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Westminster Hall

Volume 404: debated on Wednesday 30 April 2003

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Westminster Hall

Wednesday 30 April 2003

[MR. JOE BENTON in the Chair]

Aggravated Dangerous Driving

Motion made, and Question proposed, That the sitting be now adjourned.— [Joan Ryan.]

9.30 am

I am grateful to the House for allowing me this debate. I intend to cover a range of issues relating to aggravated dangerous driving. I shall focus on the tragic death of Rebecca Sawyer and call for a number of changes to laws relating to motoring offences.

The tragic events of the last new year's eve caused shock and revulsion throughout the United Kingdom. At 10.44 pm on Tuesday 31 December 2002, in Ashington in Northumberland, Mr. Steven Sawyer was driving his two children home after they had spent an evening at their grandparents' house. Mr. Sawyer was driving the family motor car south on Hawthorn road, towards the traffic light junction with College road and Sixth avenue, in an area with a 30 mph speed limit. Rebecca Sawyer, aged six, was strapped in the rear of the vehicle next to her younger sister, Kirsty, who was secured in a child seat. At the same time, a stolen Vauxhall Astra, driven by Ian David Carr, was travelling west at high speed towards the same traffic light, which all witnesses confirm was on red as he approached it.

Ian Carr had three passengers in the stolen vehicle, two men and a woman. The stolen Vauxhall Astra sped through the red light, crashing into the Sawyer family's car, with horrific consequences. The three members of the Sawyer family were seriously injured and taken to Wansbeck general hospital, where, tragically, Rebecca Sawyer died at 5 past 12 on 1 January 2003. Kirsty suffered critical injuries and had to be transferred to Newcastle general hospital's intensive care unit.

What of the fate of the driver and passengers in the offending vehicle? Eye-witnesses stated that after the collision the offending vehicle eventually stopped on the footpath directly outside an Asian-run shop. As soon as the car stopped, a male, described as tall and slim, was seen getting out of the driver's seat. That person ran off immediately and did not return to the scene. Shortly afterwards, the rear offside passenger door opened. A male and female left the car. The male ran off first, quickly followed by the female.

Ian Carr made no attempt even to check whether his passengers were injured, let alone to seek help for the terrible injuries he had caused. He did what he has always done: he ran away—a callous, cowardly act. Carr then went into hiding. Two of the three passengers gave themselves up to the police the next day, the third having been arrested near the scene. The three passengers showed the same total disregard for human life that Carr did. They made no attempt to offer assistance and must bear a heavy responsibility for leaving the scene of a serious crime without offering any help. Those were not the actions of innocent people.

At 4.57 pm on Tuesday 2 January 2003, Carr was traced and arrested at an address in Lynemouth, Northumberland, by a Northumbria police motor patrol and was taken to Bedlington police station. He was later interviewed in the presence of a solicitor, and confirmed that he was the driver at the time of the collision. Carr was described by the officers who interviewed him as showing no regret for the death of Rebecca or for the serious injuries that he had caused. He was described as being completely without remorse or compassion.

Carr had 89 previous convictions. One of his offences was committed on 14 October 1990. An Austin Metro car was stolen in Ashington. It was involved in high-speed races with another stolen vehicle. The Metro overturned at Woodhorn crossroads in Ashington while travelling at 90 mph. One of the passengers, Mark Wren, was flung from the vehicle and suffered serious head injuries. In all probability, he was killed outright. The driver of the vehicle tried to get Mr. Wren from the scene, but that was not possible, and he left Mark's body draped over a fence at the roadside before running away.

The driver then asked the other passengers to provide an alibi by saying that the deceased was the driver of the stolen vehicle. In fact, Ian Carr was the driver, and he was charged and convicted at Newcastle Crown court, and sentenced to 12 months youth custody for causing death by reckless driving, the maximum sentence permitted because of his age. Carr was described as arrogant, callous and uncaring. He showed absolutely no remorse. His only thoughts were for himself, which was exactly how he was described before he was sentenced for his latest terrible crime.

In passing sentence for that crime this year, the judge stated:

"The circumstances of this offence in which you caused the death of a much loved little girl, inflicted critical injuries to her baby sister and caused less serious injuries to her father have torn at the hearts of people throughout this region and indeed further afield as well.
Nothing I can say can begin to adequately describe the revulsion that the community feels at what you have done. Everyone is understandably appalled."

Order. I wish to make a point at this stage. I am sorry for interrupting the hon. Gentleman. I am listening carefully and with deep interest to the debate. What I am about to say is intended in a general sense for all contributors. Will hon. Members please bear it in mind that, if any matter is sub judice in any shape or form, I warn against their referring to it. I do not know whether the matters under discussion are still sub judice, but I think it as well to warn the House to refrain from referring to any matter that might be.

Thank you for your guidance, Mr. Deputy Speaker. The matters to which I am referring are not sub judice. I checked on that before I decided to use names. We are on fairly safe ground.

The judge was absolutely right. The community of Ashington and the north-east region was horrified that Ian Carr had once again caused death and destroyed a decent, loving family. Everyone in the north-east demanded action. It is a credit to our excellent regional newspapers, the Evening Chronicle and The Journal, that they decided to run high-profile campaigns to make people in the region aware of the case. They collected tens of thousands of signatures in support of a petition to be presented to the Home Secretary calling for changes to the law for criminal motorists.

Since the tragic events of new year's eve, I have had numerous meetings with Superintendent Bob Pattinson of Northumbria Police, an experienced and dedicated officer. Many of the recommendations that I will put before the House today were suggested by him and are based on actual offences and sentences. I am grateful for his help, his skill and professionalism. I record my thanks on behalf of the good people of Wansbeck to him and all his colleagues. Everyone to whom I have spoken, including the Sawyer family, have placed great value on their help.

Carr received nine and a half years in prison for his string of offences. As he was on licence at the time of the offence, he had to serve the rest of his previous term: 668 days—the maximum sentence that the judge could give. That brings me to my first recommendation. A new offence of aggravated death by dangerous driving should be introduced, carrying a maximum sentence of life imprisonment. The aggravating factors would include, but not necessarily be limited to, driving while already disqualified, failing to stop for the police, driving under the influence of drink and/or drugs, having no insurance, driving a stolen motor vehicle, or driving a class of vehicle for which no licence has ever been held.

People such as Carr will continue to pose a threat to the public. A life sentence would reflect the terrible nature of their crime and ensure that they will be monitored after release for the rest of their lives. The probation service and police would have to be informed before anyone was released on licence, and would be involved in monitoring them. Offenders such as Carr should never be released until the appropriate authorities are satisfied that they no longer pose a threat to the general public. Her Majesty's Prison Service should be required to notify police of people identified as posing a risk to the public before they are released, even if they have received a lesser sentence.

There is a serious anomaly in the present sentencing policy where serious injury has occurred, rather than death. The maximum sentence for that is only two years. Nationally, there are thousands of cases of persons who have been seriously injured—some disabled for life—and who are very bitter that the people who caused their injuries serve only two years. If two motorists have a disagreement and one strikes the other, the guilty person can be charged with assault causing actual bodily harm and could be sentenced to five years in prison. If a driver deliberately or recklessly damages another driver's motor vehicle and is charged with criminal damage, a maximum sentence of 10 years imprisonment is available to the Crown courts. It is essential that the period of imprisonment for the offence of causing serious injury by dangerous driving is increased substantially beyond two years, especially if aggravating factors are involved.

I ask my hon. Friend the Minister to draw up new advice to the courts, in consultation with the Home Office, for sentencing those who are repeatedly convicted of driving while disqualified. I have been provided with many examples that demonstrate that far too many people consistently re-offend and that there appears to be no effective deterrent. Absolute and conditional discharges seem commonplace. If we are determined to make our roads safer for the public to use, there must be an active deterrent to prevent people from getting behind the wheel without any regard for the law. Consideration should be given to introducing a mandatory jail sentence for anyone who drives while disqualified, as that is a serious offence.

Ian Carr carried three passengers in the offending vehicle. They were not charged with any offence. The Crown Prosecution Service stated
"that there is no direct, reliable evidence to show that the passengers definitely knew that Carr was driving a stolen vehicle".
The three passengers were well known to the police as all of them had serious criminal records. They knew Carr well, and they were aware that he was a dangerous serial offender. They all initially lied to the police, denying the driver's identity. Given all that and the seriousness of the crime the CPS should have prosecuted, in the public interest.

I am concerned that no power of arrest for dangerous driving exists, and I urge the Minister to consider making dangerous driving an arrestable offence.

A number of other issues are associated with repeat offenders, and I would like the Minister to consider them. There is a need to crack down hard on the use of pool cars by criminal groups or young joyriders. Pool cars are not registered in anyone's name, are not insured and are usually in a poor state of repair. They are kept for use when required. Given that most police officers are aware of the criminal records of the offenders on their patch, there should be a deliberate enforcement process to remove those vehicles from the streets and to have them crushed.

I also suggest that, in order to keep that type of vehicle off the street, the Minister should consider banning the resale of scrapped vehicles. It is possible for someone to go to any scrapyard in the land, buy a large, powerful car without having to show either a driving licence or proof of insurance, and drive the vehicle off the premises. That can be done for less than £200. The cost of insuring the car could be several thousand pounds, so no one should be surprised that that type of vehicle is never insured, although it is exactly the type of vehicle that becomes pooled. It is essential that that practice be stopped.

Another self-inflicted problem seems to be the disposal costs, or recycling costs, of motor vehicles. A cost will undoubtedly be associated with any scheme, but whatever it is, it must be charged to the new vehicle. If it is not, hundreds, if not thousands, of vehicles, will have their identification removed and be left to rot. It is inconceivable that the last person to own a motor car legally, who probably bought it as a cheap run-around, will drive it to the scrapyard and hand over a wad of cash amounting to more than he paid for it in the first place just to ensure that it is disposed of correctly. I have a genuine fear that unless there is an incentive to dispose of vehicles properly, many will be left with their keys in to create new hazards in areas ill equipped to deal with them. I suggest that the Minister should seriously consider offering a payment to people who dispose of their motor vehicles legitimately.

The issues that I have dealt with have related mainly to serious motoring offences of a criminal nature. Research recently conducted by Northumbria police showed that of 61 fatal crashes in the past year, eight involved disqualified drivers, who caused eight deaths. All the disqualified drivers were young, and all had a long history of offending. I shall briefly run through the careers of two of them—man A and man B.

Man A is 25 and first appeared in court at the age of 13. He has subsequently been convicted a further 37 times for more than 190 separate offences. The majority of his offences are vehicle related: 42 were for taking vehicles without consent, 17 of which were aggravated by involving police chases; and 31 were for driving while disqualified. Yet the maximum sentence imposed was only 15 months.

Man B is 35, and he first appeared in court when he was 15. He has been convicted many times for a variety of offences. Three were for driving while disqualified, 23 for having no driving licence, 35 for having no insurance, 25 for theft, and nine for absconding. He is currently subject to six outstanding periods of disqualification.

All the other individuals involved had similar records. From checking through the records of 30 motorists who received driving bans, I can say that more than half were already banned from driving at the time of their offence. Half committed one or more offence after the ban, with some appearing in court six more times for serious motoring offences. That cannot be allowed to continue.

I am aware of the wider debate on accident reduction and general road safety. The Parliamentary Advisory Council for Transport Safety has produced an excellent document, "Road Traffic Law and Enforcement: A Driving Force for Casualty Reduction", which contains several recommendations that would certainly help in casualty reduction. It identifies a number of issues that would help to make Britain's roads much safer: there should be better publicity about the risks and consequences of committing road traffic offences; only specially trained magistrates should handle road traffic cases; with regard to roadside enforcement, police should have full access to information about both drivers and vehicles; carrying driving licences should be compulsory; the Government should appoint a named body or individual to progress more actively the use of new technology by all road traffic law enforcement agencies; and vehicle technology to prevent law breaking should be developed. The council also advised that bad driving offences, especially those involving death, are often not dealt with in a manner that signals to society that they are serious.

The appropriate agencies need to review their procedures so that a more effective response to bad driving is achieved. If that does not work, a new offence of causing death by bad driving should be introduced. That is exactly what I am suggesting to the House this morning.

I have covered a number of issues relating to death and serious injuries caused by aggravated dangerous driving. I have put forward reasonable additions and amendments to the current laws, most of which, I am sure, will have the full support of the House. I am grateful for the all-party support that I have received to date, and for the interest shown in today's debate.

Our roads are some of the most congested in the world, yet our road safety record is one of the best. Standards of driving in the United Kingdom are generally high, but still the lives of thousands of people are blighted by criminal motorists with no respect for the law, property, or even human life. It is possible to identify from an early age those who will pursue that type of life, and much more work needs to be done on prevention. We need to send the clear message that society will not tolerate people who use a motor vehicle to maim or kill.

Steven Sawyer should have had the right to drive his children home safely to their mother, Sharon, on the fateful evening of 31 December, without fear of a dangerous maniac killing their innocent little girl, Rebecca, critically injuring Kirsty, and wrecking their lives. Carr should never have been out on licence in the first place. He should be locked away for the rest of his natural life, or at least until he and people like him no longer pose a threat to society. Never again will the Sawyer family have the joy of looking forward to Christmas. The tragic events of that terrible night will haunt them forever.

I pay tribute to the brave and dignified way in which Mr. and Mrs. Sawyer have acted. In a moving statement during the trial, Mr. Sawyer described the grievous loss that his family had sustained in Rebecca's death, and concluded:
"Whatever sentence the person responsible gets will never ever be anywhere near the sentence me and my family will suffer".
It is essential that we change the law to ensure that no more families suffer the same fate as the Sawyers.

9.51 am

I congratulate my hon. Friend the Member for Wansbeck (Mr. Murphy) on securing this important debate. I—like almost every Member of the House, I suspect—agree with every word he said. Almost all of us could relate a similar incident that occurred in our constituency, and I am no exception.

Everyone has great sympathy for those who are killed or maimed by motorists and for their families, but it is difficult to appreciate the immense frustration and distress experienced by those affected when the motorists concerned are clearly guilty of more than a temporary lapse. That is what two of my constituents are experiencing. Like my hon. Friend, I will relate an incident in my constituency: it concerns Mr. and Mrs. Briggs and what they encountered following the dreadful death of their daughter Susan.

Susan Briggs was 30 years old. She and her two friends, Angela Ovington and Victoria Fisher, had their whole lives ahead of them, but had them murderously—I use that word carefully, but most sincerely—snatched away by the reprehensible actions of a self-absorbed drunk driver. Susan and her friends were returning to their new house in Huddersfield after a night out when a car mounted the pavement, hit a wall and drove up the pavement, ploughing into the girls and causing horrific fatal injuries. A fourth member of the group managed to scramble to safety and narrowly escaped.

The driver of the car was Allan Jackson. He tried to leave the scene but was stopped by the police: he was found to be three times over the drink-drive limit. Jackson had been caught driving while banned in the past and had previous convictions for drink-driving. Plainly, the punishment that he received for those offences did not provide the necessary deterrent, as is evident from the fact that he continued to drink and drive.

Jackson was initially charged with manslaughter, but that was reduced to causing death by dangerous driving because, on the advice of his solicitor, he pleaded guilty to the lesser charge. For each person he killed—Angela, Susan and Victoria—he was sentenced to eight years in prison, a total of 24 years. However, the sentences ran concurrently, making a total of eight years' imprisonment for taking three innocent young lives. Those three people were not given the second chance previously afforded to Jackson, the motorist in question.

Although the judge recommended that Jackson should serve five years four months for the tragedy—in my view, that was a pathetic recommendation—he was downgraded to an open prison two years later, and after eighteen months he can apply to be let out on licence. Three innocent young women were killed and the guilty party could be out on the streets in less than four years—four years for murdering three young women, after which he will be free to do that again.

While I was writing this speech yesterday, my assistant asked if she could tell me about an incident in her family. She told me that her niece, while a back-seat passenger, was killed in an horrific car accident shortly after her 18th birthday—I believe that it was last year. The driver was subsequently charged with driving without due care and attention and fined £200. The victim's mother was recently stopped by the police and fined £60 for allegedly—she denied the charge—driving through an amber light. I am sure that all hon. Members can appreciate her views on the fairness of the system: a £200 fine for the motorist who killed her daughter and a £60 fine for her for allegedly driving through an amber light.

I support the view that sentences imposed are not tough enough. Evidence suggests that they do not deter people from repeating offences that can have tragic consequences. The issue must be addressed or we will continue to see the appalling and heartbreaking cases that regularly appear in the media when thoroughly decent, law-abiding citizens mourn loved ones who have been killed by criminal motorists.

What signal does my hon. Friend believe is sent out by a constituency case of mine in which an elderly gentleman going about his business was killed in a hit-and-run incident? The driver of the vehicle was sentenced to five years in prison, but was considered for release after serving less than 18 months.

My hon. Friend substantiates my points. The fact is that present sentencing policy and the law are not adequate. Something must be done or such cases will continue to arise. They will not stop simply because the law and sentencing policy are changed, but surely there will be a greater deterrent effect than at present.

Under the charge of driving without due care and attention—the charge faced by most drivers who kill or maim on the road—any death or injury is considered to be a
"tragic but disproportionate consequence of a minor driving error".
Magistrates say that under that charge they cannot take account of any fatality or injury but must consider only the driving error itself. In other words, a motorist who kills an innocent party through negligent driving can be sentenced only for that driving and not for the death that results from it. As a result, the death or injury is sometimes not even mentioned by the prosecution in court, and when it is mentioned, defence lawyers and magistrates labour the point that it can have no influence on the sentence passed. The charge carries a maximum fine of £2,500 and a driving ban, but drivers who are guilty of killing or seriously injuring someone on the road are routinely fined around £250 with a few penalty points thrown in for good measure.

A charge of driving without due care and attention must be made against a negligent driver within six months of a crash—I shall return to that point. The bereaved and injured often find the obscenely lenient sentence and the fact that the death or injury is not the central issue of the trial the most distressing aspect of post-crash legal proceedings. To put the charge in context, were the police to prosecute the driver of a vehicle that collided with another in a supermarket car park, they would use the careless driving charge. That just shows how ridiculous the situation is.

The law should be changed so that a more appropriate charge—manslaughter or assault—is brought against all drivers whose negligence results in the death or injury of another road user. Such a charge would address the death or injury as the central issue of the trial, as befits the seriousness of the offence. Even a charge of vehicle homicide should be considered.

I have had the same sort of experience in my constituency, in a case involving a young lad. The Fisher family lost their son in a hit-and-run incident. When the case got to court, the driver was prosecuted and the same old sentence was dished out. After the court case, it was discovered that the driver had been smoking cannabis before he hit the lad, but the police never took that into consideration. No wonder people get light sentences if such things are not taken into consideration,.

Every Member of Parliament could give an example of a constituent who has suffered because of the appalling attitude and performance of some drivers—it is difficult not to be rude when describing such people. My hon. Friend has described another incident of someone basically getting away with murder.

The charge of causing death by dangerous driving is the more serious of the two charges, but it is seldom brought, because of the burden of proof. The charge, together with that of causing death by careless driving while under the influence of drink or drugs and that of causing death by aggravated vehicle taking carries a maximum sentence of only 10 years' imprisonment and a driving ban. Unlike the charge of driving without due care and attention, which is heard in the magistrates court, such charges are heard in the Crown court, before a jury.

The police and the Crown Prosecution Service are reluctant to use the charge of causing death by dangerous driving even when there is clear evidence that a driver has been driving dangerously prior to a fatal crash. Falling asleep at the wheel, speeding, overtaking in the face of oncoming traffic, going through red lights and ignoring pedestrian crossings do not usually, in the eyes of the authorities, constitute dangerous driving.

Most drivers who kill on the road should be charged with causing death by dangerous driving. Sometimes, under pressure from bereaved relatives, the charge of driving without due care and attention is upgraded to that of causing death by dangerous driving, but if that is done, the alternative charge of driving without due care and attention should not be left off the charge sheet. There have been instances in which drivers found not guilty of causing death by dangerous driving have escaped any censure because the alternative, lesser charge, on which the prosecution should have fallen back, has not been included on the charge sheet. There is no time limit for laying the charge of death by dangerous driving, but if the authorities change their minds about the charge after six months have elapsed, they cannot then lay the lesser charge of driving without due care and attention.

Police officers sometimes refer to a charge of reckless driving, even though that charge was scrapped in 1991. Both the police and the CPS talk about intent and claim that, because a driver who killed or maimed on the road did not have any intent to kill, they cannot press charges of causing death by dangerous driving. However, intent is not a requirement and has not been one since changes to road traffic legislation in 1991.

A comprehensive approach to road traffic law reform can deliver the necessary changes and should be urgently addressed in the Criminal Justice Bill, which is now going through Parliament. As well as reforms to the current road traffic penalties, there must be reform that goes much further. Urgent change is needed in several other areas. When considering offences, we need to ensure that the fact of death or injury is a key point in criminal proceedings. There should be a variety of sentences based on the degree of culpability, including manslaughter. The courts must use the powers available to them: the low sentences for causing death by dangerous driving, the derisory fines for driving without due care and attention, and many other sentencing practices, cause a deep sense of injustice. The issue, therefore, is not only the penalties available, but the courts' use of them.

The Crown court should be the sole venue for cases of driving offences involving death or personal injury. Dangerous driving offences should be heard in the Crown court, not as mere summary offences in a magistrates court. The practice in magistrates courts of not mentioning and recording the fact of death is a disgrace and must stop immediately. The training of CPS lawyers in traffic matters and the proper use of charges including manslaughter and causing grievous bodily harm are very important.

The authorities are, I am afraid to say, frequently oblivious of and insensitive towards road victims. That is reflected in the conduct of proceedings, the weighing up of discretionary facts, such as inconvenience to the offender, and the language used in court, but there are many other examples. Victims face obstacles due to lack of information, and rights of appeal for victims' families in relation to serious road crash verdicts often appear to be applied unjustly, while offenders appear to be able to reduce their sentences on appeal. My hon. Friend the Member for Wansbeck made another point: the responsibilities of persons being carried in the offending vehicle should also be recognised when considering offences and, where appropriate, they too should be prosecuted.

I agree with my hon. Friend that when guilty persons are released, they should be electronically monitored until it is established that they no longer pose a threat to the general public. I asked a parliamentary question about the following point. In the year 2000, 359 cases of causing death by dangerous driving were brought to court. Of that number, 72 were charged with causing death by dangerous driving under the influence of drink or drugs and 34 were charged of causing death by aggravated vehicle taking. That is a total of 465 offences that each resulted in at least one death, and perhaps more, committed by motorists who have subsequently been charged with a motoring offence. In comparison, in 2000–01, there were 73 recorded homicide offences by shooting. The Government were very quick to take action at the beginning of the year on gun crimes—and rightly so—but they have not been so quick to take action on dangerous driving.

Since March 2001, I have met two Secretaries of State and a Minister of State to discuss the problems. I took Mr. and Mrs. Briggs with me on two occasions. Although there is no doubt that the Ministers were very sympathetic, no concrete proposals have been introduced. Innocent victims and their families continue to suffer, while action taken against guilty offenders is derisory, ineffective and provides no real deterrent. In other words, such people get away with murder.

10.8 am

As my hon. Friend the Member for City of Durham (Mr. Steinberg) said, we all come across tragic cases, and we can only extend our sympathies to the parents and relatives of Rebecca Sawyer, whose case was raised by my hon. Friend the Member for Wansbeck (Mr. Murphy). Such cases are tragedies, and people cannot understand how, when death is caused, the resulting sentence seems to trivialise the life that has been lost. There is a deep sense of grief and inadequacy among friends and victims as they have to confront the tragedy, and they feel a deep sense of hurt, which is often compounded by the way in which they are treated by the criminal justice system.

I certainly support what my hon. Friends have said about the need constantly to review the law, and I commend the work done by organisations such as RoadPeace, which has, over a period of years, put that important issue on to the political agenda. Nationwide, the consequences are enormous. Some 3,500 people die each year as a result of traffic offences. More than 500,000 are injured, and more than 100,000 are seriously injured. Considering purely the economics, or the bottom line, the result is an enormous cost to the national health service.

As my hon. Friend the Minister will point out, this country's record compares well with that of other countries. A study by the Organisation for Economic Co-operation and Development in 2000 of fatalities per billion vehicle kilometres travelled puts the United Kingdom at the bottom of the list for the number of road fatalities. Our figures were lower than those for comparable countries such as the United States, Australia and Germany. Nevertheless, our newspapers regularly report tragic cases in which life has been taken away but a fine of, for example, only £100 has been given. Politicians have a responsibility to address the issue.

As I said, we have a relatively good record in this country, but it seems that differences between countries have been flattening out. In fact, the number of fatal and serious injury road traffic accidents in the United Kingdom may be increasing. For the operational command unit in my part of the west midlands, the figure increased from 50 to 57 in the past year. Otherwise, the crime results are very satisfactory. Vehicle crime, burglary and other crimes are decreasing, but that increase stands out, although it is, admittedly, slight. Other areas in the west midlands have also seen an increase. The figures represent an enormous social problem involving shattered lives and individual tragedies.

As my hon. Friends the Members for Wansbeck and for City of Durham said, there is a range of offences. The most serious is manslaughter, but there are very few prosecutions for that. The Crown Prosecution Service must take into account the likely success or otherwise of a prosecution, and it is reluctant to bring a manslaughter charge without a realistic prospect of conviction. Other offences are causing death by dangerous driving, which has a penalty of 10 years, dangerous driving with no death involved, although there could be serious injury, and careless driving. As a result of the North committee report in the late 1980s, there is now the additional offence of causing death by careless driving while under the influence of drink or drugs.

My hon. Friend the Member for Wansbeck asked whether we should have an additional offence of aggravated dangerous driving causing death. I hope that the Government will seriously consider that, as well as other proposals for an intermediate offence between dangerous driving causing death and careless driving. Organisations such as RoadPeace have put forward strong arguments for a new offence of causing death by careless driving.

However, in our response to particular tragedies in our constituencies, it seems that we are concerned not so much with the offences but with sentences that seem lenient. The Government have announced that the penalties for road traffic offences causing death will increase from 10 to 14 years—perhaps the Minister can give us the timetable for that. It is a welcome step, but many other penalties, some of which my hon. Friends mentioned, could be given serious consideration. For example, it strikes me as strange that someone who is stopped and found to be over the limit for alcohol is not immediately deprived of his or her licence. It is thought to be somehow contrary to the person's human rights that they should not retain the licence until they go to court.

From what my hon. Friends have said, it also seems that previous convictions, which will be admissible under the Criminal Justice Bill, will help in some prosecutions. As has been said, some offenders have very serious previous convictions. If those were put before a jury, prosecutions for manslaughter or causing death by dangerous driving would have a greater chance of success.

My hon. Friends have pointed out that in sentencing, a death that results from driving is often not taken into account. That goes back to the North committee and, before that, to decisions of the Court of Appeal. It has always been said that the consequences of bad driving ought not to be taken into account unless a serious moral culpability is attached to the quality of the driving. For example, where there is dangerous driving, a death could be taken into account, so we have such an offence. However, paragraph 6.17 of the North report says:
"We agree that it would be wrong to visit on the driver severe penalties for the consequences of an act which amounted only to carelessness."
The North committee went on to say that those serious consequences ought to be taken into account in sentencing and suggested that legislation provide for thatB; unfortunately, the previous Government did not follow that recommendation.

That has always struck me as strange in comparison with other aspects of criminal law. In other cases, one does take the consequences of an act into account. For example, it is often said that the difference between wounding and manslaughter can be a fraction of an inch—a particular wound not causing death in one case but doing so in another and justifying the manslaughter charge. More generally, where the possible consequences of driving are foreseeable, they ought to be taken into account in sentencing if they then occur, whether or not they amount to death or serious injury.

When I was Solicitor-General, until 2001, I referred a number of cases to the Court of Appeal as being unduly lenient, to try to get judges to address the consequences of dangerous and careless driving. In the 1990s, the Court of Appeal said quite clearly in several cases that one should not take into account the fact that a death had occurred. In 1996, in the case of Downing, the Court of Appeal said that the judge should have had regard solely to the degree of carelessness and culpability involved, and should not have taken into account the tragic death that ensued. There were similar cases, such as Morling, and earlier ones such as Krawec.

In a case called Simmonds in 1999, the Court of Appeal clearly established that where death had resulted from careless driving, a higher sentence should result. I think that my hon. Friend the Member for City of Durham touched on the fact that magistrates do not seem to have got that message. One can take into account the consequences of dangerous driving, such as death, when sentencing.

Earlier in April, in a case called Cooksley, the Court of Appeal made it quite clear that death can be taken into account in the sentence imposed by a Crown court. That case has also made it quite clear that when drivers cause death as a result of dangerous driving, they normally must expect a custodial sentence. It is a very detailed judgment, which resulted from the particular matter being considered by the sentencing advisory panel. One paragraph from the judgment commented that motor vehicles could be lethal if not driven properly. That being so, drivers must know that if, as a result of their driving dangerously, a person is killed—no matter what the mitigating circumstances—a custodial sentence will normally be imposed. I hope that Crown courts and magistrates courts will take that into account when sentencing in the future.

Sentencing is important, but as my hon. Friends have rightly pointed out, certain offenders do not get the message. They have previously been sentenced for motoring offences, yet they continue to drive in a way that ultimately leads to death. There is a core of persistent offenders, and my hon. Friends were quite right in saying that their activity makes them criminals. We must think not only of the substantive law in terms of the offences, and not only of how we sentence those cases, but must think of other ways to address a serious social problem. My hon. Friend the Member for Wansbeck mentioned the fact that there seems to be a huge amount of driving by people who have been disqualified. We do not seem to be addressing that issue.

As for alcohol, in the Cooksley case the Court of Appeal said that where there was death by dangerous driving, the fact that a person had been drinking would be an aggravating feature. About 14 per cent. of fatal road accidents involve drivers with illegal levels of alcohol. About half those drivers are at almost twice the legal limit, and about 30 per cent. are young men. We must do something to address that. There has been a downward trend over the years in the number of drink-related casualties, but the trend seems to be flattening out. We must address the issue by enhancing the rehabilitation courses that drink drivers must take. We also need more drastic action in terms of allowing those people to drive again. As for breathalysing, it is possible for the police to stop vehicles and to breathalyse on the basis of a suspicion that a driver has been drinking, but why should we not have random tests?

We have introduced speed cameras and we have allowed the hypothecation of moneys raised through their use. There are now netting-off arrangements, and the evidence certainly demonstrates that there has been a substantial effect. Research published in February by University College London and PA Consulting demonstrated that there had been a 35 per cent. reduction in the number of people killed and seriously injured at camera sites. We have done a certain amount, but I have to say to my hon. Friend the Minister that I agreed with the Select Committee on Transport when it said that the new rules about visibility and location of cameras were unreasonable. Those rules stated that cameras had to be painted yellow and could not be obscured in any way. The Select Committee said that people would die as a result. I agree with the Government that we have to target the areas where the most serious speeding occurs, but I see no objection whatsoever to putting cameras in concealed places or to the use of hand-held cameras.

We must introduce a range of measures to address a serious social problem. We will always face political problems, and I concede that. However, we faced them over seat belts. This country was very slow in introducing compulsory seat belt wearing. In the early 1980s, it was said that compulsion was an unjustified invasion of freedom. It was said that seat belts, far from preserving life, imperilled it in some cases. It was said that some people would have difficulty in complying with the law. Finally, however, we bit the bullet, and, as a result, seat belts have saved many lives.

There will always be a backlash; we saw that when cameras appeared on the political agenda in early 2000. Various newspapers, especially the tabloids, ran campaigns about how cameras were one more thing oppressing the motorist, how they were affecting the right to drive, how it was somehow unsporting of the police to catch people in such a way, and so forth. We will face such problems. However, many people in the community support such measures, and we should not be misled by what the tabloids, motoring organisations or motoring journals might say.

In 1988, MORI asked people to respond to this statement:
"The police should be allowed to stop drivers at any time and perform 'Spot Checks'".
Some 41 per cent. strongly agreed, and 37 per cent. tended to agree. A MORI poll in 2001 found that 67 per cent. of drivers wanted cameras outside schools, and 80 per cent. did not think that they were an infringement of civil liberties.

We must also deal with the problem of criminality. Often, as my hon. Friends have said, serious perpetrators on the roads are criminals. Home Office research briefing note 5/00 found that a high percentage of dangerous and disqualified drivers were also perpetrators of other kinds of crime, and that traffic officers therefore had a dual role in protection against both traffic and mainstream offences. We must do more.

I congratulate my hon. Friend the Member for Wansbeck on raising this important issue and putting it on the agenda again. The law has not caught up with the fact that cars can be dangerous killing machines. As my hon. Friend has said, causing death or injury as a result of negligence should not be punished lightly because such a crime was committed while someone was driving.

10.27 am

I congratulate the hon. Member for Wansbeck (Mr. Murphy) on securing the debate. He will be aware that this country has the dubious honour of being the place in which the first ever road accident death occurred, 107 years ago. Tragically, during the intervening years, the number of people who have died on our roads, and throughout the world, has increased phenomenally. It is estimated that more than 1 million people are killed worldwide every year as a result of road accidents. As other hon. Members have observed, we in the UK have a relatively good record of reducing deaths and serious injuries on the roads. Even so, in this country some 3,500 people die every year, which means that about 10 people will die today, and tens of thousands of people are injured, so about 1.400 will be injured today. Much more work must be done.

Although it is worth bearing in mind that research done in 1999 by the Transport Research Laboratory suggested that the official figures probably understate the number of people who die and are injured, even if the official statistics from 1999 onwards are used, we find that some 150 people died on the railways, but 17,000 died on our roads in the same period. We all know that a rail accident gets acres of front-page media coverage day after day, yet the tens of thousands of people who die or are seriously injured on our roads rarely get even a column inch. It is important that we give more attention to deaths and serious injuries on our roads, which is why I am delighted that the hon. Gentleman has secured this brief debate today.

Like others, I pay tribute to the work of RoadPeace, which was established in 1992 to represent and support road traffic victims. It supports the victims of all road accidents, not only those that result from dangerous driving and aggravated dangerous driving, but all its recommendations and proposals, if adopted, would certainly benefit victims of the crimes that we are discussing. For example, ever since it was established, RoadPeace has argued that it is vital to put the victims of road crime at the heart of policy making.

We should give much greater support and assistance to the victims of road traffic accidents. We should, for example, allow much greater use to be made of victim impact statements in court cases. There is no doubt that when the statements are used, victims feel that they have been part of the process and that their voice has been heard, and that that has been reflected in the sentences handed down. One person who was able to make such a statement said:
"The fact that the barrister for the crown and the judge referred to"
the impact statement
"at length, reading aloud extracts, made a big difference to my brother and myself. I was very grateful to RoadPeace for making us aware that we could do this."
She said that she felt that she had "made a valid contribution."

We must give more information and support to such victims. My hon. Friend the Member for Southwark, North and Bermondsey (Simon Hughes), who apologises for not being able to be here, told me of a case that occurred some 18 months ago in which the 14-yearold son of his constituents Christine and Jim Bradford died in a road accident. Not only did they have to cope with the trauma of their son's death, but they faced a huge struggle with the complex process that followed and its various procedures, not least in trying to get all sorts of information that they wanted, including independent measurements and so on. It is vital that we make that process easier for the victims of crime.

It is worth reflecting on the fact that although many victims want access to police reports, they are difficult to come by and can in some cases cost hundreds of pounds—it seems that there is no common charging policy. Perhaps we should consider making those reports more readily available and affordable. There is difficulty assessing information, but in some cases we make it particularly hard. If a case leads to a summary conviction, there is a six-month time limit on bringing charges. Whether a case comes before a magistrates court as a summary offence or whether a more serious charge is brought is decided in light of the information gathered, yet the time limit makes it difficult to gather the information in the appropriate time. We should address that.

A key point rightly made by many hon. Members is that sentencing policy does not appear to reflect the seriousness of the crimes committed. There is no doubt that in many of the examples given by hon. Members—and I could cite others from my constituency—victims have been led to believe that the criminal justice system simply does not take cases of death by dangerous driving or aggravated dangerous driving anything like seriously enough. We need to ensure that offenders are appropriately dealt with in relation to the crime, and that we send out a clear signal to society about the importance of the issue.

As the hon. and learned Member for Dudley, North (Ross Cranston) rightly pointed out, research shows that, many perpetrators of dangerous driving or aggravated dangerous driving have fairly lengthy criminal records. They are not hapless victims of unfortunate circumstances; they are criminals, and should be treated as such. The Department's most recent research shows that 75 per cent. of dangerous driving offenders are males under 30, so it is worth bearing in mind the importance of giving training to young people.

The figures also show that almost invariably, those charged with dangerous driving are not facing their first or their last driving offence: 46 per cent. of them have previously been convicted on three or more occasions and 56 per cent. of offenders with three or more previous court appearances in 1996 went on to commit a further offence in 1997. That suggests that the whole process is riot acting as a deterrent. Evidence shows that serious traffic offenders cannot be thought of as otherwise law-abiding members of society: 50 per cent. of dangerous drivers had previous convictions and 30 per cent. of them had convictions for car theft.

The hon. Member for Wansbeck suggests that there should be a new category of offence. I am aware of the argument that, for example, the Crown Prosecution Service could use a charge of manslaughter, but appears to be reluctant to do so. There may well be great merit in the argument, which is supported by RoadPeace, but if nothing else, we ought to get our current procedures right. That is why I agree with the hon. Gentleman that we should look closely at the commitment already made by the Home Office to increase the minimum sentence from 10 years to 14 years.

The Government made that commitment in July 2002. It is worth reflecting on the seriousness with which the Home Office views the matter, which is shown in the press release of 24 July that was produced as a result of various Government consultations on road traffic penalties. It states:
"The paper recommends that the maximum penalty for the offences of causing death by dangerous driving; causing death by careless driving while under the influence of drink or drugs; and causing death by aggravated vehicle taking, should be increased to 14 years."
The Government made a clear commitment to introduce that. The press release continues:
"Home Office Minister Bob Ainsworth said: 'The message we are sending out is clear: dangerous driving kills and those found guilty can expect to be severely punished."'
The Government have an opportunity to do something in that respect: it is possible to table an amendment to the Criminal Justice Bill that is currently passing through the House. It has been suggested that such an amendment would be outside the scope of the Bill as it currently stands, but the Government have suggested in Committee that they intend to introduce a five-year mandatory minimum sentence for the possession of illegal firearms. If they are prepared to do that in respect of the use of illegal firearms, it is possible for them to table an amendment to increase the sentence for certain road traffic offences from 10 to 14 years, and I hope that they will do so. I know of several right hon. and hon. Members serving on the relevant Standing Committee who intend to table their own amendment to that effect in an attempt to persuade the Government to act, but it would be far better if the Government did it themselves. I hope that we will hear a clear statement from the Minister today that that is their intention. It is peculiar that the maximum penalty for burglary is 14 years but the maximum penalty for the offence of aggravated dangerous driving is only 10 years. That sends out the wrong signal. I hope that we will take this issue seriously, and I want to hear a clear commitment from the Government on that today.

I would have liked the opportunity to say something about the need to reduce the drink-drive limit—I have already tried to persuade Parliament to do that—and about the importance of other factors in judging what constitutes aggravated dangerous driving, including the use of hand-held mobile phones. This is a serious issue, which is not given the attention it deserves in this country. I am therefore grateful to the hon. Member for Wansbeck for securing this debate.

10.39 am

I, too, congratulate the hon. Member for Wansbeck (Mr. Murphy) on initiating this debate, on his moving and powerful speech, and on the constructive suggestions that he made. The hon. Member for City of Durham (Mr. Steinberg) referred to a constituency case in which three people were killed as a result of illegal driving in November 2000. Probably like other hon. Members, I was informed by the harrowing account of a series of appalling road incidents given in the Newcastle Evening Chronicle on 3 February, which detailed nine cases from the Newcastle and north-east area. I think that I am right to say that all those cases involved persistent offenders and people who had been disqualified from driving over a long period—people such as Mr. Carr, who had been disqualified for life, and others who had repeatedly been drinking and driving.

We should discuss such a serious issue at two levels. I will focus first on persistent criminal behaviour. The debate is timely in that it has been initiated so soon after the result of the Attorney-General's reference and the strong recommendations by the Lord Chief Justice on 3 April that the Government should now increase the maximum penalty, as hon. Gentlemen have said. The offence of dangerous driving that results not in death but in serious injury should be increased from two years to five years and the maximum penalty for dangerous driving that causes death should be increased from 10 years to 14 years.

I agree with the hon. Member for Bath (Mr. Foster) that now is the time for the Minister to make a policy announcement about such matters and to say that an amendment will be made to the Criminal Justice Bill. The Government have introduced any number of criminal justice measures and I should be surprised if, as the hon. Gentleman said, they argued that there is not the scope in the Bill to extend the maximum penalty for such serious offences. I certainly hope that that happens.

Equally important is whether the sentence, whatever it is, is implemented—imposed and served. I refer to the sense of outrage felt by the victims' families when their loved ones are killed by criminal behaviour but the sentence imposed does not mean what it says. As the hon. Member for City of Durham said, the headline sentence might be eight years, but after two years and four months the person may go into an open prison, and in a few more weeks he may be scot-free. It does not set a good example to the public if that can happen to someone who killed three innocent victims in an appalling driving incident. It gives the impression that we take the subject too lightly.

Like the hon. Member for Wansbeck, I want to know how it came about that the Crown Prosecution Service did not feel obliged to prosecute any of the other occupants of Mr. Carr's car. He had been disqualified from driving for life as a result of another incident. The hon. Gentleman did not refer to that incident because there had been so many. That incident took place in Scotland. Mr. Carr was sentenced in the sheriff court to four years imprisonment and disqualified from driving for life, having driven furiously at a speed in excess of 100 mph. His friends must have known about his criminal background, and known that he did not have a driving licence, yet having behaved despicably, they were not brought to justice. I wonder whether the Crown Prosecution Service feels that pressure is being put on it by the Government not to bring too many cases to court, but to keep matters nice and simple by going for the main culprit and letting the others go by the wayside.

There is too much pressure on the courts from the Government to ensure that sentences imposed are reduced, or are not as great as Parliament has set down that they may be. We read in the papers that the Government are obsessed with the number of people in our prisons. I am the first to say that we should not have people in prison who do not deserve to be there or who need to be released sooner, but there must surely be space in our prisons for the sort of people that we have been discussing today to serve extended sentences as a result of their culpability. I hope that the Minister will make clear statements in response to those points.

The issues are very serious, but through their policy the Government have the chance to change the law in the Criminal Justice Bill and to make a robust statement responding to the decisions of the Court of Appeal in the Attorney-General's reference case on 3 April. It is better that I conclude my remarks now to give the Minister a little extra time to respond. I know that he always relishes the opportunity to answer all the points that have been raised.

10.45 am

I relish the opportunity to answer all points made during the debate. I congratulate my hon. Friend the Member for Wansbeck (Mr. Murphy) on securing it, and in particular on the way in which he opened it and has conducted it. He spoke with considerable passion and conviction. He conveyed his anger, and that of his constituents, over a particular incident, and over other incidents in which death occurred. When there is a death of a young child, passions are even stronger. I noted the words of my hon. Friend the Member for City of Durham (Mr. Steinberg), who talked about the frustration and distress that such incidents cause, and I concur.

The debate has been wide ranging. We have touched on road safety, sentencing and the operation of the courts. I shall be somewhat restrained in responding to all those points. Hon. Members will appreciate that much of the debate has gone beyond my brief, but I shall nevertheless attempt to respond to it on behalf of the Government.

As a preface to my remarks, it is true to say, as other Members—not least my hon. and learned Friend the Member for Dudley, North (Ross Cranston)—have said, that this country has a good road safety record compared with that of other countries. That said, more than 3,000 people still die on our roads each year, and about 10 times that number are seriously injured. A figure that sticks in my mind is that each year, the equivalent of a medium-sized primary school of children is killed. That is the problem that we face. Although we have a good record, it will never be good enough, which is why we must continue with our successful efforts to drive down the figures.

I listened carefully to the arguments of my hon. Friend the Member for Wansbeck. I totally support the tougher measures for which he called to deal with those convicted of causing death by dangerous driving. I am grateful for the helpful contributions from other hon. Members. I have a great deal of sympathy for my hon. Friend's views. Road safety is a matter in which we all have an interest, and the Government take the protection of all road users very seriously.

I am sure that Members would agree that the vast majority of the motoring public are responsible, law-abiding people who treat their fellow road users with care and respect. Unfortunately, as my hon. Friend pointed out, a small minority, for whatever reason, seem either unwilling or unable to conform to the normal standards of driving behaviour that we have come to expect; they do not observe the laws that exist to protect us all. It is true that the vast majority of younger drivers are extremely responsible, and we are talking about a tiny minority of people who cause a disproportionate amount of distress to others.

I am only too aware of the extremely distressing case to which my hon. Friend referred, and I have noted his early-day motion 668 calling for action to deal with criminal motorists who have killed other road users. The case of Rebecca Sawyer, who was just 6 years old, and her sister, Kirsty, who was just 18 months, is both tragic and shocking, as the debate has clearly demonstrated. The driver responsible for Rebecca's death and for seriously injuring Kirsty was, rightly, given a significant term of imprisonment. However, given his dreadful history of offending and his previous convictions for both motoring and other criminal offences, I fully appreciate the concerns raised by the case, particularly the importance of ensuring that there is an appropriate response to such utterly antisocial behaviour.

I share my hon. Friend's view that we should do everything reasonably possible to avoid any repetition of such an appalling incident. Indeed, the Government take seriously any suggestion that might help to reduce the annual toll of road deaths and injuries. I am sure that I need not remind the House that improving road safety is one of the priorities of the Government's transport policy. Hon. Members will be aware that the Government's road safety strategy addresses the whole spectrum of road safety issues.

Much has been achieved during the past few decades by successive Governments with better highway and vehicle engineering, improvements to driver testing and training, publicity and education, and focusing on the safety of road user groups. Improvement in car security systems has led to fewer car thefts because it is much more difficult to steal modern cars. Sometimes the crimes to which my hon. Friend the Member for Wansbeck referred take place in older cars without modern security systems.

We have also examined more rigorously the problem of driver behaviour and—this is of particular relevance to this morning's debate—it has been necessary, when persuasion does not seem to work, to look at stronger methods of enforcing road traffic law. One of our main commitments in that respect was to carry out a detailed review of penalties for road traffic offences in 2001, on which a report was published last year. A number of hon. Members have alluded to that.

On the specific issues raised by this debate, I share the concerns of my hon. Friend, and of many victims of road traffic incidents and their families, that appropriate sentencing for serious bad driving leading to death or serious injury is fundamental. The devastating impact of such crime is not always fully appreciated. As a number of hon. Members have said, such incidents are sometimes unreported. When cases come to court, the distress caused to victims and their families may not be raised or seems to be given minimal attention. The damage is, of course, most immediately experienced by the victims and their families, but there is also a significant threat to the security and general well-being of our communities.

In individual cases, sentences must be determined by courts on the basis of all the information that they have on each offence and offender. It has been suggested from time to time that there should be an additional "aggravated" offence that combines a measure of bad driving with the commission of other offences, such as driving while disqualified or without insurance. I think, however, that that is largely a matter for sentencing rather than for another offence. Normally, all relevant offences are put before the court, and it would be for the bench to take account of them in determining the appropriate sentence. However, the Government are aware that sentences perceived to be lenient can undermine public confidence in the criminal justice system. As a result, our report on the review of road traffic penalties, which sets out our preferences for changes to penalties, includes measures intended to provide the courts with sufficient additional powers to allow them to achieve a just disposal more readily in individual cases.

Most notably, in the review of penalties, we announced our intention to increase the penalties available for the offences of causing death by dangerous driving, causing death by careless driving while under the influence of drink or drugs, and aggravated vehicle-taking where death results. We said that we would raise the sentence to 14 years' imprisonment as soon as a legislative opportunity arose. We will make an announcement on the matter. The hon. Members for Bath (Mr. Foster) and for Christchurch (Mr. Chope) raised the issue, as well. We have been looking for a legislative slot to deal with the matter. We are urgently considering it as a matter of considerable priority. An announcement will be made shortly.

With great respect, I have being hearing that since 2001. As I explained, I have met two Secretaries of State and a Minister of State. I was greeted with a lot of sympathy, but two years on, there is still no new legislation. Will the Minister guarantee that new clauses or amendments will be tabled to the Criminal Justice Bill, which is presently going through Parliament, to deal with the problem?

The issue is beyond the remit of my Department, so I cannot give my hon. Friend that guarantee. However, he has known me for a long time, in the House, and I assure him that it will not be long before he knows the result of the deliberations. The matter is of considerable importance to the Government, and we will make an announcement shortly. I hope that that announcement will bring some satisfaction to my hon. Friend. I cannot make the announcement now, but I hope that that is helpful to him.

In addition to the "causing death" offences, we said that we wanted to increase the maximum penalties for the core offences of dangerous driving, aggravated vehicle taking, other than where death occurs, and careless driving. For the first two offences the maximum penalty would be raised from two to five years' imprisonment, and for careless driving it would be raised from a fine of £2,500 to one of £5,000. As my hon. Friend the Member for Wansbeck said, that would make that offence arrestable. Again, we are looking for a legislative opportunity to bring those changes in and, again, we hope that it will not take too long. That matter will probably be more properly dealt with by my Department, and it will be addressed with some urgency.

My hon. Friend also made some important points about abandoned cars. That matter is very relevant to the debate. We are all concerned that abandoned cars blight the environment and all too often act as a magnet for crime and antisocial behaviour. My hon. Friend will be aware that, as a result of changes introduced in May 2002, local authorities can act more quickly against cars abandoned on the public road.

We also intend to reform the vehicle licensing and registration system to ensure that it is much more difficult for those who commit a whole range of vehicle-related offences—including the dumping of cars—to get away with it. We have already secured primary powers for a system of continuous registration, under which it will not be possible for people to evade responsibility for licensing their cars. We expect to make a full announcement soon.

In particular, we are promoting joint working between local authorities and the Driver and Vehicle Licensing Agency to tackle the problem of unlicensed and untaxed cars, which are tomorrow's abandoned cars and very often end up being used in the sort of criminal activity about which we have been talking today. Under the arrangements, the local authority can take the DVLA's powers to clamp and remove unlicensed vehicles. Joint working with a growing number of local authorities around the country has resulted in the removal of more than 8,000 vehicles in total, of which more than 3,500 have been crushed and removed permanently from the roads. Those initiatives have led to a reduction in abandonment, vehicle excise duty evasion, and other associated criminality. I understand that Wansbeck council is not currently participating in the scheme; I know that the DVLA would very much welcome an approach from the council, if it decides that it wants to go down that road.

That may well be because financial responsibility lies directly with the local authority. Will the Minister give us an assurance that extra resources will be made available to move those vehicles?

There is no time to go into that today. My hon. Friend's local authority can find out from the Driver and Vehicle Licensing Agency what resources are available.

Time is against me. My hon. Friend and other Members have raised very important points and extremely distressing constituency matters. I hope that I have given some reassurance that the Government take such issues extremely seriously. If I have not been able to cover all the points, either the Home Office, which will also consider the debate very carefully, or I will respond later.

Part-Time Students

11 am

I have sought this Adjournment debate because the needs of part-time students have largely been ignored in the present debate on the future of higher education. The recently published White Paper is to be welcomed as an acknowledgement of that omission, in that it is the first real recognition of the needs of part-timers since the creation of the Open university.

My purpose is to address five crucial matters: first, policy development in the context of equity; secondly, the need to recognise the Open university as a model worthy of better support; thirdly, the need to challenge the fear and reality of student debt; fourthly, the need to recognise the diversity of approach now developing across the United Kingdom; and, finally, the precise needs of part-time students.

I begin with policy development. The Government's commitment to a future system of higher education that is larger, stronger, more inclusive and more serviceable is very welcome, but policy is still underdeveloped in their consideration of the place of part-time students and of recurrent, lifelong access to HE. I declare an interest in that I am vice-president of the National Institute of Adult Continuing Education—NIACE—the adult learners body.

For more than a quarter of a century, I worked in adult education, which has always been part-time. Until recent years, students financed themselves, paying for their fees, travel, books and child care support. They were largely working-class people who in recent decades began studying in much greater numbers for part-time degrees on campus or in the community within what in my part of the world has become known as the Community University of the Valleys.

I heard about two such students nearly a year ago from one of my constituents, Mr. Cled Phillips, himself a product of the adult education movement and a very distinguished servant of the Workers Educational Association. He wrote:
"Just a line to let you know that two ladies of Port Talbot, mature, part-time students of your Department at Swansea University … have both achieved First Class BA Honours this year.… This confirms the WEA and Extra-Mural faith in education for life once again. My daughter Hilary Phillips, a Sister, since 1979, as District Nurse at Port Talbot achieved her First Class Degree taking as her main subject Social Policy.…
Her friend, Gail Jones of … Taibach had a First Class BA Degree in English Literature. She is a mother and housewife … who trained with my daughter as a nurse at the Royal Infirmary in Cardiff in the mid-1970s.
I'm sure Hilary and Gail are amongst a growing throng who have benefited from … the aims of the WEA."
Such students are only now beginning to register on the radar screens of politicians and policymakers. I believe that the recent White Paper breaks new ground in that respect, but it must be seen only as part 1; part 2 must be a paradigm shift towards a journey of hope for part-time students in HE—a journey which must take account of what Cled Phillips called the "growing throng" across the whole age range who wish to make widening participation a living reality for themselves.

The White Paper speaks of meeting the needs of a more diverse student body and of improved support for those doing part-time degrees, as if that diversity were not already with us. In fact, more than 30 per cent. of the total cohort of students in HE are already part-time. Part-timers are already in the mainstream, studying at different ages, in bits—not always in three-year blocks—flexibly, at work, in the community, at home or on campus, and often through e-learning. All that should be recognised as the norm, not the image of fresh-faced, full-time young people, important though they are. Equal opportunity should mean equal opportunity throughout life.

In terms of policy development, there are three major considerations. First, HE today is very different in composition and experience from the system with which most MPs grew up. That is not sufficiently reflected in the White Paper. Higher education today is no longer the preserve of an academic elite of young students moving straight from school to university to follow full-time three-year or four-year honours degrees. Instead, in England 29 per cent. of full-time students in 2001–02 were aged over 21 and 92 per cent. of all part-time students in 2001–02 were aged over 21. In total, more than half of HE students are aged over 21.

Secondly, the White Paper is not sufficiently radical in its consideration of how part-time students of all ages and mature full-time students can access and benefit from higher education. Although the White Paper does not impose any new age-related restrictions in the package of full-time student financial support in England, neither does it take the opportunity to remove the unfair and unpopular restriction on older people—those aged over 54—accessing student loans. Setting that aside would be an important symbolic commitment to lifelong learning, it would make economic sense at a time when, in an ageing society, more adults will need to extend their participation in the labour force, and it would be unlikely to have more than a marginal effect on public expenditure.

Although the Secretary of State's intention from 2004 to extend eligibility for support through the access to learning fund for certain part-time students studying the equivalent of at least 12 credits is encouraging, it would be helpful to have further details. Proposals for top-up fees may have a disproportionate effect on the participation in part-time courses of students from lower socio-economic groups unless they also have access to a higher level of loans—repayable on the same terms as those for full-time students. Although support for part-time students facing hardship is welcome, for self-financing career developers seeking to raise their qualifications from level 3 to level 4, anticipated significant fee increases will be a real disincentive without access to loans on the same terms as full-time students. If such students cannot access loans, the impression may be given that the Government will support a "student lifestyle" for full-time students but will not help those adults who are keen to help themselves.

The White Paper gives little consideration to how e-learning might be further developed by all institutions, not only the Open university, to open up access to knowledge transfer. With the exception of engagement with business, the White Paper is underdeveloped in its consideration of how HE institutions relate to other groups in civil society. This failure is of concern since it is through a variety of outreach activities that learners from non-traditional groups, for whom full-time study is not an option, can explore what HE might have to offer them and their communities.

Thirdly, unless specific consideration is given to part-time students' needs, they become invisible in comparison to the needs of school and college leavers extending their initial education through full-time study. There is a danger that the 50 per cent. 18-to-30 age group participation target will prioritise the needs of young people wishing to follow full-time three-year honours degrees in the first instance, and the needs of those following full-time foundation degrees in the second. Although the Government may not intend to marginalise part-time study, the relative absence from the White Paper of reforms tailored to meet the specific needs of part-time students makes it hard for their needs to be considered as anything other than an afterthought.

The Government paper published this month, "Widening Participation in Higher Education", which details proposals for the new Office for Fair Access, appears to acknowledge part-time study only in the context of foundation degrees. In the case of arrangements for mature part-time research students, the Government need to do more than perm it institutions to fund PhD places from their own resources. They should actively incentivise universities to develop new research opportunities for part-time research students to combine study and work—thus building essential links between universities and older learners in industry, commerce or public service employment.

The biggest single experiment in widening opportunities in HE has been the Open university. It has pioneered three significant developments: open entry, supported open learning and distance learning, now e-learning. Given our Government's commitment to fairness and enterprise, it is surprising that that learning experience, with continuing high quality and low unit cost, does not attract more attention in the White Paper.

The OU is a model worthy of close scrutiny and better funding to drive forward the wider participation agenda. The Government would do well to note its characteristics. Year on year, between a quarter and a third of all part-time UK undergraduates choose to study with the OU. The OU has deepened and widened access to HE. Two thirds of its students are aged between 30 and 49 and more than half are women. Nearly half of OU graduates had fathers with manual occupations—almost double the proportion found among students elsewhere.

I referred earlier to student debt. It is crucial that the Government take seriously the most recent research and the views of student bodies on this matter. Professor Claire Callender of the South Bank university in her recently commissioned work "Attitudes to Debt" for Universities UK reveals that it is a factor in recruitment. In my teaching experience, part-timers were very often part-timers because of the fear of the consequences of leaving paid employment, and that affected rates of retention.

A consistent theme of the part-time student is the constant juggling of work, family, travel, and financial responsibilities: 90 per cent. in one survey were in employment. The financial decisions part-timers make can greatly affect their academic success. Working long hours and studying part-time affects retention and drop-out rates. Sound financial advice, guidance and counselling are therefore crucial for part-timers.

I mentioned at the outset the need to recognise the diversity of policy now being developed by a democratically devolved United Kingdom. Scotland has given priority to linking education to enterprise, and in Wales the concept of "the learning country" puts a high premium on lifelong learning. There is no reason to believe that the "State of the Nations", as a recent NIACE study conference was called, will not provide new strategies for widening participation in HE. One such initiative combines the strategies of the OU and the community universities in focusing on community-based e-learning. Connecting Communities Cymru links one university—Swansea—to seven communities where low aspiration, geographical isolation, low HE participation, "inherited" unemployment and negative experiences in compulsory education predominate.

I will end by posing some questions about the specific needs of part-time students, and I begin with quality. Will the Government be asking leading research-intensive institutions whether part-time students can access their courses, and if not, why not? How can part-time students following HE programmes in further education colleges be assured of a learning experience of no less high a quality than full-time students receive?

On the issue of accessibility, part-time students need to study close to home. How will the Government ensure that they are able to access a broad and balanced curriculum? Is there a case for encouraging HE institutions to develop stronger structures for regional planning? On the question of flexibility, what will the Government do to encourage a more comprehensive system of credit accumulation and transfer so that part-time learners can move more easily through the system, changing the rate and mode through which credit is acquired to meet changing needs and circumstances? What can the Government do to ensure that learners and employers do not see foundation degrees as second-class qualifications and that the new qualifications extend opportunity? What evidence is available? Given the increasing divergence between different parts of the UK, which I have already mentioned, how will the Government ensure that the system is both fair and equitable for part-time learners in all parts of the UK, no matter where they study?

Turning to links between HE and other learning, the distinctions made by funders and providers about different kinds of learning are not always understood or accepted by learners. How will the Government ensure that unnecessary boundaries are avoided at the interface between higher education and further education, between higher education and community-based learning, and between higher education and work-based learning?

Next, I refer to the need for greater parity of treatment between full-time and part-time study. What assurances can the Government give that the remit of the proposed Office for Fair Access will not privilege students following a full-time route to HE awards over those following the part-time route? In other words, will there be equal opportunities for access to services and resources for part-timers? If full-time students are to make repayments on their loans only once they are earning, will the Government confirm that part-time students should not have to pay the full amount of their fees, which may be almost three times higher each year than at present, before they too have completed their courses? Will the Government confirm that part-time students have access to loans to meet the cost of their fees, repayable only once they have completed their course?

Finally, and most fundamentally, can the Government give assurances that they will act if the proposals for HE reform are found to have increased the barriers faced by part-time students in comparison with full-time students in such matters as entitlement and access to welfare and support services while on their courses? After all, improving entitlement and improving access will be the real measure of higher education reform.

11.16 am

The Parliamentary Under-Secretary of State for Education and Skills
(Mr. Ivan Lewis)

I congratulate my hon. Friend the Member for Aberavon (Dr. Francis) on securing this Adjournment debate, and on his passion for and clear knowledge about the issues that he brings to our attention. He understands more than most how access to lifelong learning has the capacity to transform people's life chances and to renew entire communities. As he said, part-time study is undoubtedly a growth area, which is something to be celebrated, supported and welcomed.

In the five years since 1996–97, the number of part-time students has increased by more than 15 per cent., from 267,000 to 309,000. As my hon. Friend knows, the Government are committed to encouraging more people into higher education, especially those from non-traditional backgrounds, about whom he spoke so eloquently. We recognise that particular challenges are faced by part-time students, in balancing learning with the commitment to their working and family lives.

It is right on such an occasion to record the fact that we believe that we have achieved a great deal. For example, the Government were the first to introduce support for part-time students on low incomes. The funding provided through discretionary fee support has increased from £2 million in 1998–99 to £17.3 million last year. Hardship funds were doubled in 1998–99, when part-time students first became eligible to apply.

In 1999, we introduced loans for part-time students on low incomes, at 50 per cent. on full-time courses, as part of our continuing strategy to encourage wider participation in higher education. In addition, disabled student allowances were extended in September 2000 to include students attending or undertaking part-time courses of higher education, again underlining our commitment to widen participation in higher education, and to improve equal opportunities. That support is available for students on both undergraduate and postgraduate part-time courses, including those students undertaking distance learning courses through the Open University.

My hon. Friend may be pleased to learn that we propose to do even more to build on that package of support for part-time students. Students on low incomes, for example, will benefit from guaranteed fee support. A new grant will replace the existing loan, to help with the costs of travel, books and equipment. That grant will reduce barriers to entry into higher education for mature students and those over 54 who, as my hon. Friend said, cannot get a loan. Loans are available only to those under 55 simply because loans are written off at 65 and time is needed to recover payments.

For the first time, child care grants will be available for part-time students. As my hon. Friend will agree, that will greatly assist those juggling the demands of work, home and study. I strongly believe in the importance of offering support to those who want to spread study over much longer periods than has been traditional, particularly those who are unemployed or on very low incomes. We especially want to encourage those who are interested in taking taster HE courses with a view to pursuing an HE qualification in the longer term.

That is why we have decided that from 2004 the new access to learning fund, which replaces the existing hardship fund, will include funding to provide discretionary fee support. It will also help towards the other costs of study for students studying the equivalent of at least 10 per cent. of a full-time course. The precise details of the new package have yet to be settled, but will be announced once we have considered responses to the White Paper, "The Future of Higher Education". I assure my hon. Friend that his representations in this debate will be taken into account as we frame our final decisions following the consultation process.

My hon. Friend rightly mentioned the importance of flexible provision, particularly for the group of students whose views he is advocating this morning. I want to focus for a few minutes on various elements that contribute to that flexibility. The first is foundation degrees. The White Paper announced the allocation of £32 million over three years to develop foundation degrees in key employment sectors. It also makes it clear that the future expansion of HE will be largely through foundation degrees. That should further illustrate our commitment to encouraging more flexible, vocational HE provision that will appeal to those already in the labour market. Foundation degrees are designed to be attractive to all students, but the Government are particularly keen to ensure that they are attractive to part-time students.

My hon. Friend mentioned distance learning. As he said, methods of learning are greatly enhanced by the Open university. It continues to play a major role in the development of distance learning and the use of information and communication technology for delivering HE courses. As he will know, it has worked with Cambridge university to develop one of the first three courses to be delivered by the UKeU—the delivery arm of the e-universities project—from early 2003. That course is a master's module in learning in the connected economy. The Open university will have a key role in the delivery of the entire White Paper agenda. It is particularly well placed, as my hon. Friend has said, to deliver the flexible teaching and learning vital to an inclusive higher education sector. That course is an innovative way in which students can study online for a degree while still in full-time employment.

As well as supporting traditional ways of studying, we are working to encourage better use of technology to deliver HE provision more imaginatively and flexibly. I think that my hon. Friend would agree that e-learning has the potential to provide interactive, individualised learning at the pace, place and level most suited to the learner. We have provided £62 million to set up the UK e-universities project to make HE more widely available over the internet for individuals and businesses. Part of the aim of e-universities is not only to help UK higher education institutions to secure a share of a very lucrative market, but to underpin a socially inclusive agenda. A number of the courses offered will be eligible for public funding.

As my hon. Friend knows, we are also keen to encourage community-based learning. He may be aware that, in my speech to NIACE's autumn conference last December, I emphasised my continuing commitment to adult and community learning, for those bring wide-ranging benefits, from the fostering of social inclusion to learning for leisure. In due course, with the publication of our national skills strategy and delivery, I intend to set out clearly our vision for adult and community learning in the long term. That is a part of the skills strategy that we will produce in June.

As my hon. Friend said, we must also consider credit transfer. People with other commitments or constraints are not always able to complete their studies in the way that is currently available to some part-time students. Credit systems, however, would make it possible to break off and start again without having to repeat learning, which is increasingly important for part-time learners in higher education. That is reflected in the White Paper, and we are encouraging the Higher Education Funding Council to start a two-year programme of work with other partners in the HE sector to identify and build on good practice in the use of credit systems. That work will include various pilot schemes to encourage the use of credit to support flexible progression and transfer between institutions and qualifications.

I turn now to student finance. My hon. Friend has genuine concerns about debt, but the Government believe that university education is one of the best investments that can be made. To underline that, on 25 April—only a few days ago—the Universities and Colleges Admissions Service reported that university applications had risen by nearly 4 per cent. and that 6.7 per cent. of that rise was in the over-25 age group. Student loans are nothing like commercial or high street debt, such as credit cards or mortgages, and they are repaid through the tax system and in proportion to earnings. People never have to pay more than they can afford. As my hon. Friend will be aware, we shall further ease the burden of repayment; in 2005 we will raise to £15,000 the income threshold at which repayments start. There is no interest penalty if borrowers take longer to pay, because we do riot intend to charge interest above inflation.

A recent UNITE/MORI poll found that debt is not the major reason for dropping out. Students are more likely to drop out because of dissatisfaction with their course than they are for financial reasons. The same poll found that nine in 10 students are happy with their university experience and that eight in 10 think that it is a good investment in their future. My hon. Friend rightly mentioned access, which is linked to that issue. I assure him that there is no reason why an institution's future access agreement should not cover the widening of access to part-time and mature students. The intention is not to exclude those students from the efforts that higher education institutions make to widen participation.

I asked specifically about the role of the proposed Office for Fair Access. Will the Minister give an assurance that that office would be specifically required to ensure fair play and equal opportunities for part-time students?

That is a very important part of the overall objective of widening access, and I would see that as a part of the relevant agreements. I can reassure my hon. Friend about that.

On devolution, tuition fees and statutory student support arrangements are currently the same in England and Wales. However, I am aware that the Assembly learning grant, which was introduced last September, is available to full and part-time Welsh students on low incomes. We are currently discussing the Welsh Education and Lifelong Learning Minister's proposals for the devolution of student support. The discussions are official and they will continue to develop proposals. In Scotland and Northern Ireland, where the Parliament and Assembly already have responsibility for student support matters, the financial support on offer to part-time students is virtually identical to the current support package in England and Wales. It is up to the devolved Administrations to decide whether they want to follow our lead and offer an enhanced package to part-timers.

I hope that my hon. Friend is reassured by my response and about our commitment to widening access and participation for part-time students. I welcome his contribution to the debate on the White Paper, and specifically on how we can ensure that the new approach to higher education supports the participation of non-traditional learners, part-time learners and mature students.

11.29 am

Sitting suspended.

Criminal Records Bureau

2 pm

I shall start by explaining why I have called today's debate. My interest in the Criminal Records Bureau was roused last November by a written parliamentary answer in the House of Lords. The Minister answering the question, Lord Falconer, announced that checks on 700,000 people mostly working with vulnerable adults were to be postponed indefinitely. Given my interest in issues affecting care of the elderly, that made me want to understand more about what was going on and what had led to that announcement.

The CRB is one of the pillars of this country's system of safeguarding vulnerable people. It is not the only safeguard, but it is an important one. The decision to postpone checks on those who work with vulnerable adults and frail elderly people has provoked an outcry from providers of care services to organisations, such as Action on Elder Abuse, and from practitioner organisations, such as the Social Care Association.

The statement made me want to know what had gone wrong with the system, why it had gone wrong and who was accountable. Strange things happen in this place at times. It was pure happenstance that I secured notification of this debate on the day that I met Lord Falconer and his officials to discuss some of the issues.

The CRB has a long history. The Conservative Government set out their plans to create the agency in a Green Paper in 1993. The idea had strong all-party support in the House. The idea for such an agency goes back even further, but taking 1993 as a starting point, the Home Office has been working for 10 years on plans to establish a centralised agency to provide criminal record checks. In preparing for the debate, I have learned as much as I can about the extensive programme of research undertaken by the Home Office to develop the business plan and the systems that underpin the CRB.

As the Minister will know, criminal record checks were originally to be available from the CRB from August 2001, 12 months after the private sector partner, Capita, signed the contract to deliver, manage and own the IT side of the operation. Over those crucial 12 months, each stage of the implementation programme suffered delays and setbacks. The CRB finally went live on 11 March 2002, seven months late. The first six months of operation saw a gradual increase in the number of applications for checks. Despite a low volume of demand for CRB checks in the early period, it failed to cope. Basically, the system lacks capacity.

In effect, the CRB was drowning in paper. The decision in May 2001 to include a full-scale, paper-based application route had a serious impact on its capacity. I am not just saying that; all the documentary evidence that I have considered supports that conclusion. It is hard to imagine how that problem occurred. It had originally been envisaged that customers of the CRB would apply by telephone or that an electronic route would also be available to apply for disclosures. As the Minister will know, given that: he has provided an answer to this effect, about eight out of 10 applications are based on paper.

The failure to identify at a much earlier stage such a basic customer requirement as how people would prefer to apply for CRB disclosures is staggering. From the evidence that I have seen and the Home Affairs Committee's consideration of the matter in 2001, I know that the matter does not seem to have been addressed at any stage. Indeed, in an answer to me, the Minister confirmed that it was not the subject of a formal consultation with customers but arose only out of the exercise of informing prospective registered bodies of their role and functions and seeing which bodies would be interested. It then became apparent that a paper route would be necessary.

To compound that omission, the CRB has laid much of the blame for the backlog in processing applications that accumulated last year at the door of applicants and registered bodies for completing forms incorrectly, rather than doing what was really needed and offering further critical examination of the design of the forms and guidance for people completing them. Some new guidance has been issued and there has been welcome progress, although some of it has involved changes such as increasing the size of the paper to reduce the number of pages.

Three months after going live, and under intense pressure to deliver checks on teaching staff in time for the school year, the CRB announced a package of measures to improve performance, which included shifting the initial processing of paper applications to Madras, India and seconding hundreds of staff from the Passport Agency.

Five months after going live, the CRB commissioned an independent review by the French Thornton Partnership Ltd. of the core IT systems provided by Capita. In a written answer, the Minister refused to publish the report on grounds of commercial confidentiality. I have been led to believe, however, that when the consultants lifted the floorboards on the system they found a catalogue of serious defects. Software and applications were poorly documented, poorly coded and not adaptable enough to meet future business needs without major modifications. There is even a question mark over whether the system originally delivered by Capita was capable of coping with the demands of the basic disclosure. If that is true, it is hardly surprising that the Carter inquiry found that, even though the system had already undergone substantial "enhancements and improvements" since its original delivery, it was still in need of significant modification to make it fit for its intended purpose.

To what extent the Home Office's system requirement contributed to the CRB's difficulties must be understood not just in the Department but by hon. Members. Did the system originally delivered by Capita fit the Home Office specification? If so, what went wrong? If not, why was the system accepted?

Six months of poor performance and panic measures ended with the Home Secretary calling in troubleshooters. The independent review team led by Patrick Carter found no evidence that the CRB had the capacity to cope with the levels of demand that were forecast. Initial feedback was given to Ministers in September, and a final report was submitted to them in December 2002. That report has not been published, and only a summary of the main findings and recommendations has been made available.

Eight months in, capacity is still a problem for the CRB. As I mentioned at the start, plans to extend checks to staff working with vulnerable adults from April 2003 were postponed indefinitely. I hope that the Minister will say something about the announcements made last November. Will he tell us when a clear timetable will be published for the introduction of checks on staff working with vulnerable adults? It is time now to get some idea of a date by which people should be expected to have been checked, and for the frail, vulnerable elderly people who rely on obtaining at least part of the safeguarding system through the CRB to know that that is coming on stream.

Will the Minister confirm that the timetable, which I hope he will outline in the near future, if not today, will include a start date for the protection of vulnerable adults list from the Department of Health? In its planning for the delivery of that list, the Department's work must mesh with that of the CRB and the Home Office. The decision to postpone checks was an admission that the CRB was ill equipped to meet the demand anticipated in its business plan, which was only published in March 2002, yet and was then already out of date and in urgent need of rewriting. In fact, in the Select Committee the year before, a promise was made that the business plan would be available in March 2001. A year went by before it was published. When will revised forecasts, financial estimates and performance targets be published? Will they appear as part of the annual accounts, or will there be some separate reporting in the near future in advance of the National Audit Office's investigation of the CRB?

One year after the go live date, the Home Secretary accepted most of the Carter review team's recommendations. The introduction of the basic disclosure will be postponed until the system can reliably cope with all the demand for standard and enhanced disclosures. Perhaps the most telling thing is that just two and a half years after awarding Capita the contract, the Government are to embark on a costly renegotiation to secure a system that is capable of delivering the original business intention—the policy intention behind all this.

In preparing for this debate, I thought it would be useful not only to consider the national context but to take the opportunity of raising constituency issues with the Minister. I had the opportunity to talk to the Sutton Volunteer Bureau in my constituency, which is probably one of the largest of its kind in the country. It runs a wide range of services for volunteers, and it is a registered body. In the past year—the first year of the CRB's operation—it estimated that long delays in securing disclosures cost it one in six of the volunteers who came through its door seeking to work for it and the local community. That is an awful lot of people who did not get to volunteer and provide services volunteers whom the bureau could ill afford to lose. That must be being replicated throughout the country.

Sutton Volunteer Bureau has concerns about the plans to reform the disclosure process. It was surprised that provision had not been made for quality standards to be set on such issues as checking identity, detecting forgery and dealing with inconsistencies of evidence. It does not have that information supplied to it as a registered body; it can make contact with the CRB and take advice, but there is no proper training or guidance available. The bureau is strongly opposed to the 200 applications minimum for applying to be a registered body.

One of the reasons why the bureau registered with the CRB was the administration charge that it had to pay an umbrella organisation for each application. It was paying El 5 as an administration charge, which is a substantially lower figure than some that I have heard about in other parts of the country. Nevertheless, that was an additional burden on a hard-pressed charity, and it is a serious concern for many voluntary organisations, especially where access to registered bodies is limited. It has led the National Council for Voluntary Organisations to recommend a national network of regional umbrella registered bodies. Will the Minister be working with the voluntary sector to determine the best way to establish such a network with sufficient funding to allow sound databases and processes to be developed to ensure that local voluntary and community organisations throughout the country have equal access to services?

Sutton Volunteer Bureau raised concerns about the idea of prioritising employment groups for different levels of disclosure. It queries whether it will be possible to draw distinctions between different occupational groups that are all in contact with children or vulnerable adults. The NCVO, too, has expressed concern. It pointed out the difficulty in the CRB making decisions about matters on the basis of nationally determined criteria, without the benefit of the detailed and specific knowledge of the job at local level.

There is also a concern about the insurance implications of placing a statutory duty on registered bodies to validate identities. Although that may be a necessary change in the law, it has implications for organisations' insurance liability. What steps is the Home Office taking to review the insurance liability implications for registered bodies following the proposals in the consultation document?

Another point that my local volunteers made related to the proposed electronic application route, which is still being prepared, and the possibility of its becoming the sole route of application for disclosures. There are substantial set-up costs for registered bodies in achieving that means of access to the CRB. Putting in place the necessary IT, appropriate firewalls and other data protection systems is a complex undertaking. That leads me to the final point that was made: the need for more support from the CRB for registered bodies. If an electronic channel is to be opened, it will require training and ongoing support from the CRB. If the CRB is about managing a process from end to end, and registered bodies are an integral part of that process, organisations need to have the benefit of ongoing support from the CRB.

If the reforms of the disclosure process are to work, the CRB needs to implement a more comprehensive package of support and training. The deadline for consultation was 25 April—last Friday. Less than 12 weeks—12 weeks is recommended in the compact that the Government have signed with the voluntary sector, and in the Cabinet Office's code of good practice—was a short time scale within which to respond on an important subject. Given the pressure that his Department is under to table amendments to the Criminal Justice Bill, can the Minister give an assurance that full consideration will be given to the responses from all the organisations before amendments are tabled, and can a written statement be provided of the Government's intentions in light of the consultation?

At the meeting that I had on Monday with my local volunteer bureau, concern was expressed about the enhanced disclosure where soft information becomes available. This is how the process works: an individual gets their certificate, which will say that they do not have a criminal record, but the agency that made the application on their behalf gets the form that has the tick to say, "Wait for the envelope that will have the soft information." That presents it with a series of issues. It is a voluntary organisation. It cannot tell the individual that it cannot appoint them because of the existence of soft information, as that would breach the requirements about registration, but it has to make it clear to the person that they cannot be appointed. Having done that, that person can walk away from that voluntary organisation with an enhanced disclosure certificate that has nothing on it.

Sutton Volunteer Bureau has heard of examples when people have done that and then gone to work for other voluntary organisations off the back of the enhanced disclosure certificate. What safeguards are in place to ensure that that cannot happen? It certainly should not happen. People should not have the opportunity to work somewhere else when there is information that should have been made available to those making that appointment decision.

The CRB is meant to be self-financing by 2007. In 2001, the Home Office secured the approval of Her Majesty's Treasury for a five-year cumulative cost recovery plan. That plan has to recover all the set-up costs incurred by the agency and Capita, all their running costs and—I believe—the cost of waiving charges for volunteers.

The unanticipated demand for, and use of, a full-scale paper-based application route an top of significant changes to the capabilities of the IT have increased the unit costs of producing a disclosure. It would be useful if the Minister could tell us today what is the current unit cost. The business plan mentions a figure of around £13, and it would be useful to know whether the figure is higher or lower than that. I believe that it is higher. The estimated loss of £100 million in revenue from the basic disclosure process over the next.three years means that fixed and set-up costs have to be spread over fewer standard and enhanced disclosures—disclosures that are more expensive to administer, leaving less scope for paying off what is in effect a loan from Her Majesty's Treasury and, I believe, from the Department of Health.

Unless the Home Office can strike a deal with HM Treasury—which I imagine is next to impossible—or other Departments, charges for disclosures will have to rise sharply to bridge the funding gap and to ensure that the organisation is brought into financial balance by 2007. Does the Minister agree that the CRB's customers should not be made to pay for poor project planning and incompetent implementation? Can he confirm that fee increases for disclosures will be indexed to prices, or will there be a different basis?

One of the most frustrating things about my inquiries into the CRB has been the refusal to publish key reports on grounds of commercial confidentiality. At times, commercial confidentiality offers a convenient means of clouding questions of accountability. I hope that the Home Office will seek the agreement of Capita to waive commercial confidentiality, and publish the Carter report in full and the parts of the French Thornton review on the core system of Capita. That will help to shed light on many of the issues that I am raising.

Because of the absence of those reports, it is hard to pinpoint whether Capita delivered the system specified by the Home Office. The fact that the system has undergone countless changes suggests a serious flaw in the specification and a breakdown in communication during the design stage.

On 12 February 1997, the current Foreign Secretary, who was then shadow Home Secretary, said:
"The experience of setting up new agencies is not happy. The Crown Prosecution Service and the Child Support Agency are the best and worst examples, but by no means the only ones. Agencies set up from scratch and all at once have a habit of early systemic failure that can last for years."—[Official Report, 12 February 1997; Vol. 306, c. 379.]
He was right to issue that warning of
"early systemic failure that can last for years."
Unfortunately, during his watch at the Home Office most of the fatal decisions that set the CRB on course for chaos were taken. The Home Office agreement with HM Treasury that the CRB would recover its costs and become self-financing by 2007 means that Home Office Ministers are now stuck between a rock and a hard place: either they jack up fees for disclosures and court public outcry, or they try to persuade Her Majesty's Treasury to extend the payback period. It seems more likely that the cost of putting the CRB right will fall on those organisations and people who are obliged by law to apply for disclosures, and that is unfair.

In a memorandum of evidence to the Home Affairs Committee in January 2001, the Home Office said:
"Delay is clearly undesirable. However, the CRB service cannot and will not be allowed to go live until systems have been fully developed and tested and there is a high degree of confidence in the service being delivered to appropriately high standards."
Given the evidence available, it is hard to understand how Ministers or their officials could have had the "high degree of confidence" in the system necessary to authorise going live in March 2002. The system was not fit for the purpose and was not ready to cope: it should not have gone live.

2.20 pm

I congratulate my hon. Friend the Member for Sutton and Cheam (Mr. Burstow) on securing this important debate. On any day other than today, more hon. Members might have been attracted to come and contribute their feelings on the rather sad state that the Criminal Records Bureau is in.

My hon. Friend's broad case is entirely correct. He put the questions that any sane and sensible person would have asked in the circumstances, and those questions demand replies from Ministers. The setting up of the Criminal Records Bureau was supported by all parties in the House, and as is so often the case when something is supported by all parties, we have ended up with serious questions about its implementation. Although the theory behind the idea may have been right, the practice in this instance can only be described as lamentable.

With issues of this kind, we often come back to the subject of project management of IT systems within Government. The subject appears to plague all Government, but especially the Home Office, whose record in this area is far from satisfactory. We all remember the Passport Agency and the immigration and nationality directorate problems. It seems that there is a lack of preparedness and understanding of how to frame admittedly complex matters of procurement in IT. The consequences are almost always systems that fail and enormous costs to the taxpayer—as well as the enrichment of certain IT companies in the process, which I do not accept to be a good consequence of the lack of proper procurement within Government.

The stages of procurement, which all seem to be at fault—my hon. Friend's evidence is clear on the point—re as follows: first, we must identify the task that we want the new machinery to effect; secondly, there must be a specification that translates that task into a contract; thirdly, there must be the development and implementation of that specification on the part of the contractor. On that third point, it seems that the Government often buy what is known in the trade as vaporware: systems that have not yet been developed but are promised on the basis of analogous operations elsewhere. However, when it comes to making the machinery fit the task, IT companies are often incapable of delivering.

Lastly, we must identify whether the system is sufficiently robust to be put into operation. Often, the equation is whether the Department accepts the machinery that has been provided, knowing that it is incapable of delivering in full the task that it has been set, or whether it is prepared to lose face and say, "No, I'm sorry, we cannot implement what we have promised, and we must go back to the supplier and say this will not do, this will not provide what we want."

Let us be fair: the problem is not confined to national Government. We accept that. It happens in the commercial world, and certainly in local government. From my personal experience, I remember finding myself twice arraying my legal tanks on the lawns of IT companies that had failed to deliver systems. On one occasion it was for the county council of which I was leader and on the other it was for the police authority of which I was chairman. In both instances, it was because the companies had failed to deliver the specification that we had required.

Obviously, there is a difference in scale when it comes to central Government. Moreover, there is a view, which the Minister should try to dispel, that too much is done by the Department in-house without sufficient expertise at its disposal to understand what it is actually demanding. I was interested recently, as a member of the Science and Technology Committee, to take evidence from a number of learned societies, and in particular the computer engineers' society, which said that it had never been consulted by the Government and that it would be delighted to be consulted on IT procurement matters, because its expertise is clearly relevant and it could greatly assist the Government. As I said, there is a question mark over the procurement process.

There are several questions over how we arrived at this point in the first instance. My hon. Friend has spelled out some of the essential questions to be asked, including where the assessment of the required capacity was. Was that assessment made at an early stage, and was it then correct or incorrect? If it was correct, why did the systems not deliver that capacity? If it was incorrect, why was that so and what post mortem has been undertaken to discover how a Department of State could make such a massive miscalculation?

I agree with the comments of the hon. Gentleman and of the hon. Member for Sutton and Cheam (Mr. Burstow). Will the hon. Gentleman consider adding something to his list of what Parliament and the people whom we represent should see? When the post mortem, as he calls it, has been divulged by the Government, should that not be placed, unedited, in the Library of the House of Commons, so that all Members, all constituents and all organisations affected by this shambles can see it?

The hon. Gentleman is absolutely right. I hope that much of the evidence will come from the National Audit Office inquiry and from the subsequent questions that our colleagues in the Public Accounts Committee will ask. That process will of course be open, but I shall be coming later to the question of openness and the cloak of commercial confidentiality, which I find entirely inappropriate where public sector money is involved. Incidentally, if we extend the analogy with local government that I made earlier, such confidentiality would be unavailable there, because the costs would be clearly specified in the authority's annual accounts. If they were not, they could be ascertained by the district auditor or by application to him. There is a clear difference in approach between what is required of local government and what is required of central Government.

Following the failure to deliver and to provide the capacity required, there was renegotiation with Capita. I think that we are entitled to know the basis on which that renegotiation has taken place. After all, Capita is not exactly unknown to Government and local government. It seems to have its finger in an awful lot of pies. I am not saying that that is necessarily a bad or a good thing, but I simply state that, because Capita is a major provider of services across a whole range of government in this country, it is reasonable for the public and the taxpayer to know what sort of terms and value they are getting in the execution of its contracts. It is unacceptable for such things to be swept under the carpet.

The effects of the inability to deliver were disastrous in many ways. There were all the problems with the start of the school term. The start of the school year seemed to come as a complete surprise to everybody associated with the Criminal Records Bureau. I would have thought that any sort of plan of operation would have had marked in clear and large letters the start of the school year, the lead-up to it and the fact that schools were likely to employ many new staff who would need clearance to allow them to work at the start of term. Apparently that was not so, and the start of term was a surprise. There was a completely unacceptable delay in approving school staff. As a result, there was an absurd situation—until the intervention of the then Secretary of State for Education and Skills—in which teachers employed by a school were sitting in the staff room, unable to deal with their pupils, despite the fact that, in some instances, they had taught for many years without any difficulty, and the local education authority and the governors and head teacher of the school were all prepared to accept responsibility for those experienced teachers having contact with pupils.

The same thing applied not only to ancillary school staff and classroom assistants but to parents who wanted to contribute to schools and governing bodies. I do not know whether the Minister is aware of the hurt and disquiet that were caused to many people. They were prevented from making their contribution to their own child's school simply because they could not get clearance. Many thought that it was a direct reflection on their character—which of course was quite wrong, but that was the perception.

Now there is an indefinite delay in applications for checks on those working with vulnerable adults. That is clearly wrong, because Parliament has willed that those checks should take place. Most people who are familiar with the area want to see the checks for the protection of vulnerable adults put in place at the earliest opportunity. Again, there has been a deleterious effect on recruitment in a sector that is already finding it difficult to recruit appropriate staff. The position is not sustainable in the medium term, let alone the long term.

What has the response been? The Government have reacted in a number of ways. As I said earlier, the then Secretary of State for Education and Skills made an emergency decision at the start of the school year, which got the Government off the hook temporarily. Clearly, there was still a serious problem to be addressed. The Criminal Records Bureau was swamped in paper and was quite unable to perform the task that it had been allotted.

In August 2002, we had the French Thornton Partnership Ltd. assessment of the position. I have to ask the Minister yet again why on earth that assessment has not been published. It will not wash to say that it is commercially sensitive. We are considering deficiencies in a public system. If that is the way in which public-private partnerships are to work in future—if they are considered to be secret and commercially sensitive, meaning that British taxpayers cannot know what is going wrong with a system that they are funding, for the protection of the public good—there is a serious deficiency in the process. The assessment must be published.

The same is true of the Carter inquiry, which has come up with a series of recommendations, some of which will have been helpful to the Government and some of which will have been helpful but distasteful to the Government in terms of what they have to do to put things right. We would be much better informed were the inquiry available to hon. Members and the wider world, so that we could make cur own assessment of what has happened and is happening. I would like to know why, for instance, no detailed financial forecasts were made by the Criminal Records Bureau in its infancy. Why on earth was an agency of such size and importance allowed to go into operation without doing its sums properly? It did not carry out the financial forecasts that would have told us whether it had the redundant capacity to allow for any miscalculation.

We need to know what the costs of the new contract that must be negotiated to put things right will be, and where they will fall. We need to know how much of the cost is due to variation of contract on the part of the Government, which can be said to be the direct fault of the Home Office, and how much is due to the inability of the contractor to make good its previous promises. We need to know whether it is intended that any of those costs will be recouped from applicants—a point made so well by my hon. Friend earlier.

We need to know what level of performance will be deemed acceptable. When will the backlog be reduced to something that is manageable and appropriate? We are told that there has been a reduction in the backlog from 194,000 to 51,000 and that, because applicants are being dealt with faster than they are coming in, the backlog is still being reduced. Presumably, the Minister now has a clear view of when there will be no backlog and when he can revisit the decision not to extend the scheme to vulnerable adults. Will he share that view with us today?

We are told that the checks are 99 per cent. accurate, which sounds very reassuring—when one achieves a target of 99 per cent. in most matters, one can be well satisfied—but in this area we are dealing with 1 million applications over a period of six months. If 99 per cent. of the checks were accurate, I per cent. were inaccurate, which means that 10,000 people were wrongly assessed. Those people were either certified as no threat when they are, which is extremely serious for the people they are working with, or assessed as being a threat when they are not, which is extremely serious for the applicants and the people who wish to employ them. Either way, I would like to know what level of performance the Minister considers acceptable.

The Minister intends to table amendments to the Criminal Justice Bill. He and I have some experience of the ins and outs of that Bill, and we look forward to resuming our jousting on that subject in the near future. Will he tell us when he intends to make those amendments available? That will ensure that they will receive proper scrutiny from the House, because he knows that we have two days on Report and on Third Reading to deal with a huge number of amendments to and aspects of the Bill, and we must be able to consult properly the organisations outside the House that will be affected, such as voluntary bodies. They must have the opportunity to have their views heard.

Are we going to continue with paper-based applications, or is it the intention to reduce the scale of such applications and return to the original vision of how the CRB will work? If that is the case, how long can we expect to wait for that to happen?

My hon. Friend has already explained the background to the position of voluntary bodies, so I will not repeat what he has said, but there are issues about the umbrella registered bodies, the threshold numbers, the appropriate levels of disclosure—and who decides them—and the insurance liability implications for voluntary organisations. Those are issues of huge importance to people whose assistance we as a country, as a society, desperately need in order to make many of our systems work. We owe it to them to make systems as helpful, not as difficult, as possible to operate.

This IT procurement debacle is yet another in a long list of battle dishonours that this Government and their predecessors have won. When will we learn from past mistakes? When will we have an IT procurement policy that delivers on time and to budget and ensures that the finished product has the capacity to deliver the required outcome? We do not have that at present, and we are not learning from mistakes. For example, the difficulties that the Lord Chancellor's Department is having with the court IT systems show that exactly the same mistakes are being made yet again, and very often for exactly the same reasons.

I make a plea to the Minister that he and his colleagues in the Treasury and other Departments get their heads together and come up with a wider view than that available in the civil service. This is no disrespect to the civil service, which is extremely competent in many ways, but frankly it is clear that it has failed in this area. We need a protocol for delivery of large IT projects that does not result in abject failure almost every time. The situation of the CRB is not a success story, and no amount of spin will project it as one. A little humility on the part of the Government would be very welcome, as well as a commitment to getting it right.

2.41 pm

It is a pleasure to speak under your chairmanship this afternoon, Mr. Amess. It is also a pleasure to follow the hon. Members for Sutton and Cheam (Mr. Burstow) and for Somerton and Frome (Mr. Heath). I congratulate the hon. Member for Sutton and Cheam on obtaining this debate on this very important subject.

The only thing that surprised me in the speech of the hon. Member for Sutton and Cheam was that his language was so moderate. The hon. Member for Somerton and Frome somewhat remedied that by making the sort of savage criticism of the Government that I believe to be entirely justified. Towards the end of his remarks, the hon. Member for Sutton and Cheam quoted some criticisms of Government projects that were made by the current Foreign Secretary when he was the shadow Home Secretary. Then, of course, this disaster occurred on his watch, as the hon. Member for Sutton and Cheam pointed out.

It is perhaps no surprise that the Minister who will respond to the debate today is not one of the Ministers who could be personally blamed for the problem, as he was appointed to the Home Office much more recently. I had hoped that we might have one of my regular sparring partners, the Under-Secretary of State for the Home Department, the hon. Member for Coventry, North-East (Mr. Ainsworth), who has been a Home Office Minister throughout this Government's period in office.

Instead we have this Minister, who is known for his emollience. Indeed, whereas his distinguished father used to say the most extreme things in an emollient tone of voice, the Minister is known for saying emollient things in an emollient tone of voice, so it is no surprise that he is with us today. I shall listen with care to what he says. However, I do not want those slightly light-hearted remarks to undermine in any way the seriousness with which Conservatives share the concerns that were expressed in very strong terms, particularly by the hon. Member for Somerton and Frome, about this disaster.

The hon. Member for Sutton and Cheam helpfully traced the history of the Criminal Records Bureau project and drew attention to his particular concerns, which were aroused list November when Lord Falconer said that the bureau's checks on those who were to work with vulnerable auks would be suspended indefinitely. I have many care homes in my constituency, as most hon. Members do, and there are many retired people in my constituency. I share entirely the concerns of the hon. Member for Sutton and Cheam, and I draw the same conclusion as he does that the reason for Lord Falconer's answer was that not only is the Criminal Records Bureau still a shambles, but no one in the Government seems to have much confidence that they will ever be able to sort it out. Conservative Members support all the criticisms of the hon. Members for Sutton and Cheam and for Somerton and Frome.

The phrase that came to mind about the Government's track record on IT projects was that they show a complete lack of understanding of how the private sector works in negotiating contracts and obtaining the right terms. 1 share the experience described by the hon. Member for Somerton and Frome when he was leader of a local authority and chairman of a police authority. My conclusion is that the Government suffer hugely from the fact that almost no one, at any level of ministerial job, has ever been involved in running a private sector business. The director general of the CBI recently carried out a survey from the biographies of every Minister in every Department and only three had even been involved in running any sort of private sector business. The vast majority of people who have been involved at the sharp end of negotiating such contracts, as I was in my previous professional incarnation, know that when drawing up a contract sensibly, the specifications are not changed half a dozen times midway through the process and stringent penalty clauses are applied to the private sector partner so that if something goes wrong everyone can see that it is the fault of the private sector and that the cost burden falls on that sector to put it right.

I could not agree more strongly with the hon. Member for Somerton and Frome when he said that it is an outrage that the Government use the phrase "commercial confidentiality" to try to hide what has gone wrong with the Criminal Records Bureau. I share the view that he expressed in response to my intervention. When the Public Accounts Committee reports, following the National Audit Office investigation into the disaster, the words of the PAC will almost scorch the paper. Its report will put in the shade all its previous hostile reports on the series of disasters over which the Government have presided. I believe that this will turn out to be the worst. I propose to pass the details of this debate to my hon. Friend the Member for Gains borough (Mr. Leigh)—and I suspect that one matter that the Public Accounts Committee will attack is the Government's attempt to gloss over its failures by not publishing the consultants' report or an unedited, complete version of the Carter report, as the hon. Members for Sutton and Cheam and for Somerton and Frome said.

When one looks at some of the issues raised by the hon. Member for Sutton and Cheam, one must query whether the Government are wise to keep returning to private sector companies that have presided over past disasters. I know from my experience when my party was in government and I worked—as you did, Mr. Amess—in a very junior capacity in a Government Department that one problem, particularly with such matters as defence contracts but also in other Departments, is that changes are often made while a contract is under way. I recently had discussions with defence contractors in my constituency who said that the trouble with dealing with the Government is that they have no idea of what they really want and they keep changing their mind. I am sure that other hon. Members have had the same response from private sector companies in their constituencies if they have ever talked to them about the problems that they face when dealing with the Government.

I strongly echo what the hon. Member for Somerton and Frome said about using tine expertise that is available in Parliament. He rightly referred to speakers from a professional body who give evidence to the Science and Technology Committee, of which he is a member. However, there is an even better example in the IT area in Parliament. During my 11 years in the House, I have been on the council of the Parliamentary Information Technology Committee. For those hon. Members who are not familiar with it, it is a unique parliamentary committee, as the industry members are treated as full members and can attend regular meetings in Committee Rooms in the House and take part in the discussions, rather than just listening or being witnesses. On a monthly basis, the Committee Rooms are full of the top IT professionals; chief executives and managing directors come to Parliament and use their IT expertise. Anyone who wants to help the Government to get out of their catalogue of IT disasters has only to use the work of the Parliamentary Information Technology Committee and the expertise available. I hope that the Minister is listening to the debate and that when he returns to the Home Office he will say, "Don't you think it would be a good idea if we talked to some of the senior officers of the Parliamentary Information Technology Committee and arranged to meet some of the industry leaders who come to Parliament regularly, and benefit from their expertise?"

If the Minister does only one thing as a result of the debate, I hope that he will give an undertaking to me and to the hon. Members for Somerton and Frome and for Sutton and Cheam to listen to us and use the IT expertise already available to Parliament, through the Parliamentary Information Technology Committee or the Science and Technology Committee. That would be a positive move.

The hon. Member for Sutton and Cheam referred to his discussions with the Sutton Volunteer Bureau, which entirely mirrors my experience and those of other hon. Members with Surrey constituencies in talking to people in the Surrey Voluntary Services Council; its chief executive, by coincidence, is a lady called Julia Grant who used to work in the same private sector company as I did. The body is in the process of changing its title but I use the title under which it has been known for some years because it will be more familiar to anyone reading the Official Report. I am not a fan of organisations, whether companies or voluntary bodies, rebranding themselves, because it confuses everyone; everyone knew what that body was supposed to do when it was called the Surrey Voluntary Services Council. None the less, I am sure that its valuable work will continue.

Like me, the hon. Member for Somerton and Frome had a helpful briefing in advance of the debate from the National Council for Voluntary Organisations. I want to highlight one or two matters in order to help that body, which represents voluntary organisations throughout the country. I hope that the Minister will respond. The NCVO spoke of its difficulty with the umbrella registered bodies and with determining the appropriate level of disclosure and said that it would be helpful if the Government provided a back-up network of umbrella registered bodies for the voluntary sector. It stated that there should be much more thorough consultation with the voluntary sector and with others to find the most effective method of delivering such a network, and not a widespread deregistration of registered bodies, as the Government are currently planning. The NCVO also made a point that seemed to me, after discussions with voluntary bodies in my constituency, especially significant: the quality of the service provided by a registered body should be of greater significance than the number of applications that are processed—the hon. Member for Sutton and Cheam nods—and I hope that the Minister will take that on board.

The NCVO also suggests that registered bodies should not be given the additional responsibility for checking applicants' identities and that voluntary organisations, rather than the discredited Criminal Records Bureau or Ministers, should be able to decide for themselves whether a standard or an enhanced disclosure is needed for their staff or volunteers. Although the NCVO, as a national organisation, supports an electronic option for applications, it feels that it should not be made mandatory.

I shall expand on a couple of the six main points. The NCVO stated that finding an umbrella registered body seems to be fairly haphazard, as voluntary organisations in my constituency have told me. One respondent to a national survey that the NCVO carried out on the difficulties with umbrella registered bodies contacted all the umbrella registered bodies in their area but received replies only from some. Another contacted organisations that they thought might be umbrella registered bodies only to be told that they were not. Another respondent found an umbrella registered body only through personal contacts. Another found that some umbrella registered bodies, listed as open umbrellas, had decided
"not to open whilst the system settles down",
which is obviously taking rather longer than the Government had expected. That may be the understatement of the century.

More significantly, another respondent to the NCVO survey could not afford the costs of the umbrella registered body that they found. The cost is significant. While we are on the subject of costs, all hon. Members present will know of my heavy involvement in sporting matters. I was particularly glad to receive a submission from the Central Council of Physical Recreation for use in the debate. It says that a number of sports governing bodies have registered with the CRB. Some have reported delays of a few months in getting registrations processed. When we are talking about criminal records a delay of a few months is simply unacceptable.

The CCPR states:
"Once registered a governing body must meet the ongoing administrative burden and the costs in terms of staff time, training, processing applications etc."
The CCPR has estimated that the basic administrative costs of processing a check should be £3 to £7. But costs impact greatly on smaller governing bodies, which typically have few full-time staff. The costs also impact on larger bodies, which must deal with a greater volume of applications. Governing bodies can seek the services of the so-called "open umbrella bodies" to process checks on their behalf. However, according to the CCPR,
"these are often commercial organisations that can charge up to £30 per check."
It should cost £3 to £7and yet commercial bodies charge £30. Those fees must be seen in the context of the intention to provide disclosures free for volunteers.

The limited amount of the Carter review that was published—I agree entirely with the hon. Member for Somerton and Frome that the full report into that disaster must be presented to Parliament—did not fully address the issue of cost-effective access to the CRB for voluntary bodies. Instead it focused on the processing efficiency, or rather inefficiency, that we have all experienced with the CRB. Proposals to deregister organisations that process fewer than 200 checks a year could make access even more difficult. That brings me back to what the NCVO said. The quality of service rather than the number of applications should be the crucial factor.

The effect of deregistering organisations that process fewer than 200 checks a year will be to reduce the number of umbrella bodies and remove the option of registration for some smaller organisations. The CCPR is asking for specific detailed consultations not only with the wider voluntary sector, but specifically with sporting bodies. I hope that the Minister will agree to have a meeting with the CCPR. I am perfectly happy, as deputy chairman of the all-party sports group, to go with the CCPR to see the Minister about this. Having been involved in voluntary sports clubs all my adult life, I know that this has been a huge extra burden. The effect, as the hon. Members for Sutton and Cheam and for Somerton and Frome have pointed out, has been to deter people from volunteering. That is tragic.

The Government say that we have huge problems with obesity and with the health of young people, and that they want to get young people involved in healthy activity, such as sport, to take them out of the drugs subculture. However, through this CRB shambles they are deterring adults from volunteering. Those adults are the backbone of all the voluntary sports clubs, and if they do not volunteer, those sports clubs cannot be run.

Bagshot cricket club, for example, which is in my constituency, and with which I and two of my now adult sons have been involved, has managed to set up a successful colt structure, despite the difficulties of the CRB. However, it has found that a number of people who wanted to work with young people have been deterred from getting involved because of the CRB bureaucracy. That point has been made to me at meetings, and I know that that is replicated throughout the country in sports clubs and other voluntary bodies. The decline in volunteering is no surprise, because the Government have presided over this complete shambles.

The hon. Member for Somerton and Frome rightly said that we in Parliament are entitled to know on behalf of our constituents the basis of any renegotiation with Capita. That is vital, and I have no doubt that the National Audit Office will agree. We must see the Government's proposed amendments to the Criminal Justice Bill relating to the CRB as soon as possible. I agree with the hon. Gentleman that there is a danger that other Departments, such as the Lord Chancellor's Department, will make the same mistakes if we do not learn from this shambles.

There were problems with IT procurement in health and in defence. There was the complete disaster of the skills issue in the Department for Education and Skills. Only a day or two ago, in the Chamber, the shambles of the Treasury and the child tax credits was highlighted. Almost everything that the Government touch concerning IT and national schemes has been a disaster.

Although this Minister is always emollient, he must accept that his own Department, perhaps before his time, presided over the complete disaster of the Immigration and Nationality Directorate and the shambles in the asylum system and the Passport and Records Agency. The Government must finally learn the lessons from all those disasters. I hope that we will hear something positive from the Minister, who at least escapes personal blame, although the same cannot be said of his ministerial colleagues. They caused this disaster—it happened on their watch—and that is not good enough.

3.2 pm

I join other hon. Members in congratulating the hon. Member for Sutton and Cheam (Mr. Burstow) on having secured today's debate, and on the genuine and close personal interest that he takes in the work of the CRB. I also congratulate him on the full description that he gave of the process through which we have gone in trying to make the CRB work successfully. It:.s an important issue, and I am grateful that he has given us the opportunity for the debate, and given me the chance to respond to the points that have been raised.

I am sorry that my presence is not what the hon. Member for Surrey Heath (Mr. Hawkins) was hoping for. However, I shall, emollient or otherwise, do my best not to disappoint in responding to his remarks.

Everyone accepts the case for the establishment of the CRB and the need for the service that it provides. It was set up to provide an important new service, which is part of a larger range of measures designed to improve the protection of children and other vulnerable persons. That is why it exists, why it is important to ensure that it works effectively, and why we are having this debate.

It is important to note, in passing, that since the introduction of the CRB, many private sector employers and voluntary organisations have, for the first time, been able to access information from police records and other data sources, and many staff in the statutory sector whose posts did not meet the criteria for the old police checks system have been brought within the scope of checks conducted by the CRB. As ever, the information that the CRB provides is intended not to be a substitute for the other good practice that employers should undertake in deciding whom to recruit, but to assist in safe recruitment decisions in the interests of the people to whom those employed will provide a service.

Let us be honest: everyone—including the Home Affairs Committee, following the short review that it undertook in 2001ߞrecognised that the task of establishing the CRB would be complex and challenging. In recognition of that, in advance of the commencement of live operations, additional phases were built into the timetable to try to test the arrangements fully.

The hon. Member for Sutton and Cheam described very fully what happened in the event, and I do not need to dwell on that. Suffice it to say that there were problems in getting the information from application forms efficiently. The output was below expectations and there were backlogs of accumulated forms. There were delays. We have heard about the particular problems that occurred towards the end of the summer and around the start of the new school year, and I acknowledge the disappointment that those waiting to get on with the job, to whom the hon. Member for Somerton and Frome (Mr. Heath) referred, felt when they could not do so because the system was not responding as it should.

In one sense I have been here before, because the first debate that I undertook as a Home Office Minister was on the Criminal Records Bureau, in this very Chamber. I remember that the first thing that I said in that debate, having familiarised myself with what had gone on, was an apology for the fact that the system was not working correctly and was not good enough. We needed to make that apology. My right hon. Friend the Home Secretary also made that clear last September when he said that the performance of the CRB up I o that point had been unacceptable. The hon. Member for Somerton and Frome made a very fair point about the problems with IT systems that the Government have experienced in trying to make large-scale projects work. I would observe in passing simply that that is not unique to the current Government elected in 1997. The problem has been going on for much longer.

Steps have been taken, such as the establishment of the Office of Government Commerce and the gateway process, to try to address the points that the hon. Member for Somerton and Front made so forcefully about learning from experience. Thinking of my other responsibilities in the Home Office and my direct experience of the work of the OGC process and the gateway system, I can say that I hope that that work is helping us to deal with some of the legitimate questions that have been raised about processes and systems. No doubt when the National Audit Office inquiry reports, there will be much for us to consider as a Government and as Members of the House.

The hon. Member for Sutton and Cheam asked whether the original system met the specification set out by the Home Office. The answer is no, but that was not apparent from the tests prior to the launch, and we learned then what the consequences were.

The hon. Gentleman asked when the revised targets and business plan would be published. The CRB business plan for 2003-04 will be published in May and will include performance targets. The question of insurance liability has been raised with us, and we have invited the voluntary sector to provide further information on it. I am advised that we are still waiting for that. That will enable us to examine the matter with the Association of British Insurers.

The question was raised of enhanced disclosure certificates in cases where soft information that led to non-appointment had not been disclosed. In the vast majority of cases in which there is soft intelligence, that will appear on the face of the disclosure and so will be available to the individual. Only in very rare and exceptional cases—where showing the information or disclosure would be contrary to the interests of crime detection and prevention—will such information be provided separately to the registered body. However—I hope that this offers the hon. Member for Sutton and Cheam the reassurance that he seeks—the advice produced by the CRB is very clear: an employer should never rely on an existing enhanced disclosure offered by an individual but should always check with the previous registered body whether there was other information. That is the clear guidance given to employers, and if they follow it, the situation about which the hon. Gentleman rightly expressed concern will not arise.

The Minister, before moving swiftly on, suggested that when the Government set up the contract with Capita, there was no requirement for any performance targets at all. How can it be possible, given all the experience of several previous Governments of both parties, that in this day and age there could be a contract with a private sector provider without any performance targets? Will he look into who on earth made such a daft decision?

I do not recollect saying that when the CRB was established there were no performance targets at all. Indeed, performance standards and other things were part of the arrangements. I was trying to answer the specific question that the hon. Member for Sutton and Cheam asked, which was about when the revised targets and business plan would be published.

Will the Minister confirm that when those are published, they will include a recasting of the financial forecasts and the demand forecasts for the next few years?

I will need to check before I answer that specific question, as I would not like to mislead the hon. Gentleman, but I will write to him.

On the Carter report, the Government have published its recommendations and our response. The simple reason why the rest of it has not been published is that it came in the form of advice to Ministers, with a range of options. As all hon. Members know, advice to Ministers is not published. The essential elements of the report, however, have been set out, both in the summary that was published and the written statement that my right hon. Friend the Home Secretary laid on 22 February 2003. However, I will undertake to investigate whether there is any possibility of the French Thornton report being released in part or in whole.

We intend to table amendments to the Criminal Justice Bill as soon as possible—that is not a fatuous but a factual answer. We will carefully consider responses to the consultation paper. It is perhaps not desirable that the end of the consultation period and the opportunity to make legislative change are so close together, but we will take on board what we can from the consultation process and let hon. Members know as soon as possible the nature of the amendments.

Paper-based applications will continue for the time being. However, as we have said, in the longer term we hope to migrate to the electronic channel, and it will be a matter of judgment as to how that process is undertaken.

The hon. Member for Surrey Heath echoed the point made by the hon. Member for Somerton and Frome about the importance of drawing on the House's expertise in IT. I gladly undertake to pass that on to my ministerial colleagues who lead on IT procurement. The hon. Gentleman asked whether I would meet representatives of the Central Council of Physical Recreation. If that would be helpful, I would be delighted to meet them and have discussions, which for understandable reasons are of great importance to him.

I shall turn to the improvements that have been made since we had the opportunity to debate the CRB in July last year. They have demonstrated the benefits of the close working that has taken place between the agency and Capita, registered bodies and police forces. In September, a plan was put in place to increase staffing, and to introduce longer operational hours and revised operating procedures. As I suggested when we debated the CRB last time, one of the major problems had been the need to return some application forms to those from whom they originated, because they had not been fully or accurately completed. Changed arrangements were introduced under the improvement plan to enable those cases to be identified at a much earlier stage so that applications could be returned to obtain the information and then sent back to the CRB. The problem that had arisen through inefficient capture of the data was resolved by outsourcing work to a company in India. That was carefully done, visits were paid, and it has proved to be successful and of great assistance. The real test, however, is that it led to improvements in the CRB's output.

I wonder whether the Minister will tell us what discussions he has had with trade unions about the outsourcing of some of the work. Various Opposition and Government Members recently attended an all-party insurance and financial services group meeting at which we spoke with union leaders, who were concerned about call centre and IT outsourcing and about the fact that this country is losing jobs that are going abroad. That is clearly of great importance to UK citizens, and perhaps he could shed some light on the matter.

The answer to the specific question whether I have had any discussions with trade unions is no. On the wider point about employment in the UK, more people are at work in this country than at any other time. I spent 23 years of my working life in the trade union movement, and I have to say that the Government's record on employment, the creation of jobs and the reduction of unemployment bears comparison with that of any Government in a long time. We can be proud of that.

The key point, and what has changed since I last responded to a debate on the Criminal Records Bureau, is that since October the average number of disclosures issued each week is. 40,000, compared with a weekly average of 24,500 in August. That is more than double the weekly average number of police checks made under the previous arrangements by the 43 forces in England and Wales. For all the difficulties, of which we are aware, the CRB is performing now at twice the rate of the old system. Many more checks are being done and much more reassurance is being offered about the suitability of people who are being given jobs. That is undoubtedly an improvement on what happened before. The total volume has increased markedly.

To date, more than 1.5 million disclosures have been issued, new applications are dealt with in less than five weeks, on average, and currently more than 90 per cent. of standard disclosures and more than 70 per cent. of enhanced disclosures are issued in three weeks. That is a real improvement and there has been real progress since we had a debate in this very Chamber in July last year. It would be wrong, not to say churlish, not to recognise the problems that were faced and acknowledge the hard work that was done by all the people who tried to do something about the situation.

For all the points that have been made about how we got to where we were—those are important, and we must learn from them—the most important thing is that, having established the CRB, we should work hard to ensure that its performance improves. That is precisely what has happened through the work of the past few months.

There was also a problem with old applications that had become lodged in the system. Those were a source of frustration to everyone: the Government, the CRB and customers. That is why the CRB has been giving those as much priority as possible. In the past three months, the number of outstanding applications that are more than six weeks old has been reduced from more than 70,000 to about 16,000—that is a huge backlog clearance. The CRB aims to eradicate by June the backlog of applications that are more than six weeks old; that will amount to enormous progress and it will be the result of much hard work.

The independent review team was established by my right hon. Friend the Home Secretary to consider what further steps might be taken. Its report was published in February, and a summary is in the Library, together with his written statement.

On the areas of the report that the Minister is not able to publish, he said clearly that that was because options were presented to Ministers. I accept that principle, although I do not agree with it. Will he give an assurance that there are no areas in this sad and sorry tale that will not be made public solely because of commercial sensitivity assumed on the part of Capita or Her Majesty's Government?

No, I cannot give that assurance, because there are commercial confidentiality clauses in some contracts; that is nothing new. I hear the question that has been asked about how we balance those requirements—which are standard in both Government and private sector contracts—with the legitimate point made about the need to understand what has been going on. In response to the specific questions asked by the hon. Gentleman and others about the contract, the Government's position has been that commercial confidentiality prevents us from providing that information.

I have a slight scepticism about this subject. When the Minister responded to the hon. Member for Somerton and Frome, he said that he could not produce some information because it had been put in the form of advice to Ministers. I have a dark suspicion that those doing the review might have been asked to put it in that form so that the Minister had an excuse for not publishing it. Am I being too sceptical?

The hon. Gentleman, for whom I have a great regard, is being a bit too sceptical. As he will know, Ministers seek advice all the time on a wide range of issues. That is how Governments—not only this one—operate. It is widely recognised that one needs the space to think about various options put before one before reaching decisions, without everything being exposed to the public gaze. The essential point in relation to the Carter review is that the recommendations were published. The Government, having considered and weighed up the various options, have made clear what they propose to do.

On the deferment of the mandatory checks, the honest answer, as hon. Members will know, is that when one is in difficulty, one should not add to it. That is why the decision was taken—sensibly, I think—not to add to the work load with the considerable additional work that those mandatory checks would require. Everyone recognises the importance of returning to the mandatory checks as quickly as possible. We are now completing double the number of checks made under the old system. That is an improvement, but we want to do more.

It was for that reason that my right hon. Friend the Home Secretary took the decision to defer the checks, as everyone will be aware. Clearly, we regret that it was necessary to do that, but it was undoubtedly the right thing to do, because in all truth one cannot on the one hand say that the Criminal Records Bureau is not able to deal with its work load as efficiently as we would like, and on the other add to that load at the very time that we are trying to sort it out. The sensible thing to do was to defer those checks, as we have done, and to put in place the measures that we have introduced in order to improve the performance. The benefit of that has been demonstrated in the figures that I have just reported; there has been real improvement.

My right hon. Friend the Home Secretary stressed at the time of the deferment that it was a temporary measure. The hon. Member for Sutton and Cheam asked what the future prospects were. When the Home Secretary announced the deferment, he said that checks on existing staff in care homes would be required during 2004—that remains our intention—and that other mandatory checks would be instituted as soon as possible. We are now working with colleagues to plan the phased introduction of mandatory checks as soon as we are confident that the Criminal Records Bureau has the capacity to carry them out. It is important that I place that on record, because the point was raised by more than one hon. Member.

It would therefore be helpful, as the Minister cannot elaborate on a timetable for the institution of the checks, if he could give some idea of the timetable for ensuring that the system has the capacity to allow the Department to bring on stream the extra checks. We need to know the timetable for the implementation of the Carter recommendations—both those that refer to legislative matters, and those that refer to the IT fixes that still clearly need to be made.

We have already discussed the legislative changes, and as the hon. Gentleman will know, we are seeking to make those changes as soon as possible, using the currently available legislative vehicle. I cannot say at this stage exactly what the timetable will be, because it will be the outcome of the process that he described of weighing the capacity and the work load and fitting the two together. The clear objective is to get back on track, having had the necessary interval—if I may use that word—to enable the CRB to improve its performance. which is exactly what it has done, as should be recognised.

We are working on several changes that have arisen from the Carter report. An important point was made about the role of umbrella bodies in the process. We must recognise that a balance needs to be struck between, on the one hand, the capacity of those organisations to undertake the checks sufficiently and, in particular, to pick up the additional requirements that we have consulted about placing on them—a result of the independent review—and, on the other hand, the throughput. That is relevant to the amount that has to be charged for the amount of work that they will be undertaking, as hon. Members will understand.

I heard the arguments about not wanting small organisations to be part of the system. I think that the hon. Member for Somerton and Frome made a reference in passing to availability. When I responded to the debate in July last year, there were 1,075 umbrella bodies, and now there are 1,474. The number of organisations to which people can turn to enable checks to he made has increased substantially, and that is a testament to the success of the concept of umbrella bodies, but a balance must be struck if we are to deal with cost.

Having listened to the debate, I hope that hon. Members will acknowledge that, notwithstanding the difficulties of which we are all aware and which have been highlighted today and in the previous debate, real progress has been made in sorting out the problem that arose. It is important to acknowledge those people who work hard day in, day out to ensure that the system works effectively. They do not want to go to work each day and consider that the service that they provided in the past to their customers was not of the standard that they would want.

We must recognise that the sensible steps that we have taken have enabled real progress to be made. It is important that that approach is maintained and sustained. The experience of the past six months has demonstrated the Criminal Records Bureau's capacity

to increase its output to meet the requirements of the service improvement plan. Having instituted the Carter review, considered the recommendations and decided on the way forward, we hope that further improvements will be made so that the CRB can look forward to the future with confidence.

May I press the Minister further on how the costs of putting the CRB right will be met? There is now a real fear that there will he a substantial increase in the charges. A figure of £35 has been mooted as a possible level for the fees for disclosures in future. Can he confirm that that is nowhere near what it will be, but that the figures will be around the level of the retail prices index, and not substantially more?

I cannot confirm figures now because they are currently under review. The cost recovery framework and the objectives under which the Criminal Records Bureau operates are clearly laid down, and the hon. Gentleman described them accurately in his opening speech. We are currently considering what the fees will be, and our decision will be based on the volume of work, the timetable, the need and so on. We will have to await the outcome of that process.

In conclusion, I must say that I have appreciated the opportunity to respond to the debate. It is an important issue. We have made real progress, but more must be done.

Education Funding (Poole)

3.30 pm

I am pleased to have the opportunity to speak on behalf of Poole local education authority and Poole schools at what has proved to be an opportune time. I should declare that I am currently a Poole councillor—although not for much longer—and that my daughter teaches in a Poole school, but to the best of my knowledge her job is not at risk.

In my role as a councillor, I was chair of education for Poole when it first became a unitary authority in 1997, and I wish to spend a few minutes setting the scene. Poole's schools had previously come under Dorset county council, and there is a long-standing record of underfunding, in both capital and revenue terms. Dorset used to be proud to boast that it was a debt-free authority, and it used to recycle its basic credit approvals to district councils, which—to be fair—did help to support social housing, but did nothing to address the state of school buildings. In 1997. Poole had two secondary schools whose science and technology facilities were akin to those provided to the school that I attended in the 1960s. In one of those schools, special needs provision was located in a poorly converted cloakroom area.

The Minister recently said to me during Education questions that he thought that I would be thanking the Government for this year's capital investment programme of £13 million for Poole's schools—and I do, from my heart. Generations of children in Poole have been educated in substandard buildings and with inferior equipment. particularly in the two pyramids that are now receiving attention. Without the current Government's commitment to education, I do not believe that the improvements in buildings in Poole's schools would have been made. However, there is still more to do, and more funding is needed.

I remember that in the 1980s—before the introduction of standard spending assessments—the then political administration used to boast about the academic results that were achieved in Dorset with some of the lowest spending in the country. Because it is a large rural county, there were high costs in keeping many rural schools open, and I believe that Poole's schools were starved of funds and that that historic low spend led to the low education standard spending assessments that all authorities in Dorset were given.

It was therefore welcomed as good news that the Government were reviewing the formula that determined those standard spending assessments. However, the outcome of the review is that Poole has fallen from being the 137th worst-funded authority to the 145th worst-funded. Inevitably, there will always be gainers and losers in any review, but it seems particularly harsh that an already low-funded authority should be pushed further down the scale. Poole is protected by the floor this year, so unless changes are made there will be even worse news in years ahead. The morale of head teachers and all school staff has been dealt a devastating blow.

Poole LEA has recently been awarded 4 out of 4 for education in its comprehensive performance assessment, and it has also received a good Ofsted report. I wish to quote from that report, which was published in January 2002:
"The Standard Spending Assessment is extremely low by national standards. Education has been designated as the highest priority by the council and has been funded slightly above SSA for the last 2 years."
I will return to that point.
"High levels of delegation mean that individual budgets are close to national norms, but some central services are thinly staffed."
I think that the Minister should return the congratulations.

I have another quote:
"Poole's education SSA is below unitary authorities' and statistical neighbours' averages and overall the sixth lowest for the primary and secondary sectors in England. However, its spending since local government reorganisation has increased in real terms from 98.6 per cent. SSA to 101 per cent. in 2001/2002. In 2001/2002 the SSA per secondary pupil for Poole was £2992, the Unitary Authority average £3262, and for statistical neighbours £3159."
Parents, teachers, local residents, MPs and councillors cannot understand why Poole's children are valued at nearly £300 per secondary pupil less than their neighbours.

In the LEA's Ofsted report, the Government's inspection team ranked the funding available to the LEA for strategy for school improvement as 7, a very low grade, whereas value for money of services to support school improvement was graded at 3. The LEA is playing its part well, but clearly more support is needed from the Government.

Poole is a small education authority. In 1997 it inherited an unusual situation, in that four of its seven secondary schools were grant maintained—more than 70 per cent. of secondary school pupils were in GM schools—leaving the borough's three secondary modern schools under the control of the LEA. The prime motivation for applying for GM status was to improve the financial status of the schools. Although I was personally deeply opposed to GM schools, I could understand the motivation, given the extremely low level of funding for our schools.

Those circumstances led to a very divided education community, as one can imagine, with the GM schools having healthy school balances, but with Poole LEA inheriting a situation in which the schools balances added up to just £26,000 overall. I believe that one half of the LEA schools were running deficit budgets. All three of the LEA secondary modern schools were in great need of capital investment, two because of the age of the buildings and the third to provide better for a growing school population.

Since 1997, overall school balances have increased, and ironically, a problem identified in the LEA's Ofsted report is their high level. Perversely, the district auditor continues to identify that as a weakness in his reports. I mention that because I hope that the Minister will deal with it. Last year, the school balances were in the range of £4 million to £5 million, which is too high in relation to the LEA's overall budget of some £50 million. It is important to note that relatively few schools hold large balances. The foundation schools accounted for £1.5 million at the end of March 2002.

My personal belief is that although the LEA has worked hard to achieve a successful relationship with the majority of foundation schools—that was very difficult, as the former GM schools had to readjust to lower funding levels—there is still a feeling among some of them that they are independent of the LEA. In addition, given the historic low funding, there is still an understandable caution among many head teachers, and there are instances of schools saving up to make the most of match funding.

I believe that the education scrutiny committee is not working as well as it might—that point was identified in the Ofsted report—and that it must bear in mind that money held idle is not being spent on the current generation of schoolchildren. However, some head teachers have told me that they are just getting by on this year's settlement because of their reserves, but that the future is grim. That is what today's debate is about.

I have case studies of 30 schools and shall quote just a few points from them:
"We would be running a deficit of £30,000…lost 1.5 Teaching Assistants."
"We anticipate running a deficit of £40–45,000 on the 2003/4 budget…training will be very limited…temporary teaching contracts will not be renewed."
"As a result of cutting back hard on books, equipment…staff training …strategic development, I am taking a budget to the governors which only recommends a deficit of £25,000."
Obviously, I could go on with those at great length, but I have much more to say to the Minister.

How did the situation arise? In December 2002, the Government said that the per pupil increase for Poole would be 4.3 per cent., far below the English average. I believe that the Minister has now accepted that Poole's actual increase was only 3.5 per cent., when one takes on board the cut in the standards grant. However, the increase is on a low base and is obviously insufficient to cover the increased costs, which have been clearly identified by many others, in national insurance contributions, teachers' salaries and pensions.

Based on Government figures, the position of Poole's education funding has significantly worsened. The gaps have widened. By comparison with the average level of funding, Poole is £47 worse off. The gap was £293; it is now £340. That is equivalent to £900,000, which would be a very useful sum for the authority. Poole is £103 worse off than the best-funded and £49 worse off than the worst-funded authority.

From the perspective of Poole parents, governors and teachers, the new education funding system appears no better, no more equitable and no more easily understood, and now a widening funding gap exists between Poole and other authorities. A particular problem with the application of the new formula is that Poole and Dorset have relatively low-wage economies but high house prices. In the Ofsted report for the LEA, the inspectors commented that
"the borough is relatively prosperous and the cost of housing is high. There are pockets of deprivation. Unemployment is well below national averages but this makes a low wage economy generally."
Poole has high average house prices. A recent survey has placed Poole at No. 14 in a list of places most expensive to buy a home by comparison with average wages in the area. That means that more has to be offered to public sector workers to attract them to Poole in the first place. Poole and all Dorset authorities are losing out from resource equalisation and not benefiting from area cost adjustment. I request that in reviewing the impact of the new formula, the Government give urgent consideration to the effect of high house prices combined with a relatively low-wage economy outside the public sector.

I congratulate my neighbour in Poole on securing this important debate. I assure her that those of a different political persuasion—and those of none—fully support the powerful case that she is making for a better deal for our borough's parents and children.

I thank the hon. Gentleman.

A further local issue is that many of Poole's schools have a relatively high proportion of experienced staff, which is really good, but they are more costly in terms of salary and making up the shortfall on their threshold payments. Poole is a beautiful place to live and work.

The Secretary of State for Education and Skills was speaking at a major conference in Bournemouth last week, and I want to spend my remaining time addressing some of the issues that he raised. First, I am reliably told that Poole did send its completed section 52 form ahead of time. Secondly, a large sum of money has not been held back in balances as far as Poole is concerned. I am told that about £180,000, or 0.3 per cent., is held simply as a contingency.

Thirdly, the Secretary of State mentioned that perhaps some areas with low council tax should increase it. Poole has put up council tax more than necessary because it has passported an extra £227,000. A political battle is going on out there right now, and the current council is blamed for the high level of council tax increase. It is difficult to increase council tax, even if it is low, because that impacts on pensioners and people with low incomes.

We also have to deal with deprivation. The Ofsted inspectors mentioned pockets of deprivation. Surprisingly, in two wards in my constituency, more than 30 per cent. of 0 to 14-year-olds live in households receiving benefit. The situation is highly variable. In my ward, that figure stands at 2.3 per cent. Relative deprivation is quite a problem. One head teacher told me:
"I have taught in London boroughs and we were all in the same boat."
That is quite a significant point.

The local authority has not diverted money to capital spending. It assures me that it has put all the special needs money into schools, and I really cannot find any of the faults that the Secretary of State was suggesting that other authorities might have. Another head teacher put it to me that there are many Government initiatives, but when they are stripped away the core funding is relatively low. The Minister needs to bear in mind the question of whether the core funding is high enough to provide basic education for an authority as lowly funded as Poole. It has relatively expensive teachers. There is a basic cost to education, and because Poole does not qualify for various pots of money, funding is too low.

We also have a further expense, of which I am really very proud. In Poole there are three excellent schools for children with disabilities. The Minister may well have heard of the Victoria school, which is obviously nationally famous. Not surprisingly, such schools attract families with children who have special needs to live in the borough. I would not want that any other way.

I am aware that Poole is just one of many local authorities where head teachers are concerned about the impact of this year's settlement. Poole works closely with its schools, parents and governors. No one believes that the authority has a secret hoard of cash or is diverting money for other purposes. One head teacher observed to me:
"I simply believe that a mistake has been made as far as Poole is concerned."
Another head teacher, as I mentioned earlier, wondered about core funding. In the speech in Bournemouth, the Secretary of State said that
"these changes do mean that each child now attracts the same level of basic funding wherever they live".
It really comes down to whether that basic level of funding is enough, given the special characteristics of an attractive area.

The schools and the LEA have major challenges ahead. For example, they have to make faster progress in improving key stage 2 results. The tight funding situation means that options for action to meet the challenges are limited. Far worse, after years of hard work obtaining excellent results on a shoestring, and a taste of life getting better, this year's settlement has devastated our teachers. All associated with Poole's schools are despondent. I trust that the Government will make it a matter of urgency to address their concerns. The Minister has agreed to a special meeting and I hope that my speech has persuaded him to have that meeting in Poole so that he can see what it is like at the chalk face in one of the lowest-funded authorities in the country. In Poole and the rest of Dorset, we need a better deal for our children.

3.46 pm

May I say what a pleasure it is to be under your careful guidance, Mr. Amess? I offer my congratulations to the hon. Member for Mid-Dorset and North Poole (Mrs. Brooke) and welcome the hon. Member for Poole (Mr. Syms).

I have only tentative family links to Poole. Some of my extended family spend large parts of their holiday there and insist that is a wonderful place. They do a large amount of water-skiing and other water sports. The offer of a ministerial trip to Poole is, needless to say, extremely tempting. However, I must balance that offer with equally tempting—or sometimes not equally tempting—invitations to visit other parts of the country.

I understand the hon. Lady's personal commitment to the education service and I should like to respond to some of her points. She mentioned one point in passing, relating to her personal link with the teaching profession in Poole. I am sure that we all want to recognise the enormous efforts that teachers, head teachers and governors throughout the country have made to raise educational standards. The fruits of those efforts in Poole are noteworthy and should be put on the record.

I asked the Department to dig cut the figures. They focus on the primary changes in Poole over the past five or six years and are striking. Since 1998, the proportion of young people leaving primary school in Poole who are doing well in English has risen from 64 to 73 per cent. In maths, the figure has risen from 54 to 67 per cent., and in science, the figure has risen from 67 to 85 per cent. At a time when many people are only too ready to disparage the teaching profession—sometimes even those who represent the teaching profession—I am sure that Members across the House would say that that is good evidence of improvement and that we are all committed to seeing that improvement followed through in the secondary sector, in which there are big challenges at age 14 through to school leaving at 18. I hope that the improvements in primary schools can be translated into improvements in the secondary sector.

The funding picture is striking in a number of ways. I am certainly not going to argue with the hon. Lady about whether Poole is the 145th or the 143rd lowest ranked authority for funding. There is a small disagreement between the statisticians at the LEA and the statisticians at the Department over that. I do not want to quibble about it. The context is that between 1997–98 and 2002–03 Poole's education spending assessment increased by more than £13 million, as the hon. Lady said, but education formula spending is only part of the picture. The standards fund increase, to which the hon. Lady also referred, has risen from about £600,000 in 1997 to £4 million this year, although 1 recognise that certain issues, to which I shall return, apply this year. The school standards grant, which goes directly to schools without going through the formula and recognises pupil numbers—regardless of the spread of LEAs to which the hon. Lady referred—has risen to £1.5 million. Capital funding has also increased.

The focus of the hon. Lady's comments was on the situation this year and the changes that have come about from reform of the local government finance system. I should address that substantively. It is worth saying at the outset that Poole receives the amount that it does because of the characteristics of its pupils. The process involves scientific census and careful work, and involves no judgment by Ministers or anyone else. Poole, notwithstanding pockets of deprivation, is a less deprived authority. The percentage of children whose families are on income support is about 15 per cent. compared with a national average of more than 20 per cent. On the working families tax credit, I was pleased that the hon. Lady referred to the issues raised about the education of children from low-wage families. In Poole the proportion is just below the national average at 17.5 per cent. compared with 19 per cent., and I hope that she will understand in a moment why the changes to the system recognise, at least in one respect, the challenges of education for children whose parents are in low-wage employment.

As the Secretary of State said in Bournemouth, we believe that similar pupils in different parts of the country should have the same amount of money attached to them by central Government, and I am sure that the hon. Lady does not dispute that different pupils have different needs and that that must be recognised, preferably in a simple way, as we have tried to do. We can say with confidence that similar pupils, whether they live in Poole or in my constituency of South Shields, have the same amount of money attached to them; I shall try to explain why.

We all agree that the old funding system needed to be changed. It was based on the 1991 census, which is out of date; it included a number of capricious elements, not least a failure to recognise the division of responsibilities between LEAs and schools; and it was widely seen to be unfair. The new system is based on three simple elements. The first is a basic entitlement-the hon. Lady did not use this language, but referred to a quorum entitlement—of £2,005 per primary school pupil and £2,567 per secondary school pupil. Secondly, there is a top-up for deprivation and additional educational needs. Thirdly, there is recognition that some areas face particularly high costs for recruitment and retention of teachers. In the development of that new three-part system we received valuable help from LEAs throughout the country, including those such as Poole, which, I believe, is one of the smaller authorities.

Sometimes people worry that Government consultation is just a matter of form and that nothing comes out of it. One specific change that was not foreshadowed in the run-up to the review of local government funding was the recognition that small authorities face a particular challenge. In the final announcement of the conclusions of the review, we established a £400,000 grant for running costs for all small LEAs in recognition that they face particular challenges. I hope that the hon. Lady agrees that that is a good example of a minority of LEAs with a particular interest making their voices heard. Central Government listened and recognised the problems that they faced in running such local authority services. I know that she did not have time to say so in her speech, but I hope that she agrees that that is a good step forward and that authorities such as Poole are not penalised because of their relatively small size. That important improvement was brought about by the work of the education funding strategy group, largely populated by representatives of local education authorities and teacher representatives.

There is a core entitlement for every child and recognition of additional needs. It is worth dwelling on that for a moment, as the hon. Lady did. The old system used data on pupil characteristics from 1991 as the basis for distributing funding for additional educational needs. That included children of lone parents, who got special amounts of money, and children of parents who were born abroad. It used information about children from families in receipt of income support, too. The idea was that authorities with significant numbers of children in those categories spent more on education in 1991 and therefore will need to spend more in future. That was obviously an inadequate way of distributing money.

In the new system, there have been some significant changes, which are not just simplification. I shall dwell first on the definition of poverty that the hon. Lady mentioned. We agree that children whose families are on

income support or who are unemployed face special challenges. There was a big debate in Government and education circles about whether the recognition of poverty through income support should be supplemented by a recognition of the challenges for children whose parents are on the working families tax credit. Although Poole is not above the national average for the number of children whose parents are in relatively low-wage work, the hon. Lady is right to say that it is a high-employment area, but not necessarily a high-wage employment area. The recognition in the new funding formula of the needs of children whose parents are on the working families tax credit is a structural change that will be of long-term benefit to places such as Poole when they keep employment up. Even if that employment is not in high-wage work, they will get the benefits in the formula.

There is also recognition of the challenges involved in educating children who speak English as a second language. Poole benefits less than many other authorities from that factor for additional educational needs because it has about I per cent. of pupils with English as a second language or from a low-achieving ethnic minority group, compared with a national average of about 9 per cent. That is another reason why the funding formula produces the changes outlined.

To complete the picture, the third element of the funding formula relates to the extra costs of hiring teachers, especially in areas where recruitment and retention is particularly difficult. We tried to take account of the point that the hon. Lady made, that it is not only the obvious places such as London and the south-east that face recruitment and retention pressures. Under the old system, 51 local education authorities had their additional costs recognised. I am pleased for hon. Members on both sides of the House that the number of LEAs that we are able to recognise has increased to 99 from 51; the bad news for the hon. Lady is that Poole is not one of them, because the result of the investigation of wage rates did not make Poole one of the top 99 authorities for extra costs.

I heard what the hon. Lady said about housing and I take it very seriously. As she knows, in our consultation document issued last summer, two of the options used housing and two used instead the general employment measure, which is a measure of wages. In the course of the discussion about that consultation paper, the overwhelming body of evidence was not just that the general employment measure was a more sensitive indicator to use; it was also the strong view that it was more accurate. On that basis we took the decision to follow the rest of Government in using the general employment measure as our indicator of relative costs throughout the country. I hear what the hon. Lady has said on the matter and I shall bear in mind her point about housing, because we have tried to consider it.

I conclude by saying that I appreciate that any year in which there are major changes in the local authority funding system is a year of uncertainty, in which the changes that are under way need to be considered.

The hon. Lady talked about the positive working relationship that exists between schools and the LEA, notwithstanding Ofsted's report that the LEA school improvement services are not necessarily all that she or others would want. I am pleased to hear about that positive relationship.

The Secretary of State made it clear that, once the purdah restrictions of the local elections are out of the way, we want to encourage every LEA and every school that is now feeling the pinch to engage in a constructive dialogue about some important issues that arise from the submission of the so-called section 52 returns from the LEAs. There is significant evidence that about £500 million is not being withheld by LEAs from schools, but is money that they have still to allocate to schools. We are anxious that schools do not take decisions on the basis of a provisional budget comparable to last year's budgetary outturn when more money is coming to them. We will encourage schools to have a careful dialogue with their LEA about the full budgetary outturn. There are also significant issues about the amount of the schools budget that is not being passed on to headmasters, headmistresses and head teachers around the country, whether that money is going on special needs or other factors. The hon. Lady also referred to money that is being transferred from revenue into capital. Those issues will be out in the open as of Friday. I very much hope that they will lead to a serious dialogue at local level, not only in Poole, but throughout the country.

Financial Services Industry

4 pm

I welcome the opportunity to say something today about the financial services industry. Given that this is a short debate, I intend to concentrate on how it affects Scotland, and Edinburgh in particular, where it is the major private sector employer in my constituency. I should declare a couple of interests at this stage. First, I am a board member of the Centre for Scottish Public Policy, which has recently received some support from Co-operative Financial Services, and also in a voluntary capacity I am the chair of the parliamentary contact group for Scottish Financial Enterprise, which is the umbrella body for all the leading companies and firms in the Scottish financial sector. Indeed, I am indebted to Scottish Financial Enterprise for providing me with briefing material for this debate, which presents a very positive picture of the state of the financial services industry in Scotland.

That positive picture of an important part of the economy in. Scotland contrasts with the picture of gloom that some of the doomsayers have been trying to paint, no doubt for their own purposes in the run-up to tomorrow's elections for the Scottish Parliament. It is worth emphasising the importance of the financial services industry to the Scottish economy as well as the economy of the UK as a whole. It is a large industry and it is a major contributor to wealth and employment.

A study undertaken in 2000 by the respected Fraser of Allander Institute for Scottish Financial Enterprise and Scottish Enterprise estimated that the sector directly employs or supports more than 180,000 full-time equivalent employees in Scotland, which is 10 per cent. of all FTE employment in Scotland. Significantly, it is also one of the fastest growing sectors of the Scottish economy: over the past eight years output from financial services companies in Scotland has grown by approximately 50 per cent., compared with 12 per cent. for the Scottish economy as a whole. The sector has also been growing faster in Scotland than in the UK as a whole, expanding at more than twice the rate of the sector in the whole country.

What may be of particular interest for the debate held here at Westminster is that the Scottish financial services industry, which has been recognised as one of the leading industries in Europe, has in recent years moved into an even more prominent position compared with its European rivals and competitors. Scotland—that means predominantly Edinburgh and Glasgow, although there are other important centres for the industry, such as Aberdeen, Dundee, Perth, Dunfermline and Stirling, to name just a few—is the sixth largest equity management centre in Europe.

Scotland is also sixth in Europe in terms of the life and pension funds managed. In January 2002, Scotland came out in the survey as the number six banking centre in Europe, behind London, Switzerland, Spain, Germany and Italy, but ahead of France, Belgium, all the Scandinavian countries and Ireland. What is even more remarkable is that Scotland no longer has the sixth position in Europe as a banking centre. A few months ago SFE updated its survey. It found that Scotland is not sixth, fifth, fourth, or even third, but is now the second most important banking centre in the whole of Europe, behind only London in its European and international importance. Indeed the chief executive of SFE tells me that when his survey reached that conclusion, he was so surprised he thought he had better check his figures, so he collected the figures afresh from another source and ran the calculation again, achieving the same result, confirming that Scotland was indeed the second centre in Europe. Those figures are impressive and show how that industry has benefited from the stable economic platform that has been established in the UK by the Chancellor and his colleagues in the Treasury.

However, we also need to remember that the benefits of that positive performance are not restricted to just a few high fliers in the financial industry. The financial services sector has been growing at four times the rate of the Scottish economy as a whole, and therefore has made a contribution to jobs that has helped to keep the Scottish unemployment rate at its lowest level for many decades. We know from individual case studies that many people made redundant from the microchip plants of Motorola, or NEC in West Lothian, near Edinburgh, have found jobs in financial companies.

The latest figures show employment in the banks, building societies, insurance companies and fund managers at 99,000. Such employment has been increasing annually since 1996, and it is now one of the most significant contributors to the general prosperity of the Scottish economy.

The financial services industry in Scotland is important in the nation's economic success, and in particular in ensuring secure employment, and it is therefore vital to create the conditions to ensure that it continues to prosper. It is also essential that we reject any political and economic experiments that would gamble with the livelihoods of so many people in Scotland, and especially in Edinburgh, about which I am particularly concerned. I will therefore mention an opportunity for further growth that is now within the reach of the Scottish financial industry but requires Government action if it is to be grasped fully. I will also speak about a peril that now faces the industry. I hope that the Minister will address those two points in his response.

Although England is overwhelmingly the largest market outside Scotland for Scottish financial products and services, in the past 10 years most Scottish financial companies have begun to sell into individual European markets, either directly or through joint ventures with local companies. Europe represents a very large potential market for Scottish-based financial services companies, particularly in the provision of long-term savings and pensions and the management and administration of investment funds. Europe is now Scotland's second biggest market after the United Kingdom. I am told that several of the non-British companies that have established financial services operations in Scotland in the past few years are already doing. or intend to do, a large amount of work in Scotland for customers in Europe.

Unfortunately, there are obstacles to Scottish companies—I am sure that the same is true for companies in the rest of the UK—selling into European markets. Those obstacles include language differences, culture, and transport links, some of which are easier to tackle than others. However, some of those factors are under the control of politicians and Governments, such as the currency difference between the UK and most of the rest of the European Union. It is my view that the Scottish financial services industry would suffer, as would the rest of industry, if we were to be excluded in the long term from the single European currency. However, I do not wish to speak at length about that issue today, as I am sure that the Minister would refer me to future opportunities to discuss it.

However, if the Scottish financial industry is to be able to take maximum advantage of the opportunities to grow its market elsewhere in Europe, the Government must address the question of regulatory differences, which can act as a powerful protectionist factor and constrain the ability of the dynamic financial services industry in places such as Scotland to compete on a level playing field in some other European countries.

I know that it is the view of many of the major players in the Scottish financial services industry that Scottish companies have much more to gain than to lose through the completion of the single market in financial services across the EU. I support their call that the European Commission should be encouraged to take forward its action plan intended to bring into being a single regulatory framework for financial services by 2005. For that reason, I welcome the announcement made by the Chancellor in his Budget speech that he will urge Europe's competition authorities proactively to investigate barriers to competition, starting with financial services. I am sure that that commitment will be welcomed in the Scottish financial services sector, and I should be interested to hear from the Minister how that plan will be implemented. I hope that he will take the opportunity to consult the important Scottish industry as he makes progress with the plan, and will consider a visit to Edinburgh to meet some of the leaders of the sector.

That is the opportunity that we must grasp. As I said earlier, there are also threats to the Scottish financial industry. In the last few minutes available to me today. I shall say something about the most immediate peril: the threat that would arise if the Scottish financial industry, as a result of constitutional shenanigans, found itself cut off from what is still overwhelmingly its most important market—that in England, which is 10 times the size of the Scottish market. Because we are part of the same United Kingdom, that market is open to the Scottish financial services industry on equal terms to those on which it is open to any London-based company. The people to whom I speak in the financial services industry tell me that they want to maintain that level playing field, and maintain a single regulatory system for the financial services industry throughout the UK.

That single market and single regulatory system would be under threat were Scotland to leave the UK. We now have long-term stability, brought about by the Government's policies and a monetary policy managed independently by the UK central bank. No one knows what arrangements would be put in their place in a separate Scotland. Would there be a Scottish pound? Would an independent Scotland keep the pound sterling? If it did, that would hardly make all the uncertainty and disruption of independence worth while. Would an independent Scotland seek to join the euro? Would it be allowed to do so, given that the spending policies of the Scottish National party and the Scottish Socialist party would breach, by vast amounts, the limits set on members of the eurozone? Would there be an independent Scottish central bank, or would Scotland's monetary policy be set by the finance committee of a Scottish Parliament?

That presents us with the unattractive prospect of an uneasy coalition of the SNP and the Scottish Socialist party sitting down to decide how much the Scottish Executive could borrow and the rate at which they would attempt to set a Scotland-based lending rate. If Scotland ended up with a separate currency from England, that would increase the costs of Scottish financial products for customers in England, who would be much more likely to move their custom elsewhere.

I know that Scottish nationalists and others who support separation do not like to talk about such issues, but they are fair questions to ask, and particularly appropriate to a debate on the financial services industry. There is no doubt that the prospect of years of constitutional uncertainty and wrangling would introduce a major threat to the Scottish financial services industry. It is uncertainty that frightens off existing and potential customers. After all, how many customers of Scottish financial services companies would risk keeping their money in Scotland if they thought that Scotland's economic and taxation policies were going to be decided by the SNP and Tommy Sheridan's SSP? Billions of pounds would flow out of the Scottish economy, hitting jobs in Edinburgh hard.

It would not just be English customers who would be frightened off. Many Scottish customers of financial services companies would be likely, I am sure, to seek safer homes for their savings. That is just what happened in Quebec in the run-up to the independence referendum held by the Quebec nationalist Government a few years ago. The SNP has the same policy of keeping Scotland in suspense, should it be elected to power, by holding an independence referendum at some secret date in the next four years.

That uncertainty, if it came about, would hang a sword of Damocles over the jobs of 100,000 people in Scotland, many thousands of whom work in my constituency. Not only would people who work in the financial services industry would be at risk of losing their jobs; the financial services industry and its employees buy goods and services from many other industries. Printers, legal and accountancy firms, and the IT industry have important contracts with the financial services industry, which would be at risk if the existing UK economy were to broken up and Scotland were to separate itself from its most important market.

I hope that the Minister can say something about the threat to the financial services industry in Scotland that would arise if those who would seek to divorce Scotland from the rest of the UK were ever to get their way.

4.15 pm

I congratulate my hon. Friend the Member for Edinburgh, North and Leith (Mr. Lazarowicz) on securing the debate, and on setting out in such clear and persuasive terms the importance of the financial services sector not only to his Edinburgh constituents but to the economic health of Scotland.

My hon. Friend is right to draw attention to this subject. Of the top 20 companies located in Scotland, 10 are in the financial services sector. They account for 70 per cent. of the profits generated by those top 20 companies. With a flourishing retail and corporate banking sector, a substantial life assurance and pension presence, and a fast-growing investment management expertise, the Scottish financial services sector exhibits strength and breadth in depth.

At the heart of that dynamic sector, despite activity in other parts of Scotland, is the vital centre of Edinburgh, which provides the pool of expert knowledge and skills that maintains Scotland in the premier league of locations for providers of financial services in Europe. The Government are working in close partnership with the Scottish. Executive to encourage a strong financial services sector in Scotland.

In June 2001, Scottish Enterprise, the Scottish Executive and Scottish Financial Enterprise launched "Investing in our Future". That action plan was developed in partnership with the financial industry to focus on the challenges and opportunities for the future growth of Scotland's financial services sector. I understand that good progress is being made in implementing the plan.

Although my hon. Friend is right to sing the praises of the financial services industry in Scotland, he is also right to warn of the damage to the financial services industry in Scotland, and hence to the wider Scottish economy, that would follow should anything be done to jeopardise the strong UK policy Framework that has fostered the strength and growth in that sector.

In response, I should like to focus on some of the key elements of that policy framework, which has been so important both at the European level, to which my hon. Friend drew our attention, and domestically. Those are essential for the continued success of the Scottish and the wider UK financial services sector.

The importance of financial services to the economy as a whole has been well stated. It is also worth stressing the importance of the Scottish economy to the overall strength of the UK's financial services sector. A full 11 per cent. of jobs in UK financial services are located in Scotland. The Scottish financial services industry has been, and remains, central to the continued success and strength of the UK financial services sector as whole. The clear links and dependencies between the industries north and south of the border are highlighted by the fact that England remains Scotland's most popular market for investment.

The financial services industry in the UK will continue to flourish and to make a key contribution to the wealth of the nation only if the macro-economic environment is correct. The Government's economic policy framework, which has delivered a platform of low inflation and sound public finances, means that the environment necessary for Facilitating further development of UK financial services now exists. That was confirmed in the recent International Monetary Fund financial system stability assessment on the UK, which stated:
"The UK's large and sophisticated financial sector features fundamentally sound and highly developed financial institutions, markets and infrastructure, supported by a financial stability policy framework that has been significantly strengthened in a number of ways in recent years, and that in many respects is at the forefront internationally".
What could be more damaging to essential economic stability, successful Celtic companies and the future of Scottish jobs than wrenching the country through a costly and complex divorce?

Perhaps because of the elections tomorrow, the Scottish National party fudges the issue of independence with a policy of fiscal separation, which is motivated by the desire not to build Scottish competitiveness but to break the British political connection. In doing so, it puts at risk Scottish jobs and successful Scottish firms, especially in the financial services field, which my hon. Friend is rightly so concerned about. Recognition that the UK's policy framework is leading the field internationally must not make us complacent about seeing reform elsewhere. As my hon. Friend has urged, the UK has been a determined advocate of further European liberalisation in the financial services field.

We brought the issue to the top of the political agenda during the last UK presidency when, at the Cardiff summit, Heads of Government agreed to the financial services action plan, which aims to deliver an integrated EU financial services market. We have kept up that pressure and, at the Lisbon summit in 2000, secured agreement that the financial services action plan should be completed by 2005.

Creating an integrated EU financial services market will enable firms to cut the cost of raising capital and it will benefit consumers by giving them a wider choice of competitively priced and better-developed products. The FSAP is an important tool, but putting legislation on the statute book is not enough. It is important that legislation be properly implemented by member states—not incompletely, with such incomplete implementation being used to hinder access to domestic financial services markets. Protectionism hinders competition and hurts consumers.

It is important that, where financial services providers encounter such barriers, they report them to the Commission, which must take effective action to tackle them. I encourage my hon. Friend to encourage the financial services providers in his constituency, and more widely within Scotland, to bring such concerns to the attention of the Commission.

My hon. Friend rightly mentioned the need to promote greater competition in European financial markets. He mentioned the Chancellor's statement to that effect in the Budget, which said:
"Because flexibility at a UK level should be matched by flexibility in Europe, we are proposing that Europe's competition authorities proactively investigate barriers to competition, starting with financial services".—[Official Report, 9 April 2003; Vol. 403, c. 277.]
Competition is central to the creation of an effective and integrated EU financial services market. In such markets, as in others, it is important that established providers do not use their market position to hinder new entrants. In that respect, we welcome the Commission's ongoing inquiry into cross-border clearing and settlement. Where UK financial services providers feel that their market access is restricted by unfair competition, it is important that they bring it to the attention of the Commission, and it is important that the Commission takes effective action. Again, I encourage my hon. Friend to pass the message on to the financial services providers in Scotland.

The Treasury has, for some time, been working closely with the financial services industry, including representatives from Scotland, to identify the barriers to the creation of a more integrated EU system. Treasury Ministers and senior Treasury officials hold regular round tables with industry and consumer representatives to discuss the issues. The Treasury particularly welcomes the recent report on single market barriers, which was produced by a number of financial services industry trade associations and firms, including from Scotland. It identified more than 80 individual barriers to the creation of a genuine single market for financial services in Europe, and it forms a substantial agenda for action. I also know that the report was well received in Brussels.

Effective and efficient financial markets are important for the reasons set out by my hon. Friend, but they also stand behind the development of all other areas of the economy. To make real progress towards the creation of a comprehensive single market, we need to recognise the important contribution that the EU's financial centres—not just London, Frankfurt and Paris, but also Edinburgh—make to the EU economy.

A national approach to issues of strategic importance to the UK as a whole is needed, and financial services are a leading example of such an area. The strength of the UK's financial sector, in which Scotland and Edinburgh are so significant, means that it is vital that the UK has a strong voice in discussions in Europe on financial services regulation and competition and on progress towards a single market. Neither the UK nor Scotland would benefit from speaking with separate voices; indeed, both would be damaged if we ever did so.

Question put and agreed to.

Adjourned accordingly at twenty-six minutes past Four o'clock.