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Commons Chamber

Volume 408: debated on Tuesday 7 October 2003

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House Of Commons

Thursday 10 July 2003

The House met at half-past Eleven o'clock


[MR. SPEAKER in the Chair]

Private Business

Nottingham City Council Bill Lords

Read the Third time, and passed.

Oral Answers To Questions


The Chancellor of the Exchequer was asked—

Bank Of England (Gold Sales)


If he will make a statement on his policy of instructing the Bank of England to sell gold and invest the proceeds in particular currencies.[124642]

The decision to sell gold reserves was taken to reduce the risk of over-exposure to one asset in our foreign exchange reserves. That was successfully achieved, as measured by value at risk, and the gold sales delivered a 30 per cent. reduction in risk.

Does not the Chancellor accept that it was a major error of judgment to force the Bank of England to sell its gold when the price was an almost all-time low? Why has he not been willing to admit to the precise consequences when reputable organisations advised me yesterday that, taking everything into account, the actual loss—they say that it is very easy to calculate—was about £400 million, which is about £32for every family in Britain? Although I accept that the Chancellor of the Exchequer is a very wise person, when he makes a mistake, should he not admit it and tell us the consequences?

I disagree entirely with the hon. Gentleman. First, every country has been diversifying from gold. Switzerland sold 1,300 tonnes; Belgium sold 1,000 tonnes. We have sold 395 tonnes. Almost all our European partners, and Australia and Canada, have far less in gold than we do. It was the right decision for the country, and it was the right decision for the management of risk. The hon. Gentleman will be interested to know that, of the new assets that we bought, the ones that have gone up most in value over the past few years have been those that we bought in the euro. It is quite interesting that, when the Conservative party wants to present itself as pro-European, we start the day with the hon. Gentleman leading the fight for the Conservatives.

I do not doubt the Chancellor, but what is the basis of the judgment that there has been a 30 per cent. reduction in risk? How is that arrived at?

I have with me the National Audit Office report, and the hon. Member for Rochford and Southend, East (Sir Teddy Taylor) was also wrong to imply that that may not have been the Bank of England's advice to us. The Bank of England supported our decision. The hon. Gentleman will be interested to know that the NAO made a study of this. The study is not from a PhD thesis on the internet. [HON. MEMBERS: "Oh."] Again, if I can repeat to the House that, reading the study in its quite detailed complexity, there is no question of it ever being sexed up. The document itself makes it clear that this was a value-for-money exercise. That was the sole reason why it was done. It diversifies the risk to us, and already, as I have indicated to the hon. Gentleman, the rise in the value of the euro shows that it was a worthwhile exercise.

Is the Chancellor aware that he is wrong when he says that all the countries are selling gold? The biggest holders of gold, none of which have sold, are the United States, France, Germany and Italy. China is a big buyer of gold, and it has been for some months. Will Britain press for a renewal of the Washington agreement on gold of September 1999, which is due for renewal next year and which he played a part in bringing about?

It is exactly because we have the Washington agreement that other countries did not sell. We had to have the Washington agreement.

Yes, but they did not sell in the past two years. It is precisely because there was concern about the amount of gold being sold around the world, depressing the gold price at the time, that we got an agreement from all the countries. Our gold sales went ahead, other gold sales went ahead, and the countries the hon. Gentleman mentions agreed that they would not sell gold at that time because of the Washington agreement. Of course, we will continue to look at this, but he cannot deny the fact that, in many cases, the countries that have sold gold have sold far more gold that we have and, at the same time, most of the countries that I have mentioned, including Australia and Canada, outside the European Union have far less of their assets in gold. As for value for money, the mistake was made by the previous Conservative Government not selling gold when the gold price was even higher.

To what extent did my right hon. Friend need to coerce the Bank of England into taking that decision; or did it, in fact, agree with him that that was the correct policy to pursue given the current prevailing economic circumstances?

The decision had the support of the Governor of the Bank of England. The decision was made in a transparent way, with the auctions of gold, for which we have been praised because that is a far more open process. The decision has been gone into in a huge amount of detail in the NAO report, and the results of that show that we have achieved value for money, that we are getting a satisfactory return on our reserves and that we are protecting the position of our reserves, while reducing risk. I should have thought that the Opposition parties would support what we did.

Health Spending


If he will make a statement on progress towards bringing UK health spending into line with the EU average.[124643]

Health spending this year is now estimated at 8.1 per cent. of GDP—around the European Union average. It will rise to 9.4 per cent. of GDP by 2007–08.

I am grateful to the Chancellor for that response. I need not remind him of his manifesto commitment to bring spending up to the EU average, and his right hon. Friend's subsequent comments to that effect. The King's Fund detects a sleight of hand, however, and I would be grateful for clarification. Is the Chancellor relying on weighted or unweighted data in addressing that comparison? Will he look at a static or projected spend to the year 2005? In addition, will he rely on the Office for National Statistics recomputation of health spend, which takes in, for example, spending by charitable and voluntary sectors, churches, the prison health service and the defence medical services? Clearly that will have a big impact.

First, it is weighted data. Secondly, we cannot know in advance what all the other European countries will spend. I do not think that the hon. Gentleman can deny, however, that we have the fastest rising health service budget of any of the countries in Europe. We are making a public commitment to the health services. In relation to the King's Fund, I am happy to look at any evidence that he brings to bear, but he cannot deny that we are raising health expenditure by £8 billion, £9 billion and £10 billion a year in future and successive years, which is more than the previous Government ever committed themselves to spending. I would have thought that he would congratulate us today, because his two local health authorities have seen rises in their health expenditure of 9.5, 9.9, 9.7 and 9.5 per cent., and 8.9, 9.1, 8.9 and 8.7 per cent. respectively. How could any of that be possible if there were 20 per cent. cuts in the health service budget?

Has my right hon. Friend considered the financial implications of some of the alternative ways of funding the health service? To pluck an example out of thin air, has he considered some kind of voucher scheme that would allow NHS patients to have their private care subsidised? Has he considered how much that would cost the country?

I am grateful to my hon. Friend. We are spending 7.5 per cent. in real terms increases in the health service over the course of the next few years. Taxpayers, through the national insurance rise, are rightly contributing to the national health service increase. Every party at the last election stood on a manifesto supporting extra health service spending, but the Conservative party has walked away from the commitment. As far as the amounts of money that would be involved in a voucher system in private medical health insurance are concerned, something in the order of £2 billion extra a year would have to be taken from the national health service. That would still mean that a pensioner would pay £5,000 for a hip joint operation, £6,000 for a knee joint operation and £7,000 for a heart bypass. Those are the policies of the Conservative party.

The Chancellor says that the Government are delivering on improved health services, yet he will be aware of recent opinion polls that show that the public believe that health services, along with education, the police and transport, are all getting worse in this country. Who has got it wrong? Are the Government wrong on delivery, or are the public wrong?

There were 11.3 million out-patient admissions a year when we came into office. There are now 12.7 million. There were 12.5 million accident and emergency admissions. There are now 12.9 million. There were 3.5 million elective admissions. There are now 4.5 million. There were 39,000 heart operations. There are now 54,000. That is an increase in the amount of money and an increase in the amount of activity in the national health service. Perhaps the hon. Gentleman might care to comment on his party's spokesman, who now seems to be absent from all our debates on economic matters, who said very clearly that there would be no extra money for the health service from the Liberal party.

Is the Chancellor aware that I am pleased that Labour Members decided to increase massively the amount of money that goes into the national health service, because in the last few months I have been one of the recipients of that treatment? I did a survey while I was in hospital, and every single person regarded their heart bypass as a success story. When we walked out of the hospital, I was waiting for the BBC "Panorama" camera team to ask me whether I thought that the money spent on the NHS was a success story. I did not find a single member of the media waiting for us. Why? Because all they are bothered about is digging in the gutter and failing to recognise that 1 million people are looked after in the national health service every 36 hours. That is a success story not a failure.

The whole House will be able to see that my hon. Friend is back fighting fit after the great treatment that he has had in the national health service. We welcome him back, and the contribution that he has made.

I do not know what to say about the BBC and its programmes, but the fact is that there were 1.2 million cancer operations in the NHS when we came to power and there were 1.34 million last year. There has been a very big rise in the number of cancer patients treated. Equally, we are now in a position in which 98 per cent. of people are able to see a cancer specialist within two weeks. Under the Conservatives, the figure was 63 per cent.

Is the Chancellor not at least a little concerned that in one part of the United Kingdom, Scotland, health spending is already at or even above the European average, and yet health outcomes are substantially below?

Death Certificates


If he will ask the Office for National Statistics to discuss with the Department of Health (a) the reliability of information contained in and (b) return of death certificates.[124644]

I can confirm to my hon. Friend that the Office for National Statistics is working with the Department of Health and the Home Office on planned changes to the system of death certificates. These will be set out in the Government's response to the fundamental review of death certification and the coroner service that was published last month. I can also confirm that the ONS has today published a consultation document on the legislation necessary to make such future changes. I have ensured that a copy of that document is placed in the Library of the House.

I am grateful for that reply, but can my hon. Friend tell me whether the brief that his Department gave him for this question contained the question that was asked of his predecessor on 29 March 2001 when I was promised that, from April that year, there would be an alteration in the ground rules for filling in death certificates, particularly in relation to MRSA? I would like his comments on when we are going to get the consistent filling in of death certificates when they relate to MRSA. Practice across the nation is patchy, and coroners and dependants are being deceived. Doctors are putting down pneumonia and septicaemia, which is true, but the contributory factor is MRSA. We need veracity in the statistics so I hope that he will tell his client Department—I was about to say something rude—to ensure that the certificates are filled in properly.

My hon. Friend is well aware of the difficulties of capturing MRSA and other such infections on death certificates. He also knows that the NHS has introduced a national management system for checking such infections in hospitals. He is right to draw attention to this concern. The particular problem that he highlights with death certificates is one of a wider set of problems with the certification process. That relates precisely to the system that we need to reform, and today's consultation document will help us to do that. I know that the ONS would welcome any further representations that he might choose to make.

My constituent, Dr. Payne, is very concerned that when information on death certificates is found to be insufficient, that has resulted in the Inland Revenue approaching him directly for medical information about deceased persons. I do not believe that a majority of members of the public are aware that all their confidential medical records can be accessed by the Inland Revenue after death. Does the Minister agree that confidentiality does not cease with death and that the disclosure of information should be limited? What steps is he prepared to take to ensure that the Revenue is able to access only those records that are relevant to the financial matter being considered and not all medical records, as is currently the case?

The hon. Lady will know that the certification legislation that covers many of these aspects is now 50 years old. It is increasingly obsolete, inflexible and inconvenient for many families that want to register births, deaths or marriages. The legal amendments that I explained to the House a moment ago will help us to make those changes.

On the hon. Lady's specific points about the Inland Revenue and her constituency case, I shall look into the matter further and respond to her if she writes to me with the details.

I am sure that all hon. Members welcome the review of the coroners service that has been conducted and look forward to the introduction of legislation to ensure that we have a coroners service that is consistent throughout the whole country and a death certification process that is much more sensitive to the needs of families at a tough moment in their lives. Will the Minister assure us that the process for the certification of drug-related deaths will be clarified, because the way in which coroners in different parts of the country record such deaths dramatically affects spending on drug-related issues?

My hon. Friend makes a good point and neatly encapsulates many of the aims of the reforms that we are putting in place. Like my hon. Friend the Member for Thurrock (Andrew Mackinlay), who mentioned MRSA, he draws attention to a condition that is often not included on death certificates. One of the problems with the system is that it does not capture all the information about a death and all the circumstances that might have contributed to it. That will be a problem when we consider future policy changes, and it is also important when dealing with the problems that underlie such sad deaths.

National Insurance


What plans he has to make further changes to the rates of national insurance contributions; and if he will make a statement.[124645]


What plans he has to make further changes to national insurance contribution rates; and if he will make a statement.[124652]

Any changes to national insurance rates are announced at the time of the Budget and pre-Budget report.

Following the loss of 200 jobs in the banking sector in Southend this week, will the Minister tell the House what plans she has to ensure that national insurance payers get value for money? Will she now admit that if the recent hikes are included, net taxes and social security contributions in the year 2003–04 will amount to £402.9 billion, but that that will not bring the improvements to public services that we would hope for? Will she admit that this rotten Government are taxing, spending and failing?

As the hon. Gentleman well knows, unemployment in his constituency has reduced dramatically since the Government were elected in 1997. He will also be fully aware that the national insurance rise is specifically to pay for the increased spending on the national heath service. He must answer the question of whether he is in favour of spending more on the heath service. If he is not, what will he say to his constituents about the services that he wants to cut?

The whole country knows that the increases to national insurance so far and those that are further threatened by the Labour Government are destroying jobs and driving down the competitiveness of our economy because that must be the long-term natural result of such increases in taxation. Will the Paymaster General admit that the Labour Government are heading for a high-tax, low-efficiency economy—the old socialist piral?

Opposition Members will do anything to try to avoid the facts. There are 1.3 million more jobs in the economy. Britain's unemployment is at its lowest level since the 1970s. Opposition Members do not want to answer the question of whether they are in favour of increasing spending for the national health service. If they are not, why not, and how will they explain to their constituents the cuts, and the public services that they will not get?

Does my right hon. Friend agree that one of the difficulties is the measurement of progress in the health service? Those of us who have an interest in economic aspects are used to measuring such things as waiting list falls. However, some of the most important effects of our changes to national insurance and funding for the health service are non-measurable, such as the availability of statins for heart patients, which means that many thousands of people are walking around who would otherwise be dead. Does she agree that such non-measurable benefits are as important as those that we can weigh and count?

If my hon. Friend studies all the statistics, he will find out that in-patient and accident and emergency services, elective admissions and stations services offered by the national health service have increased. He is quite right that we need to increase spending on the national health service so that it provides the world-class service that our constituents want. National insurance is the fairest and best way to achieve that, and the spending results in improvements for his constituents and all our constituents.

Does my right hon. Friend accept that the people in Yorkshire in particular, and throughout the country in general, think that a taxpayer-funded NHS is the best way forward for health provision, so that health care is provided on the basis of need, not on the ability to pay? Is the hospital building programme on target? Will the new hospital planned for my constituency go ahead on schedule?

My hon. Friend is a well known campaigner for the NHS, especially on the principle of availability to all on the basis of need. He is right to focus on the development of new hospitals. The Government have committed themselves to 110 new developments. Only 11 were undertaken under the previous Government. Those developments, including the hospital in my hon. Friend's constituency, are proceeding on time. I am happy to deal with more detailed questions that he may want to raise with me outside the Chamber if he wants to follow that point through.

:Is the Paymaster General really unaware of the difficulties that the Chancellor's tax on jobs and pay are causing for taxpayers, public services and businesses alike? Did she not see the announcement last week by HSBC of 1,400 job losses, with higher national insurance contributions and pension costs given as the cause? Does she think that HSBC does not know what it is talking about, or does she accept that the Chancellor's policies have directly led to the loss of those jobs? Will she rule out any further rise in employer national insurance contributions?

It is breathtaking to hear that from the right hon. and learned Gentleman, who was in a Government who increased national insurance, increased VAT and introduced 22 tax rises. He will not answer the question: does he support more spending in the national health service—yes or no?

The Paymaster General does not understand. She should answer questions—not ask them—on behalf of the Government.

So the Paymaster General refuses to rule out yet another rise in national insurance contributions for business. Is she not also aware of the pain that the Chancellor's rises in employee national insurance contributions are causing? Is that not a tax on income by another name? Does she realise that this year alone a typical couple on average full-time earnings are £568 a year worse off as a result of rising council tax, frozen allowances and the rise in national insurance contributions? If the right hon. Lady refuses to rule out another increase in employer national insurance contributions, will she now rule out a further rise in employee national insurance contributions? Will she rule out yet another breach in the upper earnings limit? If she cannot provide the reassurances people want—we know that the Chairman of the Treasury Committee recently cast doubt on her ministerial knowledge—perhaps she can take a minute to ask the Chancellor, who is sitting next to her, whether he can provide the answers that we all want?

That is very illuminating. The right hon. and learned Gentleman will do anything but answer the question normally, but he rose to the Dispatch Box on that specific point to say that he is not committed to spending that money in the NHS, which is what—

Order. The shadow Chancellor has the luxury of not having to answer questions. He is entitled to ask them.

After those exchanges, we can all understand why the Chancellor does not like answering questions on tax at the Dispatch Box. This is a Government who said that they had no plans to increase tax at all, but who then introduced 60 new tax rises. This is a Government who said that people should not suppose that there would be rises in national insurance, but who increased national insurance in their very next Budget. Are there not growing fears of a black hole in the Chancellor's finances? After his record to date, is it not all too clear how that hole will be filled?

I ask for a third time: are the Government refusing to rule out yet further rises in employer national insurance contributions, employee national insurance contributions and the upper earnings limit? Is it not clear that the Leader of the House was right and that further tax rises are exactly what they have in store? After the promises they have made and the promises they have broken, is it any wonder that no one believes a word they say?

The right hon. and learned Gentleman cannot escape his own record. The British public are committed to and support increases in national insurance to pay for increases in spending in the national health service. It is fair and it is proper. He has confirmed today that he does not agree with that and that his party is not committed to that increased expenditure.



If he will make a statement on current employment levels and their effect on the economy.[124646]

Employment in the United Kingdom is this year at its highest level ever. We are also today publishing our recommendations for employment creation in the European Union.

I thank my right hon. Friend for that answer. Can he tell me what he is doing about the disparity in employment levels between the regions?

In every region, employment has been rising and unemployment falling. In every region around this country, there are vacancies that there never were even with the high levels of growth achieved in the late 1980s. I say to my hon. Friend that, yes, there are pockets of unemployment in many parts of many regions. That is why we are introducing enterprise areas, which will provide additional resources for job creation in those areas, and why we are also announcing proposals this autumn to improve the new deal. The fact of the matter is that we have employment creation in every part of this country, and it is the policy of this Government to work towards full employment not only for one part of the country, but for all parts of it.

The Chancellor will no doubt be aware of the recent Office for National Statistics figures—the Government's own statistics—showing that, for the 12 months to the end of March, the 9.1 per cent. increase in spending on public services produced only a 2.5 per cent. increase in the real value of services delivered. Is the Chancellor concerned that those ONS figures also reveal that the extra £4.6 billion spending, which included more than 100,000 extra public sector employees, contributed only 0.5 per cent. to GDP growth, when the figures also show that a similar increase in household expenditure would have added 2.2 per cent? How does he propose to tackle the decline in public sector productivity? Does he accept that it is no good creating extra jobs when they do not create appropriate growth in the gross domestic product?

This is a question about employment, and the hon. Gentleman should be congratulating us on the employment increase not only over the past six years, but over the past year, in which unemployment has been rising in almost every major industrial country. Our unemployment is now lower than in America, France, Germany and Japan. On his point about the public sector, he said—this is the view that he expressed in his question, and which lies behind it—in The Sunday Timeson 10 March:

"The whole mentality in the public sector is to do as little as you can."
If that is the motivation behind the Flight review to cut 20 per cent. out of public expenditure, we know exactly where the Conservatives are coming from.

My right hon. Friend will be aware that unemployment in my constituency has halved since 1997, but we still have a problem with people who are caught on benefits. Glasgow is now reaching a skills shortage and we need skilled labour. Does he agree, along with many people in Glasgow, that projects such as Glasgow harbour will create thousands of new jobs, including skilled and unskilled jobs, and that we should be supporting such projects?

I am grateful to my hon. Friend, who is one of those pressing for more job creation in Glasgow. Unemployment has halved in Glasgow since 1997, but there are many areas of Glasgow where unemployment is still too high. That is why the new deal is operational. There is a particular project in Glasgow, which involves working with the private sector, the voluntary sector and the Employment Service to create more jobs, and it has been very successful. There is also a major apprenticeship scheme run by Glasgow city. It has also been very successful and it is one of the most important apprenticeship schemes in the country, bringing people into the building trades and other trades. On Glasgow harbour, I shall pass on my hon. Friend's concerns to the Secretary of State for Scotland.

Contrary to the rosy picture given by the Chancellor, we have learned this week that Scottish manufacturing has fallen by some 24 per cent. over the past year. That comes on top of the Government's own figures, which show that we have lost 39,000 jobs in manufacturing in Scotland since 1999. What specifically is he doing to assist Scottish manufacturing? Is he prepared to comment on the 18 different reports in his Department that suggest that early euro entry would help Scottish manufacturing?

We will debate the euro later today, when I hope that we will hear about the position of the Scottish National party.

As far as manufacturing industry is concerned, the hon. Gentleman will welcome our decisions to introduce a research and development tax credit, to make capital allowances permanent, to introduce an information technology allowance at 100 per cent., and to give funding to all the development agencies, including, via the Scottish Executive, Scottish Enterprise. All those measures help manufacturing most of all.

The hon. Gentleman will also welcome the skills paper that was published yesterday and all the work that is being done throughout the United Kingdom in creating a modern apprenticeship taskforce. Perhaps he will reflect on the policies of the Scottish National party, which would cut thousands of jobs from the Scottish economy and even cut public spending in Scotland.

Money Laundering


If he will make a statement on progress in identifying money laundering through financial services companies reporting suspicious accounts.[124647]

A range of relevant measures has been implemented by the Government, working with the Financial Services Authority, the police, Customs and Excise and, of course, the financial services industry itself, to strengthen the UK's protection against the money laundering that underpins so much crime and terrorism.

I thank my right hon. Friend for that answer. Could he say what impact the threefold increase in suspicious activity reports from the financial services industry since 11 September 2001 has had on the number of prosecutions? Could he further say whether he believes that the strength of the National Criminal Intelligence Service is adequate for the purpose of investigating the current volume of suspicious activity reports?

My hon. Friend is right to stress the importance of the suspicious activity reporting regime to the Government's anti-money-laundering strategy. It is undoubtedly making a contribution to the increase in prosecutions, but also, vitally, to the intelligence gathering that is so important in combating crime and terrorism. The role of NCIS is vital. That is why my right hon. Friend the Home Secretary announced last week the establishment of a multi-agency taskforce to ensure that other criminal justice agencies and law enforcement bodies work effectively with NCIS in this area.

Rather than the Government having secret talks with the Spanish about Gibraltar, is the Minister having talks with Gibraltar and other British territories overseas regarding money laundering in banks there?

I am glad to give the hon. Gentleman and the House the assurance that to my certain knowledge, as a former Police Minister, Criminal Justice and Treasury Ministers have regular contact not only with the Spanish Government and authorities, but across the EU and beyond. It is that international co-operation that is securing the gains that are being made in combating crime and terrorism, not least in the aftermath of the events of 11 September.

The Minister may be aware that I have written to more than 30 banks and building societies about this matter. They all responded and outlined several concerns, not least in relation to NCIS and the need to report every single incident; there is a general feeling that that is clogging up the system. Consequently, I hope in the autumn to hold a conference with the industry and the Financial Services Authority. Will the Minister ensure that Treasury and Home Office representatives are there so that we can examine the issue comprehensively and end up with a more efficient system?

I am very grateful to my hon. Friend for the work that he does in this field as Chair of the Treasury Committee. He is absolutely right to stress the importance of the role of the banks and other financial services institutions. I would be delighted to ensure that Treasury officials attend the conference, and I shall certainly urge the same course on my right hon. and hon. Friends in the Home Office.

I welcome the progress that is being made in identifying money laundering. Does the Minister agree that ordinary citizens who observe in their own communities individuals who are acquiring property and enjoying lavish lifestyles, yet are known not to have won lottery money, should pass on that information to their local police? We must put an end to this from the ground up.

The hon. Gentleman is right. The public's role is crucial and we have therefore recently joined the industry in an information campaign explaining to the wider public why they are asked to provide proof of identity on a more routine basis. It is vital in the battle against crime and terrorism.

I pay tribute to the police and Customs and Excise in Northern Ireland. They work with the public in combating crime and terrorism. Gathering intelligence as the hon. Gentleman suggests is vital to that.

Non-Domiciled Tax Status


If he will review the treatment of those claiming non-domiciled tax status.[124648]

In the 2002 Budget, the Chancellor announced a review of the residence and domicile rules as they affected the tax liabilities of individuals. That work is continuing. A background paper was published on Budget day 2003. It provides a framework for further analysis and discussion so that any specific options for reform are based on the widest possible understanding of their effect.

I am grateful for that, but we were promised opinions and proposals in the November 2002 pre-Budget report. It is taking a long time to provide them. Does the Paymaster General accept that ordinary, decent, hard-working people in my constituency who pay their taxes in full find it a little rum that a few multimillionaire freeloaders pay next to nothing?

The hon. Gentleman follows the debate closely and he therefore knows that the rules are broadly unchanged since the early 19th century. In the absence of guidance, they have largely built up through case law. Consequently, the current rules are complex and, as he says, poorly understood. They do not reflect the realities of today's integrated world. In taking forward the review and examining all the questions, including the hon. Gentleman's, it is vital that the outcome is fair, clear, easy to operate and supports the competitiveness of the UK economy, for his constituents as well as mine and those of other hon. Members.

Value Added Tax


What plans he has to reduce value added tax on residential conversion works to existing buildings.[124649]

The Government have already reduced the VAT on most types of residential conversion work to the lowest rate permissible under the European Community VAT rules, but we will continue to keep the VAT treatment of that and other types of construction work under review.

I welcome the progress that has been made, but I am sure that the Minister knows of English Heritage's campaign for 5 per cent. VAT throughout the building industry, for new build and established buildings. Why do the Government refuse to follow the advice and recommendation of English Heritage?

I am aware of English Heritage's campaign, about which several hon. Members have contacted me recently. Creating a flat rate of VAT for all building work, for which English Heritage argues, would mean that we would have no option but to give up our zero rates, including on new charity buildings and new housing. I understand the argument that a VAT level playing field for all sorts of construction would encourage the repair of existing properties as opposed to the building of new ones. We will continue to keep those matters under review. We have undertaken to consider English Heritage's representations and several others in the context of a current European Commission review of the reduced rates rules at European level.

Despite our welcome actions, does my hon. Friend believe that we have done enough for areas such as Burnley, which has 4,500 empty houses? We need to do more in the housing pathfinder renewal areas because although we might need to demolish 2,000 houses, the cost of converting two into one and other schemes to save some others is expensive. We need more Government assistance to make the options viable.

I understand my hon. Friend's point. Most conversions of residential properties have been done at a reduced rate of VAT since 2001. That is also true of non-residential buildings, about which my hon. Friend is concerned, and conversion work to increase the number of residential units in existing buildings. The additional support for which he rightly argues in some of our most disadvantaged areas can come from beyond the VAT regime. We are providing for precisely that, especially in the 2,000 most disadvantaged wards in the UK. We are designating them as enterprise areas.

Is the hon. Gentleman aware that the English Heritage campaign has strong support from the all-party arts and heritage group, which has some 300 members from all parties in both Houses? May I draw his attention in particular to the problems faced by historic churches and by those charged with their repair?

I am aware of the support from the all-party group, and of the hon. Gentleman's support in particular. He has spoken personally to me about this matter, and I know of his work on the all-party group. All that I can say to him is that we are willing to consider proposals for new reduced rates in the context of the current European Commission review. We have received representations on proposals for reduced rates for a wide range of items, from bicycles and compact discs to restaurants and houseboats. We shall consider them all carefully, but they will be considered in the round, and in the context that I have just mentioned.

Private Medical Insurance


What representations he has received about giving tax relief to private medical insurance payments.[124650]

We estimate the Exchequer cost of full tax relief for private medical insurance to be about £1 billion— money that would be lost to the national health service.

I thank my right hon. Friend for that answer. Does he agree that the way to tackle waiting lists for hip and knee replacements in Mitcham and Morden is not through expensive subsidy of the private sector but by developing cutting-edge projects such as the south-west London treatment and diagnostic centre, which will open in December and, we hope, reduce waiting lists to six months?

I am grateful to my hon. Friend for making that point. I know that she does a great deal in fighting for more resources for the health service in her area. It is true that, if we were to expand capacity in the private sector using policies that have been put to us, operations would cost twice as much as in the public sector. If we were to give expensive tax relief to private medical insurance, and to subsidise vouchers for private medical care, the overall cost could be in the order of £2 billion, but pensioners would still have to pay £5,000 for a hip joint operation. We consider that unfair.

The Public Accounts Committee recently undertook detailed discussions with the Cour des Comptes in Paris on the back of a study published by the National Audit Office on international health comparisons, which showed that health care in France and Germany is far more comprehensive and effective than ours. Will the right hon. Gentleman therefore adopt a third way by rejecting the ideological solutions that suggest that either a central, state-run system or an entirely privatised system is best, and follow the French and Germans in promoting new ways to encourage ordinary people to devote a greater proportion of their income to their health care?

What the hon. Gentleman, who is the Chairman of the Public Accounts Committee, forgets is that the French spend substantially more on health care as a whole. Even in the public sector, they spend more than is spent in the United Kingdom. It therefore seems strange that he is also putting forward the proposal that he will not support additional national health service spending here. So far as private medical insurance is concerned—[Interruption.]There seems to be a division within the Conservative party: some people will not support additional health spending, but some are now suggesting that some of their Back Benchers do support it. The shadow Chancellor said clearly today that he did not support additional health service expenditure—

The shadow Chancellor said that very clearly today, and it will be in the Hansard record tomorrow. So far as private medical insurance and the French model of social insurance are concerned, the hon. Member for Gainsborough (Mr. Leigh) also forgets that all the private medical insurance policies on offer in Britain at a rate that people might even consider exclude treatment for conditions or symptoms arising from physiological or natural causes, critical care, routine health checks, out-patient consultations and physiotherapy. In other words, people are paying substantial amounts of money for policies but not getting complete cover.

Trade Liberalisation


What discussions he has had on progress with world trade liberalisation.[124651]

At the International Monetary Fund, I chaired a discussion of the trade negotiations by the governors of the IMF and central banks and the head of the World Trade Organisation. That was in the run-up to what we hope will be the successful outcome of the trade negotiations in Cancun in Mexico.

I thank the Chancellor for that reply. Will he join me in congratulating the Trade Justice Movement and Christian Aid on organising last weekend's campaigns—involving many Members of Parliament—to raise liberalisation issues across the country? The question being asked in Portsmouth, in support of the Government's move, was whether the Government would maintain the momentum to enable the poorer countries to be free to choose the way in which they obtain sustainable development and poverty reduction in their own countries.

My hon. Friend is right. A successful outcome for the world trade negotiations could lift 300 million people out of poverty. That is why I applaud the work done last weekend in presenting the case of the Trade Justice Movement to Members of Parliament in all political parties, and why I hope that the trade discussions that will take place in Cancun will gain extra momentum.

There are a number of areas in which progress must be made. The first is agriculture, but that has been helped by what happened in the European Union last week, and I hope that the talks can now move to a successful conclusion. The second is pharmaceuticals. As my hon. Friend knows, there is considerable worry about a failure to reach an agreement allowing drugs, particularly generic drugs, to go to the poorest countries. I hope that those who have not been able to sign up to that agreement will now do so.

As for access to the developing countries generally, I hope that my hon. Friend agrees that the Government's record in ensuring that the developing countries' voice is heard in the trade negotiations is something of which we should be proud, but also something that we should continue and extend.

Given that agriculture subsidies of up to $1 billion a day are gravely damaging to some of the poorest people in the world, and that the poor countries have vastly fewer resources to enable them to make their case in international trade negotiations than their richer counterparts, will the Chancellor endorse the Conservative proposal to establish an advocacy fund, paid for by the richest countries in the world, to allow the poorest countries in the world to choose the best possible legal representation to protect their interests and ensure that they will enjoy the level playing field that they have not enjoyed in the past?

I will of course look at any proposal that is presented, but the hon. Gentleman must recognise that the United Kingdom Government have been helping the developing countries through the IMF and the World Bank and in the WTO talks, and will continue to do so.

The decoupling that took place in last week's European Union agriculture talks is of some help, but we shall have to move the talks forward with other initiatives in other areas over the next few months. If legal assistance is needed we shall be willing to consider it, as we have done in regard to debt relief and at the International Monetary Fund. I hope that the hon. Gentleman will acknowledge that, in involving the developing countries, we all share the same aims.

Does my right hon. Friend agree that although further trade liberalisation is essential, there may be a case for offering protection to emerging markets in the least developed countries? That is one of the points made to me by members of the Trade Justice Movement when they visited my advice surgery. How will the issue be dealt with in the Cancun talks?

I agree that that is a point of contention between the WTO and others who are presenting proposals, including many non-governmental organisations that subscribe to the Trade Justice Movement. I believe that there is a way forward, however. The sequencing of capital liberalisation and trade liberalisation will enable us to bridge the gap between the position taken by some NGOs and that taken by some of the Governments who have not yet reached agreement in the WTO. I think that the answer for some of the poorest countries is to work within the WTO to bring about a sequencing of their liberalisation. If they do so they will not lose out, and at the same time will gain the benefit of trade in the world market.

The Chancellor has the details of the Conservatives' pledge to establish an advocacy fund to help secure a fair deal on trade for the people of the developing countries, consisting of contributions from the world's rich nations. Those details were in a letter from my right hon. and learned Friend the shadow Chancellor that the Chancellor received 10 days ago. The fund would allow developing countries access—according to their own choice—to the highest-quality economic advice and advocacy on trade issues and WTO round negotiations, and support in the settling of trade disputes.

As the Chancellor knows from that letter—and the answer that he gave my hon. Friend the Member for Buckingham (Mr. Bercow) was not unhelpful—this is designed to be a long-term, sustainable fund, despite being misrepresented as short-term by the Under-Secretary of State for International Development, who declined to correct his error. Our advocacy fund will go far beyond what is currently available from the Geneva advice centre.

On the bipartisan basis on which the Chancellor always seeks—and indeed receives—our support for initiatives to help developing countries, will he now respond to the proposals set out in my right hon. and learned Friend's letter, and support our advocacy fund initiative?

Of course, as I said earlier, we will look at every proposal that is put forward. The hon. Gentleman is suggesting economic advocacy but the hon. Member for Buckingham (Mr. Bercow) was suggesting legal advocacy. We will examine this issue in detail, but I will not be prepared to have international development funds being paid out in big fat fees to lawyers over the next few years. What I will do is to look at how we can help the poorest countries in all the areas in which they are negotiating—that includes the IMF, the World Bank and the WTO—and on which we have already made progress in terms of debt relief. We are prepared to look at such proposals, but there will be no huge payments in fat fees for lawyers.



If he will make further changes to duty rates to facilitate the development of biodiesel fuel.[124653]

Biodiesel already benefits from a duty incentive of 20p per litre below the rate for ultra-low sulphur diesel. As my hon. Friend is aware, duty rates are kept under review as part of the Budget process.

I thank my hon. Friend for that reply. Is he aware that nearly all the biodiesel produced in this country is made from used cooking oil and tallow, but that it could be produced in large quantities from rapeseed if it were economic to do so? The industry estimates that a further duty reduction of some 8p to 10p a litre is necessary for the economics to be right. Will he look again at the figures with the industry? Would not the reward be not only a new, environmentally sustainable fuel from a new type of oil field in places such as East Anglia, but new jobs in a new biodiesel production industry and a new market for farmers, who definitely need new markets?

I welcome the points that my hon. Friend makes; he is the very effective Chairman of the all-party group on the offshore oil and gas industry, so he has not only a constituency interest but industry expertise. I have looked at those arguments very carefully, met industry representatives and gone through their figures and arguments. Our principal consideration in assessing appropriate rates of fuel duty to support cleaner fuels is the environmental benefits that they can bring. We have looked at the figures from the sources that he cites and from others, at the environmental benefits and at the cost of production. However, as yet, we are not convinced that a bigger duty incentive for biodiesel is justified.

Is the hon. Gentleman aware that a further reduction in biodiesel rates may come too late for the ARBRE project that took willow coppice from the Vale of York to be treated at its plant near Selby, and which regrettably has gone into receivership? What discussions has he had with his counterparts in the Department for Environment, Food and Rural Affairs on the benefits not just of lowering duty on biodiesel production, but of the helpful grants that DEFRA gives?

I am aware of the ARBRE project, as the hon. Lady would expect—it was undertaken in the region in which we both represent constituencies—and I was sad to see its collapse and closure. What she is really directing my attention to is the greater environmental gains that may be achieved from biofuels when they are made from woody, ligno-cellulosic feedstocks. We are in close discussion with DEFRA because we want to consider effective ways in which we can support the development of these new technologies. They are currently in the pre-production stages, but they offer much more potential for the future.

Equity Release Schemes


If he will make a statement on the regulation of equity release schemes.[124654]

All mortgage-based equity release schemes will be regulated by the Financial Services Authority with effect from 31 October 2004. I announced on 5 June that an open consultation would take place in the autumn on whether home reversion plans should also be regulated by the FSA.

I thank my right hon. Friend for that reply. Given that these schemes are so important for pensioners—many of them are asset-rich but cash-poor—is the Treasury prepared to look at some options to provide further support or relief for equity release schemes where essential building repairs are required?

I shall treat that—as, no doubt, will my right hon. Friend the Chancellor—as an early Budget submission and it will be given careful consideration, as all such submissions are. On the wider point of consumer protection of the elderly, lessons have been learned from the failures of the '80s in relation to home income plans. In the light of the consultation on home reversion plans, I commend the work done by Age Concern with responsible members of the industry in setting up a code of practice under the safe home income plan scheme. That gives my hon. Friend's constituents and many others the sense of security and certainty to which they are entitled in their old age.

Working Tax Credit


If he will make a statement on the introduction of the working tax credit.[124655]

The working and child tax credits were introduced in April and will provide an extra £2.7 billion support for families with children and low-income working households. The working tax credit continues to provide in-work support for families with children and disabled workers, and extends support to low-income working households without dependent children or a disability.

When the working families tax credit was introduced, one of my constituents was concerned that it did nothing for single people, particularly those on low wages. It remained a possibility, as in his case, that some one could be worse off in work than on benefit. That changed with the introduction of the working tax credit. My fear is that all the emphasis has been on support for children, while there has not been enough publicity for the benefits for single people. The working tax credit could make a huge difference to their lives. Will my right hon. Friend do more to publicise the difference that the working tax credit can make to single people in work?

My hon. Friend is correct that single people aged 25 or over are entitled to receive the working tax credit, as are couples without children. The publicity focused both on the child tax credit and on the working tax credit, but I agree that in the next phase of publicity it will be important to highlight the benefits of the working tax credit to single working people, and I would be happy to involve her in the consultation as we develop the strategies.

Business Of The House

12.32 pm

Will the Leader of the House please give us the business for next week?

The business for next week will be as follows:

MONDAY 14 JULY—Commons consideration of Lords amendments to the Communications Bill.

TUESDAY 15 JuLY-Second Reading of the Sexual Offences Bill [Lords], followed by Commons consideration of Lords amendments.

WEDNESDAY 16 JULY—Opposition Day [14th Allotted Day]. There will be a debate on an Opposition motion, subject to be announced, followed by Commons consideration of Lords amendments.

THURSDAY 17 JULY—Commons consideration of Lords amendments, followed by motion on the summer recess Adjournment followed, if necessary, by further Commons consideration of Lords amendments.

The House will not adjourn until Royal Assent has been received to any Act.

The provisional business for Monday 8 September will be:

MONDAY 8 SEPTEMBER—Second Reading of the Water Bill [Lords].

I should like to remind the House that we will rise for the summer recess on Thursday 17 July and return for the September sitting on Monday 8 September.

The House will rise again for the conference recess on Thursday 18 September and return for the spillover on Tuesday 14 October.

I should also like to inform the House that the business in Westminster Hall for the remainder of the summer will be:

THURSDAY 17 JULY—A cross-cutting question session on domestic violence. Followed by a debate on financing development.

THURSDAY 11 SEPTEMBER—A debate On the United Nations.

THURSDAY 18 SEPTEMBER—A debate On the report from the Education and Skills Committee on the future of higher education.

I thank the Leader of the House for that statement, but does he agree that, with just a week before the start of the recess, there are some important issues that remain to be discussed? First, when can we expect the Green Paper on children at risk to be published? It is referred to in early-day motion 1548,

[That this House is concerned that the inability of the honourable Member for Barking to carry out the duties of Minister for Children is impeding the Government's progress in presenting to the House the Green Paper on Children at Risk, as a result of which local councils are unable to implement changes which would improve the coordination of organisations and agencies involved in delivering children's services and improve accountability arrangements in response to Lord Laming's Report on the Enquiry into the death of Victoria Climbié and calls upon the Government to publish the Green Paper forthwith.] The right hon. Gentleman's predecessor said that it would be published before the recess, so where is it? The rumour is that the delay is due either to the Minister for Children feeling besieged or to the Prime Minister's desire to be present for the launch. Does the Leader of the House agree that neither reason is an acceptable excuse to delay such an important document?

Will there be a further statement before the end of next week on the security and humanitarian position in Iraq? This morning, the BBC reported Whitehall sources—that is sources plural, on this occasion—saying that Downing street now accepts that weapons of mass destruction may never be found in Iraq. That underlines the need for a statement to the whole House.

Perhaps most importantly, we need to clear up once and for all the controversy about the dodgy dossiers, which surfaced yet again at Prime Minister's questions. The Prime Minister claimed that the material in the February dossier—the dodgy one—
"was shared with the Leader of the Opposition at briefings"—[Official Report, 9 July 2003; Vol. 408, c. 1151.]
by the security services. However, my right hon. Friend met the security services once in September, long before the second dossier was even considered. His only other meeting was on 12 February, which was nine whole days after the dodgy dossier was published. When will the Prime Minister come to the House and explain himself? The Ministerial code is clear about this. Page 1—or, in new Labour terms, page 1, clause 1, line 1—of the code states that any error, inadvertent or not, must be corrected "at the earliest opportunity."

May we have an urgent debate on the role of the parliamentary ombudsman? There is an article in The Guardian this morning—I have to declare an interest, as I write a column for the Guardian website—[Interruption.]
I cannot repeat that comment from the hon. Member for Bolsover (Mr. Skinner), but I like to think of my column as a beacon of right thinking in a sea of muddle-headedness. The parliamentary ombudsman, Ann Abraham, writes in her annual report:

"I cannot be expected to carry out my responsibilities properly with one hand tied behind my back."
One problem concerns getting information out of Ministers about gifts. It has apparently taken 16 months to get a response from the Government. The former Lord Chancellor thought that there was no problem. As the report says:

"He did not believe that disclosing the information would do any harm."
In response to attempts to get information on potential conflicts of interest for Ministers, the new Lord Chancellor issued a notice saying that disclosure would
"be prejudicial to the safety of the state."
That is a huge difference in opinion. It just goes to show that one's old flatmate is more reliable than one's old boss. The parliamentary ombudsman plays a vital role. These are matters of great importance, and they should be debated in the House.

In the context of the Modernisation Committee, will the Leader of the House look again at the completely unacceptable way in which programme motions are used to limit effective scrutiny of Bills? In consideration of the Health and Social Care (Community Health and Standards) Bill, 60 clauses were not even considered in Committee. Will the Leader of the House publish, and place in the Library, a list of clauses and schedules for all Bills that are not debated either in Committee or on Report? That list might well turn out to be a roll of shame, but people should know if this place is not allowed to do its job properly.

The Leader of the House will be aware that at the end of a parliamentary term there has been a tendency to sneak out—to use the words of my right hon. Friend the shadow Leader of the House—awkward and embarrassing written statements, answers, confessions, corrections and suchlike. In internet terms, it is like last minute.con. Can we have a guarantee that that will not happen on this occasion?

Now that the Convention on the Future of Europe is over, the Leader of the House has given up one of his three jobs, so I hope that he will and time to launch his great debate—I think that the words he used were "open and honest debate"—on taxation. We are all looking forward to that. After 60 tax increases and a national insurance rise that broke an election promise, people have a right to know what they are in for next. When is he going to tell us?

I welcome the hon. Member for Witney (Mr. Cameron) to the Dispatch Box. I said last week that he was widely liked, but I did not realise that my influence extended so far into the reaches of the Tory party that he would be instantly promoted. However, I would like to know why the shadow Leader of the House, who has only one job, cannot be bothered to turn up today. I understand that he is being wined and dined by journalists in the Press Gallery. The menu is Parma ham and figs, steamed halibut and vegetables, followed by assorted deserts—I mean desserts—although the vacancy he leaves is like a desert. He is being wined and dined instead of attending to the only duty that he has in the House all week.

The hon. Gentleman asked a series of questions, the first of which was about the children at risk Green Paper. We are the only Government ever to bring children's policy as it affects all Departments under one Minister. He should welcome that innovative, new and ground-breaking approach to government in respect of children's rights and protection. [Interruption.]As for the Green Paper, we will publish our strategy not when the hon. Gentleman demands it from a sedentary position but when we are ready. We will not publish according to a timetable set by the Opposition. The Tory party has never had a strategy for children.

Since the commitment was made, we have created a new opportunity to develop policy across Departments, under the control of one Minister for Children. The report will be published in due course, as soon as we are ready to do so. When it is published we will be able to show that it is being followed through in the context of a wider strategy of protecting children and advancing their rights. I have no doubt that the inquiry report, which has been published already, will be followed by local authorities. They will already be considering how to implement the recommendations, and that is the key point.

As I have explained, the report must be set in the context of a sensible, coherent children's policy that protects their rights and advances their opportunities. That is the important point. As I said, the Tory party never had a policy on children at all.

The hon. Gentleman asked when there might be a statement on the humanitarian situation in Iraq. As he knows, there was such a statement last week. If the situation changes, the Government will stand ready to make a new statement. We heard the familiar gramophone record from the Tory party about weapons of mass destruction, dodgy dossiers and so on. As my right hon. Friend the Prime Minister explained very clearly, we are confident that the evidence for the weapons of mass destruction will be found. Iraq is larger than France, and the evidence could be hidden in any nook or cranny, or any shed, anywhere in Iraq. It will be found.

The hon. Gentleman referred also to the BBC. It is very important that the BBC stops being a player in the story and starts to become a spectator. Its job is to report fairly and accurately, and not to create the news or set the agenda. The BBC should stop spinning. It should listen to its own political editor, who rightly said last night:
"A very senior source I have spoken to on this was absolutely sure, when British troops went into action in Iraq, they would face chemical and possible biological weapons."
I think that Andrew Marr was right, and that the BBC should reflect that.

The hon. Gentleman made an important point about the ombudsman's report. We are the first Government to publish the gifts list for Ministers, which we did on 14 March. The list goes back to June 2001. The Cabinet Office apologised for the delay in publication, but we are the only Government ever to have published the list. We are open and accountable in such matters, and will continue to be so.

On the issue of disclosure in respect of conflicts of interest, what is being demanded is that we disclose contacts, correspondence and any communications between Ministers and their permanent secretaries. Permanent secretaries are responsible for upholding the ministerial code, and every Minister has to ensure that that is done. The Government have nothing to apologise for on the matter, and indeed we have every reason to say that we are out in the open and fully accountable in that respect.

The hon. Gentleman repeated another familiar refrain on programme motions and scrutiny. I shall certainly consider his request to publish a list of clauses and schedules that have not been debated, although as he will know, that is a matter of public record anyway. I do not think that it would be a problem to put it all together in the Library, but I shall get back to him on that.

On sneaking out last-minute statements, there is always a balance between keeping the House in formed—as Leader of the House I am anxious that the Government should do that—and overloading the House with business. [Laughter.]Hon. Members may laugh, but those on the Conservative Benches complain that too many statements are made and do not want them to be made on their Opposition days. They cannot have it both ways—they cannot have Ministers making statements at the Dispatch Box and keeping the House fully informed, if they are not prepared to accept that on Opposition days. The hon. Gentleman should bear that in mind.

Finally, on taxation, the Conservative party put unfair taxes on the British people year after year, hitting the lowest-paid and affecting everyone in all income brackets. As a Government, we have introduced fair taxes that assist those at the bottom of the pile, are fair to those in the middle, and are seen overall as fair and just.

I remind the Leader of the House that yesterday was the final day for the Government to produce their response to the report of the Joint Committee on House of Lords Reform. When will he or his colleagues produce that response, or is it yet again a case of a timetable that has been set by someone else and is to be disregarded?

When will the Waste and Emissions Trading Bill return to the House? Having been through the Standing Committee, it seems to have become becalmed. We see no sign of its returning to the House for Report and Third Reading.

I welcome the right hon. Gentleman's announcement that there is to be a debate in Westminster Hall on the United Nations on the symbolic date of Thursday 11 September. I remind him that since the commencement of hostilities in Iraq, the House has had a large number of statements from Ministers but we have not had the opportunity to debate the outcome or the future prospects of that country. Will he arrange for a debate on our return to the House? By then it will be urgently needed, given that so far practically none of the objectives of the military action have been achieved. Saddam Hussein has not been found and nor have the weapons of mass destruction, there is no peace or security, there is a shortage of humanitarian and medical aid, there is no oil and there are no plans for reconstruction. The House needs an opportunity to debate those matters.

Finally, I ask the right hon. Gentleman not to listen to the siren voices in the House who are complaining about the siren voices outside in Parliament square. I remind him that in times past he thought that direct action outside Parliament was useful and appropriate, and it still is.

On House of Lords reform, it is my understanding that the Government will respond to the second report of the Joint Committee before the House rises for the summer recess.

The Waste and Emissions Trading Bill has completed all its stages in the Lords and is awaiting introduction in this House. I hope that we can proceed with that when the business slot arrives.

I agree with the hon. Gentleman that the debate on the United Nations is timely and important, and I hope that the whole House will have the opportunity to commend the UN for its international role and will seek to strengthen it, as indeed we as a Government have a proud record of doing. He pointed out the obvious fact that Saddam Hussein has not been found—obviously, he had prepared his exit strategy carefully, no doubt taking much Iraqi money with him. We intend to find him. When we do, that will encourage greater stability. However, the picture that the hon. Gentleman painted was almost as though the Iraqis would have been better off if we had not liberated Iraq. That is unacceptable. If one talks to any Iraqi who was not a Saddam supporter or one of his henchmen, or henchpersons, one finds that they are pleased that he has gone, and we ought to take credit for having achieved that.

As for protest outside the House, there is a long and honourable record of protest in Britain. I have taken part in it, as the hon. Gentleman was kind enough to remind me, and we should always uphold it.

The Leader of the House is aware that all local authorities in England and Wales have to be compliant with the terms and conditions of the Disability Discrimination Act 1995 by October 2004, but is he aware that, over the past three or four years, 5,000 of the 10,000 public toilets in England and Wales have been closed? Will he get in touch with his colleagues in the appropriate Department to urge them to hold an emergency debate on this serious matter, before all public toilets are closed?

I very much welcome the fact that my hon. Friend raises that issue, which is of concern to all constituency Members, and I shall certainly draw his point to the attention of the Deputy Prime Minister. I commend my hon. Friend for continuing to raise such issues; access to toilets for people with disabilities is extremely important.

The Leader of the House would expect me to support the request made by my hon. Friend the Member for Witney (Mr. Cameron) for a review of programming, at an early date, by the Modernisation Committee, of which I believe the Leader of the House will assume the chairmanship next week, and I wish him well with that. Will he give an assurance that that review will be a priority?

My real question relates to Zimbabwe. It is and has been a disaster, and it is developing into a catastrophe: a country will virtually disappear because of starvation and all the horrors of a totalitarian regime. Will the Leader of the House arrange for a statement—I know that a debate will be impossible before the House rises—on the current situation in Zimbabwe and on what the Government would hope to do, with other countries in southern Africa, to bring about the removal of Mr. Robert Mugabe?

I endorse what the hon. Gentleman said about Zimbabwe. As he knows, we have stood shoulder to shoulder in exposing and attacking the brutal tyranny that exists under Robert Mugabe. There will be an opportunity to discuss that in an Adjournment debate in Westminster Hall on Tuesday, and I hope that, if he is not in the Chair, he and colleagues will at least go along to make their voices heard. It is vital that we stand by the people of Zimbabwe and assist them in ensuring that a change is made to get rid of the tyranny to which they have been subjected.

The hon. Gentleman has raised with me the review of programming both on the Floor of the House and as Chairman of the Procedure Committee. I shall be happy to listen to his and others' views on the matter. It is an agenda item for the Modernisation Committee, and I am content that that is the case.

Has my right hon. Friend seen the sensational headlines in today's Daily Express? Obviously, the control of sex offenders is important, so can he ensure that we have time to debate the issue before the summer recess?

A balance needs to be struck between gross sensationalism and ensuring that the problem is dealt with firmly. We are all aware of the need to target the problem of sex offenders and clamp down on it. The Government and the police are working together to ensure that that is done. Through the legislation and other measures that we have introduced, the problem is being targeted more systematically than ever before, but I shall certainly draw my hon. Friend's remarks to the attention of the Home Secretary.

The Leader of the House knows that thousands of my constituents depend for their livelihood on the BAE Systems factory at Brough that makes Hawk aircraft. The factory depends on a Government contract for those aircraft, on which it was promised a decision last month. That decision was not forthcoming and the factory sought an extension. The extension passed last week. There is fear in my constituency that this unpopular decision, which, at the stroke of a pen, will alter the future for all my constituents, is being put off into the recess. Can the right hon. Gentleman give an undertaking either that we shall have that decision before the recess or that a Minister will come to the Dispatch Box to explain why the Government are not competent enough to deliver on a promise that they made last year?

I understand the point that the right hon. Gentleman is, quite properly, making on behalf of his constituents. As he knows, we have a good record of support for the aerospace industry, especially on defence contracts. I realise that the contract is extremely important for the BAE factory in his constituency, and I shall certainly get in touch with the Secretary of State for Defence as a matter of urgency.

May I draw the attention of my right hon. Friend to early-day motion 1488.

[That this House congratulates Liverpool, and all the contenders for the title of European City of Culture 2008, on their efforts to make the UK a rich and diverse place to live; notes that many British cities could with justice have claimed the title, but that there are other strengths in cities which should be recognised and encouraged amongst which, most importantly, would be the ability to create strong local economies; calls upon the Secretary of State for Trade and Industry to lobby the European Union for the creation of the title European City of Enterprise to be awarded annually, starting with a British city in 2004; and further notes that if this award were to be made, one of the strongest contenders and probably winner of the first award would be the city of Leeds, which on every measurehas demonstrated a determined and successful strategy to reduce unemployment, create new businesses and develop thriving private and public sectors which has resulted in long-term economic stability for its inhabitants, whilst recognising that there is always more to doi.]? We hold many debates about the rural economy and the role of London and capital cities. Should not more attention be paid to the role that regional cities play in the country's economy?

My hon. Friend has identified an important point. I was a strong backer of Cardiff's bid to be the European city of culture, because it is a fine and enterprising city, as are Leeds and other cities in the rest of Britain. We should like to pursue the idea of an annual award to a European city, and if he makes further representations, I am sure that they will be listened to.

Will the Leader of the House arrange, at the earliest opportunity, for a debate on the report that the Home Secretary intends to introduce compulsory identity cards and on the implications of that in terms of both cost and the freedom and liberty that we have enjoyed for so long in this country?

There is, of course, a debate on entitlement cards in Westminster Hall on Tuesday, and Home Office questions will be held next week, so the hon. Gentleman will have an opportunity to raise those matters.

Has the Leader of the House seen the statement made by Mr. Joseph Wilson, a former United States ambassador, who investigated for President Bush the claim that Saddam Hussein was buying uranium in Africa? In February, Mr. Wilson informed the CIA that the documents pertaining to that were forged. In view of the fact that President Bush has acknowledged that he should not have used that information in his State of the Union address, may we have a statement from the Prime Minister to explain why he continues to insist that the evidence justifies the claim?

I understand my hon. Friend's concern about that matter; she has followed such questions closely. However, the Prime Minister has made more statements on the matter than most people have had hot breakfasts—[Interruption.]—or hot dinners, or hot lunches upstairs with the press. Those matters were dealt with in front of the Foreign Affairs Committee and they will continue to be dealt with, as the Prime Minister has done.

In his response to my hon. Friend the Member for Witney (Mr. Cameron) about the Government Green Paper that will eventually respond to the findings of the Victoria Climbié inquiry, the Leader of the House said that the Government would not follow a timetable set by the Opposition. Of course, that is his prerogative, but may I draw his attention to a letter to me from his predecessor, saying that the Government would publish their response before the summer recess? That, in the middle of May, was the Government's timetable for publication of the Green Paper, yet now it is not. What has changed, apart from the Government's excuse?

I would have thought that the right hon. Lady would have understood the point that I made earlier. What has changed considerably between May and a few weeks ago is that we now have a new Minister for Children and we are able to set that important report and the action that we are taking to deal with it in the context of a wider strategy on children's issues. I would have thought that she would welcome that. I would have thought that she would say that reports on children who have been subject to abuse and the action that needs to be taken ought to be set in the context of action on children's policy right across the board. No Government have had such a comprehensive policy on children's rights and the protection of children as we have the opportunity of developing. That is a commonsense approach, and the right hon. Lady should pause and wait a few weeks, and then I think that she, and every child in Britain, will be pleased with the outcome, even if Tory Back Benchers are playing games and making mischief about the timing of the matter.

I associate myself entirely with the question asked by the right hon. Member for Haltemprice and Howden (David Davis). To follow on from it, two weeks ago at business questions I asked my right hon. Friend to arrange for a statement on the intentions of the Ministry of Defence on buying British Hawk jets. He agreed that it was important that the interests involved were secure. I listened carefully to his reply to the right hon. Member for Haltemprice and Howden, and urge him not only to speak to Ministers, as he agreed to do, but also to ensure that there is a pre-recess statement. Surely it would be improper and wrong for such an important announcement to be made when the House is in recess.

I understand the points that my hon. Friend makes on behalf of his constituents, and I am well seized of the issue's urgency. It is important the Government get the decision right, rather than rushing it out, although any undue delay would obviously cause anxiety. As I have said, I will certainly speak to the Secretary of State for Defence as quickly as I can, and I am sure that he will understand the urgency as well.

I urge the Leader of the House to find time for an early debate in the House on early-day motion 1391, on establishing an older people's rights commissioner.

[That this House believes that the human rights of older people in the United Kingdom are too often overlooked or undervalued; condemns the neglect and financial abuse of vulnerable elderly people revealed by the BBC Television series 'Britain's Secret Shame'; recognises that the majority of such cases result from a lack of understanding rather than deliberate cruelty; welcomes the Help the Aged campaign to tackle such mistreatment of older people; notes the introduction on 17th June of a bill under the 10 minute rule by the honourable Member for North West Leicestershire to establish an Older Person's Rights Commissioner to promote and protect the human rights of older people; urges honourable and Right honourableMembers to endorse this proposal; notes that domestic and European anti-discrimination legislation for goods and services does not make specific provision relating to age; and calls on the Government to correct that position as a matter of urgency as part of a comprehensive effort to end the injustices endured by older people on a regular basis.] Does the right hon. Gentleman accept that there is still a lot of injustice and discrimination against people on the grounds of age, and that it is therefore important that the House consider this matter, establish such an office and end discrimination against older people, not only in employment, but in the provision of goods and services?

I will certainly draw the hon. Gentleman's interesting idea to the attention of the relevant Secretary of State. I am sure that he will know, however, that the Government have a very good record, especially in recent times, of ensuring that age discrimination is elevated right to the top of the agenda, along with other forms of discrimination. Successive Governments have not done that in previous years. That is a good policy, and his proposal certainly deserves scrutiny.

Will the Leader of the House arrange a debate on prescribing anti-TNF drugs for rheumatoid arthritis sufferers? Clinicians in Sheffield tell me that about 140 people could benefit from using those drugs, but that fewer than half of those people will be receiving them by the end of this year. The Government have done a great deal to stop postcode prescribing in the national health service. We do not want it to come in by the back door. All those people who do not get those drugs will suffer further irreversible damage to their health. I hope that we can have a debate on that very important issue.

I agree with my hon. Friend that this is a very important issue, and I commend him for his interest and work on the issue, as will lots of our citizens, far too many of whom suffer from that problem. The Adjournment debate on Thursday—the last business of the House before we go into the summer recess—provides an opportunity for those issues to be raised; but in the meantime, I shall draw his concerns to the attention of the Secretary of State for Health.

In supporting the point made by my right hon. Friend the Member for Haltemprice and Howden (David Davis), may I ask the Leader of the House whether he will also consider—perhaps when the House returns in September—holding an urgent debate on defence procurement and its effect on the aerospace industry in the north-west? There is considerable uncertainty about tranche 2 of the Eurofighter, Typhoon, about the future of the Nimrod MR4A aircraft and, indeed, about the implications of the Hawk order, to which right hon. and hon. Members have already referred. Some 40,000 jobs are dependent on the aerospace industry in the north-west, and a debate on that matter would now be timely.

The right hon. Gentleman has spoken to me about those matters in the past, and I understand his important constituency interest, which is shared by the right hon. Member for Haltemprice and Howden (David Davis) and my hon. Friend the Member for Brigg and Goole (Mr. Cawsey). We would all share their concerns if we were in the same position. Even if I have received no other message in the past half hour or so, they have made it clear that that is something of very great concern, and I shall ensure that their views are transmitted to the appropriate quarters.

Survival rates for breast cancer are improving. Nevertheless, more than 11,000 women died from breast cancer in 2002. There is evidence of regional disparities and age discrimination. May we please have an early debate on breast cancer services?

I will certainly bear in mind my hon. Friend's request because that is an absolutely crucial issue, and she has a very long record of promoting good policy on such issues. Indeed, as she implies, 98.3 per cent. of patients with suspected breast cancer, referred urgently by their GPs, are now seen by specialists within two weeks, and 96.3 per cent. of patients diagnosed with breast cancer now receive treatment within a month. That is a massive improvement and a tribute to the Government's policies, but we must never be complacent on this issue.

Will the Leader of the House arrange for a statement before the summer recess on this country's ability to control its own borders—something that was promised in the Labour party manifesto, although recent parliamentary answers have revealed that it will not be guaranteed in future?

No; I do not know where the hon. Gentleman gets that idea. As far as we are concerned—whether in negotiations on the future of Europe, or in other respects—we are absolutely committed to secure borders and to retaining control over our own borders. Yes, there is a problem with illegal human trafficking; it is a worldwide problem, affecting Europe in particular, and we are suffering from it especially, but we are taking action. The issue is coming increasingly under control, and we will continue to bear down on it to ensure that our borders are indeed secure.

I am grateful to the Leader of the House for the time that he has provided for debates on Europe, but I wonder whether he might find time to debate the resolution of a specific European conundrum: the statement by the right hon. Member for Wells (Mr. Heathcoat-Amory) that, if there were a vote against the proposed European constitution, the state would have to

"allow the others to go ahead, having negotiated an associate membership of some kind",
and the statement made by right hon. Member for Chingford and Woodford Green (Mr. Duncan Smith) in Prague today that a vote against the proposed new EU constitution would not be a vote in any way to withdraw from Europe.

There is a contradiction, and I will certainly consider the opportunities for arranging such a debate. Of course my hon. Friend, along with other colleagues, can press for an Adjournment debate or another debate on that matter, but it is very significant that the Leader of the Opposition is still a signed-up member of Conservatives Against a Federal Europe, which advocates withdrawal. Indeed, he is also been a supporter of the Bruges group, which said only a few months ago:

"It would have been better if we had never joined"

The Leader of the House will be aware that, a fortnight ago during business questions, I asked him whether he could provide an urgent debate on Iraq, having earlier called for an independent inquiry. Given that Whitehall sources are now saying that weapons of mass destruction may never be found, will he provide time for a statement, since some of us are increasingly concerned that we may have been misled into voting for war without good cause and that, whether or not that is so, the Government owe us an explanation on WM D?

I realise that that is a convenient parliamentary tactic by the Conservatives, but the hon. Gentleman knows as well as I do that the Prime Minister appeared before the Liaison Committee only a few days ago to answer in detail and to make himself accountable on the specifics of those matters. That is old ground, which has been crawled over ad nauseam. The truth remains that we are confident, as the Prime Minister said, that we will find evidence of weapons of mass destruction. Is the hon. Gentleman suggesting that the intelligence services did not provide accurate evidence? Is he attacking the intelligence services? If so, he should come out and say so.

My right hon. Friend will be aware that the High Hedges (No.2) Bill was recently talked out. The Government are aware of that Bill's importance to alleviating the misery caused to thousands of people throughout the country by high hedges. Indeed, some of my constituents, who are members of Hedgeline, were very pleased to receive a ministerial statement with a commitment that the Government will make every effort to get that Bill on to the statute book. Will my right hon. Friend discuss how that can be achieved with colleagues in the Office of the Deputy Prime Minister? After all, it is a very simple Bill; apart from the odd loquacious Member, it has all-party support; and it should not take up too much time with Government support.

I very much agree with all the points that my hon. Friend makes. It was scandalous that the Conservatives talked out that Bill—the hon. Member for Christchurch (Mr. Chope) was specifically responsible for doing so—and I will certainly consider any opportunity to resurrect it, because all Labour Members recognise that that is an important issue to address.

The recess, which the Leader of the House has confirmed for next week, will come as an enormous relief to Labour Members—while Conservative Members will, of course, be happy to sit into August if necessary. Will he spend the recess taking a knife to next year's legislative programme? Does he agree that what has happened in the past fortnight has been wholly unacceptable, with large chunks of Government Bills simply not debated? Will he give an undertaking that there will be no repetition of that fiasco next year?

I saw the glum faces around the right hon. Gentleman when he was proposing to chop his colleagues' holidays. There would be cancelled holidays galore on the Conservative Benches. I must disappoint him, however, as there is no prospect of that happening. He will understand that the original legislative programme, which I agree has become overcrowded, became so because of Iraq in particular—and, rightly, the enormous pressure on parliamentary business from debating those matters fully—and Northern Ireland legislation. I am confident that we will get a legislative programme that is better able to be taken through the House in the normal timetable. We cannot plan for the unexpected, however, which is what happened in the past year. We are attempting to provide for the unexpected in the next year's legislative programme.

Would my right hon. Friend consider having a debate on schools funding? Today, there are calls from schools across Essex for the resignation of the Tory cabinet member responsible on Essex county council, because the council is still sitting on £21 million that could be allocated to schools in my area. If we had a debate, we could find out how much more money is being held by authorities around the country that should now be directed to local schools.

My hon. Friend raises an important charge against Essex county council, and I am sure that the public of Essex will want to know what the situation is and what the Conservative council is doing about it. He will also understand, however, that spending per pupil is up by £800 a year in real terms since 1997, with huge numbers of extra teachers and classroom assistants being recruited. That is against a background, of course, in which one in five teachers would be sacked as a result of the Tory policy of 20 per cent. cuts across the board.

My hon. Friend the Member for Witney (Mr. Cameron) has already drawn the attention of the Leader of the House to early-day motion 1548, on the Green Paper on children at risk. It seems that the Government have changed not only the timetable for the publication of this important Green Paper, but the excuse for the delay in publication. Last week, the excuse given was that the Prime Minister understandably, wants to be present at the launch of the Green Paper, and that he does not have time to do so until September. This week, in answer to my right hon. Friend the Member for South-West Norfolk (Mrs. Shephard), the Leader of the House said that the reason for the delay is that there will be further policies in the Green Paper. This matter is too important to be played about with in this manner. We are not making mischief. I am genuinely concerned about the children who are at risk and who are not getting the attention that they deserve from local authorities, as local authorities are having to wait so long for this Green Paper. They cannot take action until they have it. Can we have a debate next week on children at risk? It is an urgent matter.

The report has been out for some time now. Every responsible director of social services and responsible local authority has already had a copy, is acting on it and is taking forward its recommendations.

Perhaps there is a Conservative county council somewhere in the country that is not doing that, in which case we should be told—[Interruption.]

Order. The hon. Member for Epping Forest (Mrs. Laing) has asked a question, and the Leader of the House should be able to answer.

Thank you, Mr. Speaker. The point of the hon. Lady's and her right hon. and hon. Friends' fabricated frenzy is to attack the new Minister for Children instead of recognising that there are sensible reasons, including the Prime Minister putting his personal stamp on a radical new policy to advance children's rights and to protect children in a way that has not been done before. As someone who seeks to aspire to that job, she ought to welcome that.

Can we have a debate on Duchenne muscular dystrophy, a deadly disease that affects families from every constituency in this country? Is my right hon. Friend aware that last week a group of parents came to Westminster and lobbied outside the Department of Health but sadly no one was available to see them? Will he undertake to raise this matter with his ministerial colleagues and if possible arrange for a debate to build on the welcome proposals contained in the Government's White Paper on genetics?

I am well aware that my hon. Friend has shown great energy and diligence in pursuing the problem of muscular dystrophy, and it was unfortunate that that particular protest was not recognised. I hope that the relevant Department will ensure that representations on behalf of those people are fully taken into account, and I am sure that he will follow that up. In terms of House business, he has the opportunity to apply for a debate, and, with any luck, it will be heard.

In answer to the hon. Member for Birmingham, Selly Oak (Lynne Jones), I hope that time will be found for the High Hedges (No. 2) Bill and that it will not be kicked into the long grass.

Has the Leader of the House had an opportunity to see early-day motion 1566, on the centenary of the young Liberal movement, of which he was at one time a leader?

[That this House notes that Liberal Democrat Youth and Students are celebrating '100 years of Young Liberals' this week; congratulates the Young Liberals on their centenary and their contribution to politics both in the UK and abroad; and wishes LDYS every success in continuing to make politics relevant to young people.] Can he speak to the Minister for Children, who I understand is also the Minister for youth, to see whether we can have a statement or a debate on making politics relevant to youth today? As he will recall, the level of youth involvement in politics when I first joined some 30 years ago was greater than it is today.

I recognise the hon. Gentleman's points. I notice that my brief on early-day motion 1566, headed "Young Liberals", says, "Be neutral", so that is what I will be.

Can we have a debate in Government time on the procedure for the closure of post offices? I have written to the Secretary of State about the closure of Humberstone post office in my constituency, which was done without proper consultation with local residents. The head of the regional office, Mr. Paul Maisey, refused to meet me or my constituents before the post office was closed. I support the Government's policy on modernisation, but modernisation should not be used as a euphemism for closure.

I certainly endorse my hon. Friend's point on behalf of his local post office. Modernisation is not a euphemism for closure. We all share the concern that a changing pattern of consumption and lifestyle means that many local post offices are increasingly coming under threat. As I have said before in business questions, my local post office has been under threat over the past year. When a local branch of Barclays bank closed, however, and I encouraged customers to switch their accounts to the post office, which they could have done to underpin its viability, there was very little take-up. We are therefore dealing with a problem of human behaviour that is wider than the issues that he raised.

Yesterday, the Prime Minister sought to implicate my right hon. Friend the Leader of the Opposition in the dodgy dossier by insisting that he had been briefed on the intelligence contents of that dossier, when we now know that that was not the case. The day before, however, in his evidence to the Liaison Committee, the Prime Minister, in answer to question 186 from my hon. Friend the Member for Gainsborough (Mr. Leigh), denied categorically the claim that 90 per cent. of that dossier had come from plagiarised material. On 19 June, however, the author of the main article that was plagiarised gave evidence to the Foreign Affairs Committee that 90 per cent. of the second dossier came from his article and two other articles; and a paper by a Cambridge academic submitted to the Foreign Affairs Committee provided a page-by-page analysis backing that up. May we therefore have a statement from the Prime Minister analysing the contents of the dossier, because he has not only plagiarised the material of that young student but called him a liar by denying his analysis that 90 per cent. of the dossier was plagiarised and that therefore only a tiny fraction of it could have been intelligence material?

This contribution from the Conservative Benches is getting to sound like a rather scratchy old gramophone record. Let us look at the facts. The Prime Minister said yesterday that the briefing given to the Leader of the Opposition was based on intelligence. That is what he said: the very same intelligence that had gone into those two documents. The Leader of the Opposition should come clean. He should say whether he is disputing any of that intelligence, because he did not dispute it at the time. Indeed, he supported the Government's policy at the time. Now, however, he sees a chance to make mischief opportunistically, and he continually seeks to do so, with the support of the hon. Gentleman.

In the light of the previous answers from the Leader of the House, is it still the Government's position that Iraq's weapons of mass destruction will be found? Is he categorically denying the reports running on the BBC today that the Government are now saying that such weapons will not be found, either because they were destroyed before the war began or because they have been hidden? Surely we should have a debate on the issue in the House. It would not be some arcane parliamentary debate; people died on the decisions that the House made based on reports that the Government had given not only on the size of the weapons of mass destruction arsenal but on Saddam Hussein's capacity to launch them within 45 minutes.

I am sorry that my hon. Friend is relying on BBC spin rather than on the evidence. The truth is that the Foreign Affairs Committee report upheld the Prime Minister's record on this matter. The truth is that those like myself—I was in the Foreign Office as the Minister with responsibility for Iraq, then Minister for Europe, and subsequently a Cabinet Minister—who saw the raw intelligence and were briefed by the Joint Intelligence Committee and other senior intelligence sources were absolutely clear that there was evidence of weapons of mass destruction. That evidence was underpinned by United Nations inspections reports that my hon. Friend has never really accepted. That was the basis for our action. I would have thought that we ought now to put that behind us and seek to work together internationally to make sure that Iraq goes into a new democratic future, having been liberated from such a brutal dictator.

Surely it is now imperative that we have a statement from the Prime Minister on the whole issue of weapons of mass destruction, especially after senior Whitehall sources—I note that the Leader of the House did not contradict them—suggested that we would never find these weapons of mass destruction. I know that the Prime Minister has appeared before the Liaison Committee, but only the three main parties are represented on it. Does not the whole House deserve an explanation and does not the whole nation, through the House, deserve to know what is going on with WMD?

I do not know whether BBC sources these days are dodgy or not; I really do not, and I do not think the public know. If the hon. Gentleman is asking what I and the Prime Minister believe, the answer is that we believe that evidence of weapons of mass destruction will be found. I would be very surprised if it was not. As I have said before, Iraq is a huge country and we know, and we knew at the time from intelligence, that Saddam Hussein was dispersing these weapons of mass destruction for months before he anticipated the weapons inspectors would come in. It is not surprising that they are not in a shop window somewhere for us to go and find. That would be astonishing.

May I echo the concerns expressed by my hon. Friend the Member for Leicester, East (Keith Vaz) about post office closures? We are witnessing an incredible shrinkage of the post office branch network. In my constituency, people have been absolutely bewildered this week at the news that five branch offices are due to close. It is an important issue and we should hear from Ministers in the Department of Trade and Industry about the discussions that they are having with the Post Office to maintain this valued national institution of a post office branch network.

I understand my hon. Friend's concern. All of us as local Members of Parliament value local post offices and the local communities that they serve value them even more. The picture that he paints is a very serious one and I shall bring it to the attention of the relevant Minister and Secretary of State as soon as I can, so that any action can then follow.

Order. Only a few Members are standing, but I must have brief questions if I am to call them all before half-past the hour.

The Prime Minister told the Liaison Committee that he would not have committed UK troops to war in Iraq if he had not won the vote in the House of Commons. It is reasonable to infer that many Members supported him in the Division Lobby because they believed that there were weapons of mass destruction that could be deployed within 45 minutes. If they knew then what they know now, many Members might well have not supported the Prime Minister in the Division Lobby.

Is it not despicable that the Prime Minister should come to the Liaison Committee and do Prime Minister's questions and, almost immediately after, Government spokesmen put out another spin on the story—that weapons of mass destruction may never be discovered? It is doubly despicable that the Leader of the House should then come to the Chamber and seek to blame the BBC for fabricating that story. Can we have a debate next week not necessarily on Iraq, but on the whole Government machinery of—

Just for the record, I did not blame the BBC's political editor. In fact, I commended the quote that he gave on either the 10 o'clock news or the "Today" programme this morning. I blamed BBC spin—and indeed, that spin was directly contradicted, as I understand it, by the Prime Minister's official spokesman in the Lobby briefing this morning, in which he said that the Prime Minister and the Government remain confident that evidence will be found.

I do not know whether the hon. Gentleman, along with opponents of our action, wants to airbrush out of history the fact that United Nations reports consistently reported evidence of weapons of mass destruction. Our own intelligence services—as I have seen for myself—reported that evidence as well. He should be standing by those reports and standing by the intelligence services, and not seeking to undermine them.

My right hon. Friend will be aware that I have a high proportion of private rented sector dwellings in my constituency to cater for the needs of students. I welcome very much the excellent pilots that the Government carried out on the tenancy deposit protection scheme. However, I am disappointed that there is no forthcoming mention of that in the draft Housing Bill. Does my right hon. Friend agree that it is an important issue that needs to be pushed forward? Will he make representations to my right hon. Friend the Secretary of State?

I understand my hon. Friend's concerns and the important points that she makes. I will certainly draw them to the attention of the Secretary of State.

I join other colleagues in calling on the Leader of the House to arrange for the Prime Minister to come to the Dispatch Box next week to explain the allegations that he made against my right hon. Friend the Leader of the Opposition yesterday. Will the Leader of the House confirm that my right hon. Friend met the head of the Joint Intelligence Committee on 12 February, which was nine days after the dossier was published? Yes or no?

The Prime Minister wrote yesterday to the Leader of the Opposition setting out very clearly—[Interruption]He did, indeed. He made it absolutely clear that the evidence upon which the Leader of the Opposition was briefed was the same evidence that went into the documents concerned. It has been the same evidence that formed the basis of the approach to conflict and that we relied upon. Again, I directly ask the right hon. Gentleman, if not the Leader of the Opposition, whether he is disputing the intelligence services' evidence. Is he—yes or no? As for the Prime Minister answering questions, he will be here on Wednesday to answer the questions that anybody wants to put to him.

Can the Leader of the House organise for a statement to be made to the House following the publication by her Majesty's chief inspector of prisons of the report on the two remaining detention, or what I think are called removal, centres for immigrants, including Dungavel in Scotland? Is my right hon. Friend aware that, when the chief inspector published in April her review of the three centres that she had visited, she said that no child should be kept in such places—that applied to all five of them—for more than six days? Does he not think it ironic that while he is talking today about the children's Minister, something that I fully support, the children of the Ay family will have spent a year in detention in Dungavel come next week? Can he arrange for that to be debated on the Floor of the House as soon as possible?

I am not sure that I will be able to find time for a specific debate. My hon. Friend will have the opportunity to raise the issue in other ways, but I assure him that I will draw his important points to the attention of my right hon. Friend the Home Secretary.

The Leader of the House will be aware that there have been discussions about a shadow monitoring commission for Northern Ireland. Can he guide as to whether the Government are planning to introduce legislation in the coming week or in September?

There are no plans for the coming week but, as the hon. Gentleman will be aware, we are obviously seized of the importance of Northern Ireland legislation on a number of matters. I will draw the Secretary of State's attention to his question.

Very close, Mr. Speaker. It is Alistair actually. I am delighted to have the opportunity to ask my question.

Can we have a statement before the recess from the Minister responsible for shipping to give the Government's response to reports that we are to import a so-called ghost fleet of 94 former naval ships from the United States for decommissioning on Teesside? Apparently, they will be towed through the Pentland Firth, to the south of my constituency. My constituents wish to know why on earth we are importing these ships from the other side of the world and what steps the Government will take to ensure that these highly contaminated and dangerous wrecks do not cause the damage that they have the potential to cause to our very precious coastline.

Obviously, safety factors are uppermost in the minds of the Government and the authorities when such undertakings are considered. I imagine that the enterprise means that jobs are at stake, and I am sure that the hon. Gentleman will consider that as well. I shall draw his specific points to the attention of the Secretary of State, and the Scottish Parliament might want to take an interest as well.

Further to the Leader of the House's erroneous claim, in response to the question asked by my hon. Friend the Member for South-West Bedfordshire (Andrew Selous), that this country has kept control of its national borders, may we have an urgent statement to clarify the situation, because the Minister for Europe's written answer at column 735W on 8 July to a question tabled by my hon. Friend the Member for Witney (Mr. Cameron) said that it was essential to scrap the veto and move to qualified majority voting on immigration and asylum policy? The Leader of the House seems to be woefully ignorant of that fact.

I always admire the hon. Gentleman's ability to recite facts one after another without consulting his notes.

I am about to. The hon. Member for Buckingham (Mr. Bercow) is confusing border control with having a common asylum policy throughout Europe. Such a policy would enable us to ensure that backmarkers on human trafficking—countries in which the problem arises but that pass the buck to us—take their responsibilities seriously and have procedures for admitting such people. That would mean that we could ensure that if such people cross on to our shores, we could put them back in the European countries where they first landed. Our border controls will remain exactly the same and the hon. Gentleman should not confuse the two issues in such a way.

Economic And Monetary Union

[Relevant document: The Sixth Report from the Treasury Committee, Session 2002–03, HC 187-I and -II, on the UK and the euro.]

Motion made, and Question proposed,That this House do now adjourn.— [Vernon Coaker.]

1.32 pm

I want to share with the House the evidence and conclusions contained in the euro assessment. I shall give more detail on measures that are good for Britain and that advance convergence and flexibility: measures on housing, the sale of surplus public sector land; planning, driving up performance; and flexibility, progress on skills, labour market reforms and pay flexibility in the public sector. I want to show not only that sustained convergence and living with euro area interest rates while advancing stability, full employment and the funding of public services is in the national economic interest, but, more generally, that it is in the British national economic interest to be fully engaged and enthusiastic members of the European Union—not to be semi-detached—and to play a full part in equipping a new enlarged Europe to meet global challenges.

I acknowledge that no cause has been more controversial, no issue has been more difficult, and no subject has been more complex for the British people for so long than Britain's relationship with Europe. No issue has attracted more of the House's attention or engaged it in so much scrutiny and debate. However, if the first three phases in our post-war relationship with Europe were our pre-1972 decision not to join, which was wrong, our decision to join yet to be continually unhappy with the terms for the next two decades and, in the wake of the fall of the Berlin wall and the Maastricht treaty, the decision in the early 1990s to stand further apart from Europe, we have now entered a new fourth phase of our relationship. Europe is moving from its often inward-looking and exclusive era as a trade bloc towards a recognition that it must compete globally. That is the context of the decisions that we must take about not only the intergovernmental conference but the euro.

When we joined the then Common Market in 1972, 2 million jobs depended on our trade with Europe, but now 3 million jobs depend on it. We now import £154 billion of goods and services each year from Europe—53 per cent. of our total imports of goods and services—compared with £5 billion in 1972. Compared with £4 billion in 1972, we now export £140 billion of goods and services to Europe each year, which is 52 per cent. of our total exports of goods and services. It is estimated that 750,000 British companies have trading relationships with the rest of Europe. As Europe has advanced from a common market to a single market, 73 per cent. of our investment overseas now goes to European Union countries, compared with less than 14 per cent. before we joined the Common Market. Therefore, adopting a policy that would leave Britain semi-detached from Europe would be a disastrous stance for jobs, business and trade.

Until now, the context in which we have viewed decisions about Europe has been European rather than global. The European Union was the world's first trading bloc. It was the precursor of the North American Free Trade Agreement, Mercosur, the Association of South East Asian Nations and the other trade blocs. Its role was to organise its rules, to formulate its preferential agreements and to fashion its social dimension and external relations. However, discussion of the euro takes place today in a new global context. We have an enlarged Europe that is moving from the Europe of the trade-bloc era in which it was more protected, sheltered and inward-looking, to a Europe of the global age that cannot avoid intense global competition.

I shall give way after I have set up the argument.

In 1972, 21 per cent. of the UK's output was traded, and the figure is now 27 per cent. France traded 22 per cent. of its output in 1972 and now trades 26 per cent. Germany's figure was 29 per cent. and is now 33 per cent. Twenty-one per cent. of Europe's output was traded worldwide in 1972. The figure was 30 per cent. in 1990 and is 34 per cent. today.

In this new stage of Europe's history as a union—the global rather than trade-bloc phase—three changes affect our decision on the euro. First, the enlarged Europe has to look outwards. Indeed, during the past 10 years, there has been a tenfold increase in European investment in the USA, and European investment in the USA has been twice American investment in Europe. That means that Europe must recognise that it benefits from partnership rather than rivalry with the USA, and that it must seek job-enhancing trade agreements with the rest of the world, including the USA.

Secondly, the euro decision must be taken, as the intense competition that globalisation brings forces every country to become more competitive. Economic reform is, and must be, the driving force behind Europe's economic agenda. Thirdly, the euro decision is being made as the global competitive challenge demands a greater flexibility in labour markets, thus forcing Europe to redefine its social dimension.

Europe has to form new outward-looking relationships and is being forced to reform economically and socially. That leads me to conclude that those who rule out euro membership, either because they demand a choice between Europe and America or because they believe that Europe does not have the capacity to reform, are misreading the direction of change and the influence that Britain is having, and can have, on the debate about a global Europe, because, after all, Britain was the pioneer of free trade and the first proponent of economic liberalisation—I pay tribute to Conservative Members for their role in that—and the single market. That is the new global context in which we must make our decisions about the euro.

Will the Chancellor explain why the richest country in Europe, as measured in per capita income, is Switzerland? It does not intend to join the euro but it does massive trade with the rest of the European area.

It is funny that the right hon. Gentleman says that because whenever I meet Switzerland's finance Ministers I am told that they wish to join the European Union and that it would be to their advantage. When I give him figures showing the increasing amount of British trade with the European area, surely he must accept, as many of his Front-Bench colleagues now do, that detaching ourselves from the European Union would be a big mistake. The question is not whether we detach ourselves but whether it is right to join the euro at this stage.

We know the Chancellor's judgment at this time about the five economic tests. Will he tell us whether he would be disappointed if Britain was not in the single currency in five years' time?

We are in favour of joining the single currency in principle, but we need to meet the five economic tests. I am about to explain what needs to be done to meet the tests and the changes that we need to make. However, the changes that we are bringing about to the British economy are in the British national economic interest.

The Chancellor might be about to pass on from his observations about our membership of the European Union. He is fully aware that our ability to continue to be a strong and active member of the European Union without joining the single currency is safeguarded by the opt-out clause in the treaty of Maastricht. Is he aware that no such opt-out clause exists in the European constitution?

We always supported the Maastricht opt-out clause. The opt-out clause stands. If the right hon. and learned Gentleman is suggesting that the opt-out clause falls, he is making a great mistake.

In that case, will the Chancellor give the House a cast-iron guarantee this afternoon that in the negotiations on the constitution at the intergovernmental conference the United Kingdom Government will make it absolutely clear that they will not sign up to the new constitution unless it replicates the opt-out from the single currency that is contained in the Maastricht treaty?

Not only does the opt-out clause remain, but, equally, the other states that are joining the European Union from the east of Europe do not have that opt-out clause, nor does Sweden. Britain has that opt-out clause, and we supported it in 1992 when the Bill came before the House of Commons. The right hon. and learned Gentleman does not have the evidence to suggest that Britain is walking away from the opt-out clause.

If what the Chancellor says is correct, there should be no difficulty in giving me the assurance for which I asked. He should be able to give the House a guarantee this afternoon that the Government will not sign up to any constitution that does not replicate the opt-out from the single currency contained in the Maastricht treaty. It is a perfectly simple matter.

The shadow Chancellor is trying to raise an issue that does not arise. The opt-out clause remains. Once again, it is a Conservative red herring to disguise the fact that the Conservative party is against the euro in principle and against membership of the European Union. That is the position.

The right hon. Gentleman is factually and legally wrong, and my right hon. and learned Friend is factually and legally right. Does the Chancellor not recognise that the European constitution will override and supersede all previous treaties and that it is therefore essential to guarantee the opt-out by incorporating a clause to that effect in the new constitution? In the absence of such a clause, will the Government veto the constitution—yea or nay?

Once again, Conservative Front Benchers and Back Benchers are trying to get us into a position of vetoing the conclusions of the IGC. They will choose any issue—any red herring—to do so. Their aim, frankly, is that we reject the IGC, put Europe into crisis and have a semi-detached or associate membership of the European Union, or some other relationship with it. I have told the shadow Chancellor the position: the opt-out stands. It was negotiated. We supported it at the time, just as they supported it. As for what is likely to happen, no other members of the European Union that are joining from the east have sought, or are getting, the opt-out clause. Britain has the opt-out clause. Even Sweden, which is to have a referendum later this year, has not asked for, and does not have, such a clause.

Europe is having to make difficult decisions about outward-looking relationships with the rest of the world, economic reform and a new social dimension. As a nation with a global trading economy and a history of stop-go in economic policy and management, the question for us, which the euro assessment addresses, is not whether further engagement is, in principle, against the British national interest, but whether the practical economic consequences of euro membership are in British national economic interests, because the decision is irreversible—hence the policy that we have adopted of testing membership against strict criteria, investment flexibility, financial services, employment and growth, and convergence.

Sustainable convergence is essentially the stability test. It means that the British economy can live on a permanent basis with euro area interest rates, can advance our objectives of high and stable levels of growth and employment and, of course, can provide secure, sustained and stable funding of our schools, hospitals and other public services. Flexibility is being able, in the absence of exchange rate or interest rate flexibility, to adjust our economy quickly to any shocks that arise so that we do not put those objectives at risk.

The purpose, therefore, of the five tests is to assess whether we have secured for Britain convergence with our European partners that is settled and durable, which is the first test; sufficient flexibility, which is the second test; and whether we can also confirm conclusively and confidently to the British people that the potential benefits for investment, financial services, employment, growth and trade—the benefits that I listed in detail when I made my statement to the House of Commons, which are contained in the many documents that were produced on the day—can indeed be realised.

The five tests are our guarantee of stability, high and stable levels of growth and employment, and the proper funding of public services. To meet them would ensure that we do not put at risk our economy or our public services. To fail to meet them would risk repeating the exchange rate mechanism mistakes. Overall, the assessment concluded that, inside or outside the single currency, the competitive strength of the City of London is such that the UK financial services industry should continue to thrive. Subject to the achievement of sustainable convergence and sufficient flexibility, we also concluded that the tests for investment and employment would be met. We were especially interested in the views of many inward investors about how they saw the future.

The issue is the convergence and flexibility tests, and then the exchange rate and transition issues. On convergence, since 1997 the short-term interest rate divergence between Britain and the euro area has fallen from 4 percentage points to 1.5 percentage points after the interest rate cut announced by the Bank of England today. Long-term interest rates have virtually converged today at around 4 per cent., but while our assessment finds that convergence has been, or can be, achieved in the provision of small business finance, large company finance and personal finance—where, in fact, the UK economy is found to be no more interest-rate sensitive than others—it is the inflationary pressures that arise from the housing market that have led consistently, over the past 30 years, either to higher inflation in Britain than in other countries or to higher interest rates to keep inflation under control, and sometimes both.

The challenge of convergence when applied to housing is not, as some suggest, that we seek the same structure of the housing market or the mortgage market as the Germans, French, Dutch or Italians. All countries have, and will continue to have, unique features of their housing markets. The challenge is that the combination of house price inflation and volatility, and the impact of both on consumption, has generally led to interest rates that are higher than rates in other countries in order to deliver stability. Measures that reduce housing market volatility would reduce the extent to which interest rates need to take account of the housing market, and they would be good for industry whether or not the UK were to join the economic and monetary union.

Given the structural issues involved in meeting the convergence test and the steps that the Chancellor has set out to tackle them, what is his forecast of when the convergence test might be met?

I am not going to give a running commentary. I gave the assessment that we have made to the House of Commons a few weeks ago. I said that we would review the position prior to the Budget next year and report on progress. If there were sufficient progress, we would trigger a further assessment. I do not believe that it is helpful for me either to prejudge what might be announced next year or to give a forecast, as though I were a gambler on such matters. The important thing to recognise is that we will not short-cut or fudge the test. We will have a rigorous assessment and, before the Budget next year, a rigorous review. That is the best guarantee I should and can give to the British people.

The one thing that is absolutely clear—I think it needs to be said, given what we have heard from Conservative Front Benchers today—is that we will not repeat the mistakes that were made in the ERM era. Those mistakes were, incidentally, never to have an assessment, either public or private—[Interruption.]Let me explain to Conservative Members the extent of their problem. No assessment was ever made, internal to Government, of any detail—

Oh! So it would have been right, as an act of statesmanship, for us to ask for an assessment before it could be done?

The Chancellor cannot escape from his history on the matter. A year before we joined the ERM, he was asking for early entry. When we joined, the right hon. Gentleman and his colleagues in the shadow Cabinet never asked for an assessment, never said it was the wrong rate and never criticised that decision in any way, shape or form. Instead, they gave that decision their full and wholehearted support. That decision, which was a grievously mistaken decision, had the full support of the Chancellor, all his right hon. and hon. Friends, the TUC, the CBI, the Liberal Democrats—of absolutely everyone. The Chancellor cannot escape his history.

The shadow Chancellor was Secretary of State for Employment. He conducted no assessment of the employment consequences of entering the exchange rate mechanism, and the Secretary of State for Trade and Industry did no proper assessment of the investment and trade consequences—and now the Opposition try to blame us. They told us at the time that they had five conditions that had to be met. Those conditions were not met, and they still joined the ERM. They were never able to prove to us that the conditions were met.

The shadow Chancellor thinks that he has got out of the problem because he has made an apology, but I seem to remember that, as Home Secretary, he used to say that apologies were not enough. He said that the punishment must fit the crime. He used to tell us that punishment worked and that we should condemn a little more and understand a little less. Why is he the only surviving member of that ERM Cabinet who is still sitting on the Conservative Front Bench? He is a very fortunate man, but the electorate will not forget that he was responsible for the loss of a million jobs in manufacturing and unemployment rising above 3 million, even while he was cutting employment training schemes that would have kept people in work. So we will accept no attempt to blame the Labour party in opposition for the mistakes of a Conservative Government who brought us the worst recession since the second world war and caused 15 per cent. interest rates and 10 per cent. inflation. Until the Conservatives do more than apologise for those mistakes, the electorate will never support them for economic competence again.

I am grateful to my right hon. Friend for giving way. At the time of ERM entry, there was not only a complete lack of rigour in making any assessment, but the Government of the day also had a completely enfeebled negotiating stance, because the party was completely split on Europe—a split between those who wanted to come out and those who saw its practical benefits. Does he agree that that is still the case today? The Conservatives would be on their knees in the face of having to negotiate at a new intergovernmental conference, whereas I know that my right hon. Friends will stand up and fight for British interests.

My hon. Friend is absolutely right. [HON. MEMBERS: "Give him a job."] Job applications do not come to me; they come to the Prime Minister.

I intervene in the hope of understanding a little more and perhaps making a little bit of special pleading on the question of the stability of interest rates. My right hon. Friend and I know, as we both represent the paper industry, how incredibly important stability of interest rates is. My hon. Friend the Member for Glasgow, Anniesland (John Robertson) and I, along with other colleagues, were recently in Finland finding out about nuclear waste, but we heard about the paper industry there. Surely these industries throughout Europe need an indication of the stability or otherwise of interest rates? Can he be helpful on that point?