ben Bradshaw (Exeter) (Lab): A more accuratetitle for this debate than local economic partnerships inthe south-west would be the absence or lack of localeconomic partnerships in the south-west. When theGovernment launched their flagship regional economicpolicy the week before last, most of the south-west wascompletely missing. Only Bristol and Cornwall are coveredby these new bodies.

This sorry saga began with the Government’sideologically driven determination to abolish the regionaldevelopment agencies. That of the south-west, like mostof those around the country, was successful. It hadbrought much-needed strategic coherence to our region,as well as valuable investment. It had managed toovercome the age-old political in-fighting between thedifferent parts of the region, and the RDA could take aview as to what was in the interests of the region asa whole. I am afraid that, like so much of what thecoalition Government are doing—and in spite of theBusiness Secretary’s support for RDAs before the election—regardless of their merits RDAs had to go, becausethey were a Labour creation.

Soon after the election, in preparation for the newpolicy, the local business leaders in our half of theregion—led by Tim Jones and the Devon and Cornwallbusiness council—started an early promotion of theidea of a peninsular local economic partnership, comprisingCornwall, Devon and Somerset. The business communityfelt scale and capacity were vital for these local economicpartnerships to succeed, and I wholeheartedly agree. Inhis letter of 29 June, the Secretary of State invited localareas to come together and put forward bids for LEPsin their areas by 6 September. That precipitated atwo-month period of chaotic negotiations, lobbyingand planning. That happened largely behind closeddoors and was led, not primarily by business, as wassupposed to be the case, but by the upper-tier localauthorities—in our case, Cornwall, Devon, Plymouthand Torbay. Somerset county council was effectivelyfrozen out of those discussions. It was clear that thefour upper-tier authorities in Devon and Cornwall didnot want Somerset’s involvement in the discussions orin any subsequent local economic partnership for thearea.

My own local authority, Exeter city council, and theExeter business community, led by our chamber ofcommerce, were totally excluded from the discussions.They were never formally consulted on any of theemerging proposals. That was in spite of numerousrequests to be involved as one of the two key economicdrivers in our peninsula. Exeter’s exclusion was alsoin clear contravention of an instruction in a letter of25 August from the Minister with responsibility fordecentralisation, the right hon. Member for TunbridgeWells (Greg Clark), to Gary Porter, chair of the districtcouncil network, in which the Minister said,

“It is essential that district authorities are included.”

He went on to say that he did not expect countycouncils to act as “sole building blocks”, and that

“We want to see economic geographies reflected in proposals,not just administrative ones.”

It soon became clear that Cornwall, as is so often thecase, wanted to go it alone—a move unfortunatelyendorsed by the Government for political purposes,much to the consternation of the Cornwall businesscommunity and business leaders in the rest of thepeninsula.

I have a number of questions for the Minister today.First, does he agree with me and the business communityin the west country that local economic partnershipsshould have sufficient scale to add value and to haveclout? Does he also agree that they should reflect realfunctional economic areas? Is it not the case that thefirst of those objectives has been compromised by hisGovernment’s decision to accept Cornwall’s bid to go italone? Is it not also the case that the Cornwall bid didnot meet the criteria the Government laid down anddid not enjoy sufficient business support? Will he explainhow, exactly, a Cornwall local economic partnershipwill differ from or add value to the economic developmentfunctions of the unitary Cornwall county council? Doeshe also agree with me that it is vital urgently to salvagesomething from this sorry mess, and that the mostsensible solution would be for Devon, including Plymouthand Torbay, to work with Somerset and, if they areinterested, those western parts of Dorset that look westrather than east? Will he confirm that the Governmenthave been pressing such a solution?

When questioned in the House on the day of theannouncement, the Business Secretary blamed the situationin the west country on the lack of agreement betweenthe local authorities involved. That, I am afraid, is anunderstatement. In spite of the fact that Devon, Somerset,Plymouth and Torbay are all Conservative-controlledcouncils, which one might think would make the processof negotiation easier, they have been fighting like rats ina sack. We have seen a return to the worst sort of pettypolitical in-fighting that blighted economic developmentso badly in our region in the past, and was one reasonwhy Labour set up the RDAs in the first place. Iunderstand that there is little love lost between theConservative leaders and the councils involved. At onestage, to illustrate the ludicrousness of the whole process,Somerset became so frustrated by Devon county council’sbehaviour that Somerset suggested a tie-up between itand Cumbria, based on the nuclear industry.

Will the Minister please start banging some headstogether and tell his political friends in the south-westthat they must stop their childish squabbling and worktogether in the interests of the public and local businesses?If they cannot, or will not, do that, will he please tellthem to get out of the way, and let the business communityget on with it? Business leaders are keen to moveforward with a partnership on the basis I have outlined.

Anne Marie Morris (Newton Abbot) (Con): I amdelighted that the right hon. Gentleman has given thisdebate an airing, because it is crucial that we have LEPsin the south-west. Would he agree with me that, in thevein of what he has just said, we should put politicaldivides aside and move forward and get an LEP forDevon, and I suspect for Somerset, as quickly as possible?I believe the business community is now absolutelybehind it.

Mr Bradshaw: The hon. Lady is right; the businesscommunity is behind it. The point I was trying to makeis that this is not about putting political differences

99WH 100WH10 NOVEMBER 2010 Local Enterprise Partnerships(South-West)

[Mr Bradshaw]

aside, because the four local authorities involved are allConservative-controlled. They do not—or should not—havepolitical differences but they have been completely incapableof working together on a sensible local economicpartnership for our region. I hope we can see themmake swift progress toward doing so now. If they willnot do it, I want the Minister to tell the local authoritiesto get out of the way and leave the field clear for thebusiness community, which, as the hon. Lady rightlysays, is keen to make progress, so it can put in a bid. Willthe Minister confirm, on that basis, that the businesscommunity is entitled to come forward with a bid—thatit is perfectly possible for it to bypass the fractious localauthorities? Will he assure the business community andme today that the Government would look favourablyon such a bid? Will he also reaffirm the instruction ofthe Minister with responsibility for decentralisation:that it is essential that Exeter, which is so important forour region’s future prosperity, be included at the table?If I were the Minister here today, I would be hoppingmad at Devon’s deliberate and calculated rebuff to hiscolleague’s instruction that Exeter should be included inthe process.

As the head of Britain’s leading business organisation,the CBI, said recently, this process has been a shambles.We now know that the Minister’s own colleague, theMinister of State, Department for Business, Innovationand Skills, the hon. Member for Hertford and Stortford(Mr Prisk), warned the Business Secretary in a letter of14 September that the Government’s local economicpartnerships were in danger of failing. I quote from hisletter:

“There is a strong view amongst the business community thatmany LEPs lack the ambition to make significant economicimpact undermining our agenda for growth. Key messages I havebeen made aware of include: a lack of credible business representationon LEPs Boards; negotiations dominated by local politics and alack of a clear focus on economic growth. They also reportdifferent messages coming from Government about LEPs. JohnCridland [of the CBI] specifically was concerned that the processhas not been transparent, business engagement was poor overalland exacerbated by a tight timescale. He and other senior businessleaders from Tesco and Ford have expressed their concern that intheir view the policy is in danger of failing to aid economicgrowth.”

That is exactly what the Labour party warned wouldhappen if the Government went ahead and abolishedRDAs. The public and businesses of Devon and mostof the south-west have been badly let down by theGovernment, and the Minister and the Governmentneed to get a grip before it is too late.

11.9 am

The Minister for Further Education, Skills and LifelongLearning (Mr John Hayes): It is a pleasure to speak onthis subject and I congratulate the right hon. Memberfor Exeter (Mr Bradshaw) on securing this debate. Ithink that he and I first faced each other many yearsago when he was fisheries Minister. In those days, hewas in government and I was in opposition, but to therelief of fishermen, their friends and many other people,the boot is now on the other foot.

I thank the right hon. Gentleman for drawing theseimportant matters to the attention of the Chamber.Creating the right framework for local economic growth

and renewal in the south-west and throughout the wholecountry is an important issue that the Government takeseriously. Indeed, it is one of our core priorities. As myDepartment—the Department for Business, Innovationand Skills—is the Department for growth, I am pleasedto be able to respond in that spirit.

It is important to understand that as we managegrowth, and as we stimulate business to deliver theadditional growth that we need to move from recessionto recovery and ultimately to prosperity, we take accountof the economic profile of different parts of the country.Contrary to what was at least suggested in the righthon. Gentleman’s remarks, this issue is not a matter ofdisagreement among the coalition partners. The twopartners in the new coalition Government are bothcommitted to the principle of having a local, regionaland sub-regional structure to stimulate growth; we havebeen committed to that principle before and after theelection.

Local enterprise partnerships are a vital element inthe broader reforms that we are implementing to createthe new framework for local growth. They are underpinnedby three important principles, which I shall outline atthe outset. The first principle is that the economicgeography of our country is not fixed, but changes asthe character of the economy changes. It is widelyunderstood that as economies advance, their needs—forexample their skills needs—also advance. However, it isnot so often said that economies also become moredynamic as they develop, and our prospects for growthwill depend on creating the right framework to facilitateand stimulate that dynamism.

The second principle is that economic prospects canbe transformed when enterprise is free to innovate. Thatadditional freedom is about creating the right conditionsin which entrepreneurs, businesses and commerce canthrive. I think that it would be vulgar to make too manynarrow party political points, but I am not sure thateven the greatest advocates of the last Governmentwould argue that they had created the right environmentfor business to thrive.

The third principle is that lasting economic renewalrequires civic and business leaders to feel empowered toshape their own community and its economic interests.That principle has long been embedded in our assumptionsabout the role of local government. At district, unitaryand county level, local government has long had aneconomic purpose: to produce an economic developmentstrategy and to ensure that that strategy married withthe wishes and desires of local business people, as wellas those of the wider population, in the interests of thecommon good.

I believe that private enterprise is the dynamo thatwill power our future prosperity and fuel the innovationthat will underpin our future global competitiveness.The White Paper on local economic growth, which waspublished on 28 October, sets out our detailed proposals,as the right hon. Gentleman acknowledged. Thoseproposals are designed to promote economic developmentand spread economic opportunity right across the country,and they rest on four foundations.

The first foundation is the strengthening of nationaleconomic leadership for the activities that enable theUK to compete internationally: trade, inward investmentand innovation. At the risk of digressing—I know thatyou will not let me digress too much, Mr Weir—I also

101WH 102WH10 NOVEMBER 2010Local Enterprise Partnerships(South-West)


will add the issue of skills, which was referred to in theprevious debate by the Under-Secretary of State forCulture, Olympics, Media and Sport, my hon. Friendthe Member for Wantage (Mr Vaizey). Skills are criticalfor driving economic growth, because if an advancedeconomy is to become more dynamic, its skills needsalso need to become more dynamic and advanced. Thatis why we are putting so much emphasis on skills, and Ihope that I will be forgiven for repeating the fact that weare making apprenticeships the pivot of our skills policy,with substantial additional investment. Indeed, manybusiness people have written to the national press todayto celebrate that fact.

The second foundation of our proposals is investingin crucial infrastructure such as broadband and high-speedrail. As you know, Mr Weir, the Government havealready said much about that. The third foundation isestablishing the regional growth fund to support jobsand growth, which is worth £1.4 billion over three years.

The fourth foundation of our proposals is to createlocal enterprise partnerships, which is the central issueof this debate. However, before I deal with the specificmatters on which the right hon. Gentleman understandablyconcentrated, let me set out the case for local enterprisepartnerships before I say a little about their applicationin the south-west.

If we are to succeed in rebalancing the nationaleconomy and kick-starting local economies, includingin the areas that the right hon. Gentleman mentioned,we need a framework that recognises the economicgeography of the country rather than one that is twistedto fit arbitrary administrative structures. I think that Ican warmly support what the right hon. Gentlemansaid in that regard. I believe he said that the systemshould match “real” areas of economic growth andeconomic interest rather than being an artificialconstruction.

The role of LEPs in those terms will be to buildgenuine and effective partnerships of local business andcivic leaders. Once again, I do not think that there is anydisagreement between us on that point. I have alreadymentioned the long-standing commitment of localgovernment to economic planning, and indeed to economicdevelopment. That idea is central to what I think is ourshared understanding of the role of these new LEPs. Itis absolutely right that civic leaders who identify withtheir area, share an ambition to grow the local economyand believe in creating jobs, wealth and so on shouldplay a part in ensuring that measures taken by Governmentand other agencies match the priorities of their localarea.

Duncan Hames (Chippenham) (LD): Given thoserequirements, will the Minister tell us what the Governmentconsider should be included in the bid for an LEP,including what requirements the bid for a WiltshireLEP is yet to meet? Will he also explain to us thetimetable for the announcement of further LEPs?

Mr Hayes: The hon. Gentleman knows that I will notgo into details about a timetable because he also knows,given his interest in the particular matter to which herefers, that that is very much under discussion. Indeed,representations that have been made in that area arebeing considered in detail by my Department. As he isprobably aware, there is an ongoing discussion between

the locality and the Department. However, it is reasonableto say that we do not want any undue delay in establishingthe parameters of each area, because to do so wouldcreate uncertainty. The right hon. Member for Exeter isright that we need to establish the parameters withinwhich people are going to work clearly and reasonablyspeedily so that we can then move forward to the nextstage of development. I will therefore not give the hon.Member for Chippenham (Duncan Hames) a definitiveanswer now, but I think that he will understand theemphasis that I have placed on dealing with the perfectlyproper intervention that he has just made.

Let me go on to talk a little about how we will assesssuccess, because I think that that issue relates directly tothe hon. Gentleman’s intervention.

Neil Carmichael (Stroud) (Con) rose—

Mr Hayes: Before I do so, however, I give way again.

Neil Carmichael: I would just like to make a couple ofpoints about LEPs. The first, of course, is that theyreally should co-operate with each other. I would certainlyexpect to see such co-operation when Gloucestershire’srelationship with Swindon—or some other relationship—isestablished, particularly in connection with the west ofEngland LEP, which is of course centred around Bristol.My second point—

Mr Mike Weir (in the Chair): Order. Will the hon.Gentleman resume his seat? This debate is about thesouth-west. I think that Swindon might get into thatregion—my geography of southern England is perhapsa bit uncertain—but I think that the west of Englanddoes not form part of the debate.

Neil Carmichael: May I just say that all Back Benchersin the Chamber at the moment are south-west Members?I am; the right hon. Member for Exeter (Mr Bradshaw)is; the hon. Member for Chippenham (Duncan Hames)is; and my hon. Friend the Member for Newton Abbot(Anne Marie Morris) is.

Andrew Jones (Harrogate and Knaresborough) (Con):I am from Yorkshire.

Neil Carmichael: My hon. Friend is not from thesouth-west. Nevertheless, this is an important question,because what happens in Cornwall or Somerset affectswhat happens in Bristol or Gloucestershire, becausethey are in the south-west and all under the one regionaldevelopment agency which, thankfully, will be abolishedin 2012.

My second point is about the necessity for localauthorities to co-operate with each other, specifically inconnection with economic development, and I thinkthat that point needs to be discussed in this debate.

Mr Hayes: I am delighted to say that my hon. Friendis absolutely right that local authorities should co-operatewith each other in pursuit of that objective of economicdevelopment. We would expect them to co-operate, butthe early stage will inevitably involve a process of negotiationand of bid and counter-bid. That is not unhealthy,provided that it does not delay progress unduly and



[Mr Hayes]

Government play a helpful mediating role in assessingthose representations against the core criteria, which Iam about to discuss.

We announced the first wave of successful LEPsalongside the White Paper on 28 October. The first 24partnerships—of many more, I am sure—all sharedcertain characteristics. Perhaps it will help the hon.Member for Chippenham and my hon. Friend theMember for Stroud (Neil Carmichael) if I describethose characteristics: they have a strong local identity;they have a buy-in from the business community; andthey are a testament to the ambition and ingenuity oflocal people. That is what we expect of local enterprisepartnerships.

In the south-west region, we received seven applications,two of which were approved. Each of the remaining fivegroups of applicants has been asked to do further workto develop their proposals, and we are supporting themas they do so. I understand why the right hon. Memberfor Exeter is making a strong case for his area—it isright that he should do so—but he should know thatDevon, Plymouth and Torbay have been asked to holdfurther discussions with local business, civic leaders andthe Government to develop the long-term vision fortheir partnership. In addition, they have been asked toconsider in more detail their economic links withneighbours, particularly Somerset. The chief executivesof Devon, Torbay, Plymouth and Somerset have embracedthat feedback and are working together to secure thebest outcome for their area, and we hope to say more indue course. The right hon. Gentleman will also bemindful that I have said that undue delay would beunhelpful.

Anne Marie Morris: I am delighted to hear what theMinister is saying. I am glad that progress is beingmade, and I welcome LEPs. They are absolutely theright vehicle, and the combination of local governmentand businesses is on point. I ask that a decision be madequickly—subject to all the bodies concerned giving himall the information that he needs—so that the deadlineto apply to the regional growth fund is not missed. Ihope that that will be present in his thinking andtimeline, even though he cannot be specific.

Mr Hayes: My hon. Friend, like me, will want toensure that the criteria are applied robustly and consistently.The right hon. Member for Exeter made the good pointthat we need to be certain that the marriage betweenlocal authorities is right, as is the link between them andbusiness. I repeat that I share the view that the constructionof areas should reflect their economic profile. Thatseems fundamental to making the scheme work well.

The right hon. Gentleman mentioned Cornwall, so Iwill give him a straight answer. Cornwall made a powerfulargument for a local enterprise partnership coveringCornwall and the Isles of Scilly, making it clear thatit was a functional area. The Department examined itclosely and we decided, in the end, to support thepartnership. I know that counter-arguments will bemade, but as he knows from his long experience as aMinister, the Government sometimes have to take decisions.We took that decision, and I think that we can justify itbased on the criteria that I have outlined. People from

Cornwall would certainly argue that the area’s profile isvery particular. The right hon. Gentleman will knowthe economic challenges that face Cornwall. Its issuesinclude skills, employment and the character of thelocal economy, which legitimises the case that Cornwallmade.

South-west Members, including the right hon.Gentleman, understandably make the argument thatthey do not want the south-west to be left behind. Iassure him that we are keen to see as many localenterprise partnerships taking root as possible, bothacross the whole of England and in the south-west. Wedo not want any part of the country to be left behind, soas soon as a bid can demonstrate that it meets theassessment criteria, it will be given the green light.

I will say a word about Exeter in particular, as theright hon. Gentleman would expect me to do. I amaware that he is worried that his constituency mightsuffer disadvantage and that it will not be able to bid tothe regional growth fund because it is not part of apartnership. Let me reassure him that although weexpect many LEPs to submit project bids to the fund, itis not a prerequisite that applications for funding mustbe submitted by partnerships—any public-privatepartnership may apply. Exeter’s business communityand local council—along with other potential partners,such as the city’s excellent university, which he and Iboth know—may work together on an ambitious planfor economic development and then apply for fundingaccordingly. Indeed, I take this opportunity to encouragethem to do so. I know that the right hon. Gentleman, asa diligent local Member, will work with them to make ita success.

Mr Bradshaw: My concern was not simply that Exeterwould not be able to access the funds; it was more aboutthe whole process. Devon county council has deliberatelyexcluded Exeter, for which it was criticised by the hon.Gentleman’s ministerial colleague in the letter that Iquoted. Will he deliver a message to Devon today thatExeter needs to be at the table?

Mr Hayes: Although the right hon. Gentleman probablydid not know it, he was quoting a letter to the leader ofmy district council, Councillor Gary Porter, who alsoholds national office. I know that Councillor Porter wasanxious to ensure that district councils played theirpart.

The Government’s position is clear and resolute. Wewant local government to play a part. Local governmentis, as I said earlier, district, unitary and county government.Circumstances will differ in different parts of the country,and that encourages—indeed necessitates—differentapproaches. We do not take a vanilla-flavoured viewabout what will emerge, although we are clear that thecriteria must be met. The criteria should be consistent,but the character of local partnerships might be different,given that the local economic profiles of various partsof the country differ. We want all partners to be involved.As I think I have suggested, there is a degree ofpermissiveness about who may bid.

Given that enterprise, investment and innovation arethe south-west’s route to lasting prosperity, as is thecase in other parts of the country, we are clearing awaythe panoply of failed quangos that we inherited andreplacing them with local enterprise partnerships as



part of our new framework for economic growth andrenewal. The new framework will recognise functioninglocal economies rather than imposing arbitrary boundaries.It will offer civic leadership and a genuine partnershipbetween local businesses and councils instead of assumingthat Whitehall knows best. It will be less about targetsand micro-management, and more about the inspirationalqualities of local businesses and local people. It willcombine a strong voice for business with democraticaccountability to local people. It will also have theflexibility to respond to local economic priorities.

The Government are determined to make the nextdecade the most dynamic and entrepreneurial in Britain’shistory. Britain’s future can be as great as its past, andlocal enterprise partnerships have a vital role to play inmaking our ambition a reality.

11.28 amSitting suspended.

Science Research

[ANNETTE BROOKE in the Chair]

2.30 pmNicola Blackwood (Oxford West and Abingdon) (Con):

I am absolutely delighted to have secured today’s debateon science research. The contents of my inbox showthat Oxford West and Abingdon is a constituency thatsurely must contain more STEM—science, technology,engineering and maths—researchers and science-basedcompanies per square mile than any other, and it is agreat privilege to represent them today. My predecessorwas a great advocate for science and I aim to continuehis excellent work to the best of my ability.

Although I am not a scientist, as the daughter of avery single-minded doctor, I spent many a breakfasttime having the parasympathetic nervous system or therole of the white blood cell explained to me in greatdeal—Rice Krispies were never quite the same to myseven-year-old mind. Despite my father’s best efforts, Idid not follow him into medicine, but he succeeded ininstilling in me a deep respect for the value of scienceresearch—not only for the future of medicine, but forgiving our industrial sector a competitive edge, fordeveloping a greener transport system and a more advancedtelecoms infrastructure, and for giving our troops thebest intelligence and protection possible. Most importantly,my father taught me the intrinsic value of looking at theworld as a problem solver and about the innate desire inall scientists to understand better how the world aroundus works. We must protect and strengthen that sense ofcuriosity. Perhaps speaking up for this issue today willmake up just a little for my non-medical career path.

Medic or not, I understood from the moment I wasselected and had knocked on my first door as a candidatethe value that my constituents place on science. As acandidate, I visited Begbroke science park with my righthon. Friend the Member for Havant (Mr Willetts)—heis now the Minister for Universities and Science—wherewe glimpsed just the tip of the iceberg of the richness ofSTEM-based research and industry in Oxfordshire. Sincethen, I have had the opportunity to meet businessessuch as Nexeon, which is developing next-generationlithium batteries. I have also met Professor Rawlingsand some of his team to hear about the role that Oxforduniversity’s astrophysics department is playing in theextraordinary square kilometre array project. In addition,I have visited the Joint European Torus at the Culhamcentre for fusion energy, where many of my constituentswork.

Just last week, I took part in the Royal Society’sMP-scientist pairing scheme, which does exactly what itsays on the tin. The scheme was set up in 2001 to helpbuild bridges between parliamentarians and some ofthe best science researchers in the UK by pairing MPsand scientists in an exchange programme. More than200 MPs have taken part in the scheme including, Iunderstand, the Minister himself. The pair spend oneweek in Westminster, during which the scientist has theopportunity to observe an MP in their natural habitat,while in the second week the politicos venture into thelaboratories, so both scientists and politicians get achance to walk for a week in the other man’s shoes.Such a scheme offers the hope of better networksbetween Westminster and the science community and


[Nicola Blackwood]

aims to lead to more evidence-based decision making inParliament, more targeted lobbying from the sciencecommunity, and far better communications betweenboth sides. Perhaps it might even tempt a few morescientists into Parliament.

When I participated in the scheme, I had the goodfortune to be paired up with no less a luminary thanProfessor David Wark, who is fellow of the RoyalSociety, a leading international authority on neutrinophysics and—along with his family—my constituent. Iobviously cannot speak for him but, so far, I have foundthe experience extraordinarily eye opening. TheGovernment’s statement on higher education, my meetingswith Oxfam about the situation in southern Sudan andmy meetings with the Independent Police ComplaintsCommission on the challenges facing policing have allbeen reflected back to me through the prism of aparticle physicist’s perspective. I have yet to find outwhat I will learn from accompanying Professor Wark tohis work at Rutherford Appleton laboratory, but I canonly hope that, during that time, I will gain a deeperinsight into how Government policy can better encourageand support science research and development in the UK.

One of the ways the Government can do that is, ofcourse, is to keep funding science. Before the comprehensivespending review, my inbox was filled with e-mails fromscience supporters who were deeply worried that thecuts would fall especially hard on science. The Chancellor’sextremely welcome decision to freeze the science budgetin cash terms at £4.6 billion a year was therefore a greatrelief to many. I thank the Minister for the role I amsure he played in securing that commitment, but it stillrepresents a cut of roughly 10% over four years. Evenwith the speculated savings, that will be a challenge for ahistorically underfunded area. We also need to considerthe announced reductions in university funding. Althoughsuch reductions are sustainable, they do not representany real closing of the funding gap for major researchuniversities competing on an international stage, andthat is cause for concern.

I am sure that the Minister is aware that UK scientificresearch is among the best in the world. With just 1% ofthe global population, the UK produces 11.8% of theworld’s scientific citations, which are the most reliablemeasure of academic excellence. The UK also has threeof the world’s top 10 research universities, one of whichis, of course, in my constituency. All that has takenplace despite the comparatively low funding that UKscience receives. In 2007, for example, Germany, theUSA, and France spent 0.71%, 0.77% and 0.81% oftheir gross domestic product on public research anddevelopment, while the UK spent just 0.55%.

Clearly, UK science already does extraordinarily wellwith less, but just think what we could do if there were alevel playing field. In the context of the current fiscalsituation, increasing research and development spendmight not be immediately possible, but it is worthnoting that our competitors, such as Germany and theUS, are both increasing science funding in real terms.They recognise, as I believe the Government do, thatSTEM funding is not a net loss to the country, but aninvestment in the smarter, greener and more sustainablegrowth that all hon. Members agree should be ouraspiration.

To achieve that growth with the kind of investmentwe are able to make right now, we have to make absolutelysure that we spend the money in the best possible way.One of the key concerns raised with me is that theshort-term funding models of our four or five-yearGovernments are naturally at odds with the more long-terminvestment that is typically needed to reap significantresults from STEM R and D. Moreover, the frequentchanges of funding models and strategies underminethe stable growth in STEM fields. Our top priority,therefore, must be to outline as clearly as possible theentire funding structure and the Government strategyfor STEM, not only so that current researchers will beon solid ground with their planning, but so that graduatesand students deciding on their career paths will knowthat the Government value them and that they have asecure future in the UK.

We are in an environment in which we risk losing ourbest graduates to other countries’ facilities if we cannotassure them of our long-term commitment to fundingresearch programmes in the UK. Inward investors mustbe shown that this is a sector to which the Governmentare fully committed, both through funding and bycreating a competitive and attractive R and D environment.

In that spirit, will the Minister clear up a few uncertaintiesthat have remained following the spending review? Researchcouncils’ capital expenditure has been excluded fromthe science settlement. The total capital budget availableto the Department for Business, Innovation and Skillsnext year has been set at £1.8 billion and will fall to£1.1 billion the following year. However, it is not clearhow much of that will be made available for science andresearch. As well as investment in bricks and mortar,such as new labs, that capital spend supports themaintenance of existing facilities, training, and investmentin essential but non-tangible infrastructure, such asdigital. A significant reduction in capital expenditurefunding will potentially lead to funds being divertedaway from research and into facilities maintenance.

The Science and Technology Facilities Council is theresearch council that relies most heavily on capitalexpenditure. By way of background, it is worth nothingthat it is also the research council that the previousGovernment created in 2007 from the Particle Physicsand Astronomy Research Council and the Council forthe Central Laboratory of the Research Councils. Thatmerger was administered in such a ham-fisted way thatit led to an almost catastrophic funding crisis in particlephysics, nuclear physics and astronomy, which arose inpart because the capital liabilities of the CCLRC meantthat funding for research had to be diverted into fundingexpensive facilities. Today, those facilities—such as theDiamond synchrotron and the ISIS neutron source inthe Minister’s constituency—are the responsibility ofthe STFC, along with the experiments now running inCERN, the Institut Laue-Langevin and the SKA projectI mentioned earlier. In short, capital expenditure makesup more than a sixth of the STFC’s entire expenditure.

In case anyone listening thinks that spending on suchphysics experiments is a luxury that can be forgone intimes of austerity, let me assure them that that is not thecase. The Wakeham review of physics found that 6.4%of the UK’s GDP came from physics-based industry. Aconstituent recently sent me some excellent examples ofthe valuable real-world outcomes of research at theISIS neutron source. The ISIS has improved the medicine

109WH 110WH10 NOVEMBER 2010Science Research Science Research

that is sprayed into new-born babies’ lungs to help thembreathe and has created a new technique to fix cleftpalates in babies. It is performing vital research that isneeded to make hydrogen fuel cells market-ready sothat they can play their role in solving the energy crisis.It also performed the majority of world research ondata storage and LCD screens more than 20 years ago,which led to innovations such as the iPod and themodern laptop, which illustrates the role that physicsplays in major industry. In addition, it studies why oilcompanies’ pipes clog, which is a problem that leads tobillions of pounds of losses for those companies andthe UK economy each year.

Despite the Government’s commitment to the Diamondsynchrotron, which I know the Minister welcomed asmuch as I did, he will recognise that there are manyworried STEM researchers who are awaiting clarificationon capital expenditure, because the ramifications gowell beyond just keeping up the buildings in which theywork. We do not want to make the same errors that theprevious Government made and fail to attach sufficientsignificance to the availability of capital funding.

In addition to capital spend, there is the issue of thefunding that reaches STEM via the Technology StrategyBoard and R and D tax credits. So far, the Governmenthave not announced plans for those funding routes.While that uncertainty remains, companies cannot includesuch support for innovation on their balance sheets asan incentive for investment. However, the Governmenthave announced that they will spend more than £200million over the next four years to establish a networkof technology innovation centres that will be overseenby the Technology Strategy Board. I understand thatthose centres will be based on the recommendations ofthe Hauser and Dyson reports, which in turn wereloosely modelled on the German Fraunhofer centrenetworks. Given the prohibitive cost of such undertakings,it is unlikely that Government funding alone will beable to achieve that. The Government have said thatthey wish to encourage private investment, but so farthey have not released a target for such investment orexplained how they intend to attain it. Will the Ministergo into further detail on that point?

My father would not forgive me if I did not take amoment to mention the importance of world-class medicalresearch. Charitable organisations contribute greatly toscientific inquiry in the UK. The recently announced£50 million project on tumour profiling, which is fundedjointly by the Medical Research Council and CancerResearch UK, is a great demonstration of the continuingcommitment of DBIS to supporting charity-based medicalresearch. I know that the Minister will be aware of thecharity research support fund, which is a programmethrough which the Government support the infrastructurecosts of charitably-funded pure research. However, forthose in Oxford West and Abingdon and elsewherewhose hopes are pinned on the research coming out ofthese projects, I hope that the Minister will clarify theGovernment’s plans for the future of that fund.

The Government have also announced the introductionof a £1.4 billion regional growth fund over three years.Local enterprise partnerships will be able to make bidsto that fund, and they will have a role in supportingregional R and D. As the Oxfordshire city region hasdeservedly won its bid to be an LEP, and becauseOxfordshire is well placed to lead as we seek to achieve

sustainable growth in the STEM sector, will the Ministergive an insight into the Department’s strategy for therole that regional growth funds and LEPs will play increating an internationally competitive environment forUK R and D and innovation?

Clarification of these funding questions will be valuableto the STEM community. If the Minister is unable toanswer my entire shopping list of questions today, Iknow that he and his Department will be working hardto clear them up as soon as possible. However, the factis that without a clear, long-term strategy that setschallenges and the direction for UK science, we will notachieve the stability and certainty that is needed toattract inward investment and retain the brightest andbest graduates in UK institutions.

On the other side of the question about exactly howmuch research funding will be available is the questionof exactly how the money will be allocated. Somescientists have expressed concern that if they are toreceive research council funding, they will have todemonstrate the short-term economic benefits of theirwork. I am perfectly sure that that is not the intention ofany part of the Government or the research councils,and I know that the Minister for Universities andScience has expressed his support for a dual fundingsystem based on scientific independence and excellence.However, over there has been some uncertainty over thepast few years about the interpretation of the Haldaneprinciple, and I know that the Minister for Universitiesand Science has recently announced that he will, inconsultation with the scientific community, develop aclearer statement on the principle. It would be helpful ifthe Under-Secretary of State for Business, Innovationand Skills, my hon. Friend the Member for Wantage(Mr Vaizey), today reiterated the Government’s positionon the role of pure research in our STEM strategy.Neither lasers nor MRI scanners would be saving livestoday were it not for the blue-sky research that begantheir development into applied technologies. Whendetermining exactly which streams of research receivefunding, we need a strategy to ensure that we do notexclude the research that will lead to the vital discoveriesof tomorrow.

Such a strategy cannot be achieved by DBIS alone.The key growth sectors of low-carbon technology,biotechnology, advanced manufacturing and electronicswill rely on a good supply of scientists, engineers andtechnologies, and that goes far wider than the Department.

Mr David Lammy (Tottenham) (Lab): Does the hon.Lady agree with me that, in relation to those futureinnovations, subjects beyond those that are traditionallydescribed as STEM are of critical importance, and thatwe need design and creativity, including the overall artsand humanities? Is she therefore concerned about thedecision to withdraw state funding for teaching anythingother than science? We need interdisciplinary andmultidisciplinary practice in our universities if we are topioneer the innovations of the future.

Nicola Blackwood: I thank the right hon. Gentlemanfor his comments. As a musicologist, it is hard for me todisagree, so I will be interested to hear the Minister’sresponse to those points.

To continue with my range across the Departments,the Home Office must take a wider strategy into accountwhen setting the permanent cap for tiers 1 and 2. We


[Nicola Blackwood]

all know that STEM research is a highly internationaland mobile field and that we need sufficient flexibility inour immigration system to enable the UK to recruit thebrightest and best into key areas that the domestic workforce cannot fill. That point has already been made by anumber of groups, including the Home Affairs Committee,of which I am a member, and I know that it is somethingof which the Minister for Immigration is well aware.

The role of the Department for Education is alsointegral to creating an environment in which our youngmen and women are excited about pursuing careers inscience. I heard from dozens of constituents earlier inthe year about the need for more specialist physicsteachers, as a quarter of all schools for 11 to 16-year-oldsin England have no specialist physics teacher. A sixth ofthose schools—more than 500 institutions—fail to senda single pupil on to study physics A-level. It is importantthat our schools ensure that the invaluable subjects ofscience and maths are taken up and that students aregiven the support necessary to allow them to excel.

The Department for Education must ensure not onlythat schools are able to achieve that—for example byoffering triple science—but that the right careers andfinancial advice is available to both girls and boys. Thatadvice must give them the best possible options, whetherthat is to pursue science degrees through an entirelyacademic route, or to take up an apprenticeship, orthrough a combination of the two. The Government’scommitment to offer 75,000 more apprenticeships iswelcome, but it will improve student choices only if theright information gets to the right students at the righttime and with the right funding support. The previousGovernment’s record on that count must stand as awarning that things can go wrong if the informationdoes not reach the students at the right time.

Even after education, we must consider how we supportresearchers and scientists as they go into the work force,and that is especially important for female scientists.Although, according to Research Councils UK, thenumber of women studying STEM subjects atundergraduate level has increased at a greater rate thanthat for their male counterparts over the past six years,the drop-off rate between qualification and employmentin science, engineering and technology is still higher forwomen graduates. Of the 600,000 SET-qualified womenin the UK, 97,000 are inactive and 70% are employedelsewhere in the economy. Women still make up just9.1% of the total SET work force in the private sector.

Most barriers affect women and men, but they areoften more decisive for women. After a break to take upcaring responsibilities, for example, women commonlylose their place on the career ladder and are unable toregain it. Women do not reach senior levels in the sameproportions as men with the same qualifications. Anumber of businesses, labs and institutions, includingmany in my constituency, are making positive improvementsin their workplace and trying to create viable careerpaths through increasing flexible working, through fair,transparent and anonymous recruitment processes, byoffering parental leave, or quality part-time or job-shareroles, and with inclusive workplace cultures.

However, DBIS and the Government Equalities Officecan play a role by finding ways to support better practicesby employers and to provide better indicators to measure

progress. Of course, UK Trade and Investment mustalso play its role in working effectively with UK STEM-based business to attract inward investment and adviseinnovative start-ups in how to leverage that crucial earlyyears financing. The best research in the world will belost to the UK if start-ups and entrepreneurs do not getthe right advice to support such development at theoutset.

I could continue my speech for some time, but I amaware that many Members would like to speak and Ithink that I have made my point. The role of science inour society is not just a matter for DBIS. Sciencetouches on so many parts of our society that it needs tobe on the agenda for all parts of the Government. Nowthat the Treasury, by protecting the science budget, hassent the message that science research is a priority, weneed to fill in the details and move to a cross-departmentalstrategy that can create the long-term certainty that isneeded for sustainable growth and investment in STEMresearch and development. UK science is already worldclass—the growth rate of the space sector is evidenceenough of that. With a Parliament and a Governmentwho are behind it, there are no limits to what it canachieve.

2.49 pm

Andrew Miller (Ellesmere Port and Neston) (Lab): Icongratulate the hon. Member for Oxford West andAbingdon (Nicola Blackwood) on securing this debateand on making a splendid speech. There are two sentencesI would delete from it, and I would be happy to claimthe rest as my own. She was perhaps misled while eatingthose Rice Krispies. It is a great pity, because there is ahuge link between music and mathematics, and it isalways great to see more young women, in particular,coming into science and engineering. It is a pity thatperhaps she missed her vocation. We might attack heron other things as time goes on, but I congratulateher now.

On the hon. Lady’s general points, she was absolutelyright about the importance of the Royal Society pairingscheme. It is a huge asset to the House because so fewMembers have had any experience of working in thescience, technology, engineering and mathematics sector.I would encourage as many Members as possible tothink about signing up for it next year, particularlycolleagues who do not have a STEM background. Thescheme is hugely beneficial to us, and to the sciencecommunity, who can see how we solve the problemsthat face us.

Not the least of those problems is the challenge ofthe comprehensive spending review. I agree with thehon. Lady: the Minister for Universities and Science dida splendid job in arguing the case for the core sciencebudget. She was right to say, nevertheless, that there willbe a 10% reduction over the four-year spending round.More important is a point on which I would press theMinister; in fact, I have pressed his colleagues on itduring successive Question Times—[Interruption.]

Annette Brooke (in the Chair): As Members can tell,there is a Division in the House. The sitting will besuspended and will resume in about 15 minutes. Tenminutes will be added for any immediate subsequentDivision. I was intending to call winding-up speakers at20 minutes to 4, so if you add the time that we take out,


you will be aware of when the winding-up speeches willoccur. Also, people need to be mindful of how manyMembers wish to speak.

2.51 pmSitting suspended for a Division in the House.

3.2 pmOn resuming—

Andrew Miller: Before I was rudely interrupted—notthrough any fault of yours, Mrs Brooke—I was goingon to draw something from the observations that thehon. Member for Oxford West and Abingdon madeabout this being a cross-governmental issue. I have beentrying, in a series of questions—three of which I raisedon 1, 2 and 3 November with different Ministers—tofind out what happened with the cross-departmentalanalysis of the impact of the whole comprehensivespending review. The CSR’s impacts on science will notonly be seen in the block grants to the research councils;very serious impacts will be caused by any cuts thatmight occur in departmental science spending, the detailsof which have yet to be announced. The Browne report—Isay that loudly, given the noise of the students drummingaway outside—also has an impact, as does, perhaps in aslightly more sensitive way, the migration cap, which is acause for concern. All those items together need across-departmental analysis, so that we can be certainthat none of them causes long-term damage to thescience base. I hope the Minister will be able to throwsome light on that, because I am trying very hard to getto the bottom of what analysis has occurred, and tofind out what contingency plans there are for any unforeseeneffects of the impact of any of those items on anotherone. That is hugely important.

I also want to comment on the hon. Lady’s remarksabout education, which is a significant area for us. Iappreciate that this goes well beyond the Minister’sbrief, but we need to look deeply at how we incentiviseyoung people to switch on to science. The hon. Ladywent into music despite the efforts of her father. Wehave to go right down to the core of how primaryeducation is taught, how we train our primary teachersand keep them up to date, and how we partner themwith industry and academia to inspire them to pass onthe exciting things that are happening in the worldtoday to the children around them. One of my favouriteexamples, which happens to be led by a constituent ofmine, Professor Mike Bode, is the National Schools’Observatory. It is hugely disappointing how few primaryschools use that tool. It is there, it is free and it is hugelyexciting, so we have to ask ourselves, “What is it that isfrightening teachers?” It is not the curriculum, becausethe tool can be used in the context of the curriculumwithout any difficulty, but there must be problems andwe need to work with our colleagues in the Departmentfor Education to find out what the underlying problemis, and solve it.

The hon. Lady touched on technology innovationcentres, which are, in principle, a very importantdevelopment. She was right that the development stemmedfrom Hermann Hauser’s report to the previous Governmentand James Dyson’s to the current one. Both thosereports picked up on the same theme. As shorthand, anumber of people have said that this is like lifting themout of the Fraunhofers and planting them in the UK,but it cannot be that, because it would miss the point

about what is here already. We do need to learn, however,from what happens elsewhere in the world: for example,how it is that venture capital works better on the westcoast of the States, and how it is that state involvementin the Fraunhofers seems to help more longer-termfinance to emerge in the German market. Those arehugely important issues. We need to learn from them,and we need to apply the British solution using toolslike that in our economy. The technology innovationcentres provide a way forward, but we should not go fora one-size-fits-all solution. Alternative models mightevolve, based on the structures that are already in place,in the public, private and not-for-profit sectors.

I shall make one more remark on the CSR, which Iknow will get support from my colleagues from outsidethe golden triangle—apologies to my colleagues withinit. I welcome the four big capital projects in the CSR, asthey are very important to UK science, but I hope thatHer Majesty’s Government will not forget that scienceoccurs right across the nation, outside the golden triangle.We must not forget the centres of excellence in universitiesin the regions of this nation outside that area, forexample the Daresbury laboratory.

My final point stems from the privilege—it is aprivilege—I have as Chair of the Science and TechnologyCommittee. Doors have been opened to me that I didnot know existed. Just yesterday I found myself sharinga platform with Professor Brian Cox, which was afantastic honour. We were addressing a group of engineersin an innovation competition run by National Instruments,and he made the point that the hon. Lady has justmade: that we ignore blue-skies thinking at our peril.On the panel with me were a very successful entrepreneur,someone from National Instruments and Professor Cox,and all four of us saw the link between the smallentrepreneur and blue-skies thinking. For goodnesssake, I hope that at no stage during this Parliament willanyone inside the Department for Business, Innovationand Skills or elsewhere start to make suggestions againstblue-skies thinking, against the need to support some ofthe big science projects such as Rutherford Appleton,Daresbury, the space programme and CERN.

Those hugely important projects have direct benefitsfor some of our smaller companies, so let us make surethat we join up the needs of our business and academiccommunities. Let us find ways further to inspire youngpeople to take up exciting careers in science and engineeringand to make sure that this Parliament goes down inhistory as the one that really sought—on a cross-partybasis, I hope—to make a difference in this hugely importantfield.

There is no doubt that the success of our economy inyears to come will depend on our continual investmentin science and engineering and in all the educationprogrammes I have touched on. It is vital that Parliamenttake the lead in ensuring that there is no diminution ininvestment; in fact, investment should move in a positivedirection, and we should drive it up in the sectors we aretalking about.


Annette Brooke (in the Chair): Order. The winding-upspeeches will now commence at 3.51 pm unless we haveanother Division.


3.11 pm

Dr Julian Huppert (Cambridge) (LD): It is a greatpleasure to serve under you, Mrs Brooke. Before I start,I should declare an interest as a member of the Instituteof Physics and the Royal Society of Chemistry, as wellas a Research Councils UK academic fellow, although Iam on long-term leave. [Laughter.] This feels like theFloor of the House during Prime Minister’s questionsearlier. I was, therefore, an academic scientist before Ifell in with a bad crowd and ended up here.

It is a great privilege to follow the hon. Member forEllesmere Port and Neston (Andrew Miller), who is theChair of the Science and Technology Committee, andthe hon. Member for Oxford West and Abingdon (NicolaBlackwood), whom I congratulate on securing a debateon this important topic. As she commented, her predecessor,Dr Evan Harris, was a great champion of science inParliament, and, in that respect, there is a lot of work todo to replace him.

It is great that the hon. Lady gave such a well-researchedspeech, which dealt with so many of the issues that aredear to the hearts of many scientists around the country.I would, however, take issue with her description ofOxford West and Abingdon as having the highest densityof STEM researchers and science-based companies. Wewill have to measure that properly, because I suspectthat Cambridge could do rather well, given that it is thebest university in the world, according to one recentrating.

I have experience in a number of areas of science,which says a lot about how we can do interdisciplinaryscience. I am a chemist, and I used to work on biologyin a physics department. It is becoming much easier tobreak through. If I have any issue with the idea of triplescience, it is with the idea that there are three separatesciences. We need much more integration.

I should also tell hon. Members that I set up aspin-out company. If they are interested, I will tell themlater exactly what it was trying to do.

The Parliamentary Under-Secretary of State for Business,Innovation and Skills (Mr Edward Vaizey): Now.

Dr Huppert: We were aiming to make it easier tocollect virgin female fruit flies, and I will explain laterexactly why we wanted to do that.

Scientific research is extremely important. This countryhas a proud history of scientific research. We haveNewton, who was, of course, also a Member of Parliament,Watson and Crick, a whole series of people based inCambridge and the fantastic glut of Nobel prizes thatwe won this year, although, in some cases, the workinvolved was not based in Cambridge.

As well as our history, however, there is also the issueof our future. What is our economic future? What willthis country be doing in 2050? If we actually mean itwhen we say that we want to rebalance our economy,science and high technology will surely be how we dothat and where we go. I have been working on this issuewith various people, and I draw hon. Members’ attentionto an article that I have written with another newMember of Parliament, the hon. Member for MidNorfolk (George Freeman), about the appliance ofscience. We discuss some of the issues and some of theblocks, and the article is available in selected newspapers,

possibly near you, depending on where in the countryyou are. We look at how we can advance in biotech,cleantech, agritech and digital technologies, in which wereally have the capacity to be world leading and tochange what happens over the next 40 years.

I do not, however, want to talk about all those issues.Instead, I want to pick up three key issues that feed intoour scientific research, and I apologise in advance if Igive them a slightly more academic than industrialslant. Those three issues are people, money and freedom.

We cannot do scientific research without good peopleor the right people. As we have heard, we have problemsright at the beginning, at school. We have problems inteaching STEM subjects, and the shortage of physicsteachers has been mentioned. Work is being done toalleviate that; in fact, there are possibly too manydifferent initiatives. I am delighted to be shadowedtoday by James Glover, from Mott MacDonald, who isan ambassador for the Science, Technology, Engineeringand Mathematics Network. It is sheer coincidence thathe is here today, but STEMNET does a lot of worklinking industry with schools to make sure that they areaware of what can be done, so that practicals becomeexciting, relevant and interesting, unlike some of thestaid practicals that many of us had to experience.

We have problems at school with people falling out ofSTEM subjects. We possibly make people make decisionsabout A-levels too early, and we lose them that way. Wethen have problems at universities with the perceivedease of STEM subjects and their relative attractiveness.Increasingly, many courses are for four years, whichautomatically makes them less attractive than three-yearcourses, and Browne, if I can mention it—it has suddenlygone quiet outside—will make the problem worse. Iffees go up to between £6,000 and £9,000, people willthink about what they should do. Will they do thatfourth year, which is so necessary to have a full groundingin a subject? I worry about. For the record, I do notsupport increasing the fees, and I have campaignedagainst it for many years, since Labour first broughtfees in.

Mr Lammy: Will the hon. Gentleman give way?

Dr Huppert: I was wondering whether I could temptthe right hon. Gentleman.

Mr Lammy: I want to add something on that specificpoint, although I think that the hon. Gentleman willwelcome what I have to say. The House will continue tohave a big debate about the level of fees, and we areaware of what is going on outside. However, we havenot discussed what student debt at the end of theundergraduate experience will do to domestic studentswho want to go on to postgraduate study. Is the hon.Gentleman as concerned as I am that UK students willbe put off going into postgraduate study and engagingin the innovation that we really need?

Dr Huppert: I thank the right hon. Gentleman forthat comment. Indeed, that was my next point, so it wasvery helpful. We do have a problem. I used to teachstudents, and they were concerned about debt. We candiscuss to what extent it is a debt and so forth, but theywere concerned. The issue of whether to go on torelatively low-paid PhD positions is a real concern.


Furthermore, I welcome the fact that PhDs are changingfrom being typically three years long—or at least paidfor for three years, although they normally overrun—tofour years long. Although that gives a more roundedexperience by the end, however, it also means thatpeople are delaying serious earning potential for a lotlonger, and I worry about how that fits with the increasein debt.

There are issues about the quality of PhD programmes.I was recently told that one university has given out onePhD in the past seven years. Although I have notverified that figure, I would be concerned if we hadinstitutions that gave so few PhDs, because there wouldbe questions about the quality of such qualifications.There is also a problem with availability in some subjects,and some very good students struggle to get positionsor funding. We therefore have problems attracting peopleto do science-based PhDs.

If those who go on through PhDs, having sacrificedmany years of earning potential, want to stay in academia,they will look for a post-doctoral position, but we havea big bottleneck in terms of the availability of suchpositions. Even if someone gets one, such positionstend to involve very short contracts—two or three yearsare typical. That causes problems getting money for thenext position. It takes such a long time to find moneyfor the next job—I will come back to this later—that alot of postdocs do not have the freedom to focus ontheir work. The fellowship schemes that exist are fantastic,partly just because they allow postdocs to focus on theirwork.

That uncertainty—that hopping from one short-termcontract to another—has real issues for gender balance.We talked about the gender balance at earlier stages, butthere is an issue at the post-doc level as well. Women ingeneral do not like this process, and it is a real disincentivefor them.

Once people finally make it through the post-doctoralposition, they may be fortunate enough to get one ofthe few academic positions available. That will finallycomplete the process, but the steps at every stage makeit harder to attract and keep people.

So far I have talked only about domestic students. Ofcourse we do not get all our scientists from Britain. Weget a huge number from overseas, and that is essential.Science is a global activity. It does not make sense to saythat Britain should supply all the skills it needs forscience. We cannot draw up barriers. I have been veryconcerned about the Government’s proposed immigrationcap, and many hon. Members will know about concernsthat have been expressed. The cap causes problems; itmakes it hard to get good quality people from outside.There are many stories of people not coming, andothers of people who have made it clear that they wouldnot have come under such a system. Venki Ramakrishnanis one example. We have heard some instances already,and I have heard of students not being given visas tocome to Cambridge for a four-day conference, becausethe UK Border Agency was not satisfied that there wassufficient evidence that they would not require benefitswhile they were here. Given that they had already paidthe fees for a four-day conference I think that it wouldbe safe to assume that they would have come to theconference and then gone again. There is increasingconcern from the university of Cambridge that wecannot get PhD viva examiners from outside the EU,

because that is classified as work. We do not want tostop that activity. I find it bizarre that the cap includesexemptions for elite sports people and ministers ofreligion, but not for doctors, scientists or engineers,who contribute much more to our economy.

Another issue is people—just as people. When I talkto representatives of high-tech companies aroundCambridge, I find that many of their concerns are notjust about the things we have discussed already. The No.1 concern that people talk about in Cambridge is housing—the cost of affordable housing there, by which I meanaffordable for science researchers, and not in the sensethat was used in the rather ill-informed debate that wehad in the House yesterday. People also talk abouttransport problems and how to get where they want togo. They talk about the problems of finding goodeducation for their children, and the issues of theenvironment that they live in. Those issues affect scientistsand their choice to continue working in this countryrather than moving elsewhere.

Money, of course, is another factor, and scientists,like all people, are motivated by money. We had a freezeon the total science budget, as has already been discussed—the £4.6 billion. That is good news. It is not as good as itcould be. Other countries, such as Germany, investmore in their science funding. However, it is helpful,and I thank the Deputy Prime Minister in particular forgetting the last £200 million that came into the sciencebudget on the Sunday night just before the comprehensivespending review. I share hon. Members’ concerns aboutlack of knowledge about the capital budget. A commentwas also made about long-term security, and I have inthe past asked the Minister for Universities and Sciencewhether we can have at least a 10-year funding horizon,because science projects often take that long.

There are also problems with the cycle of allocationof money by research councils. I am well aware of theHaldane principle and would not dream of telling researchcouncils how they should operate. They did not give methe grants I deserved and I am sure that they willcontinue not to give people the grants that they deservein future, but the real problem is the slow pace. Anapplication goes in, and it takes six to nine months,typically, to get a response. If people are on contracts ofone to two years, that is a huge amount of time for themnot to know the result. Success rates are phenomenallylow. Academics apply for grant after grant, driving upthe number of applications that must be studied, andfilling up the system. There must be a way to run thesystem faster and more efficiently.

We need financial support from industry, and goodrelations with it. Cambridge is fortunate because wehave an excellent cluster. One of the features of that isto do, again, with people. People can work in industryor academia and can move between them. Scientists areoften married to other scientists, so both partners canhave jobs in the same area, with the same level ofsecurity. We have a number of successful spin-outs.Research and development tax credits were also mentioned.They play a critical role in supporting industry systems.Companies have highlighted that time and again asessential.

I support the moves for greater procurement by smalland medium-sized enterprises. A detailed analysis byentrepreneurs in Cambridge shows that if there is aclient when someone sets up a company, it works. It is


[Dr Huppert]

much better to have a client. The success of siliconvalley has been largely due to Government procurementwith small start-up companies, really giving them theinitiative to go. However, the issue is not only public. Ithink that Max Perutz was responsible for the excellentcomment:

“We’ve got no money, so we’ve got to think.”

[HON. MEMBERS: “It was Rutherford.”] I am gratefulthat so many hon. Members can correct me on that: mythanks to them. The sentiment stands, none the less. Itis the freedom to think that makes a difference. Wecannot predict which research will be world-shattering.We cannot say that lasers or the internet will be thething that matters. DNA was first discovered in pus,and was a curiosity. It was believed to be the way inwhich phosphate was stored by the body. It was completelyuninteresting; and now it leads to all the advances ingenetics, health and biotechnology. We cannot predictsuch things, so we must allow academics the freedom toexplore. There is a false split between pure and appliedresearch, which I am very concerned about. Pure researchoften leaps into applications and I am very concernedabout the increasing drive to impact. It does not makesense to ask people to estimate the economic impact ofa piece of research.

Graham Stringer (Blackley and Broughton) (Lab):The hon. Gentleman is making an interesting speech.Does he agree with Professor Cox who said when hecame to the previous Select Committee on Science andTechnology that he found it impossible to know what toput when assessing impact? It is not do-able.

Annette Brooke (in the Chair): Order. If I may intervene;there are 25 minutes left, and at least three speakersbefore the winding-up speeches.

Dr Huppert: I am about to finish, Mrs Brooke. I thinkthat Professor Cox is to some extent right, and to someextent wrong, because universities have begun to providethe text to put in those boxes. I think that a form-fillingexercise is developing.

I join in the support for the technology and innovationcentres, whether they are Fraunhofer or Hauser models.That will make a big difference in enabling us to do truetranslation that works.

We know what we need. We must make sure that weprovide it, whether it is money, freedom or support forthe people involved. I take the point that we shouldlook more broadly than just to the sciences. Humanities,classics and other subjects have a lot to provide. I haveone last request to the Minister. I have asked beforewhether the Treasury could have a chief scientific adviserso that its staff could understand science. They saythey cannot see why they need one: that is exactly whythey do.

3.27 pm

Mr Andrew Smith (Oxford East) (Lab): I congratulatemy neighbour, the hon. Member for Oxford West andAbingdon (Nicola Blackwood), on securing the debate,and on her speech. Her timing is exquisite, whether byaccident or design, as she has picked the day when more

than 50,000 students are protesting outside at the damageto be inflicted on higher education by the 80% cuts inteaching grant and huge increases in student fees. Iparticularly welcome and support the students from theuniversity of Oxford and Oxford Brookes university,both of which have most of their students, and keyscience facilities, in my constituency. Those include theOxford science area and the Oxford science park, althoughof course the Begbroke science park is in the constituencyof the hon. Member for Oxford West and Abingdon,the Diamond synchrotron is in the Minister’s constituencyof Wantage, and the Culham science centre is in theconstituency of the hon. Member for Henley (JohnHowell). There is a huge Oxfordshire-wide and cross-partyinterest in the health of scientific research. The work ofscientists in our area is of global as well as nationalimportance, and makes a huge contribution to theeconomy, which is crucial to the competitiveness andfuture prosperity of our country.

It is to the credit of the Labour Government thatthey were responsible for record investment in science.[Interruption.] I am pleased to hear the Minister applaudingthat. The Government’s investment was amplified bythe invaluable contribution of the Wellcome Trust, themedical research charities and others. However, as thehon. Member for Oxford West and Abingdon pointedout, when we consider publicly funded science as ashare of GDP it is not as though no more needs to bedone. I echo the call made by my hon. Friend theMember for Ellesmere Port and Neston (Andrew Miller)for us to pull together to do more.

Given the context of massive and ill-judged publicexpenditure cuts, it is also right to recognise that theGovernment have afforded science and research a measureof protection in the recent spending review. I know thatthat the higher education Minister fought for that, and Ithank him. I am sure that the Minister who is presenttoday fought for it too, and if so I thank him too. I amnot going to let them off the hook, however, given thereal cuts, the big outstanding uncertainties still affectingscience funding and the challenging context in whichscientists will be working in the years ahead.

I should like the Minister to answer a number ofquestions. First, as we have heard, the cash freeze overthe next four years represents a 10% real cut. Althoughwelcome protection for medical research is provided,there are worries that that could involve bigger real cutsin other areas of science, such as physics and engineering.What is the position on that?

Secondly, the Science and Technology Facilities Councilhas already, as we have heard, had a tough three yearsand is not facing further cuts from a position of enormousstrength. It is not clear whether the commitments toimprove STFC’s situation, made by Lord Drayson lastJanuary—to cover exchange rate fluctuations in thecosts of international subscriptions—will be honouredby the coalition Government. It would help if theMinister confirmed that that undertaking still stands.

Thirdly, the severe cuts to the Minister’s capital budgetcould, as we have heard, have a serious impact if theyfeed through directly to research council funding. Capitalis not just about new projects, which can of course bedelayed, albeit at some cost to our international researchcompetitiveness. A significant proportion of the runningcosts of facilities, for example, the routine replacementand upgrade of equipment, are classified as capital.


Almost a quarter of the running costs of the ISIS centreat Rutherford Appleton, which does cutting edge atomicwork advancing a range of physical, biological andmaterial sciences, are classed as capital costs. Cutswould reduce the amount of time that that vital facilitycould operate each year. Can the Minister assure us thatsuch factors will be given sympathetic attention whenhis Department makes its capital allocation?

Fourthly, what is the position on the overall budget ofthe Technology Strategy Board over the spending periodand how much redirection of current funds will berequired to support the operation of the new the technologyinnovation centres that were recommended by the Hauserreport. Obviously, if that amounted to a big sum—tensof millions of pounds a year, or whatever, from a staticTSB budget—it would represent a significant cut inother important areas of its work, such as collaborationwith business on knowledge transfer. Can the Ministerclarify that position?

As the hon. Member for Cambridge (Dr Huppert)said, success for science research depends on more thanthe science budget, critical though that is. I should liketo mention a couple of other areas. Keeping up the highquality of our science depends in no small part on thequality of science teaching in our schools, as the hon.Member for Oxford West and Abingdon said. In awritten parliamentary answer on 26 July, to my questionon incentives for physics graduates to enter teaching,the Minister of State said:

“We are considering a scheme to repay the student loans ofscience and mathematics teachers.”—[Official Report, 26 July2010; Vol. 514, c. 817W.]

Where has that consideration got to? It is clearly all themore relevant, given the huge increases in fees that theGovernment are now imposing.

My hon. Friend the Member for Ellesmere Port andNeston and the hon. Member for Cambridge mentionedthe immigration cap. I would like to press the Ministeron what representations he is making across Governmenton the real threat to our scientific excellence and standingposed by the coalition Government’s proposed annuallimit on economic migration and changes to the visaregime. Nearly a third of Oxford university’s academicteaching and research staff, and 46% of its research-onlystaff, are from overseas. Although some of those peopleare of European economic area origin, a lot of academicstaff hold tier 1 highly skilled migrant programme visas,more than 700 are work permit/tier 2 visa holders andsponsored researcher/tier 5 visa holders. As the vice-chancellor of Oxford university said in his evidence tothe Migration Advisory Committee:

“Most of our current Tier 1 visa holders are in highly specialisedresearch areas, and many are working in strategically importantsubject areas such as engineering and technology, environmentalscience and the biosciences…It would be disastrous for internationalrelations and research programmes if we at Oxford were not ableto continue to welcome overseas researchers at current levelsunder all tiers. This would seriously affect recruitment and retentionparticularly in all the physical, bio and clinical sciences, and intechnology, engineering and mathematics”.

I hope that the Minister is concerned about this as well.Can he assure me that, in view of the contribution thattheir teaching and research make to knowledge, theeconomy and society in general, top internationallymobile academics and researchers will be exempt fromthe immigration limit or, at the very least, that the visaand work permit regulations will be operated in such a

way that Oxford and other universities and researchinstitutes will be able to recruit all the people they needto sustain their international standing?

Science and successful business spin-offs do not justneed funding, research facilities and the best researchers;their staff—managerial and technical as well as scientists—need somewhere to live, a good environment, transportinfrastructure and room for businesses to grow. However,these things are all too likely to be a casualty of thecoalition Government’s decision to abandon all theevidence and careful consideration that went into thesouth-east and other regional plans and leave planningup to district councils. An example of the disastrouseffect that this is having is that a significant housingdevelopment to the immediate south of Oxford, in theplanning jurisdiction of South Oxfordshire district council,is now most unlikely to go ahead, given that nimbyismseems to be that council’s principal planning policy.[Interruption.] The Minister may laugh, but if I recallcorrectly, he once famously told the Conservative partyconference that he was greatly in favour of additionalhousing in Oxfordshire, as long as it all went into myconstituency, although it is not quite big enough to takeit all. I welcome the expansion of my constituency tomake room for the growth south of Grenoble road.

Part of the development that I have mentioned wasan expansion of the Oxford science park, providingexactly the sort of facilities that are needed to harnessour scientific excellence to business success, jobs andprosperity. Will the Minister consider that, bearing inmind his comments to the Conservative party conference,and chat about it with his colleagues in Department forCommunities and Local Government?

Stephen Mosley (City of Chester) (Con): The hon.Gentleman has asked the Minister a number ofquestions—I agree pretty much with all of them—and Ishould like him to ask one on my behalf. For everyleading research scientist there are dozens, if not hundredsand thousands, of lower-level lab technicians, who arejust as important a part of our national science researchbase as those guys at the top. Perhaps the hon. Gentlemanwill ask the Minister what he is doing to ensure that weget 17 and 18-year-olds into science research, throughapprenticeships, further education and workplace training,because these guys are just as important as the people atthe top.

Mr Smith: The hon. Gentleman makes a good point,which I shall add to my list of questions. We will all belooking carefully at the announcement of the Government’sskills strategy next week to see what specific componentit contains to address those important issues.

We can have higher, sustainable economic growth ifwe really want it. But if we are to achieve it we needmore housing and better transport in places such asOxfordshire, across the south-east and in other regionswhere science is so important, so that business can dostill more to make the most of the scientific excellencethat we are investing in.

Those are a few questions for the Minister to consider.If he does not have time to answer them all this afternoon,I should be grateful if he wrote to me. It is important, asother hon. and right hon. Members said, that we keepup the pressure in the cause of science, which it is no


[Mr Andrew Smith]

exaggeration to say is vital to the quality of life, livingstandards and our whole civilisation, now and forgenerations to come.

Annette Brooke (in the Chair): There are 12 minutesremaining. I wish to call two speakers—Gavin Barwelland David Mowat—and I call Gavin Barwell first.

3.39 pmGavin Barwell (Croydon Central) (Con): Thank you

for those clear instructions, Mrs Brooke. I will watchthe clock carefully. I congratulate my hon. Friend theMember for Oxford West and Abingdon (NicolaBlackwood) on her excellent opening speech, and allhon. and right hon. Members who have spoken in thishigh-quality debate.

I start by declaring a personal interest: I am a sciencegraduate. I studied theoretical physics at Cambridge,although I am ashamed to say that I have not used agreat deal of that study since I graduated. However, Inow have the opportunity to do so because I wasrecently elected to the Science and Technology Committee.I am also taking part in the Royal Society pairingscheme, and I echo the comments made by several hon.Members about its importance. I am paired with DrEmily Nurse from the high energy physics group atUniversity college London. I represent a Londonconstituency, and while we have heard a great dealabout Oxford and Cambridge universities throughoutthe debate, London has Imperial college, UCL, andother leading institutions.

I have been asked to stick to time but, luckily, thosehon. Members who have spoken have covered many ofthe points that I wished to make, so I can be relativelybrief. There is political consensus about the need todiversify our economy, and one of the lessons we mustlearn from what has happened over the past few years isthe need for a broader economy. One of the strengths ofUK plc is our scientific base.

My hon. Friend the Member for Oxford West andAbingdon cited figures from “The Scientific Century”,which is an excellent report by the Royal Society. Let meset out the full figures for the world: we have 1% of thepopulation; 7.9% of scientific papers; 11.8% of worldcitations; and just under 15% of the most highly-citedpapers. This is an area of excellence, and we also havethe second strongest higher education sector in theworld, after the USA, so we must build on that strength.

Like other hon. Members, I am grateful for the workcarried out by my right hon. Friend the Minister forUniversities and Science and the relative protection ofthe science budget. I echo the points raised about theScience and Technology Facilities Council, and theissue of capital funding, which accounts for just morethan a third of its budget.

Neil Carmichael (Stroud) (Con): It is good to seescience supported and to ensure that science works withbusiness. Many business men have asked me how wecan protect our patents and our value in an internationalsphere, so the Department for Business, Innovation andSkills needs to think about that.

Gavin Barwell: My hon. Friend makes an importantpoint to which I am sure that the Minister will respond.My point is that the Science and Technology Facilities

Council has a high dependency on capital funding. Ifwe do not have clarity on that matter, there is the dangerthat we will see significant cuts in the general grantspend. Its dependence on capital is higher than that ofother councils.

Although it is important that the Government lookat the benefits of science—economically and to widersociety—there is also a benefit to society from knowledgein its own right and from pure research that is designedto extend the sphere of human knowledge. It is sometimesdifficult to quantify that, and I appreciate that theGovernment have to cost such matters. However, it isimportant to put on record the significance of knowledgein its own right, which is often the primary motivationof scientists, rather than some putative economic return.

Let me echo the points that have been made about theimmigration cap. I am a strong supporter of the cap,and although my constituents feel strongly aboutimmigration, they are not worried about leading scientistscoming into the country to drive our economy forward.Their concern is about the numbers of people who havebeen brought into the country and take jobs that shouldhave gone to economically inactive British people whocould have gone back to work during the last boom butfailed to do so. Their concern is not with people whocome in to create businesses, opportunities and jobs forother people, and I hope that the Government will besufficiently flexible on that issue.

My hon. Friend the Member for Oxford West andAbingdon pointed out that these matters are not onlyones for the Department for Business, Innovation andSkills, and I echo that sentiment. A number of membersof the Science and Technology Committee have spokenabout whether the Government office that deals withscience would be better located in the Cabinet Officebecause of the overarching role that science plays acrossGovernment activity.

I shall conclude with a point about education which,again, several hon. Members have touched on. I haveread a piece by Simon Schama about the teaching ofhistory in our schools. It contrasted children’s greatfascination with detailed works such as “The Lord ofthe Rings” with our failure to make the story of ourhistory sufficiently interesting to children. The same istrue of science education. I have an eight-year-old son.Any conversation with him quickly becomes a successionof “Why?” questions. He has complete fascination withthe world around him and why it is as it is. As childrenget older, however, we somehow fail to maintain theirenthusiasm to find out about the natural world.Developing that passion for science in the critical phaseof secondary education is a key area that the Governmentmust look at.

I am conscious of the time and I know that my hon.Friend the Member for Warrington South (David Mowat)wishes to speak. I end by congratulating my hon. Friendthe Member for Oxford West and Abingdon on securingthe debate and thanking other hon. Members who havetaken part.

3.44 pm

David Mowat (Warrington South) (Con): I thank myhon. Friend the Member for Croydon Central (GavinBarwell) for giving me the chance to speak. I am one ofthree hon. Members in the Chamber from Imperial


college—I think that there are only three of us—so weshould get our retaliation in first—[Interruption.] Myhon. Friend the Member for Windsor (Adam Afriyie) isone of them.

I wish to talk about the application of science. Wehave heard a lot about pure research and so on, butwhen we think about the economy over the next 20 or30 years, and the fact that we can no longer rely on theCity and North sea oil to the extent that we have overthe past two decades, we must ask where the innovationwill come from. With respect to the right hon. Memberfor Tottenham (Mr Lammy) and the large contributionmade by arts graduates, that innovation will, to a greatextent, come from science.

My constituency, like many in the north-west, willlose around 2,000 public sector jobs over the lifetime ofthis Parliament. The Office for Budget Responsibilityhas forecast that it will gain 5,000 private sector jobs.All north-west Members, and those more widely, mustthink about where those jobs will come from and whatwe can do to help their creation.

Hon. Members have mentioned silicon valley, and itis interesting to note that companies such as Microsoft,Google, Yahoo!, Dell, Apple and eBay, and their supplychains, have probably generated in excess of 1 millionjobs over the past two decades. For the most part, thosecompanies did not exist 30 years ago. In 20 or 30 years’time, there will be another list that people will talkabout. I do not know what companies will be on it—if Idid, I would probably not be in the Chamber—but theywill come from innovation and science. We must dowhat we can towards achieving that.

On the border of my constituency is a place calledDaresbury. We have heard something of the goldentriangle, which makes me feel a bit outnumbered, butDaresbury is a fantastic place that, together with Harwell,is one of two SFTC locations in the UK. Daresbury is alittle different from Harwell because it focuses stronglyon innovation as well as on pure science. There is alsopure science, however, and Daresbury has a fourth-generation accelerator—a lot of the design work on theDiamond synchrotron was carried out there. However,the distinctive thing about Daresbury—if the Ministerhas not seen it, he should come and visit—is that thereare about 100 small companies that are growing, takingoutput from the universities and turning that intocommercial exploitation. On average, those organisationshave grown by 20% over each of the past two years.That has happened through the recession, so it is quite athing. A 36,000 square feet extension is being built andis already nearly full. There is a significant chance that10,000 jobs will be created by those 100 companies andthe public-private partnership that is being put intoplace.

Andrew Miller: Does the hon. Gentleman agree thatthose 100 or so tiny companies are in Daresbury as aresult of the magnet provided by the research facility?They would not have come there on their own; this ispart of the integration between very small and verylarge companies that I was speaking about.

David Mowat: I agree with the hon. Gentleman. Thekey term is multidisciplinary. Those companies interactwith each other, and the pure science laboratory, whichwas there in the first place, has been the driver.

I want to contrast the multidisciplinary model of theDaresbury campus with some of the ideas that havecome out of the Hauser review. That is more aboutexcellence, with the Government picking areas in whichthey want to invest and going for it. I am not againstthat, but there are two models to determine how weinvest in science and applied science. One is what couldbe called, “Let’s pick a winner and go for it,” and theother is, “Let 1,000 flowers bloom. Let’s try lots ofthings. Some of them will be brilliant and some of themwon’t.”

My hon. Friend the Member for Cambridge(Dr Huppert) pointed out that silicon valley was createdby Government procurement, but I do not think thatthat is true. I think that it was created by innovation,entrepreneurship, encouragement and the linkage ofmoney to brilliant technologists.

I do not wish to overrun my time, but I have twominutes left and a couple of concerns to raise, to whichI shall be interested to hear my hon. Friend the Minister’sresponse. I welcome the local enterprise partnerships asa way forward. There is a risk, however, that they will bequite fragmented in a way that the regional developmentagencies were not and other things are not. I recentlyhad a ridiculous conversation with a colleague who saidto me, “Which LEP is Daresbury going to be in?” Thatis not the right way for us to think about how we do allthis, and if we let that mindset grow, it will be quite adangerous.

I mentioned the Hauser review and technology andinnovation centres. It is not clear to me how they willinteract with what we call regional growth hubs—or atleast there is a lot of language in this area that seems tobe quite loose—so I would welcome input on that.

With regard to the success of Daresbury, I have a bitof concern about the way in which the Science andTechnology Facilities Council funding goes betweenDaresbury and Harwell. I am not an expert in how thatworks, but I think that nearly all the members of theboard of the STFC are Harwell-based, not Daresbury-based. We must be careful that we do not have asouth-centric civil service and a south-centric triangledriving science in a way that we do not want.

You will be pleased to hear that I shall stop speakingshortly, Mrs Brooke. I just want to reiterate that this hasbeen a good and positive debate, principally because ithas not been party political. We have much more incommon with one another—especially those of us whowent to Imperial college—than party politics allows,and it is extremely important to us all and to ourchildren that we get this right.

3.51 pm

Chi Onwurah (Newcastle upon Tyne Central) (Lab): Icongratulate the hon. Member for Oxford West andAbingdon (Nicola Blackwood) on securing a debate onsuch an important subject and on the excellence of herspeech. As one of those STEM-qualified women whoare no longer working directly in STEM, I was veryimpressed by the breadth and depth of her analysis,even if I do not agree with every one of her conclusions.Her constituency certainly has an excellent advocate.

Oxford West and Abingdon is home to excellentscience research, as are many of our great universitytowns: London, Manchester, Cambridge, Liverpool,


[Chi Onwurah]

Bristol, Southampton, Edinburgh and, of course, myown constituency of Newcastle, to name but a few.However, it is clear from the speeches and interventionsmade today that hon. Members on both sides of theChamber have concerns that go wider than the scienceresearch carried out in their constituencies.

I am sure that even if his colleagues in BIS had notbeen in China or otherwise engaged, the Culture Ministerwould still have been eager to come to this debate andset out the Government’s policies on science research.That is recognition of the hugely important role thatscience plays in our society. From the sharpened stoneto the mobile phone, scientific developments have changedsociety and brought new opportunities. Indeed, I amsure that if decent research grants had been available inprehistory, it would not have taken 2 million years to gofrom sharpened stones to the stone axe. Equally, theEgyptian pyramids would not have required quite somuch slave labour—the wheel could have taken a bitmore of the strain.

To take an example closer to our own day and age,the mobile phone—we all have one—is a result ofdecades of public sector defence research into wirelesstransmissions; billions of private sector investment in Rand D, infrastructure and commercialisation; academicresearch into cutting-edge modulation techniques; andGovernment-led access to spectrum and global protocolstandardisation. The result is a technology that enablesa farmer in Kenya to know the market price of corn onthe Chicago stock exchange, and ensures that informationabout voting irregularities in Burma or Iran can betweeted across the world before the voting is over.

Science changes society, and generates wealth. TheCampaign for Science and Engineering has estimatedthat investment in science research gives a return of30% a year in perpetuity. Right now, we need thatreturn more than ever, so we are right to treat thisdebate as hugely important. To be fair, the Chancellorof the Exchequer, in the comprehensive spending reviewstatement, claimed that he was protecting the sciencebudget, as many hon. Members have gratefully commented.In his final flourish, under the sub-heading “growthand promoting a private sector recovery”, he said:

“I have decided to protect the science budget. Britain is a worldleader in scientific research and that is vital to our future economicsuccess. That is why I am proposing that we do not cut the cashgoing to the science budget.”—[Official Report, 20 October 2010;Vol. 516, c. 961.]

Now let us consider what the Chancellor did not say.As has been pointed out, a cash freeze means a 10%cut—assuming current rates of inflation—in real terms,or £460 million, at a time when the rest of the world,including the US, China, France and Germany areincreasing their science spend. Also, what the Chancellorcalls the “science budget” is only 50% of Governmentscience investment in the UK. The rest, includingdepartmental R and D, capital expenditure, R and Dtax credits and RDA spending, has not been frozen orring-fenced and therefore is vulnerable to cuts. In thecase of the RDAs, we know that their science funding of£440 million a year has been lost. If other expenditure iscut at the same rate as departmental expenditure—letus remember that this is science funding that has deliberatelynot been ring-fenced—we are looking at a cut of 10% incash terms.

In July, the Royal Society said that“severe cuts of 10% or more in cash terms...threaten to devastateBritish science, impair the future growth of the economy andderail the UK’s ability to govern effectively and tackle globalchallenges. Regaining our scientific pre-eminence, with all theeconomic and social benefits that this brings, would be impossibleor cripplingly expensive for future generations.”

Although the upgrade of the Diamond Light Sourcesynchrotron in the Minister’s constituency has beensecured, the rest of the capital budget, as has beenpointed out, has not been safeguarded. Nature reportsthat the research councils have been warned to expect atleast a 30% cut in their capital funding. Hon. Membershave pointed out that as a result of those capital cuts,the Science and Technology Facilities Council, whichfunds the Rutherford Appleton laboratory in theconstituency of the hon. Member for Oxford West andAbingdon—

Mr Vaizey: It’s in mine.

Chi Onwurah: I apologise. The STFC, which fundsthat laboratory in the Minister’s constituency, is likelyto be hit as the bulk of its budget is capital. High-techEuropean partnership projects such as JET—the JointEuropean Torus at the Culham centre for fusion energyin neighbouring Henley—are funded through the capitalbudget. They will need to find extra money to coverinflation. That might result in UK researchers having tocut usage while still paying high fixed costs, or to cutother areas. As the Royal Society says, that woulddramatically reduce the efficiency of our investment.

Overall, there could be far-reaching consequences inthe UK economy. Research Councils UK has calculatedthat a cut of £l billion in science spending results in adrop of £10 billion in gross domestic product. Therefore,the protection offered by the Chancellor seems ratherflimsy, especially in the competitive world of globalscience. China is stoking its engine of innovation with2.5% of its GDP and an 8% rise this year. I hope theSecretary of State for Business, Innovation and Skillswill be listening to his hosts in China in that regard atleast.

The situation is somewhat worse than it first appears.We have agreed that we need to rebalance our economy,but we do not want to do that by reducing the financialsector—absolutely not. We want to do it by growingother sectors, such as advanced manufacturing.

In addition to the cuts to science funding, we havefurther cuts disabling the vital economic levers thattranslate scientific understanding into commercial ideas.For example, programmes funded by the RDAs, whichsupported the commercialisation of scientific discoveries,which we have discussed, have already been cut—suchas the Innovation Machine in Newcastle.

It was mentioned that the Prime Minister announcedfunding for the technology and innovation centres tothe tune of £200 million. However, in Germany, wherethe model they are based on is located, six times more isspent each year on running costs.

Given that our situation and the funding for scienceare under such threat, I ask the Minister to confirm anumber of points. Will Government spending on sciencethat is not in the £4.6 billion be safeguarded? Are theGovernment intending to increase science spend as aproportion of GDP, in line with European targets? Do


they acknowledge the vital role they must play in helpingto commercialise new technologies? Finally, will R andD tax credits be safeguarded?

We need the jobs that come from the timely exploitationof scientific discoveries. The Government’s plans forscience and research endanger all our futures.

4.1 pm

The Parliamentary Under-Secretary of State for Business,Innovation and Skills (Mr Edward Vaizey): I am gratefulfor the chance to speak under your chairmanship, MrsBrooke. The last times I spoke in a debate, I had the fullmight of the Welsh Labour party ranged against me, so50,000 students making noises off is slightly easier todeal with.

I congratulate my hon. Friend the Member for OxfordWest and Abingdon (Nicola Blackwood) on securingthis important debate. One of the great advantages ofhaving new Members of Parliament is that those of uswho have been in Parliament for merely five years getthe chance to patronise them, so let me say what apleasure it was to be at her parliamentary birth, at theAbingdon leisure centre on that momentous night whenshe became the Member of Parliament for Oxford Westand Abingdon.

I put on record what a hugely successful job my hon.Friend is doing—slightly too successful, as my Conservativeassociation in Wantage keeps asking whether we canhave her to speak instead of me. Also, almost all thecompanies in my constituency seem to want her tocome and visit them. In fact, she mentioned one that I,too, visited on Friday—she had got there beforeme—Nexeon, in Milton park in Didcot.

If my hon. Friend the Member for Warrington South(David Mowat) wants to know what the future is, heshould resign his seat and go and work for Nexeon. It ismaking extraordinary lithium ion batteries, which areanother example of British scientific expertise. Thediscovery was about the use of silicon, which storesmore energy, and Nexeon’s way of putting silicon intobatteries promises the future—houses powered by batteries,apparently.

One of the great pleasures of representing myconstituency is that I wish I had won the lottery andcould invest in almost every company that I go and seethere. One is literally “The Man in the White Suit”company—coat a shoe or shirt with its material andwater literally drips off without leaving any damp patchat all. However, I digress, and we do not have muchtime.

We have had a fantastic number of excellent contributionsto the debate, such as those from the Chair of theScience and Technology Committee, the hon. Memberfor Ellesmere Port and Neston (Andrew Miller), andfrom the hon. Member for Cambridge (Dr Huppert),who reminded us why it is so important to have scientistsin the House, because of his chalk-face experience, if Imay put it that way, and his ability to talk us throughwhat happens with scientists on the ground.

Another such contribution came from the right hon.Member for Oxford East (Mr Smith) who, as I have saidmany times before, is only in the House because I wasthe press officer of the Oxford university Conservativeassociation when he was fighting Steve Norris in 1987.However, what is absolutely true is that he, I, my hon.

Friend the Member for Oxford West and Abingdon, myhon. Friend the Member for Henley (John Howell),the Prime Minister and my hon. Friend the Member forBanbury (Tony Baldry) all work well together onOxfordshire interests, even if we might clash on nationalpolicies.

My hon. Friend the Member for Croydon Central(Gavin Barwell) made a valuable contribution to thedebate, and I have renewed respect for him now that Iknow he is a theoretical physicist, while my hon. Friendthe Member for Warrington South has a distinguisheddegree in engineering, although he left it for accountancy.I propose a twinning arrangement with my hon. Friendthe Member for Warrington South: I would certainlylike to see his facilities in Daresbury, if he will come andsee my facilities in Harwell.

The debate covered a huge range of subjects. We evengot on to housing shortages, nimbyism and transportnetworks. However, what it boils down to—stating whatI regard as the highlights—is essentially: the myth andreality, as it were, of the science budget; the need toengage young people in science, even those in primaryschools; concerns about whether the coalition Government’simmigration policy will impact on scientific research inthe future; and some specific Government policies, notablyon technology and innovation centres.

Adam Afriyie (Windsor) (Con): May I bring theMinister’s attention to another point that was raised? Inmy time as the shadow Minister for Science and Innovation,I was keen to have a chief scientific adviser in theTreasury. Can he shed any light on that matter or onany progress that might be taking place in that regard?

Mr Vaizey: If I can make a career-ending response tothat, in my short experience as a Minister I have discoveredthat the Treasury thinks it knows absolutely everything,so the idea that it needs to be advised on science or,indeed, any other subject would clearly be anathema toit. That, I am sure, is why it is resisting the appointmentof a chief scientific adviser—I shall turn to the role ofthe Government’s chief scientific adviser in a minute. Ialso congratulate my hon. Friend, because he was adistinguished shadow science spokesman for us. I haveno doubt that, behind the scenes, he influenced theGovernment’s approach to the science budget.

To give credit where it is due, however, the Ministerfor Universities and Science, my right hon. Friend theMember for Havant (Mr Willetts), who cannot be herebecause he is flying the flag for UK plc in India, I think,ought to be hugely credited with securing the importantsettlement that we have had for science.

I would like to say that I played a role in thatsettlement. There was a moment when I was in theSecretary of State’s office and I noticed a paper on theDiamond synchrotron, so I said to his private secretary,“You really want to sort out the Diamond synchrotronbecause they have a really effective MP and you don’twant to cross him.” He looked at me and said, “Who’sthat?” So, I am not sure how much influence I had,although as a politician I would like to take the credit.

Other issues raised were the allocation between specificresearch councils—the charity research fund referredto by my hon. Friend the Member for Oxford West and


[Mr Vaizey]

Abingdon—and the capital funding. The debate wasnot partisan and has been conducted on a good cross-partybasis.

One of the things that I note about science, which weshould all treasure, is that people from different placeswork together. [Interruption.] That is probably my righthon. Friend the Minister for Universities and Scienceringing—

Mr Andrew Smith: Or the Chancellor.

Mr Vaizey: Yes, that is the Treasury on the phone.Going to such large scientific facilities—I was struck

in particular going to the large hadron collider—onesees Iranian scientists working next to Israeli scientists.That for me, if we are talking about bringing sciencealive, brings alive the global, co-operative nature ofscience.

I can tell hon. and right hon. Members that I cannottell them anything about some of the questions theyasked, because the negotiations are still ongoing. I cantell them that we hope to conclude them by Christmas.

Mr Andrew Smith: The Minister is doing very well inthe limited time, but can he write to us on the specificquestions that he does not have time to answer now?

Mr Vaizey: I thought about standing up and simplysaying that I would write to the right hon. and hon.Members, given that approximately 35 questions wereasked in the course of the debate. However, I willcertainly ensure that we give a comprehensive responseto all right hon. and hon. Members who attended thedebate, in response to all the questions asked by individualMembers.

We talked about research budgets from otherDepartments. Yesterday the Department of Health signedan agreement for a UK Centre for Medical Researchand Innovation, with £220 million for the construction

of this new centre, which will bring together the MedicalResearch Council, University college London and medicalcharities.

Reference has been made to the £69 million securedby the Diamond synchrotron, as well as other importantinnovations such as the European Space Agency, whichis also in my constituency. I was delighted to see thereport this week, pointing out that space success hasrocketed in this country; the industry is now worth£7.5 billion, and it employs 25,000 people, which is anincrease in a year of 11%. When the right hon. Memberfor Oxford East said that our scientists have a globalreach, I would correct him and simply point out thatthey now have an intergalactic reach, which we shouldpraise.

The important question of immigration was raised.It is absolutely part of our strength as a scientific nationthat we attract the best scientists to live and work here.As I said earlier, scientists working together from differentcountries that may be politically hostile to each other isvery important. It is an extraordinary experience tovisit leading scientific institutions and see the range ofpeople from across the world who have been attractedto them. We must secure that sort of international workforce working together.

Last week, my right hon. Friend the Minister forUniversities and Science met representatives of furtherand higher education and of the UK Border Agency,and had the opportunity to hear their concerns directly.My Department is working closely with the HomeOffice to develop a system that, while delivering theGovernment’s objective—as my hon. Friend the Memberfor Croydon Central pointed out, it is strongly supportiveof reducing the overall level of immigration—allowsthose who can make a positive contribution to the UK,such as researchers and academics, to continue to comehere.

The hon. Member for Cambridge spoke about peoplebeing denied a visa to attend a legitimate high-profileconference. I understand his frustration. We need toestablish a system under which reputable institutionsshould be trusted to vouch for those who attend conferences.


Exeter to Plymouth Railway

4.11 pm

Anne Marie Morris (Newton Abbot) (Con): Duringthe next 10 to 15 minutes, I shall speak about the southDevon railway line. It is close to my constituents’ hearts,and I am clearly looking to the Minister to supportcontinued investment in it.

The line goes from Exeter to Plymouth, and part of itgoes through my constituency. It goes through Starcrossand down the coast through Dawlish and Teignmouth.From there it divides, and goes on either to Torbay orPlymouth. It is one of the most picturesque stretches ofrailway in Europe; indeed, it is a tourist attraction in itsown right.

The line is hugely important to the Devon economyfor two reasons: because of the role it plays in supportingtourism, and for its role in helping my constituents tocommute to work and back. In my part of the world,public transport is important, as it is a very ruralcommunity. The Minister will be delighted to hear thatthe more rail travel we have, the smaller will be ourcarbon footprint, so I hope to achieve some support inthat regard.

I shall dwell first on the economic value of the lineand explain how important it is for Devon. Tourismaccounts for 7% of the Devon economy, a substantialpart. We have 5.3 million visitors a year, which is nomean feat. Teignbridge, the part of my constituencythrough which the railway runs, is the second mostimportant destination for tourists. As a result, it is nosurprise that 30% of the local work force are engaged intourism or related industries. While tourists are in Devon,they spend in excess of £2 billion a year. That is asignificant sum.

I turn to the commuting element, and the economicand environmental benefits of the line. The Ministermay be surprised to learn that 2 million people usedthat line during the last 12 months. Indeed, NetworkRail’s estimate is that we will see 19% growth over thisyear and next. It has been identified as one of the fastestgrowing lines.

Sarah Newton (Truro and Falmouth) (Con): I thankmy hon. Friend for giving way, and I congratulate heron securing this debate. I give her my support and thesupport of all Members of Parliament who representCornwall.

All trains from Paddington to Cornwall use this line,but we in Cornwall are even more remote and peripheralto the UK than Devon. The line is vital to us, and itshould be protected and upgraded, especially given theenvironmental problems that I hope my hon. Friendwill mention. The line is important not only for Devon,but will play an important role in the future economy ofCornwall.

Anne Marie Morris: I thank my hon. Friend for thatvaluable contribution and for the support she offers.

As I said at the outset, I am seeking the Minister’ssupport for continued investment, and I shall explainwhy. During the last Parliament there was a House ofCommons inquiry into an alternative inland route, whichresulted from concerns about the viability of continuinginvestment, given the coastal path that the route takes.

The inquiry findings were made public in February thisyear; its view was that, at a cost of £100 million, itsimply was not viable. We now have a new Administration,and I therefore seek an assurance that the Governmentsee the coastal line as a priority. That is particularlyimportant as it will allow Network Rail and theEnvironment Agency to plan for the future, and it isclearly important that such planning be put in placenow.

Why is it important that we plan now? It is importantbecause, as many will be aware, this line has its ownchallenges, which are not new. They have been wellrehearsed; indeed, the matter was last debated in 2006.The main challenge is this: as a coastal line, it is inevitablyaffected by erosion and a rise in sea level. The linefollows 13 miles of tidal water, four of which are alignedwith or cross open sea. The Met Office prediction is thatsea levels will rise by 0.32 metres over the next 100 years.That may seem a lot, and we need to plan now becauseof the consequences.

Another factor needs to be taken into account. TheMinister may know that the UK is on a tilt: the south-westis tipping into the sea, and the north-east is going theother way and rising out of the sea. As a consequence,the south-west is sinking by between 5 mm and 10 mm adecade. We need to consider what has to be done soonerrather than later.

I have discussed the problem with Network Rail, thebody responsible for maintaining the line. It is morethan happy—it believes that it is viable—to continueinvesting £500,000 a year to ensure that the sea wallremains rugged and fit for purpose. However, whenlooking forward to 2025, it believes that more investmentwill be required. If we are to make that further investment,we need to consider its quantum and what sort ofdisruption would be caused to local businesses, touristsand commuters, as we need to manage the process in asensible way.

In my discussions, I have discovered two problemareas. One is in Dawlish Warren, where there has beenconsistent erosion; the sand has moved, to the benefit ofExminster and the detriment of Dawlish Warren. TheEnvironment Agency’s position is that we can hold theline, but come 2025 it believes that managed realignmentwill be needed. What will happen then, and what willthe cost be? The second difficult area is Powderhambank. As the sea level rises there, the wetland will beginto disappear. We need to ensure that we still have thewetland, with its birds and wildlife, which means we willhave to create a causeway for the railway line. Theappropriate spot for that is Powderham bank, but significantengineering problems and costs will need to be evaluated.

We need a shoreline management plan, and theEnvironment Agency is responsible for ensuring that itis in place. As expected, it has developed an overarchingcoastline strategy. It has been diligent in renewing groynesand gabion defences. Recently the Environment Agencyspent £100,000 on emergency repairs and, as we speak,is considering putting sand deposits on to DawlishWarren to deal with the erosion problem. However,there is a challenge in getting agreement between all theinterested stakeholders in Shoreline Management Plan 2,as it is called. That plan was discussed before theelection, and was put on hold as we moved towards theelection. Post-election, it is to be re-visited. There is ameeting in two weeks’ time of the western structure

135WH 136WH10 NOVEMBER 2010 Exeter to Plymouth Railway

[Anne Marie Morris]

team, at which Teignbridge district council, the EnvironmentAgency, English Heritage, the Countryside Council—indeed, all parties—will be present. My concern is thatat that meeting there needs to be a real focus on whatthe priorities should be. That is why I would like theMinister’s assurance that the priority is to ensure thatline continues to run.

Therefore, I am looking for three things: a statementon the Government’s behalf that it is their priority tokeep the line running; confirmation that there is no planto resurrect a debate about the alternative inland routeat a cost of £100 million; and for the Minister and theGovernment to direct Network Rail and the EnvironmentAgency to work together to find a way forward, puttingthis route and its long-term viability and infrastructureat the heart of the plan going forward. I might be sobold as to suggest to the Minister a time line, because Iam conscious that with a plan and a time line, we willhave a result. I suggest that in the rail regulatory period5, running 2009-14, the Minister propose that the grouplook at putting in place a proper plan and implementingproper consultation, because the changes required in2025 will have significant local implications. I thensuggest that during rail regulatory periods 6 and 7,which run from 2015-24, we look at the design and thebuilding of the work that needs to be put through. TheMinister will already be well aware that the Governmentare committed to a high-speed train between Londonand Torbay; indeed, that starts next month. I hope that,given that commitment, I and others can expect supportfor this line. Otherwise, it will be a wasted investment.

In conclusion, I want to make clear on behalf of myconstituents and those of adjoining constituencies howimportant this line is to the local economy of Devonand Cornwall and to the south-west in general. I makemy case to the Minister on our constituents’ behalf thatthis line needs to be protected and to have continuedinvestment. We need confirmation that this is a priorityline that will receive direction from the Governmentand, where relevant, funding.

4.23 pm

The Parliamentary Under-Secretary of State for Transport(Norman Baker): I congratulate my hon. Friend theMember for Newton Abbot (Anne Marie Morris) onsecuring the debate. She set out with great clarity theimportance of the Exeter-Plymouth railway line to herconstituency and the south-west in general. I welcomethe opportunity to reassure her that the issues she raisedabout the route’s long-term resilience are being takenseriously by the rail industry and the Government.

The Exeter-Plymouth railway line is of great importanceto the economy of south Devon, Torbay, Plymouth andwhole of Cornwall. It makes a significant contributionto tourism in the area. I am sure that there are manypeople whose first glimpse of the Devon seaside camefrom the window of an express train as it hugged thecoast on the line between Exeter and Newton Abbot.

The line is also important for people getting to workand college, and also for the businesses that rely on it tomaintain efficient contacts with the rest of the country.However, as my hon. Friend notes, its proximity to thecoast is the line’s Achilles heel, and it has been subject

to temporary closures from time to time. Network Railis responsible for the operation, maintenance and renewalof the rail network and it takes very seriously thelong-term resilience of the network in the face of climatechange.

It falls to Network Rail to continue to monitor thelikelihood of risks to the safety and operational integrityof the railway in the Dawlish area and to proposefurther appropriate measures of protection from floodingand coastal erosion. Network Rail is fully aware of theimportance of the section of coastal main line betweenTeignmouth and Dawlish Warren. I understand thataround £9 million has been invested in recent years tomaintain the integrity of the sea wall and the stability ofthe cliff face. Network Rail does not believe that therailway sea defences in the Dawlish area are likely to failin the foreseeable future, thanks to the works carriedout and ongoing maintenance and monitoring.

Network Rail advises that it spends around £500,000each year, as my hon. Friend notes, on maintaining thesea walls and estuaries. A dedicated contractor workforce is based at Dawlish. The sea walls are subject to anenhanced structural maintenance inspection regime, withan additional post-storm element, to ensure railwaysafety and performance, and to target resources atwhere the risk is greatest. Weather forecasts and tidalpredictions are monitored, and when the combinationof events reaches a pre-determined level, additionalinspections are undertaken.

The implications of climate change will stretch intothe long term, however. On 16 September, my right hon.Friend the Secretary of State for Environment, Foodand Rural Affairs responded to a report published bythe adaptation sub-committee, which was set up as aresult of the Climate Change Act 2008. She said:

“Although we need to bring down greenhouse gas emissionsinternationally and to drive down our own emissions at home, weneed to mitigate and adapt to the potential consequences ofclimate change. This is one of the key priorities contained in thecoalition agreement.”

This is a challenge that Government must rise to, butthey cannot do it alone. Transport infrastructure providersneed to recognise both the economic and social necessityof taking steps to protect the areas for which they areresponsible.

Network Rail has been taking action for some time.It is working with the Met Office by using its data tohelp to stress test thousands of miles of rail tracks,embankments and bridges to determine whether theycan stand up to the patterns of extreme weather predictedover the coming decades. The process is not cheap. Theinvestigation itself will cost around £750,000, but whenNetwork Rail points to such early action leading tosavings of around £1 billion over 30 years, the workstarts to look incredibly good value for money.

This new piece of work builds on an earlier technicalstudy undertaken by Network Rail and the Rail Safetyand Standards Board in 2008. The railway lines adjoiningthe Teign and Exe estuaries and the south Devon coastwere used as case studies, and the conclusions suggested,not surprisingly, that the frequency of disruptions alongthe main line was likely to increase over the next 70 yearsas sea levels rise.

Network Rail has therefore identified that there is aproblem—not just in south Devon but on other parts ofthe network—that needs to be addressed. The Department

137WH 138WH10 NOVEMBER 2010Exeter to Plymouth Railway Exeter to Plymouth Railway

for Transport is funding a major research project withNetwork Rail to understand the impact of climatechange on the railway. The project has already identifiedwave over-topping and flooding at defended coastaland estuarine railways at Dawlish as a priority. The nextphase of the project will provide the quantified evidenceneeded to decide where and when investment may beneeded to maintain the resilience of the railway toincreasingly extreme weather.

No conclusion has yet been reached on what mitigationmeasures might be required to minimise the risk to therail network from rising sea levels at locations along thecoast and river estuaries. Nevertheless, along with thekey objective of protecting the railway, its users andproperties adjacent to it, it must be a priority to maintainaccess by rail to the areas of south Devon and Torbay.

My hon. Friend asked whether keeping the line runningwas a priority, and I hope I have answered that question—itis. Do we see it as the main line to Cornwall—this pointwas also referred to by my hon. Friend the Member forTruro and Falmouth (Sarah Newton)—in the indefinitefuture? Yes, we do. I will turn briefly to the question ofwhether we intend to resurrect the debate about analternative route. A number of suggestions have beenmade about building alternative routes away from thecoast or re-opening former railway lines such as theExeter-Okehampton-Tavistock-Plymouth line. As I havepointed out, any solution cannot ignore the needs ofsouth Devon and Torbay, so reopening that line alonewould not meet one of our key objectives. That is not tosay, however, that if the line were to open, it would notbe welcome. It would be welcome but, in our view, itwould not be a substitute in any shape or form for themain line along the coast.

My hon. Friend the Member for Newton Abbot alsomentioned CP5 and the considerations for 2025, whichshe identified as a key date. I undertake to pass on hercomments to the Minister of State, Department forTransport, my right hon. Friend the right hon. Memberfor Chipping Barnet (Mrs Villiers), so that she has themin mind as she discusses the contents of CP5 withNetwork Rail.

I am encouraged that Network Rail is engaging withother organisations to tackle the issue and taking it veryseriously. My hon. Friend the Member for NewtonAbbot referred to the Environment Agency, which has akey role to play. To meet her suggestion that we directNetwork Rail and the Environment Agency to find asolution, I will be happy to write to them following thedebate to stress the importance of maintaining the lineto the economy of south Devon.

Housing Revenue Account Subsidy (Wales)

4.30 pmJonathan Edwards (Carmarthen East and Dinefwr)

(PC): May I begin, Mrs Brooke, by saying that it is apleasure and an honour to serve under your chairmanshipthis afternoon?

The topic of my debate is the housing revenue accountsubsidy scheme, aims to highlight one of the greatinjustices of public housing policy in Wales during thelast 20 years. That policy has led to a reported £2 billionin cash terms—not taking into account inflation—ofthe rents of some of the poorest people in Wales beingreturned to the Treasury. It has also led to chronicunder-investment in the Welsh public housing stock,which is among the poorest and of the worst standardin Europe, with the associated social and health implications.It has deprived our communities of a significant cashinvestment. Furthermore, it has driven the stock transferagenda.

With the UK Department for Communities and LocalGovernment scrapping the housing revenue accountsubsidy scheme for England in September—a decisionthat we in Plaid Cymru welcome wholeheartedly—therecan be no justification for Welsh local authorities tohave to continue paying around £100 million per annumto the Treasury.

As far as Wales is concerned, the story of the housingrevenue account subsidy scheme is one of greatincompetence by both Labour and Tory politicians,who have miserably failed some of the poorest people inWales. Perhaps that is not surprising, as I am reliablyinformed that only a very few individuals understandthe full complexity of the scheme.

As part of the then Conservative Government’s relentlessattack on public housing, the Local Government andHousing Act of 1989 led to the confiscation by theTreasury of a large part of the rents paid by tenants.The complication of the new arrangements was hardlyhelped by those arrangements being labelled as a “subsidy”.My understanding of the word is that “subsidy” shouldmean some sort of financial benefit, but that was certainlynot the case in this instance.

The effect of the 1989 Act was to undermine theattractiveness of public housing by running down itsquality, as investment was redirected from localcommunities. Rents in Wales were lower than those inEngland—they still remain lower now—and that led toless revenue in general. The quality of housing in Walesis also generally poorer. However, under the terms ofthe Act, local authorities were forced to return anysurplus from expected rent, after operational andmaintenance costs were met, to the Treasury, ratherthan investing those moneys in the housing stock. Thathad the bizarre effect of promoting the stock transfer ofpublic housing, which is a theme I will return to later.

Perhaps the use of the word “subsidy” comes fromthe effect of the new arrangements, which meant thatthose council tenants who were able to pay their rentswere, via the new funding mechanism, paying for thehousing benefit entitlements of others. Of course, thatdid not apply to private rented sector tenants or totenants of registered social landlords.

With HRA payments being used to fund housingbenefit, the greater the money that the Treasury couldaccumulate via the scheme, the less it needed to pay out

139WH 140WH10 NOVEMBER 2010Exeter to Plymouth Railway

[Jonathan Edwards]

directly in benefits. Indeed, the 1989 Act allowed UKGovernment Ministers to set the expected level of rentincome from each local authority, as well as the expectedlevel of expenditure on maintenance and managementof their homes.

Guto Bebb (Aberconwy) (Con): First, I congratulatethe hon. Gentleman on securing this debate. On thatspecific point, it is also worth pointing out that thedecision in 1989 to introduce those changes also meantthat there was a more equal distribution of rents amongthe local authorities in Wales. Indeed, there was a capon the increase in rents for local authority housing atthat time.

Jonathan Edwards: The hon. Gentleman makes anhonourable point, but I am trying to point out theperverse effects of the 1989 Act and I am sure that hewill give me some time to do so.

As I was saying, the 1989 Act allowed UK GovernmentMinisters to set the expected level of rent income andthe expected levels of expenditure on maintenance andmanagement of the local authority homes. The policymotive of the UK Government was to drive up councilrents while decreasing expenditure on housing, in orderto increase the differential and gain maximum financialadvantage from the new arrangements. As a result, thequality of publicly owned housing stock in Walessignificantly worsened.

The then Secretary of State for Wales, Peter Walker,was guilty of a dereliction of duty of the greatest scale,as Wales was included under the terms of the newarrangements while the Secretary of State for Scotland,Michael Forsyth, refused to sign the Scottish clause,meaning that Scotland was exempted from the 1989Act. Considering that housing benefit is a UK function,there was no reason at all why Scotland should havebeen excluded and Wales included, apart from the ineptitudeof the Wales Office and its Conservative occupants—ifthe hon. Member for Aberconwy (Guto Bebb) willforgive me for saying so.

New Labour being new Labour, it continued thepolicies of the previous Tory Government on publichousing for the first three years after the 1997 election.In 2000, however, following a backlash among localauthorities, the UK Government introduced proposalsto amend the scheme without legislation. To end thededuction of rents from local authorities, the Treasuryintroduced in each housing revenue account an amountfor spending on the renovation of properties. That newbudget line was called the major repairs allowance andit was set at a level to ensure that local authorityexpenditure exceeded rental income, with the immediateeffect of halting the Treasury’s rent grab.

The increase in funding brought about by the MRAfor England was from UK Government sources and theUK taxpayer, and hence a Welsh equivalent should havebeen introduced by increasing the block grant by theBarnett formula. However, and critically, those newchanges were only applied to England. In what has beendescribed as “the year of the great mistake” by PaulGriffiths, a former Labour Welsh Government specialadviser, in an excellent Bevan Foundation article, forsome reason the Treasury again decided to make Wales

a special case and Labour, which was in control of theWelsh Government, totally missed the significance ofthe changes applied to the HRA in England. As aresult, since devolution, Wales has lost a further £1 billion,with an average of around £100 million per annumbeing siphoned off from council rents in Wales.

It is true that the Welsh Government could havemade a unilateral decision and left that money with thecouncils, but as devolution guidance notes insist thatany policy decision must be neutral in its impact uponthe Treasury that would have meant that the WelshAssembly Government had to find a further £100 millionfrom its already underfunded Budget to give to theTreasury. Therefore, that is a change that can only bemade with Treasury consent.

We in Plaid Cymru continuously make the case thatWales is ill-served by the UK Government. The Barnettformula continues to underfund Wales to the tune of£300 million per annum. We welcome the announcementof a review of the formula, which will take place shortly,although for the life of me I cannot see why that reviewhas to take place after the referendum. However, givenits attitude on Barnett and other issues, it is therefore ofno surprise to us that the Treasury would considerWales as an afterthought in relation to the introductionof the MRA in England in 2000.

The gross incompetence of the Welsh Government ofthe time is less easy to understand. Quite how successiveWelsh Ministers and Welsh civil servants have failed tochallenge the inequity of the situation is quite beyondme. With a Labour-controlled Welsh Government moreconcerned with placating their London masters, it ishardly surprising that the people of Wales are being letdown so badly. Indeed, it has taken a Plaid CymruHousing Minister to put this issue on the agenda at all.In short, the Treasury, under Labour control, threw ahospital pass to the Welsh Government in 2000, with atragic £1 billion consequence for some of the poorestcommunities in my country.

In 2004, the Welsh Assembly Government created itsown MRA out of its own funds, which further confusedthe issue. It meant that around £100 million was divertedfrom other areas of devolved responsibility each year,when the right course of action was to demand whatwas rightfully Wales’s from the Treasury. Therefore,despite the introduction of the Welsh Government-sponsored MRA, the Treasury continued to rake intheir £100 million per annum from the HRA schemein Wales.

As I mentioned earlier, one of the direct consequencesof the HRA scheme has been to make the sale ofpublicly owned housing far more attractive, either underthe terms of the right to buy or by the wholesale sellingoff of stock to registered social landlords, becausehousing associations are not covered by the scheme andare free to spend this money as they see fit on improvinghousing stock.

To date, the local authorities of Bridgend, Ceredigion,Merthyr, Newport, Monmouthshire, Rhondda CynonTaff, Gwynedd, Torfaen and Conwy—the local authorityof the hon. Member for Aberconwy—have all transferredtheir stock to housing associations, with many morelocal authorities seeking to follow the same path, due totheir inability to access funds to help them to meet theWelsh housing quality standards set for 2012.

141WH 142WH10 NOVEMBER 2010Housing Revenue Account Subsidy(Wales)

Housing Revenue Account Subsidy(Wales)

Guto Bebb: On that specific point, it is interesting tonote that some local authorities in Wales have identifiedthe issue and embarked upon stock transfer as a meansby which they can invest in repairing the properties thatthey hold. Indeed, it is very interesting that Gwyneddcouncil, which is actually controlled by Plaid Cymru,has also followed that procedure. However, I am surethat the hon. Gentleman will concur that it is interestinghow often local opposition to such a move has been ledby Labour politicians. In view of how the LabourGovernment in Wales failed completely in 2000 to addressthat issue, is it not surprising that local Labour politicianshave been so opposed to those stock transfers?

Jonathan Edwards: The hon. Gentleman makes anexcellent point. It is a shame there are no LabourMembers here to debate that issue with us. Of course,he and I have divergent views on stock transfer. I willreturn to the situation in my home county ofCarmarthenshire later.

Guto Bebb: My understanding is that Plaid Cymruparty members are extremely supportive of the stocktransfer undertaken in Gwynedd. In the county ofConwy, which I have the pleasure to represent, it hasbeen deemed a great success, even though Labour partymembers opposed the decision.

Jonathan Edwards: The hon. Gentleman makes apoint. To be honest, there is a debate within the partyabout the merits of stock transfer. I, for one, am not aspersuaded as may be some of my colleagues in thenorth of our great country.

The stock transfer agenda has been driven by thedenial of funds to Welsh local authorities that wouldnot necessarily have wanted to go down that path,because of the housing revenue account subsidy scheme.The HRA scheme has therefore had the undoubtedeffect of driving greater change in Wales than was everenvisaged, and, in my view, not necessarily a change forthe better.

My local authority, Carmarthenshire county council,which is keen on keeping its housing stock, was recentlyforced to borrow money in order to introduce its housingplan to keep its stock in public ownership. If the moneyfrom the council’s own rents had been available to it, itwould not have needed to borrow money; it could haveused the revenue generated by its stock’s rents. As aring-fenced account, money collected in this way canonly be used on housing. Why is that option simply notavailable for local authorities in Wales?

Due to the scale of the situation, it is perhaps surprisingthat the Treasury was unable to provide details of theHRA contribution made by Welsh local authoritieswhen I asked a parliamentary question on the subject inJuly. Thankfully, it seems the Welsh Government arebetter at keeping records of that sort of financialtransaction. Their response to my freedom of informationrequest made clear the scale of the great rent robbery.

As the Treasury has been unable to provide thefigures, it will be useful for the record and indeed for theTreasury’s records if I outline each Welsh local authority’scontribution in cash terms since 1999. If I may try thepatience of the House, Mrs Brooke, the figures are, tothe nearest million: Blaenau Gwent, £12 million; Bridgend,£16 million; Caerphilly, £70 million; Cardiff, £139 million;my home county of Carmarthenshire, £51 million;Ceredigion, £15 million; Conwy, £14 million; Denbighshire,

£32 million; Flintshire, £62 million; Gwynedd, £53 million;Ynys Môn, £23 million; Monmouthshire, £33 million;Neath Port Talbot, £52 million; Newport, £75 million;Pembrokeshire, £63 million; Powys, £60 million; RhonddaCynon Taff, £2 million; Swansea, £56 million; Torfaen,£71 million; Vale of Glamorgan, £56 million; Wrexham,£110 million. Merthyr was the only Welsh council insurplus of £5 million. If the Minister wants, I canprovide an annual breakdown for each year since 1999,but I might try his patience a bit too much.

Guto Bebb: Do the figures quoted date from 2000onwards, or from the 1989 decision?

Jonathan Edwards: From 1999, because the WelshGovernment can only provide figures since devolution,but 2000 would have been the benchmark.

Considering the pressure on housing waiting lists, itis sobering to think that if those moneys had beenretained over the past decade, 10,000 brand-new familyhouses could have been built in Wales, all eco-friendlyand built to modern specifications. That could havehelped address major social justice issues such as fuelpoverty. Some 30% of households in Wales, not justthose living in public stock, are in fuel poverty. Wecould have addressed Wales’s terrible legacy of poorhousing and associated poor health. The money couldalso have provided enormous benefits for the localconstruction economy, which is part of the backbone ofWelsh employment, and improved the circulation ofmoney inside some of the poorest communities in Wales.

I am informed that by now the Treasury will havereceived a letter on the issue from the Welsh Ministerfor Business and Budget and Deputy Minister for Housingand Regeneration. The letter encloses a report by ProfessorWilcox, an expert on housing finance. I have not beenprivy to that report, but I believe that it argues thatWales should have parity with Scotland. I agree, as Ihope will all parties in Wales.

Furthermore, the new UK Government’s decision toscrap the housing revenue account for England thisSeptember means that there is no justification whateverfor the Treasury’s insistence that the scheme shouldcontinue to apply to Wales alone. Such is the inequityand injustice at the heart of the whole affair that Ibelieve, as I said in a recent early-day motion, that theTreasury should make reparations based on the real-termsamounts of money accumulated over the past twodecades. At the very least, the Treasury must make aclear statement that the provisions of the HRA and thegreat pillage of Welsh rents are to cease with immediateeffect.

In terms of the UK Budget, this ever-decreasingfigure, which lessens every time a local authority transfersits housing stock, is small, but to the tenants who mustmake do with poorer-quality housing than they deserveand the local authorities that want to provide new andbetter-quality housing for their residents, it is a significantamount. This is not just the right thing to do; it is thebest thing to do and the fair thing to do. Diolch yn fawr.

4.45 pm

The Exchequer Secretary to the Treasury (Mr DavidGauke): It is a great pleasure to serve under yourchairmanship, Mrs Brooke. I congratulate the hon.



[Mr David Gauke]

Member for Carmarthen East and Dinefwr (JonathanEdwards) on securing this debate and presenting hiscase with such eloquence and detail, although I amgrateful to him for not providing the breakdown ofevery local authority for every year since 1999.

I am pleased to have this opportunity to discuss theGovernment’s policy on the housing revenue accountsubsidy system and its financial consequences in Wales.Housing policy, as we heard from the hon. Gentleman,is governed by the same primary legislation in Englandand Wales, and the public spending framework is alsosimilar. However, it is important to remember thathousing policy itself is a devolved matter.

The HRAS system in Wales is based on notionalincome and expenditure on council housing, which isderived from information provided by local authorities.If the overall HRAS system is in surplus once all localauthority expenditure has been totalled, the surplus iscollected by the Welsh Assembly Government and givendirectly to Her Majesty’s Treasury as annual managedexpenditure.

I recognise that the existing centralised system is seenas complex and opaque and is therefore unpopular withlocal authorities across Wales, a point made by the hon.Gentleman. That is why the Welsh Assembly Governmentlaunched a review of the HRAS system last December.My colleagues in Government and I look forward to theoutcome of the review. As he said, there is certainlypotential to improve the current system, and anyrecommendations will be duly considered as part of ourwider reform agenda.

It might be helpful for me to touch briefly on theexample of England, about which we have heard a littlebit. As part of the spending review, we announced thatwe will be ending the current HRAS system in Englandand introducing a new self-financing model for councilhousing that will abolish the annual centralised subsidyand replace it with a more transparent system that givesgreater power to local councils and authorities.

As in many areas of public service provision, we seekto devolve responsibility away from the centre so thatcommunities have more of a say in what goes on in theirlocal area. The measure will enable councils to keeptheir rental income and use it to maintain homes forcurrent and future tenants, providing new opportunitiesand incentives for authorities to plan for the longerterm. That approach will allow councils better to meetthe housing needs of their specific areas. Decisions willbe made based on local knowledge and priorities, not acentral Government formula. Details of the new systemwill be introduced this autumn as part of the localismBill.

In principle, it would be feasible to construct a similarsolution for Welsh authorities, if that is what they wishto propose. However, there are some differences betweenthe HRAS systems in England and Wales that will needto be bottomed out. As I said, it is a devolved matter.

Any decision on the future of the Welsh HRAS systemwill be made by the Assembly Government, subjectto agreement by HM Treasury. I note some of thehon. Gentleman’s criticisms of the Welsh AssemblyGovernment—not all coalitions work as harmoniouslyas others do. His points are very much on the record.

It might be helpful for the hon. Gentleman to knowthat, earlier this week, my right hon. Friend the ChiefSecretary to the Treasury wrote to Jane Hutt, the WelshFinance Minister. He offered officials to work withWelsh colleagues on developing a similar reform to theWelsh HRA subsidy system, with the same protectionsprovided for the position of the Exchequer.

Guto Bebb: I am obviously delighted to hear thatbecause this is an important subject. Although I havemade the point that stock transfer has been a way ofdealing with the matter and providing a more localapproach, it is fair to say that there is a cross-partyfeeling in Wales that the issue should be dealt with. It ispart of the localism agenda and the Minister’s commentsare very welcome.

Mr Gauke: I am grateful to my hon. Friend for hiscomments. Indeed, I have a lot of sympathy with whathe has said about stock transfer. If there is a consensuswithin Wales, from the position of the UK Government,the Treasury is keen to engage. As I said, Treasuryofficials are available to work with their Welsh counterpartsto find a way in which we can move forward in this area.Yes, there are differences between the English and theWelsh system, but we are keen to consider the matterand engage in a positive way.

I thank the hon. Member for Carmarthen East andDinefwr for securing today’s debate. He has raised someimportant points and I am grateful to him and my hon.Friend the Member for Aberconwy (Guto Bebb) fortheir contributions. It is incredibly important to addressthe issue of housing needs across Wales—and the UKmore generally—and the Government are keen to do so.I look forward to seeing the proposals for reform of theHRAS system that the Welsh Assembly Governmentare currently putting together and, as I mentionedearlier, the Treasury is keen to engage in that process. Ihope that, through working in partnership with theWelsh Assembly Government, we can find a solutionthat meets the needs of local authorities in Wales set outby the hon. Gentleman. I also hope that we can deliversimilar protection to the Exchequer as that achieved bythe reforms we have undertaken in England, which havebeen assessed by the Office for Budget Responsibility asbeing fiscally neutral. In that context, I would like tosay that this has been a useful debate. I am grateful tothe hon. Gentleman for securing it and I hope he feelsthat it has enabled us to make some progress in thisarea.

Question put and agreed to.

4.52 pmSitting adjourned.



Written Ministerial

Statements


TREASURY

Economic and Financial Affairs Council(11 November 2010)

The Economic Secretary to the Treasury (JustineGreening): I plan to represent the Government at theBudget ECOFIN to be held on 11 November in Brussels.

Budget ECOFIN will prepare a conciliation meetingwith the European Parliament on the EU budget for2011, and handle the outcome of that conciliationmeeting.

The Government remain committed to opposing theincreases of around 6% in the 2011 EU budget, above2010 levels, proposed by the Commission and the EuropeanParliament. These are simply unacceptable at a timewhen Governments across the European Union aretaking difficult decisions to reduce national deficits andensure the sustainability of their public finances.

The Government have called for a freeze in the 2011EU budget at 2010 levels. We voted for this whenCouncil adopted its position on the budget earlier thisyear, which proposed a 2.9% increase over 2010 levels.Six other member states also voted against Council’sposition. It was nevertheless adopted by a qualified majority.

Along with 12 other member states’ Governments,the Government have made it clear that they cannotaccept any increase beyond 2.9% in the 2011 EU budgetcompared to the 2010 budget. Those are the terms ofagreement that this Government will pursue at BudgetECOFIN on 11 November.

DEFENCE

Call-Out Order to Support Operations in Afghanistan

The Minister for the Armed Forces (Nick Harvey):With the expiry of the call-out order made on 11 November2009, a new order has been made under section 54 ofthe Reserve Forces Act 1996 to enable reservists tocontinue to be called out into service to support operationsin Afghanistan. The new order is effective until10 November 2011. Reservists continue to make a valuablecontribution to operations in that country and some1,280 reservists are currently called out and serving, ofwhom 530 are deployed in Afghanistan.

COMMUNITIES AND LOCAL GOVERNMENT

Localism Bill and Planning

The Secretary of State for Communities and LocalGovernment (Mr Eric Pickles): On 6 July 2010, thecoalition Government revoked all regional strategiesunder section 79(6) of the Local Democracy, EconomicDevelopment and Construction Act 2009. This actionwas challenged in the High Court by developer CALA

Homes, and the decision today concluded that section 79powers could not be used to revoke all regional strategiesin their entirety.

While respecting the court’s decision this ruling changesvery little. Later this month, the coalition Governmentwill be introducing the localism Bill to Parliament,which will sweep away the last Government’s controversialregional strategies. It is clear that top-down targets donot build homes—they have just led to the lowest peacetimehouse building rates since 1924, and have fuelled resentmentin the planning process that has slowed everythingdown.

On 27 May 2010, the Government wrote to localplanning authorities and to the Planning Inspectorateinforming them of the coalition Government’s intentionrapidly to abolish regional strategies and setting outtheir expectation that the letter should be taken intoaccount as a material planning consideration in anydecisions they were currently taking. That advice stillstands.

Today, the Government’s chief planner has written toall local planning authorities and the Planning Inspectorateconfirming that they should have regard to this materialconsideration in any decisions they are currently taking.

Moreover, to illustrate the clear policy direction ofthe coalition Government, the proposed clause of thelocalism Bill that will enact our commitment to abolishregional strategies is being placed in the Library. TheBill is expected to begin its passage through Parliamentbefore Christmas.

We are determined to return decision-making powersin housing and planning to local authorities and thecommunities they serve, alongside powerful incentivesso that people see the benefits of building. We will veryshortly provide more details about one of the mostimportant such incentives, the new homes bonus scheme,which will come into effect from April. This means thatnew homes delivered now will be rewarded under thescheme.

The coalition Government remain firmly resolved toscrap the last Government’s imposition of confusingand bureaucratic red tape. This was a clear commitmentmade in the coalition agreement and in the generalelection manifestoes of both coalition parties. We intendto deliver on it.

FOREIGN AND COMMONWEALTH OFFICE

Constitutional Reform and Governance Act 2010(Ratification of Treaties)

The Minister for Europe (Mr David Lidington): TheConstitutional Reform and Governance Act 2010Commencement Order No.3 was made today 11 November,2010. This brings into force part 2 of the ConstitutionalReform and Governance Act 2010 (CRaG Act) whichdeals with the ratification of treaties. The Foreign andCommonwealth Office has overall responsibility forthe conclusion of treaties, and leads on policy in thisrespect. Part 2 of the CRaG Act is the new basis fortreaty scrutiny by Parliament, and replaces the formerconstitutional practice dating from 1924, known as“The Ponsonby Rule”, with statutory provisions.

15WS 16WS10 NOVEMBER 2010Written Ministerial Statements Written Ministerial Statements

The effects of part 2 of the Act may be summarisedas follows:

Section 20 provides that a treaty that is subject toratification or its equivalent, is to be published and laidbefore Parliament for a period of 21 sitting days, duringwhich both Houses have the opportunity to resolve thatthe treaty should not be ratified. If the 21 sitting daysexpire with no such resolution being passed by eitherHouse, the Government can proceed to ratify the treaty.It also defines the legal effect of a negative vote byeither House.

Section 21 provides a mechanism for Parliament torequest extensions to the 21 sitting day period, in blocksof up to 21 sitting days, at the discretion of the relevantMinister.

Section 22 provides an “alternative procedure” inexceptional cases where a Minister is of the opinionthat it should be ratified without following the proceduresin section 20.

Section 23 makes provision for classes of treaties thatare to be dealt with differently because they are scrutinisedby other means, notably—(i) under the EuropeanParliamentary Elections Act 2002 or the EuropeanUnion (Amendment) Act 2008, (ii) agreements andarrangements relating to taxation, or (iii) because scrutinyof them is not for the UK Parliament that is, treatiesconcluded by overseas territories, the Channel Islandsand the Isle of Man as authorised by HMG.

Section 24 requires that treaties laid before Parliamentunder section 20 shall be accompanied by an explanatorymemorandum explaining the provisions of the treaty,the reasons for HMG seeking ratification of the treaty,and other relevant information.

Section 25 defines “treaty” and “ratification” for thepurposes of the Act.

The Act changes the Ponsonby rule in several respects:

Part 2 gives legal effect to a vote against ratificationin the Commons or Lords. It prevents the Governmentfrom moving immediately to ratify a treaty if eitherHouse votes against ratification.

If the Government nevertheless wish to proceed toratification, the Minister must lay a statement givingreasons why. If the Commons voted against, a further21 sitting day period must expire before ratificationcan take place. If the Commons vote against ratificationduring this subsequent 21 sitting days, the Governmentare prevented from ratifying the treaty. However, astatement can be laid more than once and thereforethis process can continue. If the Lords vote againstratification, but the Commons do not, then a ministerialstatement must be laid before Parliament explainingwhy the treaty should nevertheless be ratified.

The definition of “sitting days” is limited to days onwhich both Houses sit.

Part 2 also provides that the Minister can extend thesitting period by 21 sitting days or less (and votesagainst ratification will continue to have legal effectin this period).

Part 2 also requires the Minister, if the “alternativeprocedure” in clause 23 is being used in exceptionalcircumstances, to lay a statement giving reasons.

Guidance on the ratification of treaties and part 2 ofthe Constitutional Reform and Governance Act 2010 ispublished by the Foreign and Commonwealth Office onits website (www.fco.gov.uk/treaty).

JUSTICE

Parliamentary Written Question (Correction)

The Parliamentary Under-Secretary of State for Justice(Mr Jonathan Djanogly): An error has been identified inthe written answer given to the hon. Member for DudleyNorth (Ian Austin) on 19 July 2010, Official Report,columns 45-46W. The correct answer is as follows:

The number of court proceedings processed in themagistrates courts in England and Wales, England, andthe West Midlands Local Criminal Justice Board area,from 2007 to 2009, is given in the table. Statistics are notavailable prior to 2007 on a comparable basis.

Table 1. Completed court proceedings in the magistrates courts,England and Wales, 2007-2009

Year Area

Total numberof completed

criminalproceedings

(includingbreaches)

Total numberof completednon-criminalproceedings

Totalnumber ofcompleted

courtproceedings

2007 Englandand Wales

2,184,000 981,000 3,165,000

England 2,051,000 923,000 2,974,000

WestMidlands

132,000 62,000 194,000


2,031,000 977,000 3,008,000

England 1,909,000 917,000 2,826,000

WestMidlands

121,000 63,400 184,000


1,913,000 974,000 2,887,000

England 1,797,000 910,000 2,708,000

WestMidlands

107,000 66,000 173,000

Source:HM Courts Service Completed Proceedings database, collected throughthe HM Courts Service Performance Database (“OPT”) and bymanual data returns prior to April 2007.Notes:(1) All figures are given to the nearest thousand.(2) Criminal proceedings include indictable/Triable-Either-Way, adultbreach proceedings, adult summary motoring and non-motoringproceedings, and youth proceedings.(3) Civil and family applications include care proceedings, ChildrenAct 1989 section 8 Orders, emergency protection orders, licensing,other civil applications and others. Other includes means inquiries,representation orders and special jurisdiction.(4) Prior to April 2007, data were collected through different datacollection systems and therefore not directly comparable with thosegiven in the table, based on HMCS Performance database (OPT). Forthis reason, the table shows the figures from 2007 only. In addition,the case management system used in the magistrates courts wasupdated between December 2005 and December 2008, from multiplelegacy systems to Libra. Libra was rolled out in the West Midlandscourts between March-October 2008.(5) The above stated figures may not be directly compared with thosepublished prior to the Judicial and Court Statistics 2008 bulletins, dueto figures being derived from a different data source.


PRIME MINISTER

Parliamentary Assembly of the Council of Europe andAssembly of Western European Union (UK Delegation)

The Prime Minister (Mr David Cameron): The UnitedKingdom delegation to the Parliamentary Assembly ofthe Council of Europe and Assembly of Western EuropeanUnion is as follows:Robert Walter MP (Leader)

Full Representatives Substitute Members

Brian Binley MP Lord AndersonChristopher Chope OBE MP Joe Benton MPJames Clappison MP Nicholas Boles MPAnn Coffey MP Lord Boswell of AynhoEarl of Dundee Michael Connarty MPBaroness Eccles of Moulton Geraint Davies MPPaul Flynn MP Jim Dobbin MPSam Gyimah MP Jeffrey Donaldson MPMichael Hancock CBE MP Roger Gale MPJim Hood MP Lord Glentoran CBEAlan Meale MP Oliver Heald MPBaroness Emma Nicholson Lord InglewoodSandra Osborne MP Charles Kennedy MPClaire Perry MP Edward Leigh MPLord John Prescott Ian Liddell-Grainger MPJim Sheridan MP Yasmin Qureshi MP


Lord John Tomlinson Amber Rudd MPVirendra Sharma MP

Parliamentary Assembly of the OSCE (UK Delegation)

The Prime Minister (Mr David Cameron): The UnitedKingdom delegation to the Parliamentary Assembly ofthe Organisation for Security and Co-operation in Europeis a follows:Peter Bottomley MP (Leader)


Lord Bowness CBE Nick de Bois MPTracey Crouch MP Lord Glentoran CBELord Dubs Mr Dai Havard MPBen Gummer MP Simon Reevell MPMark Hendrick MP Nick Smith MPBaroness Hilton QPM Sir Robert Smith MPTony Lloyd MP

Linda Riordan MP

Angus Robertson MP

Bob Stewart MP

Rory Stewart MP

Roger Williams MP


PetitionsWednesday 10 November 2010

PRESENTED PETITIONPetition presented to the House on Tuesday 9 November2010 but not read on the Floor

Elizabeth Regina Love CorrespondenceThe Petition of Mr Martin Burke,Declares that on 10 December 2004 Her Majesty the

Queen honoured Mr Martin Burke with the invitationthat the badge for his business, the letters E and R witha heart design, be Her Majesty’s (with effect from28 February 2004). Declares that the correspondencebetween the petitioner and Buckingham Palace in 2004was private, however sometimes confusion has arisen soin June 2007 the letters were made public.

Declares that at first glance the correspondence mayappear to say the opposite of what it does say so adetailed analysis has been given, available at the newweb address www.elizabethreginalove.com/correspondence(changed from www.eheartr.com).

Declares that this analysis firstly notes the way ofoperating in the petitioners’ first letter dated 28 February2004: that if you announce your intention to do somethingand nothing is said then leave is granted, and furtherdeclares that in now over 6 years since no instruction tocease and desist has been given, on the contrary. Notesthat further detailed analysis of the correspondence isgiven in this analysis. Further declares that the petitionerwas asked very courteously that the badge for EmotionRecords be The Queen’s Cypher. Declares that in respectof this the trading name of Emotion Records Limitedwas changed to Elizabeth Regina Love and its range ofactivities further widened.

Further declares that the guidance from the LordChamberlain’s office on the use of Royal Arms, Namesand Images is that the use of the Royal Arms and ofRoyal Devices, Emblems and Titles, or of Arms, Devices,etc., [ ... ] is prohibited by the Trades Marks Act 1994,unless the permission of the Member of the RoyalFamily concerned has been obtained, and that the LordChamberlain’s office gave the Queen’s permission.

Notes that the apparent ambiguity in the correspondencewas not a mistake, and that the petitioner was beingasked to take the consequences of any misperception.

The petitioner therefore requests that the House ofCommons accept a copy of the analysis of thecorrespondence for inclusion in the House of CommonsLibrary, and that were the question put the Houseconsent to the request(s) in this Mr Burke’s 17th petitionfirst emailed to the House on 30 March 2010, andamended and added to on 5 August 2010.

And the Petitioner remain, etc.[P000867]

OBSERVATIONS

TRANSPORT

Intercity Express Programme

The Petition of residents of the Sedgefield constituency,and others,

Declares that the petitioners believe that the Governmentshould implement the procurement of rolling stockthrough the Intercity Express programme, which wouldlead to Hitachi building a manufacturing site in NewtonAycliffe; and further declares that this would result inthe creation of hundreds of direct jobs and thousandsof jobs in the supply chain, of which the majoritywould be in manufacturing, giving a much neededboost to the North East economy and improving railservices nationwide.

The Petitioners therefore request that the House ofCommons urges the Government to implement theprocurement of rolling stock through the Intercity ExpressProgramme.

And the Petitioners remain, etc.—[Presented by PhilWilson, Official Report, 13 October 2010; Vol. 516,c. 459.]

[P000863]

Observations from the Secretary of State for Transport:In February 2009, Agility Trains, a consortium of

Hitachi and John Laing, was appointed preferred bidderto build and maintain a fleet of new Super Expresstrains under the Intercity Express Programme (IEP).The initial order, together with all of the options, wouldhave brought the total fleet size up to 1,400 rail vehicles.

If the order goes ahead, Hitachi has made clear itsambition to establish a new assembly plant at NewtonAycliffe in the Sedgefield constituency, within CountyDurham to build the new trains. The new plant wouldemploy around 500 people, and a further 200 duringconstruction.

The Government also understand how importantthis project is to British manufacturing and the northeast, and how seriously the project is being taken inJapan.

In his recent review of IEP, Sir Andrew Foster suggestedthat the programme should be paused while possiblecredible alternatives are assessed, and the Departmenthas been progressing this work. Agility Trains made asubmission to the Department during September, and itimproves the business case for that particular option.

The work has been focused on how this option comparesto the others: in terms of value for money and affordability.

We are currently giving further consideration to therevised proposals from Agility Trains for the IntercityExpress Programme, and announcements on other DfTrolling stock programmes will be made in the light ofthe Government’s ongoing work on IEP.

1P 2P10 NOVEMBER 2010Petitions Petitions

Written Answers to

Questions


WALES

Institute of Fiscal Studies

Robert Halfon: To ask the Secretary of State forWales how much her Department spent on servicesprovided by the Institute for Fiscal Studies in each ofthe last 10 years. [23397]

Mr David Jones: Nil.

WOMEN AND EQUALITIES

Sexual Harassment

Jo Swinson: To ask the Minister for Women andEqualities what recent research the Government EqualitiesOffice has evaluated on the incidence of sexual harassmentof 16 to 18-year-olds; and if she will make a statement.

[23018]

Lynne Featherstone [holding answer 9 November 2010]:The Government Equalities Office has not undertakenany recent research on the incidence of sexual harassmentof 16 to 18-year-olds.

Violence against women and girls ruins lives, destroysfamilies, and has an impact across many generations.The gendered pattern and the dynamic of violenceagainst women and girls needs to be understood andacknowledged and a cross-government strategy is thebest way to address this. We are also developing across-government communications strategy which willchallenge attitudes and behaviours towards women andgirls which are unacceptable. Our work will also considerthe effects of such violence on men and boys.

ENVIRONMENT, FOOD AND RURAL AFFAIRS

Agriculture: Subsidies

Miss McIntosh: To ask the Secretary of State forEnvironment, Food and Rural Affairs what steps sheplans to take to simplify the processes for makingsingle farm payments as part of Common AgriculturalPolicy reform by 2013. [21870]

Mr Paice [holding answer 4 November 2010]: Reformof the Common Agricultural Policy (CAP) must deliverbetter value for farmers, taxpayers, consumers and theenvironment. Part of this must also be about developinga CAP that is simpler, and reducing the administrativeburden on farmers from unnecessary regulation.Negotiations on CAP will begin formally in the contextof a communication which we expect to be published by

the Commission later this month. I look forward toworking with my counterparts in the EU and DevolvedAdministrations in order to further the simplificationagenda as part of these negotiations.

Arpley Landfill Site

David Mowat: To ask the Secretary of State forEnvironment, Food and Rural Affairs how many (a)air quality and (b) water quality tests the EnvironmentAgency has carried out within a one mile radius of theArpley landfill site in the last five years. [21679]

Richard Benyon: The Environment Agency has carriedout one air quality test within a one mile radius of theArpley landfill site in the last five years. This monitoredflammable gases close to the surface of the landfill. TheEnvironment Agency has also monitored ground gasesin boreholes adjacent to the landfill.

The Environment Agency has sampled water qualityon 522 occasions in this area over the last five years.Each test is sampled for a number of different contaminantsthat may be present in the river.

The site operator is also required to carry out air andwater quality monitoring as part of its permit conditions.The operator is required to submit the results of thismonitoring to the Environment Agency on a periodicbasis.

David Mowat: To ask the Secretary of State forEnvironment, Food and Rural Affairs how manycomplaints in respect of the handling of (a) hazardouswaste and (b) radioactive waste at the Arpley landfillsite the Environment Agency has received in each of thelast five years. [21680]

Richard Benyon: The Environment Agency has notreceived complaints in respect of the handling of hazardouswaste or radioactive waste at the Arpley landfill site inthe last five years.

The Arpley landfill site is only permitted to acceptnon-hazardous and inert wastes under the terms of thecurrent environmental permit.

Bottles: Recycling

Martin Horwood: To ask the Secretary of State forEnvironment, Food and Rural Affairs pursuant to theoral answer from the Prime Minister of 15 September2010, Official Report, column 878, on bottle depositand refund schemes, what consideration her Departmenthas given to the Campaign to Protect Rural England’sreport Have we got the bottle? Implementing a DepositRefund Scheme in the UK; and if she will make astatement. [22689]

Richard Benyon [holding answer 8 November 2010]:We are currently analysing all contributions received aspart of the review of waste policy, including the Campaignto Protect Rural England’s report, ‘Have we got thebottle?’.

As part of this review, the option of bottle depositrefund systems has been raised by a number of contributors,with divergent views. We will review all evidence submittedbefore making any formal decisions.

307W 308W10 NOVEMBER 2010Written Answers Written Answers

Cotton: EU Action

Greg Mulholland: To ask the Secretary of State forEnvironment, Food and Rural Affairs what her policyis on EU cotton subsidies; and if she will seek theirabolition as part of post-2013 Common AgriculturalPolicy reform negotiations. [22225]

Mr Paice: I believe that the time has come for the lastremaining direct support to the EU cotton sector to bede-coupled and the UK will be pursuing this end as partof our negotiating position in the forthcoming CommonAgricultural Policy Reform round.

Dairy Farming

Stephen Phillips: To ask the Secretary of State forEnvironment, Food and Rural Affairs if she will takesteps to ensure that future proposals for intensive dairyfarming are examined by her Department; and if shewill make a statement. [21683]

Mr Paice: Planning proposals for intensive dairyfarming units are for relevant planning authorities toexamine.

DEFRA’s interest is in ensuring that our comprehensiveanimal welfare and environment legislation which appliesto all livestock farming, whatever the system and regardlessof size is applied correctly.

As long as these standards are met, the Governmentrecognise that the UK market has a place for sustainableintensification as well as more traditional productionand added-value production, to enable the industry tobe competitive in the UK, EU and global markets.

English Forestry Forum

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs when she expects the nextmeeting of the English Forestry Forum to take place.

[22979]

Mr Paice: I have no plans to hold further meetings ofthis group. There will be stakeholder workshops as partof the public consultation on proposals for the publicforest estate in England, and I encourage any formermember of the English Forestry Forum to participate inthese workshops.

Environment Protection: British Overseas Territories

Huw Irranca-Davies: To ask the Secretary of State forEnvironment, Food and Rural Affairs what plans herDepartment has for future (a) co-ordination of and(b) funding for the (i) Overseas Territories EnvironmentProgramme, (ii) Darwin Initiative and (iii) OverseasTerritories Challenge Fund. [23096]

Richard Benyon: The Overseas Territories EnvironmentProgramme is jointly administered and funded by theDepartment for International Development and theForeign and Commonwealth Office. On the DarwinInitiative, my right Hon Friend, the Secretary of Statefor Environment, Food and Rural Affairs, announcedat the recent meeting of the Convention on BiologicalDiversity in Nagoya, Japan, that the UK will not onlysustain the existing level of funding, but now plans to

increase it over the next four years. The details for thenext round of the Darwin Initiative, including the plansfor the Overseas Territories Challenge Fund, are beingelaborated, and we are aiming to launch the next roundas soon as possible.

Forestry Commission

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs (1) which (a) duties and (b)functions of the Forestry Commissioners she plans todelegate to other bodies; [22975]

(2) to whom she plans to delegate the duties andfunctions of the Forestry Commissioners of GreatBritain. [22976]

Mr Paice: The Government are seeking legislativechanges in the Public Bodies Bill to enable Ministersand the Forestry Commission in England to operatemore flexibly. DEFRA and the Forestry Commissionwill consult shortly on proposals for the managementand ownership of the public forest estate in England.

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs what the role of ForestryCommission Great Britain is in respect of setting minimumstandards for sustainable forest management for forestsand woodlands. [22977]

Mr Paice: The Forestry Commission is responsiblefor developing the standards for sustainable forestrymanagement in the UK. The UK Forestry Standardsets minimum standards and is accompanied by a seriesof guidelines providing advice on its implementation.Following a comprehensive review exercise over the lasttwo years, a revised standard and guidelines are expectedto be available in the new year. These have been developedin close consultation with the forest industry and otherstakeholders.

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs what the role of ForestryCommission Great Britain is in respect of research andknowledge transfer for sustainable forest managementacross the UK. [22978]

Mr Paice: Forest Research, an agency of the ForestryCommission, develops the evidence base to supportsustainable forest management in the UK. This informspolicy development, and provides practical guidanceand support for operational forestry on the public andprivate forest estate.

Forestry Commission: Land

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs what discussions she has hadwith the Chancellor of the Exchequer on the use offunds arising from the sale of Forestry Commissionland in England; and if she will make a statement.

[22971]

Mr Paice: DEFRA continues to hold discussionswith HM Treasury about the future of the public forestestate in England. We will be consulting on proposalsshortly.


Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs when she expects the ForestryCommission’s portfolio analysis of the public forestestate to be published. [22974]

Mr Paice: The portfolio analysis is a geographicalcomputer tool that enables the Forestry Commission toaid decision-making and assist with the management ofthe public forest estate. We shall be publishing andconsulting on proposals for the public forest estate inEngland shortly.

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs what financial provisions sheplans to make for additional woodland areas that becomeeligible for land management grants as a result of futuresales of Public Forest Estate land. [22980]

Mr Paice: We are committed to maintaining theexisting levels of support for private woodland ownersfor the remainder of the Rural Development Programmefor England, which runs until 2013. This includes theEnglish Woodland Grant Scheme administered by theForestry Commission.

Mr Bain: To ask the Secretary of State for Environment,Food and Rural Affairs what estimate she has made ofthe likely change in the area of woodland certifiedagainst the UK Woodland Assurance Standard as aresult of sales of Public Forest Estate land. [22981]

Mr Paice: Certification under the UK WoodlandAssurance Standard is voluntary. The entire publicforest estate is certified, as well as 144,000 hectares ofother woods in England. An assessment of any potentialchange will be explored following the consultation exerciseon the future of the public forest estate which we planto hold early next year.

Greenhouse Gas Emissions: Electronic Equipment

Graham Stringer: To ask the Secretary of State forEnvironment, Food and Rural Affairs what informationher Department holds on the quantity of (a)chlorofluorocarbon, (b) hydrofluorocarbon and (c)hydrochlorofluorocarbon gases which were (i) emittedto the atmosphere and (ii) recovered and recycled in theUK from refrigeration and air conditioning equipmentin each of the last five years. [22449]

Richard Benyon [holding answer 8 November 2010]:The Department for Energy and Climate Change (DECC)currently reports annual emissions of hydrofluorocarbons(HFCs) in the UK Greenhouse Gas (GHG) Inventory,which is available from the National Atmospheric EmissionsInventory website at:

http://www.naei.org.uk

In addition to this, DECC funds the measurementof atmospheric gas concentrations of HFCs,chlorofluorocarbons (CFCs) and hydrochlorofluorocarbons(HCFCs) at the Mace Head observation site. This datais available from the Advanced Global AtmosphericGases Experiment website:

http://agage.eas.gatech.edu/

The HFCs observation data is used to verify the UKGHG Inventory and is available from the Air Qualitywebsite at:

http://www.airquality.co.uk/reports/cat07/1010151420_ukghgi-90-08_Annexes_Issue3_r.pdf

Under the European Pollutant Release and TransferRegister, available at:

http://prtr.ec.europa.eu/PollutantReleases.aspx

the UK estimates its emissions of CFCs, HFCs and HCFCs,however the data is only available for 2007 and 2008.

The following information is held on quantities ofCFCs recovered (and destroyed) in the UK:

Kilograms

Recovered

Ozone-depletingsubstance 20051 20061 20072 20082 20092

CFC R11 374,677 285,217 315,940 231,269 198,795

CFC R12 90,819 67,225 64,645 42,090 39,085

CFCs—unspecified 1,200 59,095 10,454 16,352 —

Total 466,696 411,537 391,039 289,711 237,8801 UK figures.2 England and Wales only.

No information is held on quantities of HFCs andHCFCs recovered and recycled in the UK.

Landfill: Refrigerators

David Wright: To ask the Secretary of State forEnvironment, Food and Rural Affairs (1) what informationher Department holds on the average annual number ofretail refrigerated display cabinets disposed of in landfillsites in the last five years; [21224]

(2) what information her Department holds on theaverage annual number of retail refrigerated displaycabinets which were (a) re-manufactured and (b)recycled in the last five years. [21225]

Richard Benyon: DEFRA does not hold completeinformation on the number of retail refrigerated displaycabinets reused, recycled or disposed of in landfill sites.

The EC regulations on substances that deplete theozone layer require ozone-depleting substances to beremoved from commercial refrigeration equipment beforeit is disposed of. In 2009, seven treatment sites inEngland and Wales processed 1,594,962 refrigerationunits (both household and non-household) for ozone-depleting substances. This does not include data forcommercial refrigeration units which do not containozone-depleting substances, nor are these data specificto refrigerated display cabinets.

The UK waste electrical and electronic equipment(WEEE) regulations encourage the separate collectionof WEEE, establish minimum treatment standards, andset recovery and recycling targets. DEFRA does nothold data on the number of retail refrigerated displaycabinets processed under these Regulations as non-household WEEE is currently non-obligated.

National Parks: Areas of Outstanding Natural Beauty

Tessa Munt: To ask the Secretary of State forEnvironment, Food and Rural Affairs what guidanceshe has issued to Ofgem on its duty to have regard tothe purposes of National Parks and Areas of OutstandingNatural Beauty. [21988]


Richard Benyon: In 2005 DEFRA produced a guidancenote about the duties to have regard to the purposes ofNational Parks and Areas of Outstanding Natural Beauty.This was sent to all those considered to be bound bythem, including Ofgem.

In April of this year DEFRA also wrote to Ofgem (asa body it considered to be covered by the ‘have regard’duty) to draw its attention to the new National ParksCircular.

Nitrogen Dioxide: Pollution Control

Sheryll Murray: To ask the Secretary of State forEnvironment, Food and Rural Affairs when she plansto announce the outcomes of her Department’s reviewof options in respect of measures to help achievenitrogen dioxide limit values by 2015. [22345]

Richard Benyon: The Government are preparing airquality plans to achieve EU limit values for nitrogendioxide (NO2). These plans will set out measures toachieve the NO2 limit value by 2015, and will be includedin the UK’s time extension notification under the AmbientAir Quality Directive (2008/50/EC). The Governmentexpects to submit its NO2 time extension notification tothe European Commission by the required deadline ofSeptember 2011.

Pollution: Liquefied Petroleum Gas

Katy Clark: To ask the Secretary of State forEnvironment, Food and Rural Affairs what estimateshe has made of the contribution of the use of liquidpetroleum gas as a (a) road and (b) domestic fuel tomeeting air quality requirements. [21722]

Richard Benyon: With regards to what assessment hasbeen made on the use of liquefied petroleum gas (LPG)as a road fuel, I refer the hon. Member to the answergiven in response to the hon. Member for GlasgowSouth (Mr Harris) by the Secretary of State for Transporton 8 November 2010, Official Report, column 108W.

No specific assessments have been undertaken toestimate the contribution of the use of LPG as adomestic fuel to meeting air quality requirements.

Indicatively, LPG is used domestically as a cost-effectivealternative to coal or gasoil predominately in ruralareas, which are not connected to the gas grid. Emissioncalculations using the 2008 UK inventory for the domesticsector emissions, found switching from LPG to eithergasoil or burning oil has a negligible effect across allpollutants, with very small increases in emissions ofSO2, CO and NOx. These calculations also showed thatswitching to coal from LPG would increase emissionsfor the majority of pollutants. If all the domestic energyproduced using LPG was completely substituted bycoal, increases in UK emissions would be observed; 4%for PM10, 3% for PM2.5, 3% for CO, 2% for SO2 and1% for VOC with a negligible effect on other pollutants.

The majority of domestic LPG use takes place inrural areas where areas of exceedences of the limitvalues stipulated in legislation do not occur. The pollutantswhich are monitored as part of the Gothenburg Protocoland the National Emissions Ceiling Directive which theUK needs to reduce in order to meet its emissionsceiling are much lower when LPG is used compared tocoal. However, the domestic sector is a small contributor.

Recycling

Mr Hollobone: To ask the Secretary of State forEnvironment, Food and Rural Affairs if she will takesteps to increase the proportion of commercial wastewhich is recycled; and if she will make a statement.

[22903]

Richard Benyon [holding answer 9 November 2010]:The recycling rate of the commercial and industrialsector in England was 42% in 2002-03, when the laststatistical survey of the sector was undertaken. We arecurrently undertaking a comparable survey, with theinterim results to be published on 10 November 2010,and the final results scheduled for release in December2010. This will give us an up-to-date picture of howmuch commercial waste is recycled. The review of wastepolicy, announced by the Secretary of State on 15 June,will consider how we can remove some of the barriers torecycling, particularly for small and medium-sizedbusinesses, and how we can make it easier for businessesto recycle. This will help in our commitment to worktowards a zero waste economy.

Rodents: Henderson Island

Huw Irranca-Davies: To ask the Secretary of State forEnvironment, Food and Rural Affairs (1) if she willrespond to the recent judgment by the UNESCO WorldHeritage Committee on the need for Government supportfor a rat eradication scheme for Henderson Island;

[23097]

(2) if she will take steps to support the conservationof endangered wildlife on (a) Henderson Island(Pitcairn) and (b) Gough Island. [23098]

Richard Benyon: At its 34th meeting in July this year,UNESCO’s World Heritage Committee commendedthe considerable progress made in planning the invasiverat eradication scheme for Henderson Island, and notedthat further funding was needed to implement thescheme. To this end my right hon. Friend, the Secretaryof State for Environment, Food and Rural Affairsannounced, at the recent meeting of the Convention onBiological Diversity in Nagoya, Japan, that the UK willbe contributing £200,000 towards this initiative duringthe current year. This is in addition to funding for theproject already provided by the Overseas TerritoriesEnvironment Programme, administered by the Departmentfor International Development and the Foreign andCommonwealth Office. The Government will considerplans for carrying out similar activities on Gough Islandas and when they are received.

Water Supply: Leaks

Mr MacShane: To ask the Secretary of State forEnvironment, Food and Rural Affairs what steps sheplans to take in respect of water companies identifiedby Ofwat as failing to reduce excessive water leakage.

[22578]

Richard Benyon: Ofwat has detailed the steps it istaking to reverse recent rises in leakage at some companiesin its 2009-10 service and delivery report. The documentis available on its website.


An explanation of the actions Ofwat has taken in thepast against companies that have failed their leakagetargets is included in the report.

NORTHERN IRELAND

Dealing with the Past

12. Mr Gregory Campbell: To ask the Secretary ofState for Northern Ireland what factors he plans totake into account in taking further steps to secureprogress in dealing with the past in Northern Ireland.

[22159]

Mr Paterson: The Government are committed toplaying their full role in dealing with the past in NorthernIreland, working with the Northern Ireland Assembly.The current absence of consensus on the issue of thepast, and the views of victims and others who experiencedthe troubles, are among the factors which are beingtaken into account.

Community Policing

13. Mr Tom Harris: To ask the Secretary of State forNorthern Ireland what assessment he has made of thelikely effects of the outcomes of the comprehensivespending review on the capacity of community policingin Northern Ireland to reduce the threat to securityfrom dissident activity. [22160]

Mr Paterson: Following the outcome of the 2010spending review, the Northern Ireland Executive is nowaware of its funding allocation for the next four years. Itis for the Executive to decide what proportion of thisfunding is allocated to PSNI.

The Government are committed to ensuring the securityof the people of Northern Ireland and it is essential thatthe Chief Constable has the appropriate resources toallow him to ensure that he can continue to tackle thethreat. But we all acknowledge that that these resourceswould be better invested in dealing with communitypolicing and issues such as antisocial behaviour anddrugs, rather than on those who impose their viewsthrough intimidation and violence.

Public Sector Employment

Toby Perkins: To ask the Secretary of State for NorthernIreland what recent discussions he has had with theChancellor of the Exchequer on the likely effects of therecommendations of his paper on rebalancing the NorthernIreland economy on the number of people employed inthe public sector in Northern Ireland. [22158]

Mr Swire: My right hon. Friend the Secretary ofState and I have regular discussions with Treasury andNorthern Ireland Ministers on these matters.

The paper will be published for consultation beforethe end of the year.

Police Service of Northern Ireland

Paul Goggins: To ask the Secretary of State forNorthern Ireland what discussions he has had with theNorthern Ireland Justice Minister on the resourcesrequired by the Police Service of Northern Ireland in2011-12 to counter security threats. [22155]

Mr Paterson: I meet regularly with both the JusticeMinister and the Chief Constable to discuss a range ofissues, including PSNI resources. It is for the JusticeMinister and the Chief Constable to negotiate andagree the policing budget with the Northern IrelandExecutive. But my right hon. Friend the Prime Ministerand I have made it clear that we will protect the peopleof our country from the terrorist threat with everymeans at our disposal.

CULTURE, MEDIA AND SPORT

BBC: Commonwealth Games 2014

Ian Murray: To ask the Secretary of State for Culture,Olympics, Media and Sport pursuant to his answer tothe hon. Member for Perth and North Perthshire on25 October 2010, Official Report, column 10, on theCommonwealth Games 2014, what representations hehas made to the BBC Trust on the BBC’s decision towithdraw as host broadcaster of the 2014 CommonwealthGames; and if he will make a statement. [22619]

Mr Vaizey [holding answer 8 November 2010]: TheSecretary of State for Culture, Olympics, Media andSport has not made any representations to the BBCTrust on this matter.

Departmental Travel

Ian Austin: To ask the Secretary of State for Culture,Olympics, Media and Sport what estimate his Departmenthas made of its expenditure on travel undertaken by (a)him and (b) each other Minister in his Department in(i) September and (ii) October 2010. [21858]

John Penrose: The total amount spent by the Departmentduring September and October 2010 on all domesticand foreign travel by Ministers in their official capacityis set out in the table.

Minister Month Estimated spend (£)

Secretary of State September 231October 1,889

Ministerial team September 753October 630

This is an estimated cost from records currently heldby the Department. Some invoices for travel have notyet been received by the Department and could nottherefore be included.

Horse Racing: Betting

Miss McIntosh: To ask the Secretary of State forCulture, Olympics, Media and Sport what representationson the horserace betting levy he has received from theRacing United campaign; and if he will take steps toensure that all areas of the betting industry contributeto that levy. [22492]

John Penrose: I have received a number of representations,on behalf of racing, about the Horserace Betting Levy,including those setting out the position of Racing United.


The Government recently announced their intentionto remove the Secretary of State’s role of determiningthe levy scheme when the parties are unable to reachagreement. This will require changes to primary legislationand will not have effect until Parliament has approvedsuch changes.

We will be discussing the options with the LevyBoard and the racing and betting industries, to ensurethat funding for racing is fair and is collected from asbroad a base as possible.

Miss McIntosh: To ask the Secretary of State forCulture, Olympics, Media and Sport if he will includein the scope of any future review of remote gamblingthe potential contribution of all gambling operators tothe horserace betting levy. [22493]

John Penrose: A consultation on the Regulatory Futureof Remote Gambling in Great Britain closed on 18 June2010. Since then, I have been examining the issues andidentifying possible solutions.

I have also received advice from the Levy Boardabout securing fair contributions from overseas bettingoperators towards the Horserace Betting Levy. I hopeto be able to make an announcement in due course.

Local Broadcasting: Television

Rehman Chishti: To ask the Secretary of State forCulture, Olympics, Media and Sport what recent progresshis Department has made on encouraging commercially-sustainable local television. [23005]

Mr Vaizey: Nicholas Shott, head of UK investmentbanking at Lazard, will shortly conclude his independentreview on the conditions necessary for commerciallysustainable local television to emerge in the UK.

This will be published on the Department’s website indue course, followed by a local media action plan due tobe published in the new year.

The recent BBC funding settlement has secured atotal of £25 million to help fund the capital costs in2013-14 for up to 20 local TV services, subject to anynecessary regulatory approval. The BBC will also committo ongoing funding of up to £5 million per annum from2014-15 to acquire content from local services.

In addition, the Government will shortly lay an orderto remove the local cross media ownership rules topromote a strong and secure local media industry.

National Lottery: Armed Forces

Mark Lancaster: To ask the Secretary of State forCulture, Olympics, Media and Sport pursuant to theanswer of 1 November 2010, Official Report, column 555W,on the National Lottery: armed forces, which countriesin which personnel are serving are affected by therestrictions on buying lottery tickets. [22206]

John Penrose [holding answer 8 November 2010]: Wedo not currently hold a list of jurisdictions where it isillegal to buy UK national lottery tickets, although Iunderstand that many countries outlaw participation inforeign lotteries and some prohibit any form of gambling.Given that other countries’ laws are subject to change,the National Lottery Commission had decided that the

best way to protect players from buying invalid tickets,or inadvertently putting themselves at risk of prosecutionin foreign jurisdictions, was to introduce a new rulepreventing anyone from buying a UK lottery ticketabroad.

However, I have now written to the NLC to ask themto reconsider how we can allow armed forces personnel(and others) to participate from those countries wherepurchasing UK lottery tickets is lawful.

INTERNATIONAL DEVELOPMENT

Developing Countries: Education

Mr Russell Brown: To ask the Secretary of State forInternational Development what steps his Departmentis taking in conflict-affected countries to (a) reducethe drop-out rate from and (b) increase access toeducation for girls. [22815]

Mr O’Brien: As laid out in “The Coalition: ourprogramme for government”, the UK Government willprioritise increasing access to basic services, such ashealth and education, for the world’s poorest people;including a particular focus on the rights of women andgirls. Girls who progress to secondary education havebetter maternal health, fewer and healthier children andgreater economic opportunities.

The Department for International Development (DFID)is currently reviewing its aid programmes to determinehow we can achieve better value for money for thetaxpayer, accelerate growth and achieve the millenniumdevelopment goals. This includes a review of our emergencyresponse programme, which will look at the provisionof education in the immediate aftermath of conflict ornatural disaster.

With over half of primary aged children not enrolledin school living in fragile and conflict-affected state—atotal of 39 million children out of an estimated69 million worldwide—we recognise the need to promoteeducation, particularly for girls, in fragile and conflict-affected states. As such, the Government have committedto spend 30% of UK ODA on supporting conflictaffected and fragile states and tackling the drivers ofinstability by 2014-15.

Developing Countries: Tuberculosis

Mr Virendra Sharma: To ask the Secretary of Statefor International Development how much funding hisDepartment has allocated to international tuberculosiscontrol in each of the last five years. [23027]

Mr O’Brien: The Department for InternationalDevelopment (DFID) supports tuberculosis (TB) controlthrough a variety of bilateral channels, including fundingfor infectious diseases at country level, strengtheninghealth systems in our partner countries to deliver TBprogrammes and funding research. Our direct bilateralspend on infectious diseases, including TB, increasedfrom £101 million in 2005-06 to £117 million in 2009-10.We also support TB control through multilateral channels,including the Global Fund to Fight AIDS, TB andMalaria. The UK has contributed £465 million to theGlobal Fund since 2005. Over the last five years


approximately 33% of proposals approved by the GlobalFund were TB-related and 15% of Global Fund fundinghas been disbursed on TB programmes. We are unableto accurately disaggregate DFID expenditure for TBcontrol from these wider interventions.

Mr Virendra Sharma: To ask the Secretary of Statefor International Development how much funding heplans to allocate to international tuberculosis controlin each year from 2011 to 2015. [23028]

Mr O’Brien: The UK remains strongly committed toreducing death and suffering from tuberculosis. TheDepartment for International Development is currentlyreviewing its aid programmes to determine how toachieve better value for money for the taxpayer andaccelerate progress towards achieving all the millenniumdevelopment goals. We will review our forward approachto tuberculosis once the bilateral and multilateral aidreviews are complete.

Institute for Fiscal Studies

Robert Halfon: To ask the Secretary of State forInternational Development how much his Departmentspent on services provided by the Institute for FiscalStudies in each year from 2000-01 to 2007-08. [23500]

Mr Duncan: Payments made by the Department forInternational Development (DFID) to the Institute forFiscal Studies since 2002-03 is as follows. Informationprior to 2002-03 is not captured in DFID’s centralaccounting system and, therefore, cannot be providedwithout incurring disproportionate cost.

Amount (£)

2002-03 02003-04 3,0942004-05 02005-06 02007-08 952008-09 02009-10 0

EDUCATION

Children in Care

John Hemming: To ask the Secretary of State forEducation how many children (a) were taken into care(excluding respite care), (b) left care and (c) wereadopted in each of the last five years; how many werein care on 31 March 2010; and what proportion ofchildren left care through adoption in each of the lastfive years. [18226]

Tim Loughton: The requested information is availableas part of the Statistical First Release, Children LookedAfter by Local Authorities in England (including adoptionand care leavers)—year ending 31 March 2010. This canbe found at:

http://www.education.gov.uk/rsgateway/DB/SFR/s000960/index.shtml

Information on the number of children taken intocare can be found in table C4, information on thenumber of children who have left care is found in table

D1 and information on the total number of childrenlooked-after as at 31 March is found in table A1.Information on the number of children adopted andthe proportion of children who left care through adoptionis found in table D1. These tables can be found in theexcel link titled ’England Summary tables’.

Children In Care

Paul Goggins: To ask the Secretary of State forEducation how many looked-after children (a) weretaken into care in each of the last five years, (b) were incare on the latest period for which figures are availableand (c) had been in care for more than (i) three months,(ii) six months and (iii) a year in the latest period forwhich figures are available. [22737]

Tim Loughton: The number of looked-after childrentaken into care in each of the last five years is availablein table C4 in the Statistical First Release, ChildrenLooked After by Local Authorities in England (includingadoption and care leavers)—year ending 31 March2010. This can be found at:

http://www.education.gov.uk/rsgateway/DB/SFR/s000960/index.shtml

The number of looked-after children at 31 March2010 can be found in table A1 of the same publication.Both tables can be found in the Excel link titled ’EnglandSummary tables’. These tables contain the latest availableinformation.

The requested information regarding the duration oftime spent in care is shown in the following table:Children looked-after at 31 March for (a) over three months, (b) oversix months, and (c) over one year, at 31 March 20101, 2, 3, year ending

31 March 2010, coverage: EnglandDuration of time in care Number

Over three months 58,300Over six months 53,100Over one year 44,3001 England figures have been rounded to the nearest 100.2 Figures exclude children looked-after under an agreed series ofshort-term placements.3 These figures are presented on a cumulative basis e.g. a child that isincluded in the ‘over one year’ category has also been included in the‘over six months’ category.Source:SSDA 903.

Departmental Reviews

Mr Watson: To ask the Secretary of State for Educationwhat departmental policy reviews his Department hasundertaken since 6 May 2010; on what date each suchreview (a) was announced and (b) is expected topublish its findings; what estimate he has made of thecost of each such review; who has been appointed tolead each such review; to what remuneration each reviewleader is entitled; how many (i) full-time equivalent civilservants and (ii) seconded staff are working on eachsuch review; from which organisations such staff havebeen seconded; and how much on average such secondedstaff will be paid for their work on the review. [21886]

Tim Loughton: The Department for Education isleading six policy reviews, all announced since 6 May2010. All are still under way. Details on publication


dates, costs and staffing levels for each review follow(please note that secondees are defined as staff secondedto the reviews from outside of Whitehall).1. Munro review

The review was announced on 10 June 2010 and isintended to report in April 2011, with an interim reportin January 2011. A first report was published on 1 October2010 and can be found at:

http://www.education.gov.uk/munroreview/downloads/TheMunroReviewofChildProtection-Part%20one.pdf

Our current estimate of the cost of the review is £100,000.

Professor Eileen Munro of the London School ofEconomics and Political Science (LSE) is leading thereview. She is supported by Dr David Lane, an expert insystems theory. Professor Munro and Dr Lane are paidby the LSE, and the Department is reimbursing theLSE for 80% of Professor Munro’s salary for the durationof the review and 100% of Dr Lane’s for one term, andthey are also both entitled to claim reasonable travelexpenses. There are 16.15 full-time equivalent civil servantsworking on the review, which is focused on improvingfrontline practice in child protection. Two people havebeen seconded from outside Whitehall—one full-timeand one part-time—from Staffordshire county counciland the National Children’s Bureau. The NationalChildren’s Bureau secondee continues to be paid bythem at no cost to the Department. The local authorityemployee is a Grade 16 (SCP 71-73) which correspondsto a current salary scale of £77,682 to £81,567. Thelocal authority is continuing to pay their salary and theDepartment for Education is reimbursing them.

2. Review of vocational education

The review was announced on 9 September 2010 andis expected to report in spring 2011. The cost of thereview is yet to be estimated.

The review is being led by Professor Alison Wolf, andher employer (King’s College, London) is being reimbursedfor her time. Professor Wolf is entitled to claim expenses.There are three full-time equivalent civil servants workingon the review, including analysts, and no individualshave been seconded from outside Whitehall to assistwith the review.

3. Capital review

The review was announced on 5 July 2010 and will becompleted by the end of the calendar year. The cost ofthe review is estimated to be up to £100,000.

The review is being led by Sebastian James, GroupOperations Director of DSG International, who is notbeing paid by the Department but is entitled to claimessential expenses. There are 11 civil servants workingon the review. No individuals have been seconded fromoutside Whitehall to assist with the review.

4. Early years foundation stage review

The review was announced on 6 July 2010 and isexpected to report in spring 2011. The cost of thereview is estimated to be around £100,000, with anadditional amount of up to £250,000 covering associatedresearch.

The review is being led by Dame Clare Tickell. DameClare is chief executive of Action for Children, so DFEis paying a salary reimbursement to them for her timebetween July 2010 and March 2011 (up to an estimated£21,520 plus VAT). There are seven full-time equivalent

civil servants working on the review, and no individualshave been seconded from outside Whitehall to assistwith the review.

5. Review of the Children’s Commissioner

The review was announced on 12 July 2010. Theexpected date of report is end of November 2010. Thecost of the review is estimated to be around £50,000.

The review is being led by John Dunford, who isbeing remunerated at a rate of £500 per day for carryingout the review, and is entitled to claim expenses. Ourexpectation is that the role will take approximately40 days. His remuneration is included in the overallbudget of £50,000. There are three full-time equivalentcivil servants working on the review, and no individualshave been seconded from outside Whitehall to assistwith the review.

6. Children in Need census review

The review was announced on 3 August 2010 and isexpected to report in March 2011. The cost of thereview is estimated to be around £7,000.

The review is being led by Nigel Nicholds fromNorfolk local authority, who is not being paid but isentitled to expenses. There are 0.1 full-time equivalentcivil servants working on the review and secondmentsfrom outside Whitehall are yet to be confirmed.

Education: Young People

Robert Flello: To ask the Secretary of State for Educationif he will issue guidance to local authorities on thestaffing levels necessary to deliver their statutoryresponsibilities for (a) safeguarding, (b) well-beingand (c) education of children and young people. [21354]

Tim Loughton: We have no plans to issue such guidance.Local authorities themselves are best placed to makedecisions about the staffing levels required to delivertheir responsibilities, in the light of local needs andcircumstances and the available resources.

Foster Care: Per Capita Costs

Bob Russell: To ask the Secretary of State for Educationwhat the annual average cost to social services of placinga child in foster care was in the last five years. [22355]

Tim Loughton [holding answer 8 November 2010]:The information is not held in the format requested.

The following table shows expenditure on fosteringservices in England in the financial years 2004-05 to2008-09.

Expenditure on fostering services1 in England: 2004-05 to 2008-092,3

£Expenditure on

fostering services(gross)4

Expenditure onfostering services

(net)4

Expenditure perweek on fostering

services5

2004-05 880,000,000 880,000,000 3842005-06 960,000,000 960,000,000 4202006-07 1,050,000,000 1,050,000,000 4632007-08 1,110,000,000 1,110,000,000 489


Expenditure on fostering services1 in England: 2004-05 to 2008-092,3

£Expenditure on

fostering services(gross)4

Expenditure onfostering services

(net)4

Expenditure perweek on fostering

services5

2008-09 1,130,000,000 1,080,000,000 —1 Fostering services includes all in-house provision, fostering servicespurchased externally, fees and allowances paid to foster parents andthe costs of social worker and other support staff who support fostercarers. For example, mainstay placements; link placements; permanenceplacements; temporary/respite fostering; placements with relatives,other than a parent, under foster care; arrangements; placed withapproved prospective adopters pending the making of an adoptionorder under the Adoption and Children Act 2002; associated independentvisitor costs and relevant contact payments.2 Expenditure data for 2004-05 to 2007-08 are drawn from PSSEX1data published on the Information Centre for Health and Social Carewebsite.3 Expenditure data for 2008-09 are drawn from Table A1 of the localauthority Section 251.4 Figures rounded to nearest £10 million.5 Per week figures are not currently available for the financial year2008-09.

GCSE

Chris Skidmore: To ask the Secretary of State forEducation (1) how many and what proportion ofmaintained mainstream schools did not enter a singlepupil for a chemistry GCSE examination in the latestperiod for which figures are available; [20080]

(2) how many and what proportion of maintainedmainstream schools did not enter a single pupil for amodern language GCSE examination in the latestperiod for which figures are available; [20081]

(3) how many and what proportion of maintainedmainstream schools did not enter a single pupil for aphysics GCSE examination in the latest period forwhich figures are available. [20082]

Mr Gibb: Of the 3,083 maintained mainstream schoolsthat had more than 10 pupils at the end of Key Stage 4and were published in the 2009 Secondary SchoolsAchievement and Attainment Tables, 1,461 (47%) didnot have any entries in GCSE chemistry, 25 (1%) didnot have any entries in a modern foreign languageGCSE and 1,467 (48%) did not have any entries inGCSE physics.

Home Education

Mr Laurence Robertson: To ask the Secretary ofState for Education what (a) A level and (b) GCSEgrades were awarded to home schooled children in thelatest period for which figures are available; and if hewill make a statement. [18841]

Mr Gibb [holding answer 21 October 2010]: Theinformation requested is not held centrally by theDepartment. We have no plans to collect this information.

Private Education: Tax Relief

Tom Blenkinsop: To ask the Secretary of State forEducation what his policy is on tax relief for privateschools. [22311]

Mr Gauke: I have been asked to reply.

Schools set up as charitable bodies that meet thedefinition of a charity for tax purposes are eligible forcharitable tax reliefs in the same way as other charities.Non-charitable private schools are eligible for tax reliefsas for any other business.

Pupil Exclusions

Chris Skidmore: To ask the Secretary of State forEducation in how many mainstream maintainedschools more than 25 per cent. of pupils have received afixed-period exclusion in the latest period for whichfigures are available. [20237]

Mr Gibb: In 2008/09 there were six mainstream schools,all state-funded secondary schools (1) where more than25% of solely registered pupils (2) received a fixedperiod exclusion.

(1) Includes local authority maintained schools and academies.(2) Headcount of solely registered pupils has been taken from

January 2009 census. Schools which were not open at the Januarycensus have been excluded from the analysis.

Schools: Violence

Chris Skidmore: To ask the Secretary of State forEducation how many (a) pupils and (b) teachers havebeen admitted to hospital as a result of violent attackswithin schools in each year for which figures are available.

[20238]

Mr Gibb: The Department for Education does notcollect or hold any data on injuries in school.

The Health and Safety Executive holds data on injuriesreported under RIDDOR (the Reporting of Injuries,Diseases and Dangerous Occurrences Regulations 1995).These include school-related injuries affecting employeesand members of the public, including pupils.

RIDDOR also requires the reporting of injuries resultingfrom acts of violence. However, only physical injuriesresulting from acts of violence suffered by people atwork are reportable. For the purposes of accident recording,school pupils are categorised as members of the public,ie not ‘at work’. Therefore, acts of violence to schoolpupils are not reportable under RIDDOR as a discretecategory within the overall figures on injuries to pupils.

The coding of injury notifications under RIDDORdoes not record whether the injured person was admittedto hospital.

The following table details the number of reportedinjuries to teachers involving acts of violence since2001. These include injuries to support staff.

Reported injuries to teachers involving acts of violence 2001/02 to2009/101

Severity of injuryReported non-

fatal majorinjuries

Reported over-3-day injuries

All reportedinjuries

2001/02 26 145 1712002/03 32 186 2182003/04 47 173 2202004/05 43 211 2542005/06 39 235 2742006/07 35 210 2452007/08 35 204 239


Reported injuries to teachers involving acts of violence 2001/02 to2009/101

Severity of injuryReported non-

fatal majorinjuries

Reported over-3-day injuries

All reportedinjuries

2008/09 29 225 2542009/101 44 207 2511 Provisional.Notes:1. Injuries are reported and defined under the Reporting of Injuries,Diseases and Dangerous Occurrences Regulations (RIDDOR) 1995.The annual basis of reporting is the planning year from 1 April to31 March.2. The information available under RIDDOR includes three categoriesof severity of injury: fatal injuries, defined major injuries and otherinjuries to workers leading to more than three days absence (over-3-day).There are two categories of severity for members of the public: fataland non-fatal injuries that cause a person to be taken from the site ofthe accident to hospital. Only physical injuries resulting from acts ofviolence suffered by people at work are reportable as a defined injuryunder RIDDOR. Physical injuries resulting from acts of violencesuffered by members of the public are not reportable.3. Teachers are identified using Standard Occupational Classification(SOC). This system is used in UK official statistics for classifyingworkers by the type of job they are engaged in. The latest version isSOC2000, which has been used in HSE statistics since planning year2002/03. Prior to this SOC90 was used.

Written Questions: Government Responses

John Hemming: To ask the Secretary of State forEducation when he plans to respond to question 18226,on children taken into care or adopted, tabled on14 October 2010. [20343]

Tim Loughton [holding answer 1 November 2010]: Aresponse has been issued to the hon. Member today.

FOREIGN AND COMMONWEALTH OFFICE

Chinese: Falun Gong

Mr Andrew Smith: To ask the Secretary of State forForeign and Commonwealth Affairs what recent reportshe has received on the policy of the Chinese Governmenttowards practitioners of Falun Gong. [22913]

Mr Jeremy Browne: We raised this issue at the UK/ChinaHuman Rights Dialogue, held in Beijing in March2010. We asked for numbers of Falun Gong practitionerscurrently serving in Re-education Through Labour (RTL)camps. The Chinese side reported that they were currentlyimplementing a pilot of a community correction schemewith a view to replacing Re-education Through Labourcamps. They stressed that the scheme was only beingpiloted at present.

We continue to have serious concerns about themistreatment of Falun Gong adherents and regularlyraise this issue with the Chinese Government. We haveregularly urged the Chinese Government to reform theRTL system on the grounds that it lacks judicial oversightand contravenes international human rights standards.

Diplomatic Service

Jon Trickett: To ask the Secretary of State for Foreignand Commonwealth Affairs what proportion of (a)ambassadors and high commissioners and (b) members

of the Diplomatic Service were educated at (i) Oxfordor Cambridge universities and (ii) independent schools.

[22142]

Alistair Burt: The Foreign and Commonwealth Officedoes not hold this data centrally on its employees. Theinformation requested could be provided only atdisproportionate cost.

The Foreign and Commonwealth Office aims to recruita talented and diverse work force that reflects the societywe serve and our recruitment policies are designed toencourage applications from the widest possible rangeof backgrounds. All external recruitment into the Foreignand Commonwealth Office is based on merit, and allcampaigns must be fair and open.

In addition, the Foreign and Commonwealth Office’sinternal promotion and progression schemes are firmlymeritocratic, based on objective and consistent criteriaagainst which all candidates are assessed.

European Parliament

Dan Byles: To ask the Secretary of State for Foreignand Commonwealth Affairs what recent estimate hehas made of the cost to the public purse of holding12 plenary sessions of the European Parliament inStrasbourg. [21896]

Mr Lidington: Estimates suggest that having twoseats for the European Parliament currently costs theBritish taxpayer at least an additional £28 million peryear. However the full cost to the EU budget of theEuropean Parliament sessions in Strasbourg is not publiclyavailable, since this is not itemised separately in theEuropean Parliament’s budget.

Gibraltar: Spain

Caroline Dinenage: To ask the Secretary of State forForeign and Commonwealth Affairs what recent discussionshe has had with his Spanish counterpart on (a) theactions of the Spanish authorities at the La Lineaborder crossing and (b) delays to UK- and Gibraltar-registered vehicles at that crossing. [22232]

Mr Lidington: We have raised our concerns about theMayor of La Linea’s earlier proposed plans to impose acharge on traffic entering/leaving Gibraltar with SpanishMinisters, making it clear that this is an issue for themto resolve. Our priority is to keep the traffic flowing atthe border. We believe that the Spanish Governmentshares this goal. They have reassured us that EU andSpanish law will be fully respected and that they do notconsider that the Mayor of La Linea’s earlier proposedactions would be legal. The Mayor has not implementedhis proposals. However we continue to keep in closecontact with the Government of Gibraltar and to monitorthe situation at the border.

Iran: Baha’i Faith

Meg Munn: To ask the Secretary of State for Foreignand Commonwealth Affairs what recent representationshe has made to the government of Iran on the detentionof members of the Baha’i community in that country;and if he will make a statement. [20079]


Alistair Burt: We remain concerned for the Baha’icommunity in Iran. I met the Iranian ambassador on 20September to discuss this and a range of other humanrights issues. I made it clear that the UK remainsextremely concerned by the sentencing of the sevenBaha’i leaders to 20 years imprisonment, which weunderstand has now been reduced to 10 years. As myright hon. Friend the Foreign Secretary said in hisstatement of 11 August 2010, these sentences areunacceptable. Both the UK and the internationalcommunity deplore the victimisation of the Baha’i faithby the Iranian state. We will continue to remind Iran ofthe international commitments it has freely signed upto, and urge the Iranian Government to cease its harassmentof the Baha’i minority, and to respect the rights of allminority groups.

Middle East: Peace Negotiations

Simon Danczuk: To ask the Secretary of State forForeign and Commonwealth Affairs what recent discussionshe has had with his (a) Israeli and (b) Palestiniancounterparts on the Israeli Government’s proposal fora compulsory oath of loyalty; and if he will make astatement. [23034]

Alistair Burt: We attach importance to the values setout in Israel’s Declaration of Independence and basiclaws. We are concerned by anything that detracts fromthese and will be watching this debate carefully. We donot want to see steps to prejudice Israel’s non-Jewishcitizens or to discriminate against people on the basis oftheir religion.

Mordechai Vanunu

Tim Farron: To ask the Secretary of State for Foreignand Commonwealth Affairs if he will ask theGovernment of Israel to release Mordechai Vanunu.

[22507]

Alistair Burt [holding answer of 8 November 2010]:While we are concerned by the developments in thiscase and monitor the situation, Mr Vanunu is not a UK

national and we are therefore constrained in the attentionwe can give to this. The UK has a strong record oflobbying the Israeli Government hard on issues regardinghuman rights and those directly related to our foreignpolicy objectives. Therefore, our capacity to lobby onspecific cases, especially on behalf of non-British Nationals,is extremely limited.

Taiwan: International Civil Aviation Organisation

Mr Raab: To ask the Secretary of State for Foreignand Commonwealth Affairs what his policy is on Taiwanjoining the International Civil Aviation Authority.

[22513]

Mr Jeremy Browne: The Government support Taiwan’spractical participation in international organisationswhere this does not require statehood.

ENERGY AND CLIMATE CHANGE

Electricity Generation

Graeme Morrice: To ask the Secretary of State forEnergy and Climate Change what assessment he hasmade of the electricity production technologies whichwould (a) enable affordable domestic and industrialprices and (b) enable the UK to meet its emissionsreduction targets. [22001]

Gregory Barker: The following table is taken fromMott Macdonald (2010) and gives levelised cost estimates(average generation cost per megawatt-hour) for newbuild plants in the main large-scale electricity generationtechnologies in the UK, including both fossil fuel andlow carbon plant, at current engineering, procurementand construction (EPC) contract prices.

It should be noted that for the purposes of presentation,the table only gives either ‘FOAK’ (first-of-a-kind) pricesor ‘NOAK’ (nth-of-a-kind) prices for each technology.

Case 1: 10% discount rate, 2009 project start at today’s EPC prices, with mixed FOAK/NOAK

Levelised costGas

CCGT

GasCCGT

withCCS

(FOAK)ASCCoal

ASCCoalwith

CCS(FOAK)

CoalIGCC

(FOAK)

CoalIGCC

withCCS

(FOAK)Onshore

wind

Offshorewind

(FOAK)

Offshorewind R3

(FOAK)

NuclearPWR

(FOAK)

Capital costs 12.4 29.8 33.4 74.1 61.7 82.0 79.2 124.1 144.6 77.3

Fixed operatingcosts

3.7 7.7 8.6 18.6 9.7 17.7 14.6 36.7 45.8 12.2

Variableoperating costs

2.3 3.6 2.2 4.7 3.4 4.6 — — — 2.1

Fuel costs 46.9 65.0 19.9 28.7 20.3 28.3 — — — 5.3

Carbon Costs 15.1 2.1 40.3 6.5 39.6 5.5 — — — —

Decomm andwaste fund

— — — — — — — — — 2.1

CO2 transportand storage

— 4.3 — 9.6 — 9.5 — — — —

Steam revenue — — — — — — — — — —

Total levelisedcost

80.3 112.5 104.5 142.1 134.6 147.6 93.9 160.9 190.5 99.0

Source:Mott Macdonald (2010), UK Electricity Generation Costs Update, available at:http://www.decc.gov.uk/assets/decc/statistics/projections/71-uk-electricity-generation-costs-update-.pdf


As new technologies are deployed it is likely thatcosts will fall due to learning. The following table setsout the estimated levelised costs for projects started in

2017 with the assumption that all technologies havereached ‘nth of a kind’ status.

Case 5: 10% discount rate, 2017 start at projected EPC prices, all NOAK

Levelised costGas

CCGT

GasCCGT

withCCS

ASCCoal

ASCCoalwith

CCSCoal

IGCC

CoalIGCC

withCCS

Onshorewind

Offshorewind

Offshorewind R3

NuclearPWR

Capital costs 11.2 20.7 28.7 47.8 33.7 46.5 71.7 89.4 97.0 49.6Fixed operatingcosts

3.7 6.0 8.6 13.8 8.0 12.3 — 23.0 30.9 9.1

Variableoperating costs

2.3 3.6 2.2 3.7 2.7 3.6 — — — 1.8

Fuel costs 49.8 64.7 19.9 27.6 19.6 27.2 — — — 5.2Carbon costs 29.6 4.1 73.8 11.4 72.0 10.0 — — — -Decomm andwaste fund

— — — — — — — — — 2.1

CO2 transportand storage

— 3.5 — 7.6 — 7.5 — — — —

Steam revenue — — — — — — — — — —Total levelisedcost

96.5 102.6 133.2 111.9 136.0 107.1 86.3 112.4 127.9 67.8

Source:Mott Macdonald (2010), UK Electricity Generation Costs Update, available at:http://www.decc.gov.uk/assets/decc/statistics/projections/71-uk-electricity-generation-costs-update-.pdf

It should be noted that the estimates of levelised costsfor different types of electricity generation are highlysensitive to the assumptions used for capital costs, fueland EU ETS allowance prices, operating costs, loadfactor, and other drivers. Meaning that there is significantuncertainty around these estimates.

Housing: Insulation

Damian Hinds: To ask the Secretary of State forEnergy and Climate Change whether he has made anestimate of the number of (a) homes and (b)businesses in (i) England, (ii) Hampshire and (iii) EastHampshire constituency which would be eligible forsupport for (A) loft insulation top-up, (B) cavity wallinsulation, (C) internal solid wall insulation and (D)external solid wall insulation under the proposedGreen Deal. [22272]

Gregory Barker: The Green Deal has the potential toimprove the energy efficiency of up to 22 million homesin England and will generate new business opportunities.It is estimated that the Green Deal could drive 14 million

individual installations in homes by 2020. Many of the4.2 million businesses in England could also benefitfrom the Green Deal.

The Department for Energy and Climate Changedoes not have a detailed assessment of the potential inEast Hampshire at this stage, however it is anticipatedthat householders and businesses across all tenures willbe able to benefit from the new framework.

Wind Power: Cost-effectiveness

David T. C. Davies: To ask the Secretary of State forEnergy and Climate Change what assessment he hasmade of the cost-efficiency of producing carbon-freeelectricity from onshore wind farms compared with (a)nuclear power and (b) other methods; and if he willmake a statement. [22802]

Charles Hendry: The following table is taken fromMott Macdonald (2010) and gives levelised cost estimates(average generation cost per megawatt-hour) for newbuild plants in the main large-scale electricity generationtechnologies in the UK, including onshore wind, offshorewind and nuclear, at current engineering, procurementand construction (EPC) contract prices.

Table 1: Mott Macdonald (2010) levelised costs (Case 1: 10% discount rate, 2009 project start at today’s EPC prices, with mixed FOAK/NOAK)

Levelised costGas

CCGT

GasCCGT

withCCS—FOAK

ASCcoal

ASCcoalwith

CCS—FOAK

CoalIGCC—

FOAK

CoalIGCC

withCCS—FOAK

Onshorewind

Offshorewind—FOAK

Offshorewind

R3—FOAK

NuclearPWR—

FOAK

Capital costs 12.4 29.8 33.4 74.1 61.7 82.0 79.2 124.1 144.6 77.3

Fixed operating costs 3.7 7.7 8.6 18.6 9.7 17.7 14.6 36.7 45.8 12.2

Variable operatingcosts

2.3 3.6 2.2 4.7 3.4 4.6 — — — 2.1

Fuel costs 46.9 65.0 19.9 28.7 20.3 28.3 — — — 5.3

Carbon costs 15.1 2.1 40.3 6.5 39.6 5.5 — — — —

Decomm and wastefund

— — — — — — — — — 2.1


Table 1: Mott Macdonald (2010) levelised costs (Case 1: 10% discount rate, 2009 project start at today’s EPC prices, with mixed FOAK/NOAK)

Levelised costGas

CCGT

GasCCGT

withCCS—FOAK

ASCcoal

ASCcoalwith

CCS—FOAK

CoalIGCC—

FOAK

CoalIGCC

withCCS—FOAK

Onshorewind

Offshorewind—FOAK

Offshorewind

R3—FOAK

NuclearPWR—

FOAK

CO2 transport andstorage

— 4.3 — 9.6 — 9.5 — — — —

Steam revenue — — — — — — — — — —Total levelised cost 80.3 112.5 104.5 142.1 134.6 147.6 93.9 160.9 190.5 99.0Source:Mott Macdonald (2010), UK Electricity Generation Costs Update, available at:http://www.decc.gov.uk/assets/decc/Statistics/Projections/71-uk-electricity-generation-costs-update.pdf

It should be noted that for the purposes of presentation,the table only gives either ‘FOAK’ (first-of-a-kind) pricesor ‘NOAK’ (nth-of-a-kind) prices for each technology.On offshore wind, for example, it shows offshore wind‘FOAK’ prices, whereas the round 2 technology may beconsidered to have progressed towards ‘NOAK’ prices.Mott Macdonald estimate ‘NOAK’ offshore wind costsat £125/MWh (10% discount rate, 2009 project start attoday’s EPC prices).

TRANSPORT

Airports: Thames Estuary

Rehman Chishti: To ask the Secretary of State forTransport what recent representations he has receivedon the development of an international airport on theHoo Peninsula, Medway. [20347]

Mrs Villiers [holding answer 1 November 2010]: Nonedirectly, although we have received several letters aboutpossible airport development in and around the ThamesEstuary. The Department has no plans for a new airportin the Thames Estuary, nor any other part of Medwayor Kent.

Our priority is to get the most out of existing airportinfrastructure in the South East, which is why I am chairingthe taskforce announced by my right hon. Friend theSecretary of State in his written ministerial statementon 15 June 2010, Official Report, column 48WS, toimprove operations at the major South East airports.

Blue Badge Scheme

Caroline Dinenage: To ask the Secretary of State forTransport whether he plans to review the operation ofthe Blue Badge scheme for parking concessions. [22233]

Norman Baker: The Department for Transport iscurrently reviewing the Blue Badge scheme. Anannouncement on how we plan to take the schemeforward will be made shortly.

Crossrail: Abbey Wood

Teresa Pearce: To ask the Secretary of State forTransport in which year he expects the Crossrail stationat Abbey Wood to be operational. [22612]

Mrs Villiers [holding answer 8 November 2010]: Underthe revised programme for the construction of thecentral tunnels, we expect that phased introduction ofCrossrail services will commence from 2018.

Teresa Pearce: To ask the Secretary of State forTransport what discussions his Department has hadwith Southeastern Railway on interchange facilitieswith Crossrail services at Abbey Wood station; andwhat step-free interchange facilities he expects to beavailable in that station when it is rebuilt. [21772]

Mrs Villiers [holding answer 4 November 2010]: CrossrailLtd is working with Network Rail, which is responsiblefor the construction of the Crossrail. On NetworkWorks, including Abbey Wood station, Network Rail isleading the discussions with Southeastern on the impactson and improvements to the railway as a result of theseworks.

The Crossrail station at Abbey Wood is expected toinclude full provision for people with restricted mobility,with lifts from ground level and road over-bridge accessto ticket halls and the Crossrail platforms.

Crossrail: Finance

Graham Stringer: To ask the Secretary of State forTransport (1) how much funding he plans to allocate toCrossrail in each year of the spending review period;

[22821]

(2) what proportion of his Department’s budget heplans to allocate to Crossrail in each year of thespending review period; and what proportion of thatbudget has been allocated to Crossrail in each yearsince the inception of that project. [22822]

Mrs Villiers: As set out in the ‘Spending Review 2010:Transport for London funding agreement’ letter fromthe Secretary of State to the Mayor of London of20 October 2010, published on the Department forTransport’s website, the funding allocated by the Secretaryof State will be as follows:

2011-12 2012-13 2013-14 2014-15

Secretary of State’sCrossrail capital grant(£ million)

517 1,205 1,123 1,082

Percentage of DFTbudget

4 9 9 9

Crossrail funding represented 2% of the Department’sbudget in 2010-11, 1% in 2009-10 and below 1% inearlier years.

Ferries: Highlands and Islands

Mr MacNeil: To ask the Secretary of State for Transportwhat steps he plans to take to ensure adequate marineemergency coverage for the Highlands and Islands followingthe removal of the Anglian Prince tug boat in 2011.

[21773]


Mike Penning [holding answer 4 November 2010]:The current contract for the provision of emergencytowing vessels at public expense will not be renewedwhen it expires in September 2011. Between now andthe end of the contract, the Maritime and CoastguardAgency intends to work with the shipping and widermaritime industries, and also with local interested parties,local authorities and the Scottish Government, to exploreoptions for ensuring the effective operation of commercialarrangements could operate in the future.

Highways Agency: Finance

Graham Stringer: To ask the Secretary of State forTransport what estimate he has made of the cost to thepublic purse of schemes in the supported (a) developmentand (b) pre-qualification pool for major schemes; andwhat his Department’s budget is for major schemes for(i) 2010-11 and (ii) each of the three subsequent years.

[22823]

Norman Baker: The total of the most recently requestedor approved Department for Transport contribution forall the schemes in the three pools, and the maximumamount that would be expected to fall within the spendingreview period is as follows:

£ million

DFT contributionrequested or

previously approved

Of which maximumfalling within thespending review

period

Supported pool 408 325Development pool 930 700Pre-qualification pool 1,246 817

However, we will be inviting revised funding bidsfrom the local authorities concerned with a view toreducing the overall call on Department for Transportfunding, and before deciding by the end of 2011 whichof these schemes should be taken forward for funding.

The Department is not able to make a reliable and upto date estimate of the total public sector cost includinglocal authorities’ own contributions, but will be seekingthis information as part of the invitation to authoritiesto submit Best and Final Funding Bids (for schemes inthe Supported Pool) and Expressions of Interest (forother schemes) by the end of December.

The Department’s budget for local authority majorschemes in 2010-11 and the spending review years is asfollows. This includes provision for existing committedschemes, not mentioned above.

£ million

2010-11 4942011-12 4182012-13 3642013-14 3352014-15 427

Railways: Electrification

Andrew Gwynne: To ask the Secretary of State forTransport what timetable has been set for the electrificationof the (a) Manchester to Liverpool and (b) Manchester-Preston-Blackpool line. [19796]

Mrs Villiers [holding answer 26 October 2010]: On20 October 2010, the Chancellor announced thatelectrification of the lines between Manchester, Liverpool,Preston and Blackpool would go ahead. We are workingwith Network Rail to determine the timetable for thecompletion of these schemes, and will make anannouncement in due course.

Railways: Fares

Andrew Gwynne: To ask the Secretary of State forTransport whether he has made a recent estimate of thelikely effect on his Department’s progress on carbondioxide emission targets of proposed increases in railfares. [20358]

Zac Goldsmith: To ask the Secretary of State forTransport what assessment has been made of the likelyeffects on the environment of his proposals to increasethe cap on regulated rail fares to three per cent. abovethe retail price index for three years from 2012. [20576]

Mrs Villiers: The Government are committed to ensuringthat transport plays a full role in delivering the UK’sclimate change targets. We will continue to monitor thecarbon impact of policy and investment decisions toensure we remain on course to deliver those targets.

Emissions of greenhouse gases from the transportsector are projected to fall significantly over the comingdecade, in large part as a result of improvements to thefuel efficiency of new vehicles and the uptake of lowcarbon fuels.

The Department for Transport has not made a detailedestimate of the likely effects of increases in rail fares ontransport emissions. Although the announced fare increasesmay encourage some modal shift away from rail, theoverall impact on carbon emissions is likely to be small.The fare increase was one element of the spendingreview announcement. Other measures such as the localsustainable transport fund and the package of supportfor ultra low carbon vehicles are expected to lead toreductions in carbon emissions.

Andrew Gwynne: To ask the Secretary of State forTransport (1) whether he has made an estimate of thelikely effect on the number of car journeys of proposedincreases in rail fares; [20359]

(2) whether he has made an estimate of the likelyeffect on the number of passenger coach journeys ofthe proposed increases in rail fares. [20360]

Mrs Villiers: The Department for Transport has notmade a detailed estimate of the likely effects of increasesin rail fares on other modes.

Although the announced fare increases may encouragesome modal shift away from rail, the overall impact onother modes is likely to be small.

Zac Goldsmith: To ask the Secretary of State forTransport what estimate his Department has made ofthe likely effect on rail passenger numbers of theproposed increase in the cap on regulated rail fares tothree per cent. above the retail price index for threeyears from 2012. [20577]


Andrew Gwynne: To ask the Secretary of State forTransport (1) what estimate his Department has madeof the likely effect on the level of passenger rail use ofan RPI+3 formula for fares; [20356]

(2) what estimate he has made of the likely effect onthe number of passengers using rail services of theproposed increases in rail fares. [20361]

Mrs Villiers: The Department for Transport expectsthat passenger journeys will continue to increase duringthe period from 2012 to 2014 when fares are due to riseby 3% above the retail price index (RPI) of inflation. Itis estimated that the level of patronage will be up to 4%lower than it would have been had the cap remained atRPI+1%.

Railways: North West

Andrew Gwynne: To ask the Secretary of State forTransport what recent estimate he has made of the costto the economy of rail congestion in principal cities inthe Northern Hub. [22298]

Mrs Villiers: The aim of the Northern Hub study wasto identify a preferred value for money option whichwould deliver economic benefits to the north of Englandthrough improving rail connectivity across the northand increasing the capacity of the rail network toaccommodate long-term growth.

Rail congestion was not considered an issue in theNorthern Hub study or in the subsequent draft northernroute utilisation strategy (RUS) so no estimate has beenmade to the cost of the economy arising from it.

Andrew Gwynne: To ask the Secretary of State forTransport what assessment he has made of the economiceffect on (a) the North West and (b) Yorkshire and theHumber region of the Northern Hub. [22442]

Mrs Villiers [holding answer 8 November 2010]: NetworkRail’s study into the strategic options available calculatedthat the preferred Northern Hub option would add£4.23 billion benefits to the north of England over a60 year period. This figure was not disaggregated betweenregions of the north of England.

Andrew Gwynne: To ask the Secretary of State forTransport what capital allocations his Department hasmade for the implementation of the Northern Hub foreach year of the spending review. [22443]

Mrs Villiers [holding answer 8 November 2010]: Aspart of the preparation for the next high level outputspecification, we will consider whether a Northern Hubscheme can be funded and what progress can be madeon the project during the next Network Rail controlperiod (2014-15 to 2019-20).

Since the spending review only covers the period upto 2015, no capital funding has been specifically allocatedto the Northern Hub as yet. However, officials at theDepartment for Transport continue to work with NetworkRail along with GMPTE on developing the case for theNorthern Hub. I have visited Manchester for discussionson this proposal.

Andrew Gwynne: To ask the Secretary of State forTransport what timetable he has set for the implementationof the Northern Hub initiative. [22485]

Mrs Villiers [holding answer 8 November 2010]: Aspart of the preparation for the next high level outputspecification, we will consider whether a Northern Hubscheme can be funded and what progress can be madeon the project during the next Network Rail controlperiod (2014-15 to 2019-20). It would be premature toset a formal timetable for the project at this stage.However, officials at the Department for Transportcontinue to work with Network Rail, train operatorsand GMPTE on developing the case for the NorthernHub. I have visited Manchester for discussions on thisproposal.

Road Traffic: Morecambe

David Morris: To ask the Secretary of State forTransport if he will assess the potential effects on trafficlevels on trunk roads in Lancaster and Morecambeconstituency of Lancashire County Council’s FaberMaunsell plan. [22624]

Norman Baker: The Department for Transport hasno plans to assess the potential effects of Lancashirecounty council’s Faber Maunsell plan on traffic levelson trunk roads in Lancaster and Morecambe. TheSecretary of State announced on 26 October 2010,Official Report, columns 177-79, that it will fund theHeysham-M6 Link Road scheme, subject to a revisedfunding bid from Lancashire county council and thesatisfactory completion of all remaining statutoryprocedures.

Roads: Safety

Jim Fitzpatrick: To ask the Secretary of State forTransport how many staff in his Department were inposts with responsibility for road safety issues in October2010; and how many such posts he expects there to be inOctober 2011. [22593]

Norman Baker: It is impossible to identify preciselythe number of staff within the central Department withresponsibility for road safety issues. While we havededicated teams with road safety responsibility—principallythe road user safety team, agency policy and sponsorshipfunctions, and the team responsible for negotiatingvehicle safety standards—road safety is also an importantgoal for many other parts of the Department (includingbut not exclusively the marketing team, the trafficmanagement team, and the walking and cycling team).

The central Department and its Executive Agenciesrecorded the following full-time equivalent (FTE) postswho are responsible exclusively or mainly for workingon road safety issues:

Road safety posts Permanent Non-permanent

DfT(c) 131.5 3DSA 2450 5DVLA 0 0GCDA 0 0HA — —MCA 0 0


Road safety posts Permanent Non-permanent

VCA 131 1VOSA 2,336.97 46.18Total 5049.47 55.18Notes:1. Figures as at end October 2010.2. DfTc. Covers some posts in Road and Vehicle Safety and StandardsDirectorate and Transformation Licensing Logistics and Sponsorship.Other posts with responsibility for road safety issues exist in otherdirectorates.3. The table gives total employee numbers for HA, DSA and VOSAgiven that all these agencies have road safety as a core concern.4. VCA consider 131.5 permanent and one non-permanent memberof staff have road safety as a core concern.

The Department is in the process of reviewing itsstructure in light of the Government’s spending review.Future staff numbers will be determined as part of thatprocess.

Transport for London: Grants

Graham Stringer: To ask the Secretary of State forTransport how much his Department allocated in grantto Transport for London (TFL) for 2010-11 (a) priorto and (b) after his Department’s in-year spendingreductions; and what such funding his Departmentplans to allocate (i) in general grant, (ii) to Crossrail,(iii) to Metronet and (iv) under each other grant flow toTFL in each of the next three years. [22824]

Mrs Villiers: Prior to in-year savings, funding forTransport for London in 2010-11 consisted of:

GLA transport grant of £2,871,589,000Two capital grants towards costs associated with the formerMetronet PPP, totalling £392,500,000London overground grant of £24,932,347A small number of other smaller payments

As a result of in-year savings, total funding for TfL in2010-11 was reduced by £108,000,000.

The Secretary of State set out his intentions in relationto funding for Transport for London, including Crossrailand the companies into which the former Metronet PPPcontracts have been transferred, for the years 2011-12to 2014-15 in a letter to the Mayor of London dated20 October. This letter has been published on theDepartment’s website at:

http://www.dft.gov.uk/press/letters/tflfunding/

Transport: Finance

John Woodcock: To ask the Secretary of State forTransport pursuant to the oral statement of 26 October2010, Official Report, columns 177-79, on transport(investment), what guidance he has issued to localauthorities submitting revised bids on local authoritymajor schemes in the supported pool. [21043]

Norman Baker [holding answer 3 November 2010]: Inaddition to the oral statement the Department for Transportprovided Members with a document entitled ‘Investmentin Local Major Transport Schemes’ which sets out ourproposals in more detail, including the submission ofrevised bids. This document has been sent to localauthorities with schemes involved in the process includingthose in the supported pool. We are already in discussionwith these authorities and will provide them with furtherdetailed guidance very shortly.

John Woodcock: To ask the Secretary of State forTransport pursuant to the oral statement of 26 October2010, Official Report, columns 177-79, on transport(investment), what estimate he has made of the cost ofthe local authority major schemes in the developmentpool. [21045]

Norman Baker [holding answer 3 November 2010]:The total of the most recently requested or approvedDepartment for Transport contribution for all the schemesin the Development Pool is around £930 million, ofwhich we estimate that no more than £700 millionwould fall in the spending review period.

However we will be inviting revised funding bidsfrom the local authorities concerned with a view toreducing the overall call on Department for Transportfunding, and before deciding by the end of 2011 whichof these schemes should be taken forward for funding.

CABINET OFFICE

Civil Servants: Recruitment

Jon Trickett: To ask the Minister for the CabinetOffice how many (a) applicants and (b) acceptancesof each (i) gender, (ii) ethnicity and (iii) socio-economicgroup there were to the Civil Service Fast Stream ineach year since 2000. [22144]

Mr Maude: Data on the social class of applicants andappointees to the Fast Stream are not available. Monitoringof the socio-economic background of applicants andappointees will begin with effect from the 2011 entrycompetition.

Data on the gender and ethnicity of applicants andappointees are available in the annual Fast Streamreports, published on the Cabinet Office website at:

www.cabinetoffice.gov.uk/about-cabinet-office/plans-performance/faststream.aspx

Jon Trickett: To ask the Minister for the CabinetOffice what proportion of successful applicants to theCivil Service Fast Stream in each year since 2001 wereeducated at (a) Oxford and (b) Cambridge University.

[22145]

Mr Maude: The proportion of successful applicantsto the Fast Stream since 2001 who were educated atOxford and Cambridge universities is as follows.

Oxford CambridgeTotal

appointees

2001 14.01% (59) 14.01% (59) 4212002 14.60% (60) 12.90% (53) 4112003 17.65% (90) 18.04% (92) 5102004 19.27% (90) 16.49% (77) 4672005 16.66% (84) 13.10% (66) 5042006 17.44% (83) 13.66% (65) 4762007 18.42% (70) 12.90% (49) 3802008 15.44% (88) 13.68% (78) 5702009 16.53% (104) 9.70% (61) 629


Departmental Redundancy

Ms Angela Eagle: To ask the Minister for the CabinetOffice what estimate he has made of the number ofredundancies arising from the spending reductions proposedin the comprehensive spending review in respect of (a)his Department, (b) its non-departmental public bodiesand (c) other public bodies which are dependent on hisDepartment for funding. [21512]

Mr Maude: In respect of (a) we expect the size of theCabinet Office to reduce by c20% given its currentfunctions over the spending review period. Naturalturnover will deliver some of the reductions, howeverthe Department is planning a voluntary departureprogramme in 2010-11 to support the reductions neededto achieve this target.

In respect of (b) and (c), the recent review of publicbodies recommended that seven of the 14 Cabinet Office’spublic bodies should no longer remain NDPBs:

Civil Service Appeals Board Government Strategic;

Marketing Advisory Board;

Main Honours Advisory Committee;

Security Commission;

Office for Civil Society Advisory Board;

Capacitybuilders;

Commission for the Compact;

The first five are small advisory bodies supported byCabinet Office staff who will be absorbed back into theCabinet Office and/or redeployed to other work.

There are no plans for redundancies in respect ofstaff supporting the work of the remaining advisorybodies—Advisory Committee on Business Appointments,House of Lords Appointments, Security Vetting AppealsPanel, and the Committee for Standards in Public Life.The remaining Cabinet Office public body, the BoundaryCommission for England has staff seconded from theCabinet Office. The staffing of the Commission is projectedto increase over the 2011-12 period to meet the requirementsof the next parliamentary boundary review and torevert to a staffing level comparable to that used forpast reviews.

Alternativearrangementsfortheworkof Capacitybuildersand the Commission for the Compact are currentlyunder review.

The Central Office of Information has recently completeda redundancy exercise which was not part of thecomprehensive spending review. 287 staff exits weremade through a compulsory exercise, mitigated withsome voluntary redundancies.

Any further changes to the status of the CentralOffice of Information are under consideration as partof a review which will report at the end of November.

The status of the National School of Governmentremains under consideration and will be announced indue course.

There are currently no plans for redundancies at theNational School of Government following the spendingreview settlement. Any decisions about the NationalSchool of Government are expected to be made as partof the arm’s length bodies review.

Government Departments: Photography

Mr Iain Wright: To ask the Minister for the CabinetOffice how many photographers are employed byGovernment Departments. [22666]

Mr Maude [holding answer 8 November 2010]: Thisinformation is not collected centrally.

Government Departments: Procurement

Chi Onwurah: To ask the Minister for the CabinetOffice whether the 25 per cent. aspiration set forGovernment contracts to be awarded to small andmedium-sized enterprises is to be measured as a proportionof (a) the monetary value of the contract, (b) the totalnumber of contracts awarded by each Department or(c) committee measure. [22306]

Mr Maude [holding answer 8 November 2010]: As setout in the coalition programme, the aspiration is for25% of the total number of Government contracts togo to SMEs.

Chi Onwurah: To ask the Minister for the CabinetOffice whether the 25% aspiration for the award ofGovernment contracts to small and medium-sizedenterprises applies to each Government Department orto the total number of such contracts awarded. [22307]

Mr Maude [holding answer 8 November 2010]: Theaspiration is for 25% of the total number of governmentcontracts to go to SMEs. It is not our intention thateach Department should award 25% of its contracts toSMEs.

Chi Onwurah: To ask the Minister for the CabinetOffice what estimate he has made of the average cost toa supplier of completing a pre-qualification questionnairefor contracts with Government Departments. [22501]

Mr Maude: This information is not held centrally,but, as announced on 1 November, we are mandatingthat Government Departments use a simplified standardpre-qualification questionnaire to reduce the burden onsuppliers.

Chi Onwurah: To ask the Minister for the CabinetOffice what timetable he has set for Governmentdepartments to agree plans of action to increase thenumber of contracts awarded to small and medium-sized enterprises. [22503]

Mr Maude: We intend to agree actions with individualDepartments once baseline figures for SMEs in procurementare published later this month.

Chi Onwurah: To ask the Minister for the CabinetOffice what proportion of potential suppliers ofGovernment Departments who completed pre-qualificationquestionnaires in the last five years received no contractsfrom any Department in (a) that financial year and (b)the three financial years following submission of thequestionnaire. [22505]


Mr Maude: This information is not held centrally,but, as announced on 1 November, we are mandatingthat Government Departments use a simplified standardpre-qualification questionnaire to reduce the burden onsuppliers.

Members: Correspondence

Kevin Brennan: To ask the Minister for the CabinetOffice when he expects the Cabinet Secretary to replyto the letter from the hon. Member for Cardiff Westof 20 September 2010 in relation to a Civil Serviceappointment. [22684]

Mr Maude [holding answer 8 November 2010]: Areply was sent to the hon. Member on 4 November2010.

Public Bodies (Reform) Bill 2010-2011: Wales

Jonathan Edwards: To ask the Minister for the CabinetOffice (1) what recent discussions he has had withWelsh Assembly Government (a) Ministers and (b)officials on the likely effects on public bodies in Walesof the implementation of the provisions of the PublicBodies (Reform) Bill; [21590]

(2) what recent discussions he has had with WelshAssembly Government (a) Ministers and (b) officialson the likely effects of the provisions of the PublicBodies (Reform) Bill on legislative competences inWales (i) prior to and (ii) after a referendum on Part IVof the Government of Wales Act 2006. [21591]

Mr Maude: There has been an extensive process ofcommunication and dialogue with the devolvedAdministrations in the development of proposals forpublic bodies reform. Cabinet Office officials havebeen in regular contact with counterparts in Wales,Scotland and Northern Ireland. I have also correspondedwith colleagues in the devolved Administrations on anumber of occasions prior to publication of the PublicBodies Bill.

Public Bodies Bill

Mr Marsden: To ask the Minister for the CabinetOffice what consideration he gave to making provisionin the Public Bodies Bill [Lords] for changes to theSkills Funding Agency. [22825]

Mr Maude [holding answer 9 November 2010]: Thescope of the Public Bodies Bill is restricted to non-departmental public bodies, non-ministerial departmentsand public corporations. The Skills Funding Agency isan Executive Agency of the Department for BusinessInnovation and Skills and therefore out of scope of thisreview process and the Bill.

Public Expenditure

Lisa Nandy: To ask the Minister for the CabinetOffice whether his Department has established processesto monitor any effects of proposed reductions in itsexpenditure. [21637]

Mr Maude: My Department is assessing the affects ofits spending review settlement.

Voluntary Organisations: Local Government

Anas Sarwar: To ask the Minister for the CabinetOffice whether he plans to review the guidelines oncommissioning between local government and the voluntarysector. [19873]

Mr Hurd: The Secretary of State for Communitiesand Local Government has responsibility for localgovernment. The Coalition’s Programme for Governmentincludes a commitment to promote the radical devolutionof power and greater financial autonomy to localgovernment and community groups. The Governmentalso runs a national training programme for publicsector commissioners which includes those from localauthorities. The Government will also be building onthe work of the Partnership Improvement Programme(PIP), the new package will develop support to statutorypartners and civil society organisations in working togetheron issues including commissioning practice.

WORK AND PENSIONS

Access to Work Programme

Rehman Chishti: To ask the Secretary of State forWork and Pensions if he will extend the Access to Workprogramme to cover the costs associated with (a)attendance at interviews and (b) participation in workexperience placements and internships. [19994]

Maria Miller: The Access to Work programme canfund the costs of an interpreter or advocate assisting adisabled person to communicate at an interview. Thereare no plans at present to extend the support availablefrom the programme to cover the costs of travelling toan interview.

The Jobcentre Plus Fares to Interview scheme isavailable to help disabled people with other costs associatedwith job interviews including re-imbursement of travelexpenses, subsistence allowance for longer periods awayfrom home and compensation for loss of earnings.

The Access to Work programme can fund the additionalcosts of support required to allow a disabled person totake part in a work trial arranged by Jobcentre Plus.Access to Work support is only available to people inpaid employment and so does not support work placementsor internships where the individual works on a voluntarybasis or receives benefits or training allowances.

Bereavement Benefits

Tom Blenkinsop: To ask the Secretary of State forWork and Pensions what plans he has for the future ofbereavement benefits; and if he will make a statement.

[21995]

Steve Webb: As is the case for all benefits, bereavementbenefits are kept under constant review. Any potentialchange to bereavement benefits in the future would beconsidered within the context of wider welfare reformand our commitment to create and deliver a 21st centurywelfare system.


Child Maintenance and Enforcement Commission:Correspondence

David Morris: To ask the Secretary of State for Workand Pensions what consideration the Child SupportAgency has given to using double-sided printing for itscorrespondence. [22625]

Maria Miller: The Child Maintenance and EnforcementCommission is responsible for the child maintenancesystem. I have asked the Child Maintenance Commissionerto write to the hon. Member with the informationrequested and I have seen the response.

Letter from Stephen Geraghty:In reply to your recent Parliamentary Question about the

Child Support Agency, the Secretary of State promised a substantivereply from the Child Maintenance Commissioner as the ChildSupport Agency is now the responsibility of the Child Maintenanceand Enforcement Commission.

You asked the Secretary of State for Work and Pensions whatconsideration the Child Support Agency has given to usingdouble-sided print for its correspondence. [22625]

The vast majority of printed correspondence from the ChildMaintenance and Enforcement Commission’s IT systems is producedin bulk by our IT suppliers in their own print centres. Muchsmaller volumes of correspondence are created by caseworkers inlocal offices.

Bulk printed correspondence is almost all printed single-sided.However, bilingual letters in English and Welsh are produceddouble-sided. The Child Support Agency is currently looking formoney saving opportunities associated with printed correspondence,including greater use of duplex printing.

The Commission’s caseworkers are strongly encouraged toprint all correspondence double-sided. We are currently deployingnew printers into all local offices that will be set up to printdouble-sided by default. Installation of these new devices will becompleted by April 2011.

I hope you find this answer helpful.

Disability Living Allowance

Grahame M. Morris: To ask the Secretary of Statefor Work and Pensions what consultation he undertookwith (a) charities, (b) third sector organisations and(c) other disability organisations prior to his decisionto remove the mobility component of disability livingallowance for those who live in residential care homes.

[20982]

Maria Miller: Local authority contracts with carehomes should cover services to meet all a resident’sassessed needs, including any assessed mobility needs,so an individual’s care support and mobility needsshould be met by residential care providers from socialcare funding. This measure will remove an overlap ofpublic funds while ensuring that resources continue tobe targeted at disabled people with the greatest needs.

As part of the spending review all organisations aregiven the opportunity to contribute to the priorities ofthe spending review. Across Government, consultationon specific spending review measures was not undertaken.All measures are subject to the parliamentary process,and we are committed to the involvement of charities,third sector organisations and other disability organisationsin the ongoing development of policy in these areas.

Employment: Disability

Kate Hoey: To ask the Secretary of State for Workand Pensions what impact assessment his Departmenthas undertaken of the (a) duty to make reasonableadjustments under the Equality Act 2010, (b) disabilityequality duty under the Equality Act 2010 and (c)implementation of Article 27 of the UN Convention onthe Rights of Persons with Disabilities; and whatmechanisms are in place to ensure his Department’sprogrammes to assist disabled people in employmentare compliant with that legislation. [22467]

Maria Miller: The coalition agreement made clearthis Government’s commitment to equality for disabledpeople. We believe that disabled people should have thesame opportunities as non-disabled people to fullyparticipate in society.

In general, the provisions in the Equality Act 2010which require reasonable adjustments to be made fordisabled people have been carried forward from theDisability Discrimination Act 1995. The Equality Act2010 introduced a single threshold at which the duty tomake reasonable adjustments arises and this change isdealt with in the impact assessment1 and equality impactassessment2 of the Equality Act. These assessmentsalso assess the introduction of a new public sector duty,which will replace the existing disability equality Dutyin April 2011.

The Government Equalities Office is currently consultingon the public sector equality duty. Details of the impactassessment and equality impact assessment are includedin the published consultation document3.

The Government take their obligations under theUnited Nations convention on the rights of disabledpeople into account as they develop policies andprogrammes. The report that Government will make tothe United Nations next year will demonstrate howacross Departments we have taken forward implementationin respect of article 27 and the convention as a whole.

The Department for Work and Pensions (DWP)undertakes equality impact assessment on any newpolicies or changes to existing policies and practice. Awell established process helps policy makers developequality impact assessments based on a strong evidencebase. This includes guidance on including informationgathered from consultation and involvement withorganisations.

Currently, equality impact assessments are beingdeveloped for both Work Choice implementation andAccess to Work and will appear on the DWP website indue course.1 http://www.equalities.gov.uk/pdf/Equality%20Act%20Impact.pdf2 http://www.official-documents.gov.uk/document/other/9780108508714/9780108508714.pdf3 Equality Act 2010: The public sector Equality Duty: Promotingequality through transparency:

http://www.equalities.gov.uk/pdf/402461_GEO_EqualityAct2010ThePublicSectorEqualityDuty_acc.pdf

Housing Benefit

Dr Whiteford: To ask the Secretary of State for Workand Pensions how many and what proportion of housingbenefit claimants in (a) Scotland and (b) the UKreceived housing benefit payments of over £20,000 inthe last 12 months for which figures are available. [21799]


Steve Webb: Information on annual awards for eachhousing benefit recipient is not available. At July 2010,our records show that:

(a) In Scotland, there were 840 households receiving housingbenefit over £384.62 per week;

(b) In Great Britain, there were 11,230 households receivinghousing benefit over £384.62 per week.Note:All figures have been rounded to the nearest 10 recipients.Source:Single Housing Benefit Extract for July 2010

Ms Buck: To ask the Secretary of State for Work andPensions (1) what estimate he has made of theproportion of local housing allowance claimants in (a)single rooms, (b) one bedroom properties, (c) twobedroom properties, (d) three bedroom properties and(e) four bedroom properties and above whose monthlyallowance does not cover the cost of their rentalpayments; [22090]

(2) what estimate he has made of the average shortfallin cases where local housing allowance does not coverthe full rent payable in each region in the latest periodfor which figures are available; [22091]

(3) what estimate he has made of the average differencebetween local housing allowance claimed and rent payableby persons whose allowance does not cover the cost oftheir rental payments in (a) all properties and (b)properties with (i) a single room, (ii) one bedroom, (iii)two bedrooms, (iv) three bedrooms and (v) four bedroomsor more in the latest period in which figures are available.

[22092]

Steve Webb: In August 2009, 48% of those receivinghousing benefit under the local housing allowancearrangements had a shortfall in their rent caused by thecustomer’s contractual rent being higher than theappropriate local housing allowance rate.

Work is underway to update this information and weaim to include this in the publication on a “two-yearreview of the local housing allowance” due out later thisyear.

Simon Kirby: To ask the Secretary of State for Workand Pensions what plans he has for the future of thediscretionary housing payments budget; and if he willmake a statement. [22120]

Steve Webb: We are increasing the Government’scontribution to local authorities’ discretionary housingpayments funds from £20 million to £30 million in2011-12 and to £60 million a year thereafter. We arecurrently discussing the allocation of the funding withthe local authority associations.

Jonathan Edwards: To ask the Secretary of Statefor Work and Pensions what recent assessment hisDepartment has made of the merits of rent controls asa method of reducing expenditure on housing benefit.

[22323]

Steve Webb: Policy on rent controls is a matter for theSecretary of State for Communities and Local Government.However, the Department for Work and Pensions hasoutlined a range of measures in the June 2010 Budgetthat are designed to exert a downward pressure on rentsand will save around £2 billion per year by 2015-16.

Housing Benefit: Brighton and Lewes

Simon Kirby: To ask the Secretary of State for Workand Pensions if he will estimate the likely change in thediscretionary housing payment for (a) Brighton andHove City Council and (b) Lewes District council ineach year of the spending review period. [22121]

Steve Webb: We are reviewing the way in which weallocate the Department’s contribution to local authorities’expenditure on discretionary housing payments. In themeantime, we cannot estimate the likely change incontributions to individual local authorities.

Housing Benefit: Down’s Syndrome

Mr Bain: To ask the Secretary of State for Work andPensions what plans he has to make discretionary housingpayments to (a) people with Down’s syndrome and (b)their families to meet housing rental costs. [23078]

Steve Webb: Discretionary housing payments areintended to make up shortfalls in entitlement to benefitwhere the local authority considers that the personconcerned is in need of further help with their housingcosts.

Decisions on who should receive these payments areentirely at the local authority’s discretion, and It is forthe authority to decide what should be awarded in anyparticular case and how long the award should last. Wewould expect local authorities to take into account thehealth and any special support needs of the household.

Housing Benefit: Shared Housing

Mr Andrew Smith: To ask the Secretary of State forWork and Pensions whether benefit recipients sharingaccommodation with unrelated non-benefit recipientswill be able to access local housing allowance under hisproposed reforms. [21305]

Steve Webb: Those who live in shared accommodationand who are liable for their rent on a commercial basiscan continue to receive help from housing benefit, unlesstheir landlord is a close relative who also lives in theproperty.

Housing Benefit: Wales

Jonathan Edwards: To ask the Secretary of State forWork and Pensions how many rooms in houses definedas shared for the purposes of the shared room rate oflocal housing allowance were available to rent in eachbroad rental market area in Wales in the latest periodfor which figures are available. [22321]

Steve Webb: Information on the number of roomsavailable in shared accommodation in the private rentedsector is not available.

Industrial Health and Safety

John McDonnell: To ask the Secretary of State forWork and Pensions what recent assessment he has madeof the contribution of trade union safety representativesto the maintenance of health and safety standards inthe workplace. [22349]


Chris Grayling: The Health and Safety Executive(HSE) strategy document ″The health and safety ofGreat Britain—Be part of the solution″ recognises thatinvolving employees has a positive effect on health andsafety performance.

Research indicates that the benefits of effective employeeinvolvement in health and safety come about because ithelps employers to manage health and safety in a practicalway by:

helping spot risks;making sure health and safety controls are practical; andincreasing the level of commitment to working in a safe andhealthy way.

In organisations where it is not practical to consultindividuals directly, having a health and safety representativeis beneficial.

Recent HSE analysis of previous survey data indicatesthat, whether the workplace is unionised or not, employeesatisfaction with consultation arrangements has a positiveimpact on health and safety performance. It also showsthat unionised workplaces generally have higher levelsof satisfaction with consultation on health and safetymatters.

Mortgages: Government Assistance

Caroline Lucas: To ask the Secretary of State forWork and Pensions (1) if he will estimate the number ofpeople in receipt of support for mortgage interest whohave mortgages with interest rates higher than 3.63 percent.; if he will estimate the proportion of such peoplewho have mortgages with interest rates higher than3.63 per cent. due to having (a) low income and (b)poor credit history; [22642]

(2) how many people were in receipt of support formortgage interest payments; and how many such peoplewere also receiving (a) pension credit, (b) jobseeker’sallowance and (c) income support on the latest date forwhich figures are available; [22655]

(3) with reference to his Department’s Equality ImpactAssessment: Support for Mortgage Interest; page 6,paragraph 1, what the evidential basis is for the estimatethat just over half of all support for mortgage interestcustomers will continue to have their eligible mortgageinterest outgoings fully met by their benefit awards;

[22720]

(4) with reference to his Department’s Equality ImpactAssessment: Support for Mortgage Interest; page 7,paragraph 4, if he will give numerical estimates for thereferences to (a) lion’s share and (b) a relatively smalllevel of arrears. [22721]

Steve Webb: The latest available figures on the numberof people claiming support for mortgage interest throughincome-based jobseeker’s allowance, income supportand pension credit are from February 2010, and aregiven as follows.

Caseload (February 2010) Number

Jobseeker’s allowance 34,000Income support 75,000Pension credit 117,000All 227,000Source:Department for Work and Pensions, Information Directorate, 5%samples.

Support for mortgage interest is also payable throughawards of income-based employment and supportallowance, although the Department does not collectadministrative data on how many of these customerswould be receiving support for their eligible mortgageinterest costs.

The Department does not collect administrative dataon the actual mortgage rates paid by support for mortgageinterest customers, or data on the proportion of customerswith interest rates higher than 3.63% due to having lowincome or poor credit history.

In November 2009, we received a sample of data onalmost 6,000 support for mortgage interest claimants(around 3% of the total caseload) from 16 differentmortgage lenders, collected on our behalf by Council ofMortgage Lenders and HM Treasury. While the dataare not a statistically robust sample and any resultsshould be considered illustrative, and it is likely that thedistribution of mortgage rates will have changed sincethe data were collected, they can provide a useful insightinto the mortgages of support for mortgage interestcustomers.

This sample indicates that around 115,000 of thecurrent 227,000 support for mortgage interest customerswould have mortgage interest rates higher than 3.63%.

Using the same sample, we estimate that just over50% of support for mortgage interest customers wouldhave mortgage interest liabilities of lower than 3.67%(the April 2010 estimate of the average mortgage ratepublished by the Bank of England), and therefore continueto have their eligible mortgage interest outgoings fullymet by their benefit awards.

Numerical estimates on the proportion of eligiblemortgage interest that we would be covered under astandard interest rate of 3.67% are given in table 3 ofthe equality impact assessment published on thedepartmental website.

http://www.dwp.gov.uk/docs/support-for-mortgage-interest.pdf

Caroline Lucas: To ask the Secretary of State forWork and Pensions what cost-benefit analysis hisDepartment has undertaken of the likely effects of theimplementation of his proposals to lower the rate ofinterest used to calculate support for mortgage interest.

[22653]

Steve Webb: The standard interest rate used to calculatesupport for mortgage interest was fixed at 6.08% by thelast Administration. That rate was too generous andresulted in the vast majority of people getting morethan their eligible mortgage interest liability, which wasunfair to taxpayers.

The Chancellor announced in the June 2010 Budgetthat the standard interest rate would be based on theBank of England’s published monthly average mortgageinterest rate. Legislation to introduce this change cameinto effect from 1 October 2010 and the standard interestrate is currently 3.63%.

The Department conducted thorough analysis on thelikely impacts of this change, and we have included asmuch information as possible in the equality impactassessment published on the Department’s website.

http://www.dwp.gov.uk/docs/support-for-mortgage-interest.pdf


Pensioners: Housing Benefit

Jon Trickett: To ask the Secretary of State for Workand Pensions how many persons in receipt of housingbenefit in each (a) region and (b) constituency areabove retirement age. [22413]

Steve Webb: The information is not available atconstituency level. A copy of the available informationhas been placed in the Library.

Social Security Benefits: Disability

Ian Swales: To ask the Secretary of State for Workand Pensions how many people were in receipt of (a)disability living allowance and (b) incapacity benefit inRedcar constituency on the latest date for which figuresare available. [16534]

Maria Miller: “Caseloads for selected benefits byParliamentary Constituencies, February 2010”is availablein the House of Commons Library and includes figuresfor incapacity benefit and disability living allowance.The information is reproduced in the following table.Recipients of disability living allowance and incapacity benefit/severe

disablement allowance as at February 2010, Redcar parliamentaryconstituency

Number

Incapacity benefit/severedisablement allowance (inpayment)

4,600

Disability living allowance(in payment)

6,560

Notes:1. Caseload figures are rounded to the nearest ten; some additionaldisclosure control has also been applied.2. For disability living allowance the totals show the number ofpeople in receipt of the benefit and excludes people with anunderlying entitlement but whose payment has been suspended, forexample because they are in hospital.3. A claimant can be in receipt of more than one of these benefitsand will therefore be counted for each benefit they receive.4. Incapacity benefit was replaced by employment and supportallowance from October 2008.5. Figures for employment and support allowance are not included.6. Constituencies used are for the Westminster Parliament of May2010.Source:DWP Information Directorate: Work and Pensions LongitudinalStudy.

Graeme Morrice: To ask the Secretary of State forWork and Pensions how many people in Livingstonconstituency receive (a) disability living allowance, (b)incapacity benefit and (c) employment and supportallowance. [22070]

Maria Miller: The information requested is in thefollowing table:

Claimants of employment and support allowance, disability livingallowance, incapacity benefit and severe disablement allowance,

Livingston constituency, as of February 2010Number

Incapacity benefit/severedisablement allowance

4,910

Disability living allowance(in payment)

7,870

Employment and supportallowance

920

Notes:1. Caseload figures are rounded to the nearest 10; some additionaldisclosure control has also been applied.2. For disability living allowance, the totals show the number ofpeople in receipt of an allowance and exclude people withentitlement where the payment has been suspended, for example ifthey are in hospital.3. A claimant can be in receipt of more than one of these benefitsand will therefore be counted for each benefit they receive.4. Incapacity benefit was replaced by employment and supportallowance (ESA) from October 2008.5. Constituencies used are for the Westminster Parliament of May2010.Source:DWP Information Directorate: Work and Pensions LongitudinalStudy.

Kate Hoey: To ask the Secretary of State for Workand Pensions whether he has assessed the merits ofdrafting a single form for the application of all medicalcondition-related benefits. [22465]

Maria Miller: The policy rationale, entitlement conditionsand information required for each benefit is differentand to cover them all in one form would increasecomplexity and be unhelpful for the recipient.

Gareth Johnson: To ask the Secretary of State for Workand Pensions how many people in Dartford constituencyreceive (a) incapacity benefit and (b) employment andsupport allowance. [22805]

Maria Miller: At February 2010 there were 2,380people receiving incapacity benefits, and 660 peoplereceiving employment and support allowance in Dartfordconstituency.Notes:

1. The incapacity benefits figure includes incapacity benefit,income support paid on the grounds of incapacity, and severedisablement allowance.

2. Incapacity benefit was replaced by employment support allowance(ESA) from October 2008.

3. Figures are rounded to the nearest 10, some additional disclosurehas been applied.

4. Constituencies used are for the Westminster Parliament of May2010.

5. These data are published at:

http://research.dwp.gov.uk/asd/asd1/stats_summary/benefit_new_parlc_table_feb10.xls

Social Security Benefits: Fraud

Priti Patel: To ask the Secretary of State for Workand Pensions pursuant to the answer of 20 October2010, Official Report, column 766W, on social securitybenefits: fraud, how many people were involved in the550 warrant cases; and how many people were involvedin more than one of those cases. [19820]

Chris Grayling: The Department seeks an arrest warrantin all circumstances in which a defendant fails to attenda hearing or trial without an explanation acceptable tothe court.

The 550 warrants refer to 550 individual defendants.

Of the 550 defendants, none have more than onewarrant outstanding for benefit fraud offences.


Statutory Sick Pay

Kate Hoey: To ask the Secretary of State for Workand Pensions whether he plans to extend entitlement tostatutory sick pay to employees who are on a phasedreturn to work. [22464]

Chris Grayling: There are no plans to extend entitlementto statutory sick pay to employees who are on a phasedreturn to work.

Statutory sick pay is payable to employees who areunable to work under the terms of their contract. It isnot payable for days when an employee does any workunder this contract. An employee, who is undertaking aphased return to work, may nonetheless receive statutorysick pay for days that they do not work, provided thequalifying conditions are met.

Unemployment

Miss Begg: To ask the Secretary of State for Workand Pensions on what occasions since his appointmenthis Department has released to the media figures fromeach source on the number of people who have neverbeen in employment. [17873]

Chris Grayling: The Department is routinely asked bythe media for figures regarding employment, unemploymentand economic inactivity and endeavour to provide asmuch information as possible. We use a variety ofsources including:

The DWP national benefits database

Nomis Web:

www.nomisweb.co.uk

Family Resource Survey

DWP Information Directorate: Work and Pensions LongitudinalStudy

Work Programme

Mr Charles Walker: To ask the Secretary of State forWork and Pensions what steps he is taking to ensurethat prisoners and ex-offenders are supported intoemployment through the Work Programme; andwhether this objective will be included in contracts withprime contractors. [22659]

Chris Grayling: The Work Programme will providemore personalised back to work support for long-termunemployed individuals, and for those with more significantbarriers to employment. We are currently working throughthe full implications of the spending review for theWork Programme and further announcements, includingabout support for ex-offenders, will be made in duecourse.

DWP is also working closely with Ministry of Justicein developing options for improving cross-departmentalco-operation to increase employment and reducere-offending for individuals leaving prison and thoseserving community sentences.

COMMUNITIES AND LOCAL GOVERNMENT

Anti-Semitism

Mr MacShane: To ask the Secretary of State forCommunities and Local Government what (a) researchand (b) programmes he plans to commission for thepurposes of tackling anti-Semitism; and if he will makea statement. [22577]

Andrew Stunell: The cross-Government working groupto tackle anti-Semitism is currently preparing to publisha three-year on response to the recommendations madeby the All Party Inquiry into Anti-Semitism. Once thisreport has been published we will reassess what stillneeds to be done and commission research and developa programme of action accordingly.

Departmental Early Retirement

Philip Davies: To ask the Secretary of State forCommunities and Local Government how many staffof (a) his Department and (b) its agencies have beenoffered enhanced early retirement packages in each ofthe last three years. [22021]

Robert Neill: The numbers of staff who left DCLGand its agencies with enhanced early retirement packagesin each of the last three years is shown in the followingtable.

DCLG Agencies

2007-08 43 <52008-09 11 92009-10 27 <5

The data for the agencies, Planning Inspectorate,QEII Conference Centre, and the Fire Service College,has been combined owing to the very small numbersinvolved.

European Aeronautic Defence and Space Company:Contracts

Bob Blackman: To ask the Secretary of State forCommunities and Local Government pursuant to theoral evidence taken by the Communities and LocalGovernment Committee on 13 September 2010, HC 453-i,Q109, what progress has been made in rectification offailures in the mapping data and directions provided byEADS to the fire service under contract. [21414]

Robert Neill [holding answer 2 November 2010]: Asignificant number of issues still remain with the mappingand routing products provided by EADS under theFiReControl contract.

The Fire and Rescue Services (FRS) using the interimversion of the software supplied by EADS for on-boardcomputers in fire appliances are still waiting for updatedmapping data formatted for these devices. EADS hasnow supplied the Department for Communities andLocal Government with a further draft plan whichwould allow roll-out to start early in the new year.

My officials received an updated proposal from EADSregarding the solution for routing fire appliances toincidents. Many of the problems highlighted by theSecretary of State would not be satisfactorily resolved


under this proposal, including, for example, reliable andconsistent use of the dimensions of the fire appliance insetting a suitable route and easy adjustment of therecommended route if the crew on board find an unexpectedblockage.

The issue with the gazetteer information showingWest Yorkshire addresses as located in Wakefield appearsto have been resolved by an EADS software maintenancerelease. However there is now a significant problemwith this product in the way it handles FRS changes.

Fire Services: Emergency Calls

Mr Ainsworth: To ask the Secretary of State forCommunities and Local Government what steps hisDepartment is taking to improve fire service emergencyresponse times; and whether he plans to bring forwardproposals for new national standards for fire serviceresponse times. [22789]

Robert Neill: The onus is on individual fire and rescueauthorities to consider strategies to mitigate the effectof increased levels of traffic, which research has shownto be the main factor accounting for increased responsetimes. That will include liaising with partners such aslocal authorities and the Highways Agency, and applyinglocally appropriate measures such as green wave trafficlight systems, GPS and improved local knowledge offire crews, and use of secondary fire vehicles and reducedresponse to low risk incidents.

Response target-setting is a matter for individual fireand rescue authorities under Integrated Risk ManagementPlanning (IRMP), according to local requirements andcircumstances, and is not something that central governmentshould direct or determine. The government has noplans to reintroduce national standards for fire andrescue service response times. Decisions made by localpoliticians and practitioners according to localcircumstances will be more effective than blanketrequirements across the country.

However, if the service chose to place consistentstandards upon itself, then equally that is not somethingthat central Government would seek to intervene in.

Mr Ainsworth: To ask the Secretary of State forCommunities and Local Government what the averagefire service emergency response times were for each fireservice in the latest period for which figures areavailable. [22790]

Robert Neill: Average response times for fires in buildingsfor each fire and rescue service are shown in the tablefor the latest period for which fire and rescue incidentdata are available.

Average response times1 by fire and rescue services, England2,April 2009 to March 2010

Dwelling fires3 Other building fires

Avon 7.5 8.1Bedfordshire 7.6 8.0Berkshire 7.5 8.3Buckinghamshire2 — —Cambridgeshire 9.1 9.5Cheshire 8.4 8.9Cleveland 5.6 6.1Cornwall 11.0 10.2

Average response times1 by fire and rescue services, England2,April 2009 to March 2010

Dwelling fires3 Other building fires

Cumbria 8.6 8.8Derbyshire 7.5 8.2Devon andSomerset

9.3 9.1

Dorset 8.4 9.5Durham 8.0 7.8East Sussex 7.1 7.4Essex 8.1 9.0Gloucestershire 9.5 9.0Greater London 6.2 6.2GreaterManchester2

— —

Hampshire 7.2 7.3Hereford andWorcester

8.9 9.5

Hertfordshire 7.7 7.4Humberside 7.0 7.9Isle of Wight 9.0 7.1Isles of Scilly — 9.0Kent 6.9 7.9Lancashire 6.8 7.3Leicestershire 7.9 8.6Lincolnshire 9.1 9.4Merseyside 5.6 5.7Norfolk 8.9 8.7North Yorkshire 8.9 9.8Northamptonshire 8.2 8.6Northumberland 9.4 9.7Nottinghamshire 6.6 7.0Oxfordshire 9.5 9.0Shropshire 8.8 9.4South Yorkshire 7.4 7.7Staffordshire 8.2 8.6Suffolk 8.9 10.1Surrey 8.5 8.5Tyne and Wear 5.3 5.5Warwickshire 9.0 7.7West Midlands 6.6 6.8West Sussex 8.7 9.6West Yorkshire 6.8 6.9Wiltshire 9.3 10.3

England1 7.3 7.91 As per previous figures, excludes fires where (i) there was heat andsmoke damage only, (ii) the call was made after the fire was knownextinguished, (iii) where the response time calculated gives an houror more.2 Excludes Greater Manchester and Buckinghamshire as dataprovided were incomplete.3 In order to be consistent with data source prior to April 2009,chimney fires not included in calculation.

Fire Services: Redundancy

Mr Ainsworth: To ask the Secretary of State forCommunities and Local Government whether he hasmade an assessment of the number of fire service jobsthat would be lost as a result of the implementation ofthe proposals contained within the comprehensivespending review. [22788]

Robert Neill: As fire service jobs are a local matter,determined by individual fire and rescue authorities, noformal assessment has been undertaken by the Department


for Communities and Local Government. I also referthe hon. Member to the answer I gave the hon. Memberfor Middlesbrough South and East Cleveland (TomBlenkinsop) on 25 October 2010, Official Report, columns88-89W.

Local Development Frameworks: Greater London

Zac Goldsmith: To ask the Secretary of State forCommunities and Local Government what steps heplans to take to enable London councils to revise theirlocal development frameworks. [23025]

Robert Neill: All local planning authorities have aduty to keep their development plans under review andhave the power to revise them when they feel this isappropriate and beneficial for their area, taking accountof local circumstances.

Public Expenditure

Lisa Nandy: To ask the Secretary of State forCommunities and Local Government whether hisDepartment has established processes to monitor anyeffects of proposed reductions in its expenditure. [21639]

Robert Neill: The Department is following guidanceissued by the Government Equalities Office on publishingits Equality Impact Assessments as part of the spendingreview. The results of the assessments will be publishedin due course.

The Chancellor announced as part of the spendingreview in October that each Government Departmentwill publish a business plan setting out the details of itsreform plans. As required, the DCLG business plan willinclude key indicators against which we will publishdata to show the cost and impact of departmentalactivities. The indicators will be published for consultationto ensure that we have the most relevant and robustindicators in time for the beginning of the spendingreview period in April 2011.

Regeneration: Newcastle upon Tyne

Mr Nicholas Brown: To ask the Secretary of State forCommunities and Local Government what discussionshis Department has had with Newcastle city council onthe refurbishment of the Byker estate; and whatconsideration he has given to the recommendations ofthe report by Professor Peter Roberts. [22962]

Andrew Stunell: My Department together with theHomes and Communities Agency has held a number ofrecent meetings with representatives from Newcastlecity council, its ALMO Your Homes Newcastle, and theByker Steering Group. The aim of the meetings is todeliver, as Professor Peter Roberts’s report recommends,a sustainable long term future for the Byker estate. Theprimary focus of the discussions is to ensure that theproposed scheme is both deliverable and achieves valuefor money for Government.

Social Rented Housing

Ms Buck: To ask the Secretary of State for Communitiesand Local Government what proportion of new socialhousing tenants are in employment. [22096]

Andrew Stunell: Information on the number ofhouseholds receiving social housing is collected throughthe continuous recording of lettings form (CORE).Historically CORE has only collected information fromregistered social landlords, though a number of localauthorities are now also providing information throughthis process.

In 2008-09, 26% of new social housing tenants werein employment.

This figure relates to the main householder and isbased on the total number of new tenants in LA/RSLgeneral needs and supported housing in full-time orpart-time work expressed as a proportion of the totalwho provided their economic status.

Further information on social lettings is published inthe live tables at the following link:

http://www.communities.gov.uk/housing/housingresearch/housingstatistics/housingstatisticsby/rentslettings/livetables/

Ms Buck: To ask the Secretary of State for Communitiesand Local Government what estimate he has made ofthe average income of households in social housing ineach region in the latest period for which figures areavailable. [22100]

Andrew Stunell [holding answer 4 November 2010]:The following table shows the most recent estimates ofmedian and mean net (disposable) household incomefor social renters.

Disposable income is gross income less income tax,national insurance contributions, local government taxesand certain other deductions. The estimates have alsobeen “equivalised” for household size and composition.Income of households by region for the social rented sector, 2006-07 to

2008-09£ per week, 2008-09 prices

Region Median Mean

North East 280 303North West 289 307Yorkshire and theHumber

286 305

East Midlands 276 295West Midlands 287 307East of England 295 313London 308 304South East 308 291South West 297 296England 293 316Notes:1. The original source for these estimates is the Family ResourcesSurvey. The income measures used to derive the estimates employthe same methodology as the Department for Work and Pensionspublication ‘Households Below Average Income’ (HBAI) series,which uses disposable household income, adjusted (or “equivalised”)for household size and composition, as an income measure as aproxy for standard of living.2. Small differences should be treated with caution as these will beaffected by sampling error and variability in non-response.3. Three sample years have been combined as regional single yearestimates are subject to volatility.4. The figures are based on OECD equivalisation factors.5. Median household incomes are more commonly used in analysisas these are less affected by outliers.6. Incomes are presented in 2008-09 prices and have been rounded tothe nearest pound sterling.


Social Rented Housing: Eltham

Clive Efford: To ask the Secretary of State forCommunities and Local Government how many homesin Eltham constituency identified as eligible forimprovements under the Decent Homes programmehave not yet had such improvements made; and if hewill take steps to ensure that funding for such improvementsis made available to the London borough of Greenwich.

[23093]

Andrew Stunell: The available data applies to theLondon borough of Greenwich and there is no breakdownby constituency. At April 2010, 4,947 council homes inthe London borough of Greenwich did not meet thedecent homes standard. This is forecast to fall to 392 byApril 2011.

In the spending review, the Government announcedthat they will spend £1.6 billion on tackling non-decentcouncil housing. My Department and the Homes andCommunities Agency will be consulting local authoritieson the process for allocating capital funding shortly.

UN Convention on the Rights of Persons withDisabilities

Andrew George: To ask the Secretary of State forCommunities and Local Government what steps hisDepartment is taking to implement obligations underArticles 9, 11 and 19 of the United Nations Conventionon the Rights of Persons with Disabilities in relation tohis Department’s policy responsibilities. [21128]

Grant Shapps: The Department for Communities andLocal Government is committed to the UN conventionon rights of persons with disabilities and to improvingoutcomes for disabled people. The Department is currentlyfurther considering its responsibilities against theexpectations of the convention, and the UK report tothe UN next year will describe how implementation isbeing achieved.

A number of measures exist or are being taken forwardby DCLG which support various convention articles,for example:

Part M (Access to and use of buildings) of the BuildingRegulations sets out a series of requirements to ensure thatreasonable provision is made to meet the needs of disabledpeople where building work is undertaken in both commercialand residential buildings. In order to support delivery of moreaccessible and adaptable housing the Lifetime Home Standardwill remain an important element of the Code for SustainableHomes.

The allocation legislation provides that people who need tomove house on medical and welfare grounds, including groundsrelating to a disability, must be given ‘reasonable preference’(i.e. priority) for social housing.

Home Ownership for people with Long-term Disabilities (HOLD)is a shared ownership scheme, to help those whose needs arenot met elsewhere.

The Disabled Facilities Grant provides the funding to helpdisabled and older people to make adaptations so they cancarry on living in their own homes.

The spending review 2010 announced that the reform of thecouncil housing finance system will build in the resourcesneeded to carry out future disabled housing adaptations requiredin the council housing stock.

TREASURY

Child Benefit

Stephen Twigg: To ask the Chancellor of the Exchequerwhat estimate he has made of the number of householdsin (a) Liverpool, West Derby constituency, (b) Liverpooland (c) the UK to be affected by his proposed changesto the administration of child benefit. [22857]

Mr Gauke: Information on household income forchild benefit claimants is not available at parliamentaryconstituency or city level.

Child Benefit: Durham

Pat Glass: To ask the Chancellor of the Exchequer ifhe will estimate the number of households in NorthWest Durham constituency which will be affected bythe proposed withdrawal of child benefit from familieswith a higher rate taxpayer. [22595]

Mr Gauke: Information on household income forchild benefit claimants is not available at parliamentaryconstituency level.

Departmental Public Expenditure

Lisa Nandy: To ask the Chancellor of the Exchequerwhether his Department has established processes tomonitor any effects of proposed reductions in itsexpenditure. [21632]

Justine Greening: “Spending Review 2010” (Cm 7942)sets out details of the spending settlement for HMTreasury which will achieve overall resource savings of33% in real terms by 2014-15. In line with all Departments,Treasury has published a business plan and will reportpublicly against the plan.

Directors: Fraud

Helen Jones: To ask the Chancellor of the Exchequerwhat mechanism he has put in place to prevent individualssetting up new businesses when their previous businesshas collapsed because of fraudulent activity. [23074]

Mr Davey: I have been asked to replyOur enforcement regime provides for the disqualification

of directors of a limited company which has enteredan insolvency procedure, if misconduct or reckless orfraudulent behaviour has been proved. A disqualificationorder prevents a person from acting in the managementof a limited company for a period of between two and15 years, depending on the seriousness of the misconduct.In 2009-10 more than five directors a day were disqualified.In addition, section 216 of the Insolvency Act 1986places restrictions on the re-use of a company name bythe same directors. Breach of the section is a criminaloffence.

If an individual wishes to set him or herself up inbusiness in their own name (i.e. not under the guises ofa limited company) then there are no restrictions inplace, unless the individual is bankrupt or a debt relieforder moratorium is in force.


National Insurance Contributions: New Businesses

Caroline Dinenage: To ask the Chancellor of theExchequer what his policy is on extending NationalInsurance exemptions on new jobs to areas of theSouth East which have low levels of employment andhigh levels of social deprivation. [23108]

Mr Gauke: The regional employer national insurancecontributions holiday for new businesses is targeted oncountries and regions within the UK where reliance onpublic sector employment is highest. For practical reasonsthe Government have no plans to introduce nationalinsurance contribution exemptions for smaller geographicalunits.

Official Cars: Expenditure

Hugh Bayley: To ask the Chancellor of the Exchequerhow much his Department has spent on the GovernmentCar Service since the Government took office. [7955]

Justine Greening: The Treasury spent £70,696 (includingspending in fulfilment of pre existing contractualcommitments) with the Government Car Service for allcar services for both Ministers and officials between12 May 2010 and 12 July 2010. In 2009-10, the Departmentspent £98,145 with the Government Car Service forboth Ministers and officials in an average two monthperiod.

Public Expenditure

Chi Onwurah: To ask the Chancellor of the Exchequerwhat the scale is on the vertical axis on the graph onpage 13 of the spending review 2010 document. [21842]

Justine Greening [holding answer 4 November 2010]:The vertical axis on chart 1.1 on page 13 of the spendingreview 2010 document starts at 33% of GDP and goesup to 49% of GDP. Each line on the vertical axisrepresents an additional 1% of GDP.

Public Expenditure: Scotland

Stewart Hosie: To ask the Chancellor of the Exchequerwhether he has had discussions with the Scottish Executiveon the future of end-year flexibility. [22042]

Danny Alexander: In the context of the Respect agenda,Treasury ministers meet with ministers from the ScottishGovernment from time to time to discuss issues ofcommon interest. The issue of EYF was discussed atthe most recent Finance Ministers Quadrilateral inSeptember.

Stewart Hosie: To ask the Chancellor of the Exchequerwhether the Scottish Executive will retain access toend-year flexibility throughout the comprehensive spendingreview period. [22043]

Danny Alexander: The spending review announcedthat the EYF scheme is being abolished at the end of2010-11, including all accumulated stocks, and replacedby a new system from 2011-12. In the context of developingthe new system the Government recognises the special

status of the Scottish Executive and the other devolvedadministrations. Further detail will be set out later thisfinancial year.

Public Sector: Females

Valerie Vaz: To ask the Chancellor of the Exchequerif he will undertake an assessment of the likely effectson women of anticipated reductions in the number ofjobs in the public sector in the next four years; and if hewill make a statement. [21768]

Danny Alexander: On 20 October 2010 the Treasurypublished an overview of the impact of the spendingreview on men and women, people from ethnic minoritiesand people with disabilities.

It will be for individual employers to determine theexact work force implications of their settlements. It isthe responsibility of departments to ensure that equalityissues are considered when assessing options for spendingreductions.

Tax Allowances: Breweries

Dr Thérèse Coffey: To ask the Chancellor of theExchequer what plans he has for future duty reliefarrangements for small breweries. [22265]

Justine Greening: Breweries producing less than 60,000hectolitres per annum continue to benefit from a reducedrate of duty under the small breweries relief that wasintroduced in 2002.

Decisions about tax policy are a matter for the Chancelloras part of the Budget process.

HOME DEPARTMENT

Antisocial Behaviour Orders: Northumberland

Ian Lavery: To ask the Secretary of State for theHome Department how many antisocial behaviour ordershave been (a) made and (b) breached in (i) Wansbeckconstituency and (ii) Northumberland in the latest periodfor which figures are available. [22928]

James Brokenshire: Data collected centrally by theMinistry of Justice on the number of antisocial behaviourorders (ASBOs) issued and breached are collated atcriminal justice system (CJS) area level, rather thanconstituency or county area level. Northumberland whichincludes Wansbeck is in the Northumbria CJS area.

The latest figures cover the period to 31 December2008, and show that for the Northumbria CJS area37 ASBOs were issued and 29 were proved in court tohave been breached for the first time in 2008.

Antisocial Behaviour Orders: Peterborough

Mr Stewart Jackson: To ask the Secretary of State forthe Home Department how many antisocial behaviourorders were (a) made and (b) breached in the CriminalJustice System area covering the Peterborough city councilarea in each year since 2005; and if she will make astatement. [22914]


James Brokenshire: Data collected centrally by theMinistry of Justice on the number of antisocial behaviourorders (ASBOs) issued and breached is collated at CriminalJustice System (CJS) area level.

The latest figures cover the period to 31 December2008, and show that for the Cambridgeshire CJS area,which includes Peterborough city council area:

in 2005, 50 ASBOs were issued, and 13 were proved in court tohave been breached for the first time;in 2006, 31 ASBOs were issued, and 14 were proved in court tohave been breached for the first time;in 2007, 20 ASBOs were issued, and 13 were proved in court tohave been breached for the first time; andin 2008, 34 ASBOs were issued, and 13 were proved in court tohave been breached for the first time.

Antisocial Behaviour: Crime Prevention

Mr Ainsworth: To ask the Secretary of State for theHome Department whether her Department has madean assessment of the effectiveness of Mosquito devicesin reducing antisocial behaviour. [22784]

James Brokenshire: The Mosquito device is a commercialproduct and is not endorsed by the Home Office or theAssociation of Chief Police Officers.

This Government believe that it is for local agenciesdealing with antisocial behaviour to decide whether ornot to use the Mosquito device in their area and toundertake any appropriate assessments. The Home Officehas not undertaken its own assessment.

Crime: Summertime

Rebecca Harris: To ask the Secretary of State for theHome Department what assessment she has made ofthe potential effects on the incidence of crime ofadopting daylight saving time. [22764]

James Brokenshire: My right hon. Friend the HomeSecretary has not made any assessment of the potentialeffects of adopting daylight saving time on the incidenceof crime.

Entry Clearances: Taiwan

Richard Fuller: To ask the Secretary of State for theHome Department if she will bring forward proposalsfor a Working Holiday Scheme with Taiwan to increasecultural understanding between the UK and Taiwan;and if she will make a statement. [22196]

Damian Green: We operate a Youth Mobility Schemefor the purpose of cultural exchanges between youngpeople. To qualify, a country needs to meet certaineligibility criteria. It is open to any country whichbelieves it meets the criteria for acceptance on thescheme to enter into discussions with us about reciprocalarrangements.

The eligibility criteria relate to:(a) a low level of immigration risk and not being a countrysubject to a mandatory UK visa regime;

(b) satisfactory returns arrangements; and

(c) reciprocal opportunities for UK nationals.

Illegal Immigrants: East Ayrshire

Cathy Jamieson: To ask the Secretary of State for theHome Department how many illegal immigrants to theUK have (a) been identified in and (b) deported fromKilmarnock and Loudoun constituency in the latestperiod for which figures are available. [22959]

Damian Green: The UK Border Agency is unable tospecify where an individual was encountered when theywere served papers as an illegal immigrant. It is onlypossible to report on their last known address and theircurrent immigration status.

Between 1 October 2009 and 30 September 2010, 10individuals were identified as illegal immigrants residingin the Kilmarnock and Loudoun constituency. Duringthis period, nine illegal immigrants resident in Kilmarnockand Loudoun were removed from the United Kingdom.

All figures quoted are internal management informationonly and are subject to change. This information hasnot been quality assured under National Statistics protocols.

Immigration Controls: English Language

Gavin Shuker: To ask the Secretary of State for theHome Department (1) when her Department notifiedaccreditation boards of proposals to change Englishfor Speakers of Other Languages requirements for (a)indefinite leave to remain and (b) application forregularisations and nationalisation as British citizens;

[22775]

(2) which (a) accreditation boards and (b) otherorganisations she consulted on the English for Speakersof Other Languages requirements for (i) indefinite leaveto remain and (ii) application for regularisations andnationalisation as British citizens prior to laying thestatement of Changes in Immigration Rules before theHouse on 18 March 2010. [22776]

Damian Green: There was not a formal consultationon the changes introduced by the previous Government.The accreditation bodies were sent copies of the revisedguidance on 13 April and the UK Border Agencycontinues to work with them to ensure the policy isimplemented.

Intercept Modernisation Programme

Mr David Davis: To ask the Secretary of State for theHome Department what arrangements she plans tomake to safeguard the privacy of individuals under thecontinued intercept modernisation programme. [20754]

Nick Herbert [holding answer 1 November 2010]:Access to communications data is primarily regulatedby the Regulation of Investigatory Powers Act (RIPA),which places strict rules on when, and by whom, thedata can be accessed. The use of communications datais also regulated by the Data Protection Act and theHuman Rights Act. Data are disclosed only on a case-by-case basis to designated public authorities understrict safeguards which require that the disclosure isnecessary and proportionate to the lawful purpose ofan investigation. We will legislate to ensure that theprogramme accords with the Government’s approachto civil liberties.


Mr David Davis: To ask the Secretary of State for theHome Department whether she plans to bring forwardlegislative proposals to provide that data stored byservice providers under the intercept modernisationprogramme will be accessible only on presentation of awarrant; and if she will make a statement. [20755]

Nick Herbert [holding answer 1 November 2010]: Asmade clear in the strategic defence and security review,the Government will continue to build on an existingprogramme of work to preserve the ability of the lawenforcement, security and intelligence agencies to obtaincommunications data and to intercept communicationswithin the appropriate legal framework. We will legislateto ensure this is compatible with the Government’sapproach to civil liberties and use of communicationscapabilities. Details of this legislation will be announcedin Parliament in due course.

Khat

Jeremy Corbyn: To ask the Secretary of State for theHome Department (1) whether her Department isconsidering the classification of khat under the Misuseof Drugs Act 1971; and if she will make a statement;

[22817]

(2) what recent discussions she has had with theAssociation of Chief Police Officers on the implicationsfor public order of the use of khat. [22820]

James Brokenshire: In line with the Advisory Councilon the Misuse of Drugs’ (ACMD) statutory duty underthe Misuse of Drugs Act 1971, I have written to theACMD asking for it to review the available evidencerelating to the harms of khat and provide advice, inrelation to both control, under the Misuse of Drugs Act1971, and a wider response.

I have had a number of meetings and discussionswith representatives of the Association of Chief PoliceOfficers (ACPO). These discussions have not, to date,covered the issue of khat.

Proceeds of Crime

Guy Opperman: To ask the Secretary of State for theHome Department what plans she has to increase theproportion of criminal assets which are recovered.

[19736]

James Brokenshire: The Government are committedto improving overall performance on recovering assetsfrom criminals. We are already encouraging the full andefficient use of the existing powers, in particular underthe Proceeds of Crime Act 2002, and will provide moredetail of our plans to further disrupt criminal financesin due course.

Mr Crausby: To ask the Secretary of State for theHome Department who is responsible for meetingexpenses incurred through operations to recover moneyunder the provisions of the Proceeds of Crime Act2002. [23012]

James Brokenshire: Law enforcement agencies meetcosts of recovering criminal assets from within theirbudgets. However they also receive a share of the moneythey recover under the Proceeds of Crime Act as part ofthe Asset Recovery Incentivisation Scheme.

Receivers who manage and realise assets to satisfyorders made under the Proceeds of Crime Act meettheir remuneration and expenses from the assets thatthey manage and sell.

The Home Office also directly funds nine multi-agencyRegional Asset Recovery Teams at a cost of £10.5 millionper annum, which assist agencies to recover moneyunder the provisions of the Proceeds of Crime Act.

Mr Crausby: To ask the Secretary of State for theHome Department on average what proportion of themoney recovered through the Proceeds of Crime Act2002 which was allocated to the police force thatcarried out the recovery in the latest period for whichfigures are available. [23013]

James Brokenshire: Under the current Asset RecoveryIncentivisation Scheme 50% of all money recoveredunder the Proceeds of Crime Act is returned to front-linepartners. How these funds are distributed will dependon the relevant part of the Act that is used.

For confiscation orders, the relevant police force receives18.75% of money recovered with 18.75% being returnedto the relevant prosecutor and 12.5% being returned toHer Majesty’s Courts Service.

For money recovered through the cash forfeitureroute, the relevant police force receives the full 50% ofthe total collected.

Strategic Defence and Security Review

Mr David Davis: To ask the Secretary of State for theHome Department what consultation she undertookprior to the announcement on the continued use of theintercept modernisation programme as part of theStrategic Defence and Security Review. [20753]

Nick Herbert [holding answer 1 November 2010]: Asmade clear in the strategic defence and security review,the Government will continue to build on an existingprogramme of work to preserve the ability of the lawenforcement, security and intelligence agencies to obtaincommunications data and to intercept communicationswithin the appropriate legal framework. We will legislateto ensure this is compatible with the Government’sapproach to civil liberties and use of communicationscapabilities. As part of this, the results of the 2009consultation on Communication Data were reviewed,advice from the law enforcement agencies and the securityand intelligence agencies were considered and discussionswith the Information Commissioner’s Office have beenongoing throughout this process.

UK Border Agency: Passports

Richard Fuller: To ask the Secretary of State for theHome Department how many passports the UKBorders Agency declared lost through its own actionsin 2009; and what the cost to the public purse was ofreplacing such documents. [21361]

Damian Green: Information relating to the number ofpassports the UK Border Agency (UKBA) declaredlost through its own actions in 2009 and the cost ofreplacing such documents is not currently recordedcentrally. UKBA is currently considering the most


appropriate way in which to improve the system it usescurrently to record such information and to minimisethe loss of documents in general and passports inparticular.

Vetting: Complaints

Amber Rudd: To ask the Secretary of State for theHome Department (1) on how many occasions adispute against the outcome of (a) a standard and (b)an enhanced Criminal Records Bureau check wasupheld in the latest period for which figures areavailable; [22695]

(2) on how many occasions the outcome of (a) astandard and (b) an enhanced Criminal Records

Bureau check was disputed by the subject of the checkin the latest period for which figures are available;

[22696]

Lynne Featherstone: The following tables detail abreakdown of how many times disputes against theoutcomes of a Standard and Enhanced Criminal RecordsBureau (CRB) were upheld since March 2010 to August2010 (Table A) and how many times the outcomes ofstandard and enhanced checks were disputed by thesubject of the check from 2009-10 to present (Table B).

An upheld dispute does not mean an individual hasbeen incorrectly associated with a criminal record. Theoutcome of an upheld dispute can involve the amendmentof a single word such as an individual’s name.

Table A—Upheld disputesCertificate type March 2010 April 2010 May 2010 June 2010 July 2010 August 2010 Total

Enhanced 205 164 135 158 189 108 959Standard 20 30 27 13 15 8 113Total 225 194 162 171 204 116 113

Table B—Dispute applicationsCertificatetype 2009-10 2010-11 Total

Enhanced 5,641 2,797 8,438Standard 1,386 523 1,909Total 7,027 3,320 10,347

Vetting: Standards

Amber Rudd: To ask the Secretary of State for theHome Department how many (a) standard and (b)enhanced Criminal Records Bureau checks took longerthan the respective guideline times in the latest periodfor which figures are available. [22697]

Lynne Featherstone: The Criminal Records Bureau(CRB) published service standards (PSS) are that 90%of enhanced CRB checks are issued within 28 days. TheCRB received 326,401 in the month of September 2010.Of these 238,402 (87% against the 90% PSS) wereprocessed within the PSS and 88,359 were issued outsidethe PSS by one day or more.

The length of time a CRB check can take to processcan include “time out with customer”. This occurswhen the CRB has to contact the registered body (RB)for additional information about the applicant, whenthe application form has not been completed correctlyor where the police require additional clarification aboutthe applicant’s identity. The CRB cannot continue toprocess the application until the RB provides thisinformation; or the applicant resolves any question ofidentity to the satisfaction of the police force.

There are a number of other factors that can affectthe timely completion of CRB checks, including but notrestricted to the length of time it can take for anemployer to deal with the initial application; the accuratecompletion of the application form; the clarity of theinformation provided; the existence of conviction ornon-conviction information; any ongoing or outstandingcriminal investigations or proceedings; where more thanone force holds relevant information and the operational

effectiveness of the disclosure units of the police forcesinvolved in the CRB checking process.

The CRB have been working with police forces throughjoint operational performance reviews, to address theproblems associated with delays and the impact thatexceptional demand for CRB checks can have on policeforces. The CRB has set up improvement plans withthose forces that have been having problems meeting thedemand for certificates. This is aimed at maintaining asteady output of applications on the system while alsoreducing the number of outstanding cases that havebeen with police forces for more than 25 days.

HEALTH

Blood: Contamination

Dr Phillip Lee: To ask the Secretary of State forHealth pursuant to the answer of 1 November 2010,Official Report, column 630W, on blood: contamination,(1) for what reasons his Department answered the13 requests made under the Freedom of InformationAct 2000 in part; and if he will place in the Library acopy of the responses his Department gave to thosewho submitted the requests; [22656]

(2) for what reasons his Department rejected orwithheld information in response to each of the eightrequests made under the Freedom of Information Act2000; and if he will place in the Library a copy of theresponses his Department gave to those who submittedthe requests. [22657]

Anne Milton: The Department will place a copy ofeach of the responses in the Library to the requests inwhich it either answered in part or withheld information.All enclosures accompanying the requests as answeredin part will be placed on the Department’s website at thefollowing address:

www.dh.gov.uk/en/FreedomOfInformation/Freedomofinformationpublicationschemefeedback/FOIreleases/index.htm


Of the 12 requests1 made under the Freedom ofInformation Act (FOIA) 2000 answered in part, informationwas withheld as exempt under the provisions of theFOIA from disclosure as follows2:

four instances withheld as exempt from disclosure underSection 12;two instances withheld as exempt from disclosure underSection 21;one instance withheld as exempt from disclosure underSection 22;one instance withheld as exempt from disclosure underSection 28;one instance withheld as exempt from disclosure underSection 32;one instance withheld as exempt from disclosure underSection 34;one instance withheld as exempt from disclosure underSection 35;one instance withheld as exempt from disclosure underSection 36;seven instances withheld as exempt from disclosure underSection 40; andone instance withheld as exempt from disclosure underSection 42.

Of the eight requests made under FOIA rejected orwithheld, information was withheld as exempt underthe provisions of the FOIA from disclosure as follows:

six instances withheld as exempt from disclosure underSection 12;one instance withheld as exempt from disclosure underSection 22; andone instance withheld as exempt from disclosure underSection 36.

Since 2007, over 5,500 documents relating tocontaminated blood and blood products have beenplaced on the Department’s website. Only five havebeen withheld because they contain personal information.If further documents from this period are identified,they will similarly be published.1 Pursuant to my previous answer, 1 November 2010, OfficialReport, column 630W, a further examination of the informationheld by the Department has identified that one request previouslyidentified as being “answered in part” does not relate to thecontamination of blood products during the 1970s and 1980s.2 In some instances more than one exemption applied to therequested information.

CJD: Drugs

Jeremy Corbyn: To ask the Secretary of State forHealth what guidance his Department provides tohealth authorities on the use of pentosan polysulfatefor the treatment of Creutzfeldt-Jakob disease; and ifhe will make a statement. [22818]

Anne Milton: The Department has issued no guidanceon the use of pentosan polysulphate to treat variantCreutzfeldt-Jakob disease (vCJD). Pentosan polysulphateis not licensed for the treatment of vCJD, therefore itsuse for this purpose is a clinical decision.

Jeremy Corbyn: To ask the Secretary of State forHealth what estimate he has made of the (a) numberof doses prescribed and (b) cost to the public purse ofprovision of pentosan polysulfate in each of the lastfive years. [22819]

Mr Simon Burns: The information collected by theDepartment does not describe the use of medicines interms of doses or indicate the medical condition beingtreated. The following table shows the number prescriptionitems for pentosan polysulfate tablets, written in theUnited Kingdom or the Isle of Man and dispensed inthe community, in England, together with the correspondingphysical quantity of tablets, measured in milligrams,and net ingredient cost (NIC).

Items(Thousand)

Tablets(Thousand)

Milligrams(Thousand)

NIC(£000)

2005 0.3 45.4 4,247.6 63.02006 0.3 39.5 3,748.4 70.32007 0.2 31.6 2,968.9 72.02008 0.3 36.4 3,643.9 84.82009 0.3 34.8 3,476.8 155.2Source:Prescription Cost Analysis (PCA) system.

Use of this drug in hospitals is limited and only thetopical form appears in the data. Figures cannot begiven under the agreement with the data suppliers.

Departmental Redundancy

Ms Angela Eagle: To ask the Secretary of State forHealth what estimate he has made of the number ofredundancies arising from the spending reductions proposedin the comprehensive spending review in respect of (a)his Department and (b) its non-departmental publicbodies. [21563]

Mr Simon Burns: The Government have announcedthat administration costs will reduce by a third in realterms across the public sector, including the healthsector, and this was reaffirmed in the spending review.

This reduction in administration costs is expected tolead to some redundancies. However the number ofredundancies will be closely affected by how the one-thirdreduction will be distributed across all organisations inthe health sector, including primary care trusts, strategichealth authorities, the Department and its arm’s lengthbodies; and to what extent staff numbers and costs inall these bodies reduce through natural wastage orredeployments.

Therefore we cannot know for certain at this stagewhat number of redundancies will arise in each organisationacross the health sector.

Ms Angela Eagle: To ask the Secretary of State forHealth what estimate he has made of the cost to hisDepartment of staff redundancy in each of the nextfour years. [21564]


This reduction in administration costs is expected tolead to some redundancies. However the number ofredundancies will be closely affected by how the one-thirdreduction will be distributed across all organisations inthe health sector, including primary care trusts, strategichealth authorities, the Department and its arm’s length


bodies; and to what extent staff numbers and costs inall these bodies reduce through natural wastage orredeployments.

We intend to set out estimates of the cost of redundanciesassociated with the reduction in administration andmanagement costs in an impact assessment.

Doctors: Career Development

Julie Hilling: To ask the Secretary of State for Healthwhat steps he plans to take to (a) attract and (b) retaingood quality junior doctors in the NHS during thespending review period. [22732]

Anne Milton: Management of recruitment topostgraduate medical training is coordinated nationallythrough the Medical Programme Board of MedicalEducation England in partnership with Royal Colleges,deaneries, lead employers, the United Kingdom FoundationProgramme Office and the General Practice NationalRecruitment Office. These arrangements have provedsuccessful with high fill rates high for most specialties.Medical training is highly competitive with large numbersof doctors competing for vacancies each year. Sometrainees do leave training programmes for a variety ofreasons, but there is no evidence that this is an increasingtrend.

For the longer term, the Department has committedto publishing a consultation on proposals for educationand training, based on the principles in the White Paper.

Julie Hilling: To ask the Secretary of State for Healthwhat mechanisms will be put in place to ensureeffective continuing training for doctors following thetermination of primary care trusts. [22738]

Anne Milton: The Department has committed topublishing a consultation on proposals for educationand training, based on the principles in the White Paper‘Equity and Excellence: Liberating the NHS’.

Drugs: Rehabilitation

Patrick Mercer: To ask the Secretary of State forHealth whether he plans to allow naltrexone to beadministered to prisoners for the purposes of treatingsubstance abuse. [22646]

Paul Burstow: Naltrexone is formally permitted in alladult prisons for the treatment of adult prisoners. Guidanceon its use was included in the clinical guidance issued bythe Department in 2006: ‘Clinical management of drugdependence in the adult prison setting includingpsychological treatment as a core part’. It is not licensedfor treating young offenders.

Naltrexone is also supported for use in the community.Clinical guidelines were issued jointly by the Departmentand the devolved Administrations in 2007: ‘Drug Misuseand dependence: UK Guidelines on Clinical Management’.

Copies of both guidelines have already been placed inthe Library.

Health Services: Greater Manchester

Julie Hilling: To ask the Secretary of State for Healthwhat estimate he has made of the likely effect on thenumber of NHS (a) frontline staff and (b) junior

doctors working in Bolton, Bolton West and GreaterManchester areas of the outcomes of the comprehensivespending review. [22739]

Mr Simon Burns: The Government have already signalledtheir commitment to real year-on-year increases in fundingand the need to protect front line services.

Making highly skilled, professional staff redundantdoes not make the best use of limited national healthservice resources—nor does it benefit patients. Therefore,it should be considered only when all other optionshave been exhausted.

It is local health care organisations, with their knowledgeof the health care needs of their local populations, thatare best placed to determine the work force required todeliver safe patient care within their available resources.

Khat

Jeremy Corbyn: To ask the Secretary of State forHealth what research his Department has (a) commissionedand (b) evaluated on the health effects of the use ofkhat. [22816]

Anne Milton: In March 2005 the Advisory Councilon the Misuse of Drugs (ACMD) was asked to assessthe extent of the harm posed by khat use in the UnitedKingdom, to the individual, their communities and tosociety as a whole.

The ACMD reported in January 2006.In October of this year, the Government asked the

ACMD to undertake a comprehensive review of theavailable evidence, to update its assessment and providethe Government with advice.

Kidney Dialysis

Ian Lavery: To ask the Secretary of State for Healthwhich primary care trusts provide kidney dialysis; andhow many NHS patients have received dialysis treatmentin the last 12 months. [22927]

Mr Simon Burns: Information is not available inthe format requested. Kidney dialysis is a specialisedservice which is commissioned by regional specialisedcommissioning groups on behalf of primary care trusts.Dialysis services are provided by 52 renal units in Englandand their satellites and may be provided at home forsuitable patients. There is a list of the United Kingdomrenal units on the Renal Association website at:

www.renal.org/whatwedo/InformationResources/RenalUnits.aspx

and the UK Renal Registry publishes an annual reportwhich includes data on incidence and prevalence ofpeople on dialysis. In December 2008, the latest date forwhich figures are available, 20,913 patients were receivingdialysis in England.

Mental Health Services: Prisons

Mr Charles Walker: To ask the Secretary of State forHealth what services are available in prisons for thepurposes of offering employment support to prisonerswith mental health disorders; and what steps he plansto take to ensure the NHS Outcomes Framework


encourages prison health services to support moreex-offenders into paid employment following theirrelease from prison. [22658]

Mr Blunt: I have been asked to reply.There is considerable employment support work

undertaken to help prisoners across the NOMS estate.Much of this is undertaken in partnership with theDepartment for Business Innovation and Skills as wellas the Department of Work and Pensions. This supportapplies to all prisoners and takes into account individual’scircumstances—including mental health issues.

NOMS is a co-financing organisation and can drawdown European funding. The first round of this funding—which lasts until December 2011 has a target that 46%of participants should have a learning disability/difficultiesand offenders with these issues will continue to be givenprominence in delivery during round 2 (January 2011 toDecember 2014) although the target will be regionaland not national. There is no specific mental healthprovision in round 1 for participants with mental healthissues, although there may be specific support containedin delivery plans from providers in round 2.

The Government will publish their response to theNHS Outcomes Framework consultation shortly. However,the primary purpose of the NHS Outcomes Frameworkwill be to focus on health outcomes, delivered by thenational health service through treatment and healthcare.

Neuromuscular Diseases: Health Services

Mr Anderson: To ask the Secretary of State for Health(1) what plans he has for the delivery of specialistneuromuscular services under the proposed nationalcommissioning board; [22716]

(2) what steps he plans to take to ensure thatneuromuscular services improve during the period inwhich his proposals for the reform of the NHS areimplemented; [22717]

(3) what plans he has for the future of the NHSregional specialised commissioning groups; and if hewill make a statement; [22718]

(4) what guidelines his Department has issued toNHS regional specialised commissioning groups oninvestment in specialist neuromuscular services for thepurposes of reducing the level of unplanned emergencyadmissions to hospital for people with neuromuscularconditions. [22719]

Paul Burstow: The White Paper sets out our futureintentions for the commissioning of specialised services.It proposes that specialised services, including some forpeople with neuromuscular conditions, will in future becommissioned by the NHS Commissioning Board.

The White Paper makes it clear that general practitioner(GP) consortia will work closely with secondary care,community partners and other health and care professionalsto design joined-up services that are responsive to patientsand the public. Commissioning by GP consortia willenable the redesign of care pathways to reflect the needsof their patients, which ultimately will lead to the moreeffective management of long-term neuromuscularconditions.

The future plans for specialised commissioning groupsare currently under consideration as part of the WhitePaper consultation. The consultation closed on 11 Octoberand we are currently analysing the responses. We willrespond to the consultation in due course.

No guidelines have been issued to specialisedcommissioning groups for the purposes of reducingunplanned emergency admissions to hospital for peoplewith neuromuscular conditions.

NHS: Redundancy

Ms Angela Eagle: To ask the Secretary of State forHealth if he will make an estimate of the likely cost tothe NHS of staff redundancy as a result of thespending reductions proposed in the comprehensivespending review. [21577]


This reduction in administration costs is expected tolead to some redundancies. However the number ofredundancies will be closely affected by how the one-thirdreduction will be distributed across all organisations inthe health sector, including primary care trusts, strategichealth authorities, the Department and its arms’ lengthbodies; and to what extent staff numbers and costs inall these bodies reduce through natural wastage orredeployments.

We intend to set out estimates of the cost of redundanciesassociated with the reduction in administration andmanagement costs in an impact assessment.

NHS: Voluntary Organisations

Julian Smith: To ask the Secretary of State for Healthwhat role he expects voluntary sector organisations toplay in the future of the NHS. [22518]

Paul Burstow: Voluntary organisations will continueto make a vital contribution to health and care, not onlyas the providers of services but also as advocates, partnersin the co-design of services and involving and engaginglocal communities.

Voluntary organisations have valuable expertise, insightand experience that can improve local public services,often for the most excluded people in our communities.The voluntary sector is well placed to supportcommissioners in developing needs assessments andcommissioning guidelines.

Current examples of voluntary sector involvementinclude Mumsnet who have been particularly valuablein helping to shape maternity services and TurningPoint on the Connected Care Audit.

The Department is exploring a range of options toensure that we can maximise the potential contributionof the voluntary sector. We plan to ensure thatcommissioners and providers across health care, publichealth and social care are able to harness the potentialrole of voluntary sector organisations in communities—helping to build strong and resilient communities aspart of the big society.


Commissioning consortia will be able to decide whichcommissioning activities they undertake for themselvesand where they will choose to buy in expertise andsupport from external organisations, including fromvoluntary sector organisations. Voluntary organisationscould potentially strengthen the process of public andpatient engagement and needs assessment through theirknowledge and understanding of local people’s needs.

As part of the reforms, we aim to free up provision ofhealth care, so that in most sectors of care, any willingprovider can provide services that meet national healthservice standards within NHS prices, giving patientsgreater choice and ensuring effective competition stimulatesinnovation, improves quality and increases productivity.We will look across government and public procurementto make sure that charities, voluntary organisations andsocial enterprises have maximum opportunities to offerhealth and care services.

We are committed to promoting continuous improvementin the quality of services for patients and greateropportunities for the involvement of voluntary providersin offering more responsive and personalised services.

We are aware that this period of transition will beworrying for voluntary organisations. We are keen,therefore, that primary care trusts (PCTs) engage withall of their stakeholders during this transition period.This includes working in close partnership with allorganisations that they hold funding agreements withthrough both grant and contract arrangements, recognisingthe principles of the Compact.

It is vitally important that we do not lose vital localservices that achieve high quality outcomes and we willtherefore work with PCT’s in the transition to the newarrangements with the NHS Commissioning Board andgeneral practitioner commissioning consortia, as theydevelop, to ensure that the sector’s contribution toimproved health, public health and social care is recognised.

Prescriptions: Fees and Charges

Huw Irranca-Davies: To ask the Secretary of State forHealth what progress he has made on the phasing out ofprescription charges for patients with long-term conditionsfollowing the outcome of the comprehensive spendingreview; and if he will make a statement. [23095]

Mr Simon Burns: I refer the hon. Member to thewritten answer I gave on 25 October 2010, OfficialReport, column 126W, to the hon. Member for Hartlepool(Mr Wright).

Social Services: West Sussex

Peter Bottomley: To ask the Secretary of State forHealth if he will meet West Sussex county council’scabinet members for adults’ services and future financeand resources to discuss the likely effects of demographicchanges in West Sussex on (a) the provision of and (b)eligibility for adult social care in that area. [22560]

Paul Burstow: The spending review recognises theimportance of social care in protecting most vulnerablein society. In recognition of the pressures on the socialcare system in a challenging local government settlement,the coalition Government have allocated an additional£2 billion by 2014-15 to support the delivery of social

care. This means, with an ambitious programme ofefficiency, that there is enough funding available both toprotect people’s access to services and deliver newapproaches to improve quality and outcomes.

We have achieved this by:the national health service transferring some funding from thehealth capital budget to health revenue, to be spent on measuresthat support social care, which also benefits health. This fundingwill rise to £1 billion in 2014-15, and will promote improvedjoint working between the health and social care systems.Further details will be set out in the NHS Operating Framework2011-12; andadditional grant funding, rising to £1 billion by 2014-15, willbe made available for social care. This funding will be allocatedin addition to the Department’s existing social care grants,which will rise in line with inflation. Total grant funding fromthe Department for social care will reach £2.4 billion by2014-15. In order to support local flexibility and to reduceadministrative burdens, this funding will go to authoritiesthrough the revenue support grant.

I recently attended the National Children and AdultSocial Care Conference where I met with 11 membersand directors of Adult Social Care to discuss the impactof the Government’s decision to prioritise social care inthe spending review.

Pressures on my diary mean that I am unable toaccept the request for a meeting, but if the hon. Memberor representatives from West Sussex county councilhave any questions about the spending review settlement,I would welcome correspondence on this matter.

BUSINESS, INNOVATION AND SKILLS

Apprentices

Robert Halfon: To ask the Secretary of State forBusiness, Innovation and Skills pursuant to the answerof 18 October 2010, Official Report, columns 595-6W,on apprentices, if he will publish the feedback providedby the Apprenticeship Ambassador Network since2006; and what steps (a) current Ministers, (b)previous Ministers and (c) the Skills Funding Agencyand its predecessor organisations have taken as a resultof advice from the Network. [23045]

Mr Hayes: The primary role of the ApprenticeshipAmbassadors Network (AAN) is to promote greateremployer engagement with apprenticeships. I welcomethe contribution which the AAN gives to the apprenticeshipprogramme, both as our eyes and ears in respect of thequality of apprenticeships and the delivery system; andas ambassadors to encourage others to offer apprenticeships.

In this time of fiscal restraint, it is both importantand powerful to have such blue chip businesses andbusiness leaders championing apprenticeships to employers,and therefore the role of the AAN becomes increasinglyimportant. The AAN has provided valuable advice andfeedback to Ministers and others since its creation in2006. Issues covered have included:

the skills strategy and the contribution of apprenticeships;apprenticeship framework design, content and levels ofqualification;careers advice and guidance;reducing bureaucracy;diversity;pay;role and function of the National Apprenticeship Service;


online vacancy matching service; andprogression to HE.

This is achieved through Ministers attending AANmeetings at which employer engagement and policyissues are discussed, Ministers and senior officials speakingat events hosted by members, correspondence and meetingson specific issues and the AAN responding to BIS andother consultation exercises. The feedback of the AANhelps to ensure that the programme is fit for purpose,that numbers increase and quality continues to improve.

The AAN has also commissioned work in two importantareas to inform the policy debate; the net benefit toemployer investment in apprenticeships (IER 2008) anda comparative international study of apprenticeships(CEP, 2010). These reports, alongside details of theAAN’s work and membership, minutes of meetings,consultation responses, letters and speeches are all publishedon the AAN website: www.employersforapprentices.gov.uk.I am happy for this to include correspondence betweenmyself and the AAN in the future.

CJD: Research

Jeremy Corbyn: To ask the Secretary of State forBusiness, Innovation and Skills for what researchprojects into Creutzfeldt-Jakob disease the MedicalResearch Council has provided funding in each of thelast three years; and what the outcomes of thoseprojects were. [22954]

Mr Willetts: The Medical Research Council (MRC)has funded basic research into transmissible spongiformencephalopathies (TSEs) including Creutzfeldt Jakobdisease (CJD) since the late 1970s. The MRC continuesto fund research across the spectrum from basic biologicalstudies through to applied clinical research.

In the last three years, MRC expenditure on TSE wasas follows:

2007/08: £6.8 million

2008/09: £8.9 million

2009/10 : £9.9 million.

Much of this research is conducted by the MRCPrion Unit, an international centre of excellence focussingprincipally on human prion disease, as well as throughother TSE researchers working in universities throughoutthe UK. As this research is still ongoing, it is too earlyto report on outcomes. MRC welcomes proposals in allareas of TSE research and particularly in the developmentof new diagnostic tests and therapeutics. In addition,MRC encourages TSE research that may also inform onthe basic mechanisms of other neurodegenerative disorders.

A list of the relevant research projects that havereceived MRC funding, between 2007/8 and 2009/10 isbelow. Further information on these projects, as well asother research supported by the MRC can be found at:

http://www.mrc.ac.uk/ResearchPortfolio/index.htm

Reference Principal investigator Research organisation Research project

G0301136 Professor V H Perry University of Southampton Prion strains and behaviour

G0501636 Dr V 0 Connor University of Southampton Molecular and cellular basis of synapticdysfunction in the ME7 model of prion disease(TSE highlight)

G0600953 Professor J Ironside University of Edinburgh The NCJDSU Tissue Resource: support forcontinued banking activities

G0700640 Professor J Manson BBSRC Roslin Institute Assessing the risk of transmission of vCJD viablood transfusion and identifying potential fordiagnosis and prevention

G0700877 Dr S Tabrizi Institute of Neurology Cellular mechanisms of prion-mediatedneurodegeneration

G0701068 Mrs C F Farquhar University of Edinburgh Refining the clinical use of pentosan polysulphatefor TSEs: animal models of intravenous infectionand intervention

G9824728 Professor N Hooper University of Leeds Amyloid precursor protein and prion protein:cellular functions, processing and roles inneurodegeneration

G0802189 Professor N M Hooper University of Leeds Alzheimers and prion diseases: cellular and geneticmechanisms of neurodegeneration

G0900580 Professor J Ironside University of Edinburgh The NCJDSU Tissue Resource: support forcontinued banking activities

U105260794 Professor S M Bird MRC Biostatistics Unit Transmissible disease epidemiology and statisticalscience in public health, criminal justice andperformance monitoring

U122886350 Professor J Collinge MRC Clinical Trials Unit Communicable diseases - human prion disease andmalaria

U123160651 Dr S Mead MRC Prion Unit Human molecular genetics and bioinformatics

U123160652 Dr S E Lloyd MRC Prion Unit Prion genetic modifiers in the mouse

U123160653 Dr E A Asante MRC Prion Unit Transgenic modelling of human prion diseases,intermammalian transmission barriers andassessing candidate therapeutics

U123160654 Professor G Mallucci MRC Prion Unit Normal cellular function of PrP: study of PrP nullmice and conditional gene expression studies

U123160655 Dr J Wadsworth MRC Prion Unit Molecular and phenotypic analysis of humanprion strains


Reference Principal investigator Research organisation Research project

U123160656 Professor A R Clarke MRC Prion Unit Structural studies of prion proteins and theirligand interactions

U123160657 Professor M Alpers MRC Prion Unit Kuru Field Studies in Papua New GuineaU123170362 Dr G S Jackson MRC Prion Unit Molecular diagnostic strategies in prion diseaseU123182016 Dr P Klein MRC Prion Unit Cellular mechanisms of prion propagationU123192748 Professor J Collinge MRC Prion Unit Prion kinetics, toxicity and synthesis and its wider

relevanceU132692719 Professor G Mallucci MRC Toxicology Unit In vivo models of disease and toxicity in the

nervous system

EU Grants and Loans

George Eustice: To ask the Secretary of State forBusiness, Innovation and Skills what discussions he hashad with his EU counterparts on future arrangementsfor the administration of payments out of EUStructural Funds. [22538]

Mr Prisk [holding answer 9 November 2010]: To dateI have not had any direct discussions with my EUcounterparts on future arrangements for the administrationof payments out of EU structural funds. In England,the Department for Work and Pensions has operationalresponsibility for the European social fund and theDepartment for Communities and Local Governmenthas operational responsibility for the European regionaldevelopment fund.

Higher Education: Admissions

Jon Trickett: To ask the Secretary of State for Business,Innovation and Skills how many (a) applicants and (b)successful applicants from each socio-economic groupthere were for places on undergraduate degree coursesto study (i) medicine, (ii) accounting, (iii) law, (iv)veterinary medicine, (v) engineering and (vi) dentistryat universities in England in each year since 2001.

[22143]

Mr Willetts: The latest information, which has beenprovided by the Universities and Colleges AdmissionsService (UCAS), is given in the table. The NationalStatistics Socio-economic Classification (NS-SEC) wasintroduced in 2002. UCAS have not released NS-SECdata for 2009 entry. Final figures for 2010 entry will beavailable in January 2011.

UK domiciled applicants and accepted applicants to institutions in England by subject and National Statistics Socio-Economic Classification (NS-SEC),years of entry 2002 to 2008

2002 2003 2004 2005

Subject NS-SEC ApplicantsAcceptedapplicants Applicants

Acceptedapplicants Applicants


Acceptedapplicants

A1—Pre-clinicalmedicine

1. Highermanagerial andprofessionaloccupations

3,486 2,093 4,107 2,198 4,710 2,266 4,788 2,067

2. Lowermanagerial andprofessionaloccupations

2,347 1,219 3,057 1,403 3,647 1,471 3,769 1,353

3. Intermediateoccupations

924 513 1,123 534 1,388 554 1,432 533

4. Small employersand own accountworkers

374 166 447 220 552 205 569 211

5. Lowersupervisory andtechnicaloccupations

160 79 246 102 316 108 267 89

6. Semi-routineoccupations

619 269 727 303 1,049 386 1,192 363

7. Routineoccupations

225 97 260 107 301 86 295 84

Unknown 1,302 561 2,091 747 2,414 679 3,547 996

A2—Pre-clinicaldentistry


467 215 485 205 544 215 646 251


395 177 432 167 483 173 525 192


170 59 183 69 196 69 261 99



2002 2003 2004 2005




Acceptedapplicants


104 35 124 39 137 35 138 48


51 18 55 20 59 14 65 16


123 56 150 54 186 51 222 72


54 20 39 7 71 24 68 12

Unknown 209 60 274 79 337 73 572 147

D1—Pre-clinicalveterinarymedicine


520 203 506 205 423 219 343 193


430 149 410 159 375 162 322 155


179 42 159 55 160 73 119 60


114 30 103 41 94 37 94 41


68 19 60 20 59 29 59 22


102 17 111 27 95 33 99 38


39 6 42 9 38 8 37 13

Unknown 113 42 152 41 135 53 243 113

H—Engineering 1. Highermanagerial andprofessionaloccupations

5,950 2,576 5,603 2,408 5,492 2,460 5,251 2,352


7,327 3,011 6,749 2,738 6,411 2,648 6,255 2,701


3,685 1,534 3,092 1,269 3,147 1,342 3,018 1,281


1,890 722 1,775 664 1,667 630 1,638 669


1,502 655 1,613 685 1,456 592 1,361 585


3,739 1,462 3,396 1,405 3,089 1,272 3,244 1,336


1,505 613 1,354 486 1,284 491 1,279 500

Unknown 4,915 2,612 5,117 2,736 4,690 2,574 6,184 3,180

M—Law 1. Highermanagerial andprofessionaloccupations

4,480 2,416 4,848 2,563 4,850 2,463 4,084 2,183


6,029 3,072 6,950 3,393 7,195 3,386 6,509 3,171


2,972 1,504 3,255 1,631 3,520 1,699 3,294 1,583


1,478 701 1,671 765 1,773 831 1,668 761



2002 2003 2004 2005




Acceptedapplicants


909 430 1,079 489 1,112 510 1,044 517


2,428 1,184 2,888 1,292 2,943 1,387 3,146 1,456


1,226 533 1,385 626 1,528 691 1,544 670

Unknown 3,656 2,185 4,448 2,526 4,831 2,699 6,580 3,648

N4—Accounting 1. Highermanagerial andprofessionaloccupations

1,052 454 938 401 1,042 446 945 399


1,521 674 1,461 684 1,639 678 1,574 720


903 451 912 420 931 420 884 412


479 193 471 212 549 242 560 246


305 144 315 141 333 150 335 148


838 378 873 449 924 407 997 462


436 196 440 200 492 228 504 232

Unknown 1,199 755 1,375 871 1,645 894 2,028 1,164

Total 72,999 34,600 77,351 35,865 80,312 36,163 83,598 37,544

2006 2007 2008

Subject NS-SEC ApplicantsAccepted

applicants ApplicantsAccepted


applicants

A1—Pre-clinicalmedicine

1. Higher managerialand professionaloccupations

4,754 2,215 4,506 2,141 4,492 2,110

2. Lower managerialand professionaloccupations

3,446 1,272 3,387 1,270 3,445 1,300


1,446 546 1,386 510 1,484 570

4. Small employers andown account workers

523 191 560 200 537 184

5. Lower supervisoryand technicaloccupations

263 94 289 100 284 110


1,151 355 1,296 361 1,435 500

7. Routine occupations 322 93 299 89 372 114

Unknown 3,592 1,000 3,397 930 2,609 784

A2—Pre-clinicaldentistry


646 247 701 283 731 288


524 167 545 162 565 168


246 84 259 102 288 103


140 42 169 57 153 40


71 24 73 17 54 18


2006 2007 2008




applicants


240 73 287 71 285 86


Unknown 566 147 582 157 488 129

D1—Pre-clinicalveterinarymedicine


331 212 403 224 475 201


288 151 383 175 422 136


129 71 168 70 207 82


113 57 107 42 144 50


40 17 53 18 55 17


82 37 141 53 157 60


Unknown 245 108 310 117 249 71

H—Engineering 1. Higher managerialand professionaloccupations

4,784 2,175 5,145 2,306 4,858 2,397


5,983 2,443 6,052 2,563 5,798 2,663


2,720 1,145 2,801 1,197 2,735 1,273


1,573 634 1,576 617 1,519 690


1,208 510 1,291 513 1,268 589


2,703 1,121 2,988 1,222 3,073 1,408

7. Routine occupations 1,070 428 1,261 500 1,193 525

Unknown 5,719 3,043 5,657 3,029 5,617 3,335

M—Law 1. Higher managerialand professionaloccupations

3,931 2,124 3,987 2,234 3,825 2,289


5,824 2,949 6,096 3,117 5,821 3,261


2,816 1,387 2,932 1,470 3,051 1,663


1,765 851 1,841 916 1,673 929


971 457 961 473 868 450


2,889 1,362 2,906 1,416 3,273 1,751

7. Routine occupations 1,355 635 1,467 690 1,520 808

Unknown 6,034 3,540 6,052 3,767 5,980 4,146

N4—Accounting 1. Higher managerialand professionaloccupations

945 390 1,030 408 1,012 373


1,520 645 1,647 645 1,655 685


844 366 905 386 951 401


2006 2007 2008




applicants


626 251 591 237 647 248


296 131 324 128 309 119


992 458 1,106 471 1,159 507


Unknown 2,001 1,147 2,119 1,210 2,075 1,277

Total 78,345 35,657 80,720 36,927 79,505 39,176

Notes:1. “Applicants” covers applicants who have made one or more applications to the specified subject.2. Applicants applying to medicine, dentistry and veterinary medicine courses can submit up to four applications. Those applying to other subjects in 2008 couldsubmit up to five applications; in 2007 and earlier years they could submit up to six applications.3. UCAS uses the Standard Occupational Classification 2000 and assigns socio-economic status based on an applicant’s parental occupation (or the occupation ofthe person contributing the highest income to the household if the applicant is aged 21 years or over), and uses a simplified version of the National StatisticsSocio-economic Classification (NS-SEC) since UCAS does not collect employment status or size of organisation from applicants. Provision of this information isvoluntary and it is not passed to institutions until after the selection process. Socio-economic status data are available only for home (UK-domiciled) applicants.UCAS is not releasing NS-SEC data for 2009.Source:UCAS.

Higher Education: Student Numbers

Ian Lavery: To ask the Secretary of State for Business,Innovation and Skills what estimate he has made of thenumber of students who had been educated in (a)Wansbeck constituency, (b) Northumberland and (c)the UK who were at university in the last 12 months.

[22926]

Mr Willetts: Figures for higher education enrolmentswho were educated in Wansbeck constituency,Northumberland county and the UK are not available.As an alternative, figures for enrolments to higher educationinstitutions who were resident in Wansbeck constituency,Northumberland local authority and the UK have beenprovided in the table as an alternative.

The latest available information from the HigherEducation Statistics Agency (HESA) relates to the 2008/09academic year. Figures for the 2009/10 academic yearwill be available in January 2011. The Department hasrecently received updated postcode information; thereforefigures in the answer may not match those previouslypublished. Figures exclude students studying highereducation level courses at further education colleges.

Undergraduate enrolments1 from Wansbeck parliamentaryconstituency2, Northumberland local authority2, and the UK—UK

higher education institutions academic year 2008/09Area Undergraduate enrolments

Wansbeck 2,075Northumberland 8,570UK 1,673,6551 Enrolments cover students in all years of study, not just first yearstudents.2 Excludes enrolments whose parliamentary constituency or localauthority could not be established due to missing or invalid postcodeinformation.Note:Figures are based on a HESA standard registration population andhave been rounded to the nearest five.Source:Higher Education Statistics Agency (HESA).

Innovation

Chi Onwurah: To ask the Secretary of State forBusiness, Innovation and Skills what powers andresponsibilities the Technology Strategy Board will havein relation to his proposed innovation centres. [23242]

Mr Willetts: The overall network of centres will beestablished and overseen by the Technology StrategyBoard but individual centres will have a high degree ofautonomy so they can respond to business needs.

The Technology Strategy Board will work with industry,stakeholders, and wider government to identify thepriority areas and governance structure for the elitenetwork of Technology and Innovation Centres byApril 2011.

National Apprenticeship Service

Andrew Griffiths: To ask the Secretary of State forBusiness, Innovation and Skills who the (a) ChiefExecutive and (b) Chairman of the NationalApprenticeship Service is; how long each has been inpost; how much each is paid, including any pensioncontributions from the employer; and in which publicationsand on which websites each post was advertised when itwas last vacant. [22734]

Mr Hayes: Simon Waugh was appointed to the roleof chief executive of the newly formed NationalApprenticeship Service in January 2009. The role wasadvertised in the Sunday Times and on the Times Online,and by the recruitment consultants, Gatenby Sanderson.The role was created in 2009 and Simon has been theonly person to hold this position. In the summer of2010, my Department agreed to Simon becoming executivechairman. Prior to this, the role of chairman of theNational Apprenticeship Service did not exist.

The National Apprenticeship Service is embedded inthe Skills Funding Agency which was created on 1 April2010. Salary information for all Skills Funding Agency


and National Apprenticeship Service (NAS) senior civilservants, including Simon Waugh’s are available on theSkills Funding Agency website

http://skillsfundingagency.bis.gov.uk/aboutus/transparencyingovernment/salary/index.htm

National Scholarship Fund

Mr Jim Cunningham: To ask the Secretary of Statefor Business, Innovation and Skills how he expects theNational Scholarship Fund to operate; and who heexpects to be eligible for awards from the Fund. [22675]

Mr Willetts [holding answer 8 November 2010]: Alluniversities that want to charge a higher graduatecontribution than the £6,000 threshold will be obligedto participate in the National Scholarships programme.We will consult students and university organisationson the details. We will look to increase the leverage ofGovernment funding by getting matched contributionsfrom universities. Our current preference is for universitiesto offer scholarships to targeted students—includingthe principal beneficiaries of the pupil premium—thatwould mean at least their first year is free. Other attractiveideas include expanding the model of a foundationyear for young people with high potential but lowerqualifications.

Regional Growth Fund

Guto Bebb: To ask the Secretary of State for Business,Innovation and Skills with reference to the Local GrowthWhite Paper, Cm 7961, what timescale he has set for theestablishment of growth hubs. [22650]

Mr Prisk: The Department for Business, Innovationand Skills will set out its plans for business improvement,including growth hubs, in more detail shortly.

Science: Finance

Chi Onwurah: To ask the Secretary of State forBusiness, Innovation and Skills what estimate he hasmade of the sum in private sector funding likely to beattracted by each £1 in science funding from the publicpurse over the comprehensive spending review period.

[23060]

Mr Willetts: The Government does not have an explicitestimate of the amount of private sector funding attractedby £1 of public spending on science—with the significantdegrees of uncertainty involved, such an estimate islikely to be unreliable.

In 2008 (the most recent year for which data isavailable) Government expenditure on research anddevelopment and higher education expenditure on researchand development, together known as public sectorexpenditure on research and development, was equal to0.162+0.469 or 0.631% of gross domestic product. Businessexpenditure on research and development, which includesfinancing from abroad, 1.097% of gross domestic product.Therefore for every £1 of public research and developmentexpenditure in 2008 there was £1.74 of business researchand development expenditure.

Skills Funding Agency: Manpower

Andrew Griffiths: To ask the Secretary of State forBusiness, Innovation and Skills how many staff areemployed by the Skills Funding Agency specifically towork on communications and campaigns; and whatrecent discussions he has had with the Chief Executiveof the Agency on this level of staffing. [22733]

Mr Hayes: Decisions about the number of staff withinthe Skills Funding Agency who work on communicationsand campaigns are an operational matter for GeoffRussell, the chief executive of Skills Funding. I havetherefore asked him to reply direct to my hon. Friend.

I have not had any recent discussions with the chiefexecutive of Skills Funding on the number of SkillsFunding Agency staff working in these areas. However,as is the case with all public bodies, the Skills FundingAgency is being streamlined. It is already making an11% additional saving in 2010-11 and will be expectedto make further significant savings to its administrativecosts over the spending review period.

Students: Fees and Charges

Mr Jim Cunningham: To ask the Secretary of Statefor Business, Innovation and Skills who he plans toconsult on options for mechanisms to enable earlyrepayment of tuition fee loans; and if he will make astatement. [22676]

Mr Willetts [holding answer 8 November 2010]: TheGovernment are committed to the progressive nature ofthe repayment system. It is therefore important thatthose on the highest incomes post graduation are notable unfairly to buy themselves out of this progressivesystem by paying off their loans early. We will consulton potential early repayment mechanisms—similar tothose paid by people who pre-pay their mortgages.These mechanisms would need to ensure that graduateson modest incomes who strive to pay off their loansearly through regular payments are not penalised. Forexample, a 5% levy might be charged on additionalrepayments each year over a specified amount such as£1,000 or £3,000. Alternatively, those on higher incomes(eg over £60,000) who made an additional repaymentcould be required to pay a 5% levy on this sum. We willconsult with students, universities, higher educationbodies and other experts.

DEFENCE

Afghanistan: Peacekeeping Operations

Nicholas Soames: To ask the Secretary of State forDefence how many Royal Air Force personnel aredeployed in Afghanistan in support of combat aircraftflying operations. [21839]

Nick Harvey [holding answer 4 November 2010]: TheRAF currently has approximately 1,900 personnel deployedin Afghanistan. The specific number of RAF personnelsupporting Tornado GR4 in Afghanistan is being withheldas the information could prejudice the capability,effectiveness or security of the armed forces.


Afghanistan: Security Forces

Paul Flynn: To ask the Secretary of State for Defencepursuant to the answer of 22 October 2010, OfficialReport, column 881W, on Afghanistan: security forces,if he will discuss with his Afghan counterpart therecruitment and desertion statistics for the Afghanpolice and army referred to in his Answer. [20589]

Dr Fox: I regularly talk to Defence Minister Wardakon a range of issues including the Afghan NationalSecurity Forces (ANSF).

Working closely with the Government of Afghanistan,we continue to make progress in enhancing the capacityand capability of the ANSF, including on specific measuresto improve recruitment and retention. However, theseissues are ultimately matters for the Government ofAfghanistan.

Air Force: Military Bases

Angus Robertson: To ask the Secretary of State forDefence which (a) live fire and (b) practice weaponsare permitted for use at (i) RAF Wainfleet, (ii) RAFDonna Nook, (iii) RAF Holbeach, (iv) RAF WestFreugh, (v) RAF Tain and (vi) the Cape Wrath Range.

[22950]

Mr Robathan: RAF Wainfleet was closed on 3 December2009. Details of the live fire and practice weaponspermitted for use at Defence Training Estate (DTE)Donna Nook, DTE Holbeach, MOD West Freugh,DTE Tain and DTE Cape Wrath are detailed as follows:DTE Donna NookLive Fire:

Ball/Tracer up to 30mm (including 7.62mm, 0.5 inch, 20mm,27mm, 30mm)

Practice Weapons:3kg14kg5401b High Explosive Simulated (Freefall and Retarded)10001b High Explosive Simulated (Freefall and Retarded)CRV-7 Inert (Ground Attack Rocket)BDU-33(Practice Bomb)BDU-50 (Freefall and Retarded) (Practice Bomb)BDU-56 (Freefall) (Practice Bomb)DTE Holbeach

Live Fire:Ball/Tracer up to 30mm (including 7.62mm, 0.5 inch, 20mm,27mm, 30mm) TOW (Tube-launched Optically Tracked Wirecommand data link guided missile)

Practice Weapons:3kg14kg5401b High Explosive Simulated (Freefall and Retarded)10001b High Explosive Simulated (Freefall and Retarded)CRV-7 Inert (Ground Attack Rocket)BDU-33 (Practice Bomb)BDU-50 (Freefall and Retarded) (Practice Bomb)BDU-56 (Freefall) (Practice Bomb)

MOD West FreughThis unit is operated and managed by QinetiQ on behalf of the

MOD and is cleared for use of the following air-launched weapons:

Live Fire:Ball/Tracer up to 30mm (including 7.62mm, 0.5 inch, 20mm,27mm, 30mm)5401b HE (Freefall and Retarded)10001b HE (Freefall and Retarded)

Practice Weapons:UK and US Practice bombs5401b HE Simulated (Freefall and Retarded)10001b HE Simulated (Freefall and Retarded)Paveway II, III and IV inert laser guided bombs

DTE TainLive Fire:

Ball/Tracer up to 30mm (including 7.62mm, 0.5 inch, 20mm,27mm, 30mm)

Practice Weapons:3kg14kg5401b High Explosive Simulated (Freefall and Retarded)10001b High Explosive Simulated (Freefall and Retarded)CRV-7 Inert (Ground Attack Rocket)BDU-33(Practice Bomb)BDU-50 (Freefall and Retarded) (Practice Bomb)BDU-56 (Freefall) (Practice Bomb)

DTE Cape WrathLive Fire:

Ball/Tracer up to 105mm (including 7.62mm, 0.5 inch, 20mm,27mm, 30mm, 40mm, 105 mm)10001b High Explosive (Freefall and Retarded)Mk-82 High Explosive (Freefall and Retarded)

Practice Weapons:3kg14kg10001b High Explosive Simulated (Freefall and Retarded)Inert Paveway IICRV-7 Inert (Ground Attack Rocket)10001b High Explosive Simulated (Freefall and Retarded)BDU-33(Practice Bomb)BDU-50 (Freefall and Retarded) (Practice Bomb)BDU-56 (Freefall) (Practice Bomb)Mk-82 High Explosive Simulated (Freefall and Retarded)Mk-84 High Explosive Simulated (Freefall)

Aircraft Carriers: Military Aircraft

Michael Dugher: To ask the Secretary of State forDefence what assessment he has made of the effects onthe aeronautical industry of not proceeding with hisDepartment’s proposals for the short take-off andvertical landing aircraft variant for the new aircraftcarriers. [21333]

Peter Luff [holding answer 2 November 2010]: Thedecision to purchase the Carrier Variant of the JointStrike Fighter was made on operational grounds. Itoffers advantages in terms of interoperability with allies,range, and pay load and through life costs over theShort Take Off and Vertical Landing (STOVL) variant.

The industrial implications of the key strategic defenceand security review choices were given careful consideration,but we have not made a specific assessment of theimpact on the aeronautical industry of the decision toproceed with the Carrier Variant of the Joint Strike


Fighter, rather than the STOVL version. However, UKcompanies have a significant interest in the overall JointStrike Fighter programme, including the carrier andConventional Take-Off and Landing (CTOL) variants.

Armed Forces: Housing

Zac Goldsmith: To ask the Secretary of State forDefence whether service family accommodation inNorth Kingston is included in his Department’supgrade programme. [22879]

Mr Robathan: Work is under way to provide newkitchens, bathrooms, heating systems and electrical rewiringto 50 service family accommodation (SFA) propertiesin North Kingston.

The coalition Government are looking to see whatfurther improvements to the SFA estate as a whole,including properties in Kingston, can be funded fromefficiencies elsewhere in the Department.

Armed Forces: Private Education

Mike Crockart: To ask the Secretary of State forDefence how many children of service personnel receivefunding from his Department to attend independentschools. [22765]

Mr Robathan: For financial year 2009-10, there were9,020 children of service personnel who attended feepaying schools and received financial assistance fromthe Ministry of Defence through the Continuity ofEducational Allowance (CEA) scheme. It is not possibleto differentiate independent schools so this figure includesall CEA eligible schools: private sector, public and stateboarding schools.

Falkland Islands: Deployment

David Simpson: To ask the Secretary of State forDefence what naval capability he expects to be availablefor operations relating to the Falkland Islands in thenext 10 years. [23001]

Nick Harvey: We are firmly committed to the defenceof the Falkland Islands and will maintain a permanentmaritime presence in the South Atlantic consisting of adestroyer or frigate and a patrol vessel. Other navalvessels may visit from time to time and a ship will alsodeploy to Antarctic waters for the ice patrol task eachaustral summer. The permanent maritime presence canbe reinforced rapidly by other Royal Navy ships andsubmarines, should the need arise.

France: Military Alliances

Gregg McClymont: To ask the Secretary of State forDefence what assessment he has made of the complianceof the defence sharing agreement with France with theUK’s obligations under the nuclear non-proliferationtreaty. [22839]

Nick Harvey [holding answer 9 November 2010]: Atthe 2 November 2010 UK-France summit, we signedtwo treaties, one on long-term defence and securityco-operation and one on shared nuclear hydrodynamics

testing facilities. Both are fully consistent with ourobligations under the treaty on the non-proliferation ofnuclear weapons.

HMS Astute

Angus Robertson: To ask the Secretary of State forDefence how many civilians were aboard HMS Astutewhen it ran aground on 22 October 2010; and what therole of each was. [20760]

Peter Luff: There were 17 civilians aboard HMSAstute at the time of the grounding incident. Of these,16 were contractors: 11 from BAE Systems SubmarineSolutions; two from Atlas, two from Thales; and onefrom QinetiQ. In addition, there was one civilian onboard from the Ministry of Defence.

These civilians were present to support ongoing weaponsand combat systems trials and training.

Joint Strike Fighter F-35 Fighters

Mr Ainsworth: To ask the Secretary of State forDefence how many Joint Strike Fighter F-35 fighters heplans to order; and what timescale he has set for theirentry into service. [20416]

Peter Luff: I refer the hon. Member to the answer Igave on 3 November 2010, Official Report, columns852-53W, to the hon. Members for Glenrothes (LindsayRoy), North Durham (Mr Kevan Jones) and Moray(Angus Robertson).

Military Aircraft: Helicopters

Mr Ainsworth: To ask the Secretary of State forDefence when he expects the short study on the helicopterplatform capabilities for HMS Ocean and HMS Illustriousto report; and when he expects to make a decision onthe future of such capabilities. [19985]

Peter Luff: The study is expected to report its conclusionsshortly. A decision on how our future landing platformhelicopter capability should be provided will be announcedin due course.

Nimrod MR4A

Angus Robertson: To ask the Secretary of State forDefence where the Nimrod MR4A aircraft designatedPA04 is stationed. [20761]

Peter Luff: Nimrod MRA4 aircraft PA04 is stationedat BAE Systems Warton.

Peacekeeping Operations: Middle East

Paul Flynn: To ask the Secretary of State for Defencewhat his most recent estimate is of the number ofcivilian deaths in Afghanistan consequent on actionsby (a) Coalition forces and (b) insurgents sinceOctober 2001. [20591]

Dr Fox: We deeply regret all civilian casualties. Protectingthe Afghan civilian population is a cornerstone of theinternational security assistance force’s (ISAF) mission,and all British troops undergo comprehensive training


on the strict rules of engagement. Where incidents dooccur procedures are in place to ensure they are promptlyreported to the chain of command and follow up actionstake place in accordance with ISAF and UK nationalprocedures. This contrasts directly with the attitude ofthe insurgents, whose indiscriminate use of suicide bombs,roadside explosive devices and human shields cause themajority of civilian deaths and injuries in Afghanistan.We will continue our efforts to prevent insurgents harmingcivilians and to develop the capacity of Afghan securityforces to protect the population.

The Ministry of Defence does not record figures forinsurgent or civilian casualties in Afghanistan becauseof the immense difficulty and risks that would be involvedin collecting robust data.

Shipbuilding

Mr Jim Cunningham: To ask the Secretary of Statefor Defence what estimate he has made of the numberof shipyards in the UK which are surplus to requirements.

[22488]

Peter Luff [holding answer 9 November 2010]: As setout in the strategic defence and security review, theMinistry of Defence has a continuing large programmeof investment in new warships. The Department iscommitted to working with the UK shipbuilding industryto ensure delivery of our future military requirements.It will, however, be for industry to retain the capacity itdeems necessary in order to meet the demands madeof it.

Strategic Defence and Security Review

Mr Ainsworth: To ask the Secretary of State forDefence (1) what estimate he has made of the saving tothe public purse from his planned reduction in thenumber of (a) operational and (b) stockpiledwarheads; [19986]

(2) what estimate he has made of the saving to thepublic purse arising from reductions in the number ofwarheads on Vanguard submarines. [19987]

Dr Fox: The Ministry of Defence made estimates ofthe cost savings accrued from measures in the strategicdefence and security review for the purposes of formulatingpolicy. However, final savings figures will depend ondetailed implementation. The MOD is therefore notprepared to release more detailed figures at this time.

Michael Dugher: To ask the Secretary of State forDefence what meetings each Minister in his Departmenthad with representatives of the defence industry todiscuss the strategic defence and security review prior toits publication. [21334]

Dr Fox: I refer the hon. Member to the answer I gaveon 26 October 2010, Official Report, column 202W, tothe hon. Member for Stalybridge and Hyde (JonathanReynolds).

JUSTICE

Alternatives to Prison

Patrick Mercer: To ask the Secretary of State forJustice what steps his Department is taking to increasethe use of community sentences for prisoners on shortprison sentences. [22648]

Mr Blunt: We want to see sentencing that is effectivein rehabilitating offenders so that they do not offendagain. This includes increased use of community sentenceswhere they are more effective than short prison sentencesin providing punishment and rehabilitation, and in helpingoffenders come off drugs.

We have announced that we are conducting an assessmentof sentencing, looking at the full range of penalties andrestorative measures available in the criminal justicesystem, including community sentences. We will publisha Green Paper before the end of the year, setting outplans to reform sentencing and rehabilitate offendersmore effectively.

Criminal Injuries Compensation

Mr Slaughter: To ask the Secretary of State forJustice whether any internal reviews of criminal injuriescompensation have recommended changes to the categoriesof person eligible for compensation through the CriminalInjuries Compensation Scheme. [23101]

Mr Blunt: The Criminal Injuries Compensation Schemeis currently subject to review. No decisions have beenmade.

Data Protection: Internet

Robert Halfon: To ask the Secretary of State forJustice what recent discussions he has had with theOffice of the Information Commissioner on the adequacyof the provisions of the Data Protection Act 1998 toprotect personal data online. [22703]

Mr Djanogly: There are regular discussions betweenthe Ministry of Justice (MoJ) and the InformationCommissioner’s Office (ICO) on the provisions of theData Protection Act (DPA) and their adequacy for bothonline and offline data processing. As part of thisongoing dialogue, the ICO responded to the MoJ’s Callfor Evidence on the DPA and the European DataProtection Directive. In addition, discussions took placebetween the MoJ and the ICO about the ICO’s PersonalInformation Online Code of Practice during for theICO’s public consultation.

Departmental Public Expenditure

Dr Phillip Lee: To ask the Secretary of State forJustice what mechanisms are in place to ensure that hisDepartment’s decisions on regional funding allocationsare based on the most recent available population data.

[20696]

Mr Blunt: The Ministry of Justice does not contributeto any single regional pot of funding. Funding allocationsto local authority Youth Offending Teams are based ona formula which includes population data. Following


the spending review, we are reviewing the YOT grantformula in order to bring it up to date and will workwith the Department for Communities and LocalGovernment to ensure that it includes the most recentavailable population data.

Fines: Surcharges

Mr Knight: To ask the Secretary of State for Justicehow much was raised through the victims’ surcharge ineach of the last three years for which figures areavailable. [22740]

Mr Blunt: I refer the hon. Member to my reply givento the hon. Member for Blackley and Broughton (GrahamStringer) on 24 June 2010, Official Report, column280W.

The Victim Surcharge was introduced on the 1 April2007. Between 2007-08 to 2009-10 the Victim Surchargeraised £21,079,310. It produced approximately £3.8 millionin 2007-08, £8.1 million in 2008-09 and £9.2 million for2009-10.

Google

Robert Halfon: To ask the Secretary of State forJustice whether he has discussed Google’s Street Viewproject with the Information Commissioner. [22704]

Mr Djanogly: UK data protection legislation is enforcedindependently of Government by the InformationCommissioner’s Office (ICO) and it would not beappropriate for Ministers to be involved in the ICO’shandling of any particular case.

Discussions between the Information Commissionerand Ministers with regard to Google’s Street Viewproject have related to the general principles of the case.

John Hirst

David Morris: To ask the Secretary of State forJustice if the Probation Service will (a) consider thecompliance of John Hirst with the terms of his licencefor release from custody and (b) recall him from hisrelease on licence. [22623]

Mr Blunt: It would not be appropriate, for operationalreasons, to place in the public domain informationregarding the management on licence of an individualoffender.

However, an offender who is in the community andon a life licence is liable to be recalled to prison, wherehis behaviour suggests he presents an unacceptable riskto life or limb.

Prison Sentences

Gavin Shuker: To ask the Secretary of State forJustice (1) how many people who were given custodialsentences of up to two years were convicted of eachoffence in the latest year for which figures are available;

[22773]

(2) how many people who were given custodialsentences of up to 12 months were convicted of eachoffence in the latest year for which figures are available.

[22774]

Mr Blunt: Information showing the number of personssentenced to immediate custody of up to and includingone year, over one year and up to and including twoyears, and over two years (including life and indeterminate)for each offence at all courts in England and Wales for2009 (latest available) can be found in the followingtable.

Persons sentenced to immediate custody, sentence bands at all courts by offence, England and Wales, 20091, 2

OffenceTotal immediate

custodyUp to and including

one year

Over one year andup to and including

two years

Over two years(including life and

indeterminate)

Murder 376 — — 376Attempted Murder 84 — — 84Threat or Conspiracy to Murder 182 81 50 51Manslaughter 202 4 17 181Causing Death by Reckless Driving 218 22 51 145Manslaughter Due to Diminished Responsibility 4 — — 4Causing Death by Careless Driving when underthe influence of Drink or Drugs

33 3 1 29

Causing Death of a child or vulnerable person 11 3 2 6Causing Death by careless or inconsideratedriving

3 2 1 —

Causing death by driving unlicensed, disqualifiedor uninsured drivers

1 1 — —

Causing Death by Aggravated Vehicle Taking 7 3 — 4Wounding or other act Endangering Life 1,626 49 131 1,446Endangering Railway Passenger 4 3 1 —Endangering Life at Sea 1 1 — —Other Wounding etc. 11,155 7,764 2,524 867Cruelty to or Neglect of Children 158 86 38 34

Abandoning Child aged under Two Years 1 1 — —

Child Abduction 16 5 6 5

Procuring Illegal Abortion 2 — — 2

Total Violence Against the Person 14,084 8,028 2,822 3,234





one year


two years


indeterminate)

Buggery 24 0 1 23Sexual Assault on a Male 118 25 34 59Rape of a Female 885 5 13 867Rape of a Male 56 0 5 51Sexual Assault on a Female 935 261 225 449Sexual Activity with child under 13 86 19 22 45Sexual Activity with child under 16 472 66 138 268Familial Sexual Offences (Incest) 77 9 23 45Exploitation of Prostitution 47 22 17 8Abduction 1 — 1 —Sexual activity etc. with a person with a mentaldisorder

15 1 6 8

Abuse of children through prostitution andpornography

19 3 4 12

Trafficking for sexual exploitation 21 — 2 19Abuse of trust—sexual offences 19 15 4 —Gross Indecency with Children 43 9 18 16Miscellaneous sexual offences 169 118 26 25Total Sexual Offences 2,987 553 539 1,895

Burglary in a Dwelling 6,873 2,636 1,887 2,350Aggravated Burglary in a Dwelling 246 11 33 202Burglary in a Building Other than a Dwelling 2,887 2,356 337 194Aggravated Burglary in a Building not a Dwelling 20 1 2 17Total Burglary Offences 10,026 5,004 2,259 2,763

Robbery 5,155 1,007 1,313 2,835Total Robbery Offences 5,155 1,007 1,313 2,835

Aggravated Vehicle Taking 620 472 148 —Money laundering offences 488 222 139 127Theft from the Person of Another 1,959 1,625 226 108Theft in Dwelling not Automatic Machine orMeter

332 310 10 12

Theft by an Employee 328 209 93 26Theft or Unauthorised Taking from Mail 41 34 5 2Abstracting Electricity 21 21 — —Theft of Pedal Cycle 138 136 1 1Theft from Vehicle 1,029 996 22 11Theft from Shops 11,903 11,850 47 6Theft from Automatic Machine or Meter 110 81 15 14Theft of Motor Vehicle 236 206 24 6Other Theft or Unauthorised Taking 1,382 1,284 73 25Handling Stolen Goods 1,355 1,156 153 46Total Theft and Handling Stolen Goods 19,942 18,602 956 384

Fraud by Company Director etc. 23 5 8 10

False Accounting 55 26 19 10

Other Fraud 2,700 1,984 448 268

Bankruptcy Offence 24 22 2 —

Forgery etc. of Drug Prescription 10 8 1 1

Other Forgery etc. 2,558 2,323 193 42

Fraud, Forgery etc associated with Vehicle orDriver Records

17 16 1 —

Total Fraud and Forgery 5,387 4,384 672 331

Arson 549 115 128 306

Criminal Damage Endangering Life 40 12 10 18

Other Criminal Damage 354 330 22 2

Threat etc., to commit Criminal Damage 93 75 9 9





one year


two years


indeterminate)

Total Criminal Damage 1,036 532 169 335

Unlawful importation—Class A 528 4 19 505Unlawful importation—Class B 74 21 22 31Unlawful importation—Class C 82 18 31 33Unlawful importation—Class unspecified 25 9 5 11Unlawful exportation—Class A 25 1 — 24Unlawful exportation—Class B 4 1 1 2Unlawful exportation—Class C 4 2 — 2Unlawful exportation—Class unspecified 4 1 2 1Production, supply and possession with intent tosupply a controlled drug—Class A

4,826 368 1,314 3,144

Production, supply and possession with intent tosupply a controlled drug—Class B

1,077 381 510 186

Production, supply and possession with intent tosupply a controlled drug—Class C

967 434 335 198

Production, supply and possession with intent tosupply a controlled drug—Class unspecified

223 25 43 155

Possession of a controlled drug—Class A 775 704 34 37Possession of a controlled drug—Class B 371 364 3 4Possession of a controlled drug—Class C 127 121 6 —Possession of a controlled drug—Classunspecified

13 4 1 8

Inciting another to supply a controlled drug—Class C

2 2 — —

Other drug offences 298 80 150 68Total Drug Offences 9,425 2,540 2,476 4,409

Going Equipped for Stealing, etc. 374 354 18 2Blackmail 132 16 33 83Kidnapping, etc. 310 39 70 201Rioting 9 0 — 9Violent Disorder 268 101 133 34Other Offence against the State or Public Order 3,064 2,494 509 61Perjury 40 35 4 1Betting, Gaming and Lotteries 3 3 — —Aiding Suicide 2 — 2 —Assist Entry of Illegal Immigrant 381 281 66 34Perverting the Course of Justice 748 623 94 31Absconding from Lawful Custody 246 236 8 2Firearms Act Offence 597 181 62 354Revenue Law Offence 17 4 6 7Failing to Surrender to Bail 1,722 1,722 — —Trade Descriptions Act and Similar Offences 236 213 16 7Health and Safety at Work etc. Act 1974 7 7 — —Possession of Obscene Material etc. 479 293 130 56Protection from Eviction Act 1977. 4 4 — —Adulteration of Food 3 1 2 —Public Health 11 10 1 —Disclosure, obstruction, false or misleadingstatements

37 36 1 —

Other (Excluding Motoring Offences) 2,192 2,023 77 92Total Other Indictable Offences (ExcludingMotoring)

10,882 8,676 1,232 974

Total Indictable Offences (Excluding Motoring) 78,924 49,326 12,438 17,160

Dangerous Driving 1,309 1,089 220 —Driving licence related offences: Making falsestatements

2 2 — —

Vehicle insurance offences: Making falsestatements

4 4 — —

Total Indictable Motoring Offences 1,315 1,095 220 —





one year


two years


indeterminate)

Total Indictable Offences (Including Motoring) 80,239 50,421 12,658 17,160

Assault: On Constable 1,609 1,609 — —Assault: Common, etc 6,787 6,785 2 —Betting or Gaming Offence 32 32 — —Brothel Keeping 13 13 — —Cruelty to Animal 102 102 — —Offences Relating to Dogs 10 10 — —Education Acts 15 15 — —Firearms Acts 17 17 — —Fishery Acts 3 3 — —Offence against Public Order 1,522 1,522 — —Interference with Motor Vehicles 281 281 — —Unauthorised Taking of a Conveyance 639 639 — —Summary Aggravated Vehicle Taking 371 368 3 —Drunkenness, with Aggravation 7 7 — —Summary Criminal or Malicious DamageOffence

1,313 1,313 — —

Social Security Offence 36 36 — —Naval, Military and Air Force Law—Navy 1 1 — —Disorderly Behaviour 5 5 — —Other Offence 2 2 — —Prostitution—Kerb Crawling 52 52 — —Public Health Offence 1 1 — —Railway Offence 23 23 — —Sexual Offences—Miscellaneous 1 1 — —Vagrancy Offences—Begging 8 8 — —Vagrancy Offences—Found In Enclosed Premises 52 52 — —Weights and Measures Acts 1 1 — —Wild Birds Protection Acts 1 1 — —Drug Offence 111 111 — —Immigration Offence 33 33 — —Other Summary Offence (Excluding Motoring) 1,639 1,638 1 —Total Summary Offences (Excluding Motoring) 14,687 14,681 6 —Summary Motoring Offences 5,264 5,264 — —Total Summary Offences (Including Motoring) 19,951 19,945 6 —Total All Offences 100,190 70,366 12,664 17,1601 The figures given in the table relate to persons for whom these offences were the principal offences for which they were dealt with. When adefendant has been found guilty of two or more offences it is the offence for which the heaviest penalty is imposed. Where the same disposal isimposed for two or more offences, the offence selected is the offence for which the statutory maximum penalty is the most severe.2 Every effort is made to ensure that the figures presented are accurate and complete. However, it is important to note that these data have beenextracted from large administrative data systems generated by the courts and police forces. As a consequence, care should be taken to ensuredata collection processes and their inevitable limitations are taken into account when those data are used.Source:Justice Statistics—Analytical Services, Ministry of Justice

Prisoners on Remand

Paul Goggins: To ask the Secretary of State forJustice how many remand prisoners (a) were in prisonon 6 May 2010 and (b) voted in elections on that day.

[22735]

Mr Blunt: On 7 May 2010, the nearest date for whichinformation is available, there were 12,823 remand prisonersin prisons in England and Wales.

Eligible prisoners may vote by post or by proxy andwe are therefore unable to say how many votes wereactually cast by or on behalf of eligible prisoners.

The right to vote is restricted to unconvicted prisoners,convicted but unsentenced prisoners, persons imprisoned

for contempt of court and other prisoners classifiedunder Prison Rule 7(3), and those serving a term ofimprisonment in default of payment of a sum of money,adjudged to be paid on conviction.

Prisoners’ Release

Kelvin Hopkins: To ask the Secretary of State forJustice how many people were given a supervision orderwith a condition of participation in a sex offenderprogramme in 2009. [22934]

Mr Blunt: In 2009, 1,451 community-based orderswere issued with a requirement to participate in a sexoffender programme.


Kelvin Hopkins: To ask the Secretary of State forJustice (1) how many people were given a supervisionorder with a curfew requirement in each year from 2004to 2009; [22935]

(2) how many people were given a supervision orderwith a requirement for unpaid work in each year from2004 to 2009. [22936]

Mr Blunt: The following table shows the number ofcurfew and unpaid work community order requirementswhich commenced under probation service supervisionin each year from 2005 to 2009—latest available.Persons starting curfew and unpaid work requirements of a community

order 2005-09Curfew Unpaid work

2005 3,209 29,9472006 9,615 66,9372007 12,608 74,7792008 15,526 74,6292009 16,479 76,699Notes:1. Sharp increase from 2005 reflects the fact that these orders wereintroduced for offences committed after 4 April 2005.2. For curfews, the data given in the table are the majority of adultcurfew requirements given. The data do not include single requirementcurfews which do not involve probation service supervision.

Data are available from April 2005 only as the communityorder was introduced under the Criminal Justice Act2003 on 4 April 2005—moreover curfew/unpaid workrequirements did not explicitly feature in the communitysentences used previously.

The figures can be found in the published “OffenderManagement Caseload Statistics 2009”—Table 3.9, acopy of which can be found in the Libraries of bothHouses and which can be found at the following website:

http://www.justice.gov.uk/publications/prisonandprobation.htm

These figures have been drawn from administrativeIT systems, which, as with any large scale recordingsystem, are subject to possible errors with data entryand processing.

Prisons: Drugs

Mr Ainsworth: To ask the Secretary of State forJustice what steps his Department is taking to improvethe delivery of drug treatment services in prisons.

[22780]

Mr Blunt: The Government recognise that treatmentis essential if we are to tackle the social and health costscaused by drugs. In prisons, a comprehensive frameworkof drug treatment is in place to address the drug needsof offenders, comprising clinical services, psychosocialinterventions, case management and through care services.The Integrated Drug Treatment System (IDTS) is bringingimprovements to the quality of prison treatment and isdue to be rolled out to all adult prisons in England byMarch 2011.

However, we believe more needs to be done to offeroffenders the opportunity to get off drugs for good andinto a position where they can stop offending and makea proper contribution to society. To achieve this we willrun pilots to pay contractors by results to rehabilitateoffenders with drug problems, launch drugs recovery

wing pathfinders in a number of prisons and explorealternative forms of residential, treatment-basedaccommodation for offenders with drugs problems.

These plans will be outlined in more detail in ourGreen Paper on Sentencing and Rehabilitation, whichwill be published for consultation shortly.

Prisons: Meat

Mr Leech: To ask the Secretary of State for Justice ifhe will review levels of meat consumption in prisons forthe purpose of improving the health of prisoners.

[23133]

Mr Blunt: There are no plans to review the level ofmeat consumption in prisons. Prisons already providemeals to meet religious and cultural needs as well asvegetarian, vegan and other dietary requirements.

Prisons: Wales

Ian Lucas: To ask the Secretary of State for Justicewhat recent discussions he has had with the Secretaryof State for Wales on proposals for the construction ofa prison in North Wales. [22992]

Mr Blunt: My right hon. Friend the Secretary ofState for Wales (Mrs Gillan) has discussed the provisionof prison places in north Wales with both myself andministerial colleagues.

The Ministry of Justice (MoJ) is committed to publishinga Green Paper on Rehabilitation and Sentencing, consultingon our longer-term plans for offender management.Following this the MoJ will re-evaluate its strategy forprison capacity.

Probation

Patrick Mercer: To ask the Secretary of State forJustice what guidance his Department issues to theProbation Service on the recall of prisoners. [22649]

Mr Blunt: The most recent published guidance issuedto the Probation Service on the recall of prisoners iscontained in Probation Circular 14/2008 and ProbationInstruction 4/2009.

The link for these circulars are:http://www.probation.homeoffice.gov.uk/files/pdf/PC14%202008.pdfhttp://www.probation.homeoffice.gov.uk/files/pdf/PI04%202009.pdf

Youth Custody: Violence

Ann Coffey: To ask the Secretary of State for Justicewhat discussions he has had with the Youth JusticeBoards on matters arising from the recent violentincidents at HM Prison and Youth Offender Institute,Warren Hill and HM Prison and Youth OffenderInstitute, Hatfield; and if he will make a statement.

[22852]

Mr Blunt: I was kept informed of events at HMYOIWarren Hill through the National Offender ManagementService. The Youth Justice Board are working closelywith NOMS to manage the situation at Warren Hill andthe impact on the wider youth estate.


ORAL ANSWERSWednesday 10 November 2010

Col. No.NORTHERN IRELAND .......................................... 269

Barnett Formula Funding ...................................... 272Comprehensive Spending Review........................... 273Dissident Violence ................................................. 277Exports .................................................................. 269Fisheries (EU Legislation) ..................................... 278Parliamentary Voting System and Constituencies

Bill ..................................................................... 276

Col. No.NORTHERN IRELAND—continued

Presbyterian Mutual Society .................................. 277Security Situation................................................... 274The Disappeared.................................................... 270

PRIME MINISTER .................................................. 278Engagements.......................................................... 278

WRITTEN MINISTERIAL STATEMENTSWednesday 10 November 2010

Col. No.COMMUNITIES AND LOCAL GOVERNMENT .. 15WS

Localism Bill and Planning .................................... 15WS

DEFENCE ................................................................. 15WSCall-Out Order to Support Operations in

Afghanistan ....................................................... 15WS

FOREIGN AND COMMONWEALTH OFFICE..... 16WSConstitutional Reform and Governance Act 2010

(Ratification of Treaties) .................................... 16WS

Col. No.JUSTICE................................................................... 18WS

Parliamentary Written Question (Correction) ........ 18WS

PRIME MINISTER .................................................. 19WSParliamentary Assembly of the Council of Europe

and Assembly of Western European Union(UK Delegation) ................................................ 19WS

Parliamentary Assembly of the OSCE (UKDelegation) ........................................................ 20WS

TREASURY .............................................................. 15WSEconomic and Financial Affairs Council

(11 November 2010)........................................... 15WS

PETITIONSWednesday 10 November 2010

Col. No.PRESENTED PETITION

Elizabeth Regina Love Correspondence ................ 1P

Col. No.TRANSPORT ........................................................... 2P

Intercity Express Programme ................................. 2P

WRITTEN ANSWERSWednesday 10 November 2010

Col. No.BUSINESS, INNOVATION AND SKILLS ............. 374W

Apprentices ............................................................ 374WCJD: Research ....................................................... 375WEU Grants and Loans............................................ 377WHigher Education: Admissions .............................. 378WHigher Education: Student Numbers ..................... 385WInnovation ............................................................. 386WNational Apprenticeship Service ............................ 386WNational Scholarship Fund.................................... 387WRegional Growth Fund .......................................... 387WScience: Finance..................................................... 387WSkills Funding Agency: Manpower ........................ 388WStudents: Fees and Charges.................................... 388W

CABINET OFFICE ................................................... 338WCivil Servants: Recruitment ................................... 338WDepartmental Redundancy .................................... 339WGovernment Departments: Photography ............... 340WGovernment Departments: Procurement ............... 340WMembers: Correspondence .................................... 341WPublic Bodies Bill ................................................... 341WPublic Bodies (Reform) Bill 2010-2011: Wales........ 341W

Col. No.CABINET OFFICE—continued

Public Expenditure................................................. 341WVoluntary Organisations: Local Government......... 342W

COMMUNITIES AND LOCAL GOVERNMENT .. 352WAnti-Semitism........................................................ 352WDepartmental Early Retirement ............................. 352WEuropean Aeronautic Defence and Space

Company: Contracts.......................................... 352WFire Services: Emergency Calls............................... 353WFire Services: Redundancy ..................................... 354WLocal Development Frameworks: Greater

London.............................................................. 355WPublic Expenditure................................................. 355WRegeneration: Newcastle upon Tyne ...................... 355WSocial Rented Housing........................................... 355WSocial Rented Housing: Eltham ............................. 357WUN Convention on the Rights of Persons with

Disabilities ......................................................... 357W

CULTURE, MEDIA AND SPORT .......................... 316WBBC: Commonwealth Games 2014........................ 316W

Col. No.CULTURE, MEDIA AND SPORT—continued

Departmental Travel .............................................. 316WHorse Racing: Betting............................................ 316WLocal Broadcasting: Television .............................. 317WNational Lottery: Armed Forces............................ 317W

DEFENCE ................................................................. 388WAfghanistan: Peacekeeping Operations .................. 388WAfghanistan: Security Forces ................................. 389WAir Force: Military Bases ....................................... 389WAircraft Carriers: Military Aircraft ........................ 390WArmed Forces: Housing ......................................... 391WArmed Forces: Private Education .......................... 391WFalkland Islands: Deployment ............................... 391WFrance: Military Alliances...................................... 391WHMS Astute........................................................... 392WJoint Strike Fighter F-35 Fighters .......................... 392WMilitary Aircraft: Helicopters ................................ 392WNimrod MR4A ...................................................... 392WPeacekeeping Operations: Middle East .................. 392WShipbuilding........................................................... 393WStrategic Defence and Security Review .................. 393W

EDUCATION............................................................ 319WChildren in Care..................................................... 319WChildren In Care .................................................... 320WDepartmental Reviews ........................................... 320WEducation: Young People....................................... 322WFoster Care: Per Capita Costs ................................ 322WGCSE .................................................................... 323WHome Education.................................................... 323WPrivate Education: Tax Relief................................. 323WPupil Exclusions..................................................... 324WSchools: Violence ................................................... 324WWritten Questions: Government Responses ........... 325W

ENERGY AND CLIMATE CHANGE ..................... 328WElectricity Generation ............................................ 328WHousing: Insulation ............................................... 329WWind Power: Cost-effectiveness.............................. 330W

ENVIRONMENT, FOOD AND RURALAFFAIRS............................................................... 307WAgriculture: Subsidies ............................................ 307WArpley Landfill Site................................................ 308WBottles: Recycling................................................... 308WCotton: EU Action ................................................ 309WDairy Farming ....................................................... 309WEnglish Forestry Forum ......................................... 309WEnvironment Protection: British Overseas

Territories .......................................................... 309WForestry Commission ............................................. 310WForestry Commission: Land................................... 310WGreenhouse Gas Emissions: Electronic

Equipment ......................................................... 311WLandfill: Refrigerators............................................ 312WNational Parks: Areas of Outstanding Natural

Beauty................................................................ 312WNitrogen Dioxide: Pollution Control...................... 313WPollution: Liquefied Petroleum Gas ....................... 313WRecycling ............................................................... 314WRodents: Henderson Island.................................... 314WWater Supply: Leaks .............................................. 314W

FOREIGN AND COMMONWEALTH OFFICE..... 325WChinese: Falun Gong ............................................. 325WDiplomatic Service................................................. 325WEuropean Parliament ............................................. 326WGibraltar: Spain ..................................................... 326WIran: Baha’i Faith................................................... 326WMiddle East: Peace Negotiations............................ 327W

Col. No.FOREIGN AND COMMONWEALTH OFFICE—

continuedMordechai Vanunu ................................................ 327WTaiwan: International Civil Aviation Organisation. 328W

HEALTH................................................................... 366WBlood: Contamination ........................................... 366WCJD: Drugs............................................................ 367WDepartmental Redundancy .................................... 368WDoctors: Career Development ............................... 369WDrugs: Rehabilitation............................................. 369WHealth Services: Greater Manchester ..................... 369WKhat....................................................................... 370WKidney Dialysis...................................................... 370WMental Health Services: Prisons............................. 370WNeuromuscular Diseases: Health Services.............. 371WNHS: Redundancy................................................. 372WNHS: Voluntary Organisations .............................. 372WPrescriptions: Fees and Charges............................. 373WSocial Services: West Sussex................................... 373W

HOME DEPARTMENT........................................... 360WAntisocial Behaviour: Crime Prevention ................ 361WAntisocial Behaviour Orders: Northumberland ..... 360WAntisocial Behaviour Orders: Peterborough........... 360WCrime: Summertime ............................................... 361WEntry Clearances: Taiwan ...................................... 361WIllegal Immigrants: East Ayrshire........................... 362WImmigration Controls: English Language .............. 362WIntercept Modernisation Programme ..................... 362WKhat....................................................................... 363WProceeds of Crime.................................................. 363WStrategic Defence and Security Review .................. 364WUK Border Agency: Passports ............................... 364WVetting: Complaints ............................................... 365WVetting: Standards.................................................. 365W

INTERNATIONAL DEVELOPMENT .................... 318WDeveloping Countries: Education .......................... 318WDeveloping Countries: Tuberculosis....................... 318WInstitute for Fiscal Studies ..................................... 319W

JUSTICE................................................................... 394WAlternatives to Prison............................................. 394WCriminal Injuries Compensation ............................ 394WData Protection: Internet ....................................... 394WDepartmental Public Expenditure.......................... 394WFines: Surcharges ................................................... 395WGoogle ................................................................... 395WJohn Hirst .............................................................. 396WPrison Sentences .................................................... 396WPrisoners on Remand............................................. 401WPrisoners’ Release................................................... 402WPrisons: Drugs ....................................................... 403WPrisons: Meat ......................................................... 404WPrisons: Wales ........................................................ 404WProbation ............................................................... 404WYouth Custody: Violence........................................ 404W

NORTHERN IRELAND .......................................... 315WCommunity Policing .............................................. 315WDealing with the Past ............................................. 315WPolice Service of Northern Ireland......................... 315WPublic Sector Employment..................................... 315W

TRANSPORT ........................................................... 331WAirports: Thames Estuary...................................... 331WBlue Badge Scheme................................................ 331WCrossrail: Abbey Wood .......................................... 331WCrossrail: Finance .................................................. 332WFerries: Highlands and Islands............................... 332W

Col. No.TRANSPORT—continued

Highways Agency: Finance .................................... 333WRailways: Electrification ........................................ 333WRailways: Fares ...................................................... 334WRailways: North West ............................................ 335WRoad Traffic: Morecambe ...................................... 336WRoads: Safety ......................................................... 336WTransport: Finance................................................. 337WTransport for London: Grants ............................... 337W

TREASURY .............................................................. 358WChild Benefit.......................................................... 358WChild Benefit: Durham .......................................... 358WDepartmental Public Expenditure.......................... 358WDirectors: Fraud .................................................... 358WNational Insurance Contributions: New

Businesses .......................................................... 359WOfficial Cars: Expenditure...................................... 359WPublic Expenditure................................................. 359WPublic Expenditure: Scotland................................. 359WPublic Sector: Females ........................................... 360WTax Allowances: Breweries ..................................... 360W

WALES...................................................................... 307WInstitute of Fiscal Studies ...................................... 307W

Col. No.WOMEN AND EQUALITIES.................................. 307W

Sexual Harassment................................................. 307W

WORK AND PENSIONS ......................................... 342WAccess to Work Programme ................................... 342WBereavement Benefits ............................................. 342WChild Maintenance and Enforcement

Commission: Correspondence ........................... 343WDisability Living Allowance ................................... 343WEmployment: Disability ......................................... 344WHousing Benefit ..................................................... 344WHousing Benefit: Brighton and Lewes.................... 346WHousing Benefit: Down’s Syndrome ...................... 346WHousing Benefit: Shared Housing .......................... 346WHousing Benefit: Wales .......................................... 346WIndustrial Health and Safety .................................. 346WMortgages: Government Assistance....................... 347WPensioners: Housing Benefit .................................. 349WSocial Security Benefits: Disability......................... 349WSocial Security Benefits: Fraud .............................. 350WStatutory Sick Pay.................................................. 351WUnemployment ...................................................... 351WWork Programme................................................... 351W

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Volume 518 WednesdayNo. 68 10 November 2010

CONTENTS


Oral Answers to Questions [Col. 269] [see index inside back page]Secretary of State for Northern IrelandPrime Minister

Support and Protection for Elderly People and Adults at Risk of Abuse [Col. 290]Motion for leave to introduce Bill—(Mr Dodds)—agreed toBill presented, and read the First time

Equitable Life (Payments) Bill [Col. 293]Considered in Committee; read the Third time and passed

European Union Economic Governance [Col. 359]Motion to take note of EC document—(Mr Hoban)—on a Division, agreed to

Petition [Col. 388]

BBC Funding (CSR) [Col. 389]Debate on motion for Adjournment

Westminster HallUK Software Industry [Col. 75WH]Local Enterprise Partnerships (South-West) [Col. 99WH]Science Research [Col. 108WH]Exeter to Plymouth Railway [Col. 135WH]Housing Revenue Account Subsidy (Wales) [Col. 140WH]Debates on motion for Adjournment

Written Ministerial Statements [Col. 15WS]

Petitions [Col. 1P]Petition presented to the House on Tuesday 9 November but not read on the FloorObservations

Written Answers to Questions [Col. 307W] [see index inside back page]