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Commons Chamber

Volume 462: debated on Thursday 12 July 2007

House of Commons

Thursday 12 July 2007

The House met at half-past Ten o’clock

Prayers

[Mr. Speaker in the Chair]

Oral Answers to Questions

Treasury

The Chancellor of the Exchequer was asked—

Tax Credits

1. What estimate he has made of the likely change in the number of people who will claim tax credits as a result of the abolition of the 10p starting rate of income tax in the financial year 2008-09; and if he will make a statement. (149004)

Tax credit take-up is rising, and is 97 per cent. among families with children that are on incomes of less than £10,000. Tax credits mean that households will be £100 a year better off on average, that 200,000 children will be lifted out of poverty and that 580,000 pensioners will be taken out of income tax.

Given the right hon. Gentleman’s reputation for being concerned about social justice, is he not worried that his predecessor’s doubling of the marginal tax rate now means that many more people will be forced to claim tax credits? The right hon. Member for Sheffield, Brightside (Mr. Blunkett) described the system as a shambles. Last year, 50 per cent. of all assessments were proved to be wrong and 25 per cent. of those entitled to tax credit found the system so complex that they failed to claim it. Does he not think that the whole matter needs re-examination?

I think that the basic proposition behind tax credits is right. The hon. Gentleman will recall that, back in 1997, one of the problems that we faced was a disincentive to working—work did not pay. The tax credit system was designed to ensure that when people went into work they saw the benefit, and that we could help people with additional costs such as child care and so on. However, the hon. Gentleman is right to say that there were administrative problems following its introduction. The National Audit Office report, which is published this morning, highlights some of them. They are comparable to some of the problems with the previous Government’s introduction of jobseeker’s allowance in the middle of the previous decade. Clearly we need to sort out the problems, but if the hon. Gentleman is asking whether I believe that tax credits are right in principle, the answer is yes, I most certainly do, because they are helping approximately 20 million families, and that is important.

I welcome the Chancellor to his new position and wish him every success, for the country’s sake.

My right hon. Friend knows that the Treasury Committee is interested in errors and fraud in the tax credit system. This morning he sent me, and others, a letter detailing the credit and working tax credit error and fraud statistics. The Select Committee does not condone any fraud in the system, but we want to know whether the Government have made progress in ensuring that there is less fraud. My right hon. Friend mentioned jobseeker’s allowance. Has any improvement been made in the past 10 or 12 years on reducing fraud?

I thank my right hon. Friend for his good wishes. He has done some excellent work as Chairman of the Select Committee in the past few years and I look forward—if that is the right phrase—to appearing before him and the Committee at some stage.

Her Majesty’s Revenue and Customs report was published this morning. I wrote to Opposition spokesmen, and I hope that they got the report. It was due to be published this afternoon, but I thought—not necessarily to my advantage, because of the NAO’s comments—that it might be better to draw it to their attention. I am concerned about the extent of error in the system. My right hon. Friend asked about JSA, which was introduced in the mid-1990s. The error rate then was approximately 13 per cent. and it has now decreased to about 5 per cent. I well remember, from my time as Secretary of State with responsibility for social security, that error in the social security system is a problem, although, after years of bearing down on it, we are beginning to see some results.

Let me revert to the central point. The tax credit system, like the tax system, operates on a basis of annual assessment. We set it up that way so that it would be flexible, and people would not be subjected to weekly income tests as they are in most parts of the social security system. There were inevitably some administrative problems following its introduction—we are all aware of that. They need to be sorted out, and they will be sorted out. However, it is important to keep sight of the fact that tax credits have benefited nearly 20 million families, and that many people with children are much better off as a result of our actions. There are times when I wonder whether the Opposition are against tax credits themselves, rather than being concerned about errors in the system.

I, too, welcome the Chancellor, and I hope that he enjoys his honeymoon—until the day that he has to say no to the Prime Minister. If the Government are so keen to encourage the take-up of the working tax credit, which is as low as 25 per cent. for childless couples, why are people expected to fill in a 10-page form, with 57 questions and 60 pages of explanatory notes, compared with the user-friendly four-page note that is required to get non-domiciled tax status? Why do the Government make it so difficult for poorer people to claim entitlements and so easy for rich people to avoid paying tax?

I thank the hon. Gentleman for his good wishes. I do not know when the honeymoon will come to end; in fact, I think that it has come to an end already—but I thank him all the same. Of course I am willing to look at the application forms for tax credits, but he will appreciate that the simpler a form can be, the more difficulty that can raise later on. I have no doubt that he will focus on that possibility today, because of an apparently simplistic promise to cut income tax by 4p, which would cost him nearly £19 billion. He will find it quite hard to explain how he is going to fill that gap—to do so through fuel duty, for example, would mean something like 39p a litre on fuel. I look forward to hearing how the Liberal Democrats are going to explain their tax changes, and who will lose and who will gain.

Have not tax credits proved a valuable way of taking families, and particularly children, out of poverty? Will they not prove to be more effective than, say, offering £20 a week for couples to get married and stay married?

I agree with my hon. Friend. The married couples allowance was steadily reduced under the previous Government. Indeed, it was Lord Lamont who did that, and at the time he was being advised by somebody—I think that it might have been the Leader of the Opposition. The problem is that the married couples allowance throws up all sorts of anomalies. For example, if the husband in a couple is killed in a tragic road accident, his widow and children will be left without support—so when we think through the consequence, we see that bringing back the allowance is not the right thing to do. Helping families with children, and the fact that the working families tax credit has lifted more than 600,000 children out of poverty, are things that we should keep in the front of our minds. All of us in the House say that we are concerned about cutting child poverty, and we have a target to do so. Our measures have helped to lift 600,000 children out of poverty, and that is why tax credits are so important to us.

I of course welcome the right hon. Gentleman to his new job and wish him well in his post. It will be fun shadowing someone with whom I am actually on speaking terms—[Interruption]—for the moment, at least. Unlike most Chancellors, he cannot blame his predecessor for the undoubted mess that he has inherited, and there is no greater mess than the tax credits system and its administration. Will he confirm that the figures that he published 30 minutes ago show that in 2005-06, the last year for which the Inland Revenue has published figures, it overpaid £1.7 billion of taxpayers’ money and underpaid £549 million. That is well over £2 billion in mistaken payments that bring hardship to many hundreds of thousands of families, and, of course, cost the taxpayer dearly. Does the Chancellor accept, in his second week in the job, that that is a totally unacceptable scandal? Will he promise that the level of error and fraud will be reduced while he is Chancellor?

I thank the hon. Gentleman for his good wishes. May I congratulate him, too, on holding on to his position? I see that there was some speculation as to whether he would be moved, but I am glad to see him here. I hope that we shall remain on speaking terms—we shall try for the next 50 minutes or so and see how we get on.

On the hon. Gentleman’s point about tax credits, of course it is unacceptable to have such high levels of error. Following the introduction of tax credits, I can well see how those errors arose, especially with a system that allows for annual assessment, and when there are many families whose incomes and circumstances may change quite a lot during that period. However, as a constituency MP, I know, as I am sure that most hon. Members will know, that we all have cases in our constituencies where things have gone wrong and the sums have added up very quickly, and that clearly causes distress. As I said a few moments ago, just as with the social security errors of a decade ago, so with tax credits. We need to do everything we can to reduce those errors. I still think that it is better to model the system on the tax system, and try to work on an annual basis, rather than moving to a far more complex system of assessment. However, the hon. Gentleman is quite right: we need to get the levels of error down and ensure that the right sums are being paid to the right people.

I thank the Chancellor for that answer, but, to be honest, he did not actually respond to the question that I asked. Will he make a commitment that during his time as Chancellor he will reduce the levels of error and fraud? I say that because, as he will have read, the Comptroller and Auditor General’s report, which is part of the HMRC accounts, says that there is currently no evidence to demonstrate that there will be lower figures in the next published year. Indeed, the report also shows that the Treasury is still trying to collect almost £4 billion of overpayments from people out there in our constituencies, and that it has given up on £1.6 billion altogether. I therefore put the question to the Chancellor again. Does he believe that during his time as Chancellor he will be able to reduce the totally unacceptable levels of error and fraud, which cause hardship to so many of the people whom we represent?

As I have said, I think that the level of error is too high and I want to see it reduced. That will take time, as I know from my experience in dealing with jobseeker’s allowance eight or nine years ago. However, as I said to the Chairman of the Select Committee, my right hon. Friend the Member for West Dunbartonshire (John McFall), those error rates, which had stood at 13 per cent. during the last year of the Conservative Government, came down to 5 per cent., and we must apply the same pressure in relation to tax credits. We need to deal with that, but we also need to keep in the front of our minds the benefits that tax credits can bring. I hope that when the hon. Gentleman next gets to his feet, he will tell us whether he supports tax credits—because, as with so many other aspects of Tory tax policy, it is not entirely clear what the Opposition’s policy is on this, especially when they have made commitments to abolish inheritance tax, to reduce corporation tax by 1 per cent., to get rid of stamp duty—

I, too, welcome my right hon. Friend back to the Treasury; what goes around comes around, in that respect. Does he agree that the tax credit system is an integral part of the campaign to abolish child poverty by 2020, as we can all see that it is having an effect in our constituencies? Does he also agree that the target date of 2020 is a crucial part of that strategy, and that it is the absence of such a date and such a determination from the social policy document that the Conservatives published this week that shows that they are dealing in words and not deeds when it comes to tackling poverty?

I thank my hon. Friend for his kind remarks. I know that he has been extremely concerned over many years in the House to ensure that the Government meet their ambitions to eradicate poverty, especially child poverty and pensioner poverty, which is also important. The fact that we have been able to lift children and pensioners out of poverty over the years, through tax credits and other measures, is important. The key thing to keep at the front of our minds is that if the Government are serious about tackling poverty, we must be prepared to spend sufficient resources to do it. There are huge question marks over the Conservatives in that regard, as I was starting to say a moment ago—but you will be relieved to hear that I will not continue with that line just yet, Mr. Speaker.

Terrorist Assets

Earlier this year, we set out new measures to tighten controls on terrorist assets, including protecting the charitable sector from the risk of terrorist exploitation, licensing those who own or control a money service business, and promoting the proactive use of asset freezing powers, including the creation of a dedicated Treasury asset freezing unit. I am pleased to say that last week the Financial Action Task Force ranked the UK as the first country to be fully compliant with international standards on terrorist asset freezing. In the second quarter of this year, we made three domestic asset freezing designations under the orders on terrorism and al-Qaeda, and this week I made a further domestic designation.

Tackling money laundering also means, in the words of the Prime Minister, that there should be

“no safe haven for terrorists”

and

“no safe hiding place for their funds.”

If that is the case, why was Abu Hamza able to buy a £220,000 semi-detached house in Greenford for cash, two years after his assets were supposed to have been frozen by the Treasury?

The police have conducted their own investigation into that case, and I know that the hon. Lady’s colleague, the hon. Member for Hammersmith and Fulham (Mr. Hands), has raised the issue with my predecessor in an Adjournment debate. The police were absolutely satisfied that, because no asset was transferred to the designated person, there was no cause for concern.

I welcome my hon. Friend to her new responsibilities and wish her well in them. Britain, of course, cannot do this alone. Is it not important to work with international partners to ensure that what we do here is replicated in the European Union, for example? What plans does she have to work with our EU colleagues to ensure that they adopt practices similar to ours?

I am grateful to my right hon. Friend for his kind remarks, and I can reassure him that we are in constant contact with our European Union partners on this issue. Indeed, I shall be travelling to Brussels this evening for the budget ECOFIN, where we will support the EU budget lines precisely on these measures.

Household Liabilities

3. If he will make a statement on the impact on the economy of the level of personal bankruptcies and home repossessions. (149006)

The Treasury continually monitors the levels of household liabilities and assets, and their implications for the wider economy are examined as part of the pre-Budget report and Budget forecasting.

Hard-working families are facing a three-pronged attack of rising interest rates, rising debt and rising unemployment. That will feed through into greater home repossessions and personal bankruptcies, with a severe knock-on effect on the economy. Does the Minister agree that it is time to provide better access to free financial advice, time for health warnings on credit promotions, and time to show greater flexibility in the social fund at times of economic downturn?

I do not share the hon. Gentleman’s downbeat assessment of the economy. At the moment, the number of home repossessions is half what we inherited in 1997 and only a fifth of the 1991 rate. We have had a decade of stability, and strong and stable economic growth; net household wealth has actually risen in real terms by 65 per cent., so I do not recognise the rather gloomy place that the hon. Gentleman seems to inhabit.

Perhaps the underlying cause of house repossessions and bankruptcy is the level of personal indebtedness, so it is important to educate people about its effects, particularly if they are over-borrowing in relation to their income. Is it not sometimes too easy for people to become bankrupt, as they do not always realise the implications for future borrowing and for their future lives more widely?

I thank my hon. Friend for that question. We have set aside £120 million for the fund on financial inclusion and education, which seeks to teach some of those lessons and to counter some of the advertising that drives small numbers of people into over-indebtedness. That is one clear aim of the Government’s financial inclusion policy.

The hon. Lady will know that UK interest rates are now the highest in the G7 and are perhaps likely to rise higher. To what extent does she believe that the record levels of insolvency are at least in part due to that cause?

The hon. Gentleman is right in that interest rates have risen slightly over the recent period—[Hon. Members: “Slightly?”]—but they are still on average only half what they were during the Tories’ period in office. We need to remember that we have had a decade of stability with growth in incomes, employment and wealth. The hon. Gentleman is scaremongering about the current situation.

I welcome my hon. Friend to her new position and acknowledge her remarks about irresponsible advertising. More particularly, is she concerned about celebrities who endorse products that are totally unsuitable for the people at whom the advertising is directed, and does she have any plans to tackle the problem?

My hon. Friend makes an extremely good point about advertising in general, and the Financial Services Authority has been looking into it, particularly in respect of misleading advertisements, of which we have seen many examples of late. It is important that the industry adhere more effectively to the voluntary codes presently in place. If there is no sign of improvement, we will certainly look into what more the Government can do through regulation.

I congratulate the hon. Lady on her move into the Treasury team. Does she agree, however, that our country faces a growing crisis of young people in debt? The latest figures from the Insolvency Service for the first quarter of 2007 show a 24 per cent. increase in personal bankruptcy on the same period last year. In my constituency, the citizens advice bureau tells me that people in debt in their 20s are now the largest group with whom it deals. Does she not accept that in taking away the 10 per cent. tax rate at the last Budget, and disproportionately taxing young people more, the Government are now part of those young people’s problems in trying to service debt? Does not she agree that the Government should look closely at the matter, and decide on severe action, instead of taxing those young people more?

I thank the hon. Lady for the welcome to me, and return that welcome to her on her first Front-Bench appearance. I hope that she will have many more such appearances, and that she enjoys her time on the Front Bench—[Interruption.] On the Opposition Front Bench, that is.

With regard to young people in debt, financial education is an issue, and that is why recent announcements have been made about changing the curriculum. We must ensure that the £120 million put aside in the financial inclusion fund is spent on increasing the sophistication of financial understanding to match the ongoing sophistication in the financial services industry and the techniques sometimes used by the advertising industry to tempt people into debt.

The hon. Lady must remember that although debt levels are higher, asset levels are also higher, because we have had a stable economy. Therefore, the £1 trillion in personal debt is set against £7 trillion in assets. As the economy grows, asset values grow. Because we have low inflation—at half the rate that the hon. Lady’s party managed when it was in office—people can sensibly borrow more money than before. That is what is happening.

My hon. Friend will be well aware of the worrying increase in the use of individual voluntary arrangements. Those are totally inappropriate for many people who find themselves in financial difficulties. What more can be done, either directly or through the regulator—the Financial Services Authority—to make sure that those arrangements are used only when appropriate?

My hon. Friend is right to say that it is extremely important for the new IVAs to be used in the appropriate way. They were introduced to ensure that bankruptcy was not the only option, and they can be appropriate in certain circumstances. It is important that the Insolvency Service, the financial services industry and our education system teach people how to use the instruments introduced to deal with debt in a way appropriate for them. It is important that people do not rush into uninformed decisions.

Goodison Review

The Government have implemented 29 of Sir Nicholas’s recommendations, and will continue to keep the further issues raised under review.

I welcome the Chief Secretary to his post. Is he aware, however, that it is now three and a half years since the publication of the Goodison review—a report that was commissioned by one of his predecessors as Chief Secretary? When will the Treasury respond to the report’s tax recommendations, which have universal support in the arts world as a means of substantially increasing private giving at relatively modest cost? May I draw his attention to the unanimous recommendation of the Select Committee on Culture, Media and Sport to that effect?

I thank the hon. Gentleman for his kind welcome, and pay tribute to him for having the courage to be the first Tory to raise the issue of museum funding for at least four weeks. As I said, many of Sir Nicholas Goodison’s recommendations to the Treasury have been implemented; others have proved more challenging, although we keep those matters under review. I hope that he will accept that museums and galleries get about £6 million from gift aid, which is a significant contribution. I warn him that such tax changes would have to be funded, and if he is considering doing so by introducing museum charges, that would be a somewhat backward-looking and elitist policy.

I, too, welcome my right hon. Friend to his new position. Does he agree that museums have played a critical part in education and the strengthening of our economy, not only in the arts and culture but in improving pupils’ understanding of science, technology and maths? Is not free admission crucial to the rolling out of our education plans and helping to improve our economy?

I could not agree more. Since Lord Smith of Finsbury had the courage to introduce the policy, there has been a huge increase in the number of people visiting our museums and galleries, many of them for the first time. My hon. Friend is right to highlight the link between education and museums, and the need to make museums even more accessible to school children and school parties. I can give her an absolute guarantee that we will maintain the policy of free entry to museums and galleries, principally because it has brought enormous cultural benefits to all the country’s major cultural centres.

I, too, welcome the Minister to his hew position. The House should be as one in dealing with the art, culture, tradition and heritage of this country. Historically, patronage—which has recently been given rather a bad name—has played a major role in arts and heritage. Will the Minister and the Treasury team look more favourably on expanding patronage of the arts, which is one of the best ways of obtaining money from those who have it and investing it in what we believe in—arts, heritage and tradition?

I thank the hon. Gentleman for his welcome. I will give him a commitment to keep these matters under review, but I recall from my time as an adviser at the Department for Culture, Media and Sport—it seems many years ago now—that most museums are still able to display only a small part of their collections. If there is new money to come into the museums sector, be it from tax relief or from direct grant, we must consider how it can best be used to strengthen further the renaissance and the cultural boom that we have seen since this Labour Government came to power.

Can my hon. Friend assure me that the Government will continue to give financial support to the exciting new developments in national museums in Liverpool as part of the city’s regeneration? What impact does he think a policy of charging for admission would have on the development of the museum?

I pay tribute to my hon. Friend for her support for Liverpool’s status as European capital of culture. I have visited Liverpool a good deal recently and seen the changes taking place in the city, and it gives me—as a native scouser—huge pride to see it on the up, and ready to enjoy a fantastic celebration of culture next year. If we were to bring back museum charges at this stage, just as we are about to throw open the doors of the marvellous national museums and galleries in Liverpool, it would be a complete dereliction of our duty to the people of my hon. Friend’s city and this country.

Disposable Household Income

5. What assessment he has made of the trend in real disposable household incomes over the last 12 months; and if he will make a statement. (149008)

Real household disposable income grew by 0.3% in the 12 months to the first quarter of 2007, supported by high levels of employment and growth in wages and salaries. The Budget forecast is for disposable income to grow by 2 ¼ % to 2 ¾% over the whole of 2007.

The Minister sounds very enthusiastic, but is she aware that family income tax has risen by about £1,300 and council taxes by 92 per cent. since 1997? There has also, of course, been a £100 billion raid on pensions. As the Minister knows, for the last two quarters disposable income has fallen as a consequence of all that. How will she reverse the trend?

It is important to recognise that over the last decade real disposable incomes have risen by an average of 2.6 per cent. a year. During the last 10 years of Tory government, it rose by only 1.6 per cent. In a decade of stability, real disposable incomes have risen by 20 per cent., earnings by 40 per cent., and prices by only 21 per cent. You do not need to be Mr. Micawber to work out how that makes you feel.

Has the Minister assessed the incomes of the poorest working people in our society who, as a result of Government policies, are now going to pay income tax at the rate of 20p in the pound rather than 10p? Is that fair?

The Government have rightly set a target of ending child poverty by 2020 and halving it by 2010. They have made enormous strides by reducing the numbers affected by 600,000 so far, but what will my hon. Friend do for the lowest fifth of those with disposable incomes so that, by 2010, we have made a significant difference, especially as it appears that, over the last year, the progress made has slowed? Are there any new initiatives to ensure that we end child poverty in this country?

The strategies to end child poverty rely on making work pay and on giving people the opportunity to earn more money as they stay in work. We must ensure that the labour market is open to them, that they have training opportunities and that they have opportunities to upskill. We also need to ensure that we carry on making progress with Sure Start and with affordable child care to allow many women who look after children to have an opportunity to work. We have a multi-pronged approach and, in the pre-Budget report and subsequent Budgets, the Treasury will take account of how we are doing with our unprecedented targets to end child poverty.

In the last few months, a considerable number of nurses in my constituency have either written to me or visited me in my surgeries to express grave concern that their disposable household income will be falling as a result of their below-inflation pay award. Given the fantastic work that they, ancillary workers and others do in the NHS, why are they being punished in this way?

We have to look at what has happened to public sector pay overall. There has been a 25 per cent. real increase in health service pay in the last period. It was important in this round of pay rises to ensure that we kept inflation under control, which is why the pay increase was staged. Inflation is forecast to be back below its 2 per cent. target by the end of the year, which means that the money in nurses’ pockets will not be eaten away by inflation getting out of control. That is an important part of the stability that we have been able to deliver in the last 10 years. Although it is difficult at the moment and nurses in England might not be happy, they will benefit from getting inflation back down under control by the end of the year.

Does my hon. Friend realise that work needs to be done on household incomes and their effect over the life cycle? As a young person purchasing my first home and bringing up the work force of the future, I had less liquidity at the end of the week than when the amount of mortgage taken out of my wages every week was diminishing. If I had been offered the opportunity to offset my capital investment at the start of my life cycle, I would have been able to bring up my children with a better standard of living and met the cost at a later part of my life. Has she considered this?

That philosophical question implies a complete change in the way in which we do the national accounts. It would require massive inter-generational transfers between individuals when they are young and individuals when they are older; pensions and savings are the only examples I can think of. My hon. Friend will be glad to know that the success of individual savings accounts, which have now become available to lower income people much more than tax-exempt special savings accounts were, gives a chance for some of that transfer to take place. Perhaps we should also rely on the endless ingenuity of the financial services sector to see what it can make of my hon. Friend’s question.

What does the Exchequer Secretary estimate will happen to disposable incomes in the next 12 months, particularly those of people on low incomes who will be particularly hard hit by the abolition of the 10p tax rate? Although the Minister has said that tax credits might offset that, many groups of people are ineligible for tax credits, such as the under-25s. Does the Minister have any plans to soften the blow for such important groups?

We always keep such issues under review, but the hon. Lady must explain how her party’s new proposals for a 4p cut in income tax, which will give 75 per cent. of the £18 billion sum involved to the wealthiest 40 per cent. and less than 1 per cent. to the bottom 10 per cent., will help the low paid.

Given that the Chancellor’s predecessor has boxed him in by setting tax and spending levels for the next three years and that Monetary Policy Committee decisions will largely determine inflation and growth, will the Exchequer Secretary tell us what policy tools remain available to the current Chancellor to address the fall in real disposable income?

There are plenty of policy tools that can be employed and nuances and changes that can be made—

I was remiss; I should have welcomed the hon. Member for Runnymede and Weybridge (Mr. Hammond) to his new position in the shadow Treasury team.

As I was saying, in the period between the pre-Budget report and the Budget there are many opportunities to change structures and approaches, both fiscally and in terms of monetary policy, to fit in with new issues and situations that arise. The hon. Gentleman would not aspire to sit on the Government Benches if he did not think that he would have some options if he were in the Treasury.

I welcome my hon. Friend to her new post; her promotion is as welcome as it is overdue. Labour Members put the interests of children first, and children of the poorest families are our highest priority. With that in mind, will my hon. Friend tell me what proportion of low-income families with children have taken up tax credits?

My understanding is that the take-up of tax credits by low-income families with children is very high—the proportion is in the high 90 per cent. range. I thank my hon. Friend for her generous welcome to me.

Pension Funds

6. What assessment he has made of the impact on pension funds of the abolition of dividend tax relief in 1997; and if he will make a statement. (149009)

When my right hon. Friend the Prime Minister was the Chancellor and he ended dividend tax relief and announced a 2p cut in corporation tax in 1997, he considered a wide range of factors.

Various figures have been bandied around as to the effect of the abolition of dividend tax relief. To put the record straight, what is the most recent Treasury figure for the cumulative effect of that annual smash-and-grab raid on our pension funds?

The only figures that have been bandied around have come from the Conservative party. The decision that the then Chancellor took was right. We wanted to ensure that investment decisions were taken for good business reasons, rather than for tax advantages. The hon. Gentleman will no doubt bear it in mind that under the previous Conservative Government the rate of dividend tax relief was cut on no fewer than five occasions. The last time it was cut was in 1993 when the then Chancellor, Lord Lamont, was being advised by the current leader of the Conservative party. Not only did the Conservatives cut the rate of dividend tax credit, but they failed to cut corporation tax at the same time.

Rather than continuing to look at the change in corporation tax, will my right hon. Friend look at what I think is the real cause of pension funds getting into trouble and subsequently having to receive help from the financial assistance scheme: the pension holidays that many of them took? I have been asking questions requesting the publication of information on how many of those funds had previously taken pension holidays, but the Treasury has as yet failed to answer. I hope that the Chancellor will change his mind and look into the issue, because it is the cause of the subsequent problems.

I agree with my hon. Friend. The causes of the difficulties that many pension funds encountered in the early part of this decade were many. There was the stock market collapse, following the collapse of the dotcom bubble in 2000. Many pension trustees had allowed a pension holiday through the 1980s and 1990s, and many did not realise until the beginning of this decade that their beneficiaries were living a lot longer than they thought. Moreover, a change to the accounting rules made companies bring on to their balance sheets their occupational pensions, which unfortunately led to many deciding to curtail their benefits or to end the schemes altogether.

Encouragingly, since that time the stock market has recovered, trustees are being more realistic and the Government have introduced legislation to help the victims of failed pension funds. The new pensions Bill, which will come before Parliament in the next Session, will provide further help, and we want to restore the link between earnings and pensions. In addition, we have introduced the winter fuel payment that has helped pensioners throughout the country, and the pension credit, which has helped to lift pensioners out of poverty. A range of things needs to be done, but my hon. Friend is right—people have to remember that what they get out of a pension has a lot to do with what they put into it, and the pension payment holidays did have a damaging effect in the 1980s and 1990s.

May I, in welcoming the right hon. Gentleman to his grand and historic office, remind him that yesterday, when I asked the Prime Minister about the massive blow that he struck, as Chancellor, against occupational pension funds, he replied by hiding behind the stock market crashes to which the right hon. Gentleman has just referred, and pointed out that pension fund assets had doubled? That being the case, how does the present Chancellor explain the fact that so many well-managed and profitable businesses now have very large pension fund deficits, and that almost all firms—including even the Bank of England—are closing their final salary schemes, which are so much more beneficial to pensioners than the alternatives now on offer?

I thank the hon. Gentleman for his opening remarks. I know that he has seen a good few Chancellors in his time, although I am not sure whether he was here when we joined the gold standard some years ago. I know that he has a keen sense of history, so he will know that before 1997, Chancellors of the party that he supports steadily decreased the amount of dividend tax credit. They started in 1979—when, incidentally, the Conservatives doubled VAT, even though they said during that year’s election that they would not—and they did it again in 1986, 1987, 1988 and 1993.

It has got a lot to do with it. The hon. Gentleman was critical of the decision that my right hon. Friend the Prime Minister took, as Chancellor, back in 1997. It was the right decision to take in the long-term interest of this country, and it is the long-term interest that we will keep our eyes on. It is very important to ensure that we have a climate in which people are encouraged to invest for good business reasons, and that the system is not distorted because of tax reasons. On the hon. Gentleman’s point about pensions, I refer him to what I said a few moments ago. Pension funds have got into difficulties because of a combination of factors. I mentioned the stock market collapse and the change to the accounting rules, which had a profound effect on pension funds. Other factors also had an effect, such as the pension holidays that such funds took. However, we are determined to do everything that we can to help pension fund trustees, as well as helping pensioners present and future.

Will my right hon. Friend confirm that tax credit dividends were simply a perverse incentive not to invest in one’s business the profits that one achieved, and that the long-term growth in the value of businesses as a result of the abolition of such tax credits is precisely the reason why the hon. Member for Louth and Horncastle (Sir Peter Tapsell) was able to allude to the fact that the value of pension assets has risen from £500 billion to more than £1 trillion during the period in question?

My hon. Friend is right and I can only assume that he has been looking at the papers that were made available to the former Chancellor, Norman Lamont, and released under the Freedom of Information Act 2000, which make it abundantly clear that at the time the Treasury was aware of the distortion. Of course, the document then went on to note:

“Everybody is being asked to pay more tax”—

in that Budget—

“and exempting institutions must play their part.”

The Conservative Government made the changes because they had run out of money; we made them because we wanted long-term sensible arrangements to encourage long-term investment in this country.

May I, too, welcome the Chancellor and congratulate him on his appointment? I press him to answer the question put by my hon. Friend the Member for Scarborough and Whitby (Mr. Goodwill). In 1997, the Chancellor was perfectly happy to say that

“there is no question that in the long term and the medium term”

the abolition of dividend tax credits for pension funds

“will be good for companies and it will be good for pensioners”,

despite the advice he received from Treasury officials. Independent experts say that the cumulative cost is something like £100 billion—at least. The Treasury must have made its own calculations. Let us hear what they are.

The hon. Gentleman refers to the advice that my right hon. Friend received in 1997, which was of course the subject of a debate in April—a debate that the Opposition may now wish they had not brought up. It was quite clear that all the predictions made when the Chancellor tested what might happen after the changes did not come to pass: the stock exchange rose afterwards and the amount of contributions to pension funds continued to rise. The hon. Gentleman needs to reflect on the fact that nobody—not the Conservative party, no one else in the country, no one else in Europe and the developed economies of the world—is actually calling for the restoration of that system of dividend tax credits. As the shadow Chancellor himself has said, the test of whether he is ready for government is whether or not he can resist additional calls for public expenditure. He is right on that point, even if not on most others.

Tax Credits

7. What estimate he has made of the likely change in the number of tax credit claimants following the abolition of the 10 per cent. starting band of income tax in the financial year 2008-09; and if he will make a statement. (149013)

Actually, I was here. May I, too, congratulate the Chancellor on his new job, and also on his relatively reasonable response to my hon. Friend the shadow Chancellor about the shambolic and chaotic situation regarding tax credits? Given that almost half the claims have been mispaid and that of those, nearly 2 million people have received demands to pay back money, which of course they have already spent, does he think it sensible that by abolishing the 10p tax rate, instead of first sorting out the system, more people will become eligible for it and thus sucked into that shambolic and chaotic situation?

There are two points and I think that the shadow Chancellor touched on the first when he made the perfectly reasonable point that people had been overpaid, the sums can be substantial and if they are on modest incomes that is one of the reasons why it takes longer to get repayments and there is more money outstanding. We have to be sensitive about people’s ability to pay. However, on the second point, I do not follow the logic of the hon. Member for Blaby (Mr. Robathan) at all. If changes are made to the tax system that relate to people with children, it is important that we use the tax credit system to help them. The changes that the then Chancellor announced earlier this year in the Budget mean that more families with children are being helped, which is something that I want to continue to happen.

The Institute for Fiscal Studies is hardly a cheerleader for our party, but its assessment of the Budget in this regard is broadly very positive indeed. The IFS indicated that of the 10 deciles of income where it had assessed the impact the lowest two had benefited most from the changes. However, will the Chancellor respond to the IFS’s one observation of concern, which is that those who lost out due to the changes were disproportionately low-earning, single people, with no dependent children? Will he promote take-up—

I agree with the point that my hon. Friend made in relation to the IFS, which was extremely complimentary about the budget changes; but of course, I recognise what he said. The former Chancellor increased the threshold for working tax credit. He increased the child tax credit itself, which will help us to take 200,000 children out of poverty. We increased the age allowance, so low-income pensioners over the age of 65 will be no worse off and 580,000 will be removed from tax altogether. As my hon. Friend has said, the IFS showed that the biggest proportion of gainers are those at the lower end of the income distribution, which stands in stark contradiction to what the Liberals are proposing today.

Non-domiciled Status

8. When he expects to complete his consideration of the tax liabilities of those with non-domicile status. (149015)

I saw the hon. Gentleman make his entrance halfway through our time this morning, and I am pleased that he has found the time to join us.

The Government’s review of the residence and domicile rules is ongoing. The Government are mindful that any change to the current system would need to balance carefully the principles of ensuring fairness and of promoting the UK’s international competitiveness.

I thank the Financial Secretary for her courteous welcome.

The review was started in 2002 and seems to be taking an inordinate amount of time. Is that in any way connected with the large sums of money given to the Labour party by those who qualify for non-domiciled status, such as Lakshmi Mittal? While we are on the subject of this new sleaze-free environment that the Prime Minister has created, can we have an absolute guarantee that neither the Prime Minister nor the Chancellor will appoint as an economic adviser anyone who qualifies for non-domiciled tax status?

To deal with the general point about non-domiciled status, it is important to keep such issues in context and perspective. Resident non-domiciled people remain a relatively small group who are liable to pay UK tax on their earnings in the UK. Indeed, the Exchequer benefits to the tune of £3 billion. It is rich for the Liberal Democrats to come here and seek to lecture other hon. Members, given the circumstances in which some of their donors are living.

Does my right hon. Friend not acknowledge that this issue is now a rich source of public concern, a great deal of complication, which makes money for accountants, and a great deal of abuse? Britain’s reputation as an offshore tax haven and the concern expressed by tax authorities in the United States about that must be addressed. We cannot run the tax economy of this country as a large-scale version of Chelsea football club.

Contrary to recent press claims, the International Monetary Fund does not categorise the UK as a tax haven, despite some recent publicity attached to an IMF working paper, which was seeking to develop a methodology to identify tax havens. Under that proposed methodology, the UK would have counted as a tax haven, but the methodology is seriously flawed. I could go into the detail of why that was so, but I suspect that I would try your patience if I did so, Mr. Speaker. However, I acknowledge the concerns that my hon. Friend has raised and appreciate that a debate is taking place about the matter, and I will keep it under very close review.

Although I have some sympathy with the concerns addressed by the hon. Member for Lewes (Norman Baker), at least in relation to donors to the Labour party, may I tell the Financial Secretary that it is of great importance to the City of London and to ensuring its place as a pre-eminent global financial capital that we ensure that we have the very best talent here? Will she therefore ensure that, whenever the report comes into play—five years seems quite a long time for it to be ongoing—there is a balance between the interests of London as a global financial capital, which benefits all of us, and the issues of non-domiciled status?

I am grateful to the hon. Gentleman for those comments. I acknowledge the very serious point that he makes. As I said earlier, fairness in the tax system is one of our primary objectives, but it is also important to promote the UK’s competitiveness, by remaining an attractive place to do business.

The Financial Secretary will be aware that a Select Committee is looking at private equity and non-domiciliary taxation as an aspect of private equity. It is clear already that those matters are costing the Treasury and the taxpayer considerable sums of money and that they are rewarding the main participants—the self-proclaimed masters of the universe—with grossly inflated sums of money, without any real risk. Can the Financial Secretary confirm that the review set in train on those taxation measures is still under way and will report at pre-Budget time?

I can confirm that the review is under way and that it will report. If my hon. Friend will excuse me, I will not be drawn into a discussion on the particular issues that he raised, because it is a much wider subject. Estimates of the tax loss to the UK as a consequence of the use of the remittance basis by those who are not domiciled in the UK are not routinely made. We do not hold information on overseas income and gains that do not give rise to a tax liability in the UK, but, as I have said, individuals claiming that they are resident but not domiciled declare approximately £9.8 billion in taxable income, which leads to a UK tax liability of about £3 billion.

Income Tax

9. What account he took of the estimated number of people who would be subject to a higher marginal rate of taxation as a result of Budget 2007 in taking the decision to abolish the 10p rate of income tax. (149016)

I would have referred the hon. Lady to the reply that I gave to Question 1, but I do not think that she was here when I gave it. My right hon. Friend the Prime Minister looked at a range of factors before deciding to reduce the basic rate of income tax to 20p from next year.

I thank the Chancellor for that reply. Obviously, my question was different from Question 1. I have seen from his written answer that the Treasury’s own figures show that 5 million households are worse off as a result of abolishing the 10p tax rate, and it is those on low and middle incomes who are suffering most at the hands of the Labour Government. Will the new Chancellor rise to the challenge of creating a fairer tax system, or will he continue his predecessor’s habit of acting like Robin Hood in reverse?

The hon. Lady would do well to read in Hansard tomorrow the exchange in relation to Question 1, which she might find interesting. As I said just a few moments ago, when she was in the Chamber, we increased the working tax credit to help people without children. We also increased child tax credit, which helps people on low incomes. I suggest that before she next gets to her feet to speak she should have a good look at her own party’s proposals, because the benefit they provide to people on low incomes is very small indeed. Green taxes are interesting, but they can sometimes hit people on low incomes very hard, and she needs to think about that.

Business of the House

The business for next week will be:

Monday 16 July—Opposition day [17th allotted day]. There will be a debate entitled “Overseas Corruption” followed by a debate entitled “Fair Taxation on the Super Rich”. Both debates arise on a Liberal Democrat motion.

Tuesday 17 July—Consideration of Lords amendments to the Pensions Bill followed by, if necessary, consideration of Lords amendments, followed by Committee and remaining stages of the Parliament (Joint Departments) Bill [Lords].

Wednesday 18 July—Consideration of Lords amendments to the Statistics and Registration Service Bill followed by, if necessary, consideration of Lords amendments.

Thursday 19 July—If necessary, consideration of Lords amendments, followed by a debate on Zimbabwe on a motion for the Adjournment of the House.

Friday 20 July—The House will not be sitting.

The provisional business for the following week will include:

Monday 23 July—Second Reading of the Criminal Justice and Immigration Bill.

Tuesday 24 July—Opposition day [18th allotted day]. There will be a debate on an Opposition motion. Subject to be announced.

Wednesday 25 July—Consideration of Lords amendments followed by consideration of the draft legislative programme on a motion for the Adjournment of the House, which I will open, followed by, if necessary, consideration of Lords amendments.

Thursday 26 July—Motion on the summer recess Adjournment.

I anticipate making an oral statement to the House on my priorities as Minister for Women before the summer recess. As my right hon. Friend the Prime Minister said yesterday, we also expect an oral statement next week on the Government’s housing policy.

I thank the right hon. and learned Lady for giving us the future business. Last week, she offered me a non-aggression pact. Of course I am happy to co-operate with her in the interests of the House, as I did with her two predecessors, but pretending to protect the interests of the House to stop me holding the Government to account is not a peace deal—it is an attempt to use hon. Members as a human shield, not to protect the House, but to protect her from scrutiny.

Talking of scrutiny, there is a backlog of 109 inquests into the deaths of servicemen and women serving in Iraq and Afghanistan. Last October, the right hon. and learned Lady was responsible for the inquests. Then, she said that the backlog was “unacceptable” and would be “sorted out”, but that has not happened, and the backlog has caused considerable distress to bereaved families. Will the Secretary of State for Justice come to the House urgently to make a statement on what he will do to sort out that backlog?

The Government are due to respond to the Leitch review of skills, which they commissioned in 2004, and which reported more than six months ago. Will the right hon. and learned Lady ensure that the Secretary of State for Innovation, Universities and Skills comes to the House to make an oral statement when he publishes the Government’s response?

Yesterday, the Prime Minister said:

“regeneration… may be…better…than the creation of super-casinos”—[Official Report, 11 July 2007; Vol. 462, c. 1438.]

and the media were briefed that the Manchester super-casino was dead in the water. That is no way to announce a change in Government policy. If the Prime Minister respects Parliament, will he order the Secretary of State for Culture, Media and Sport to come to the House to make a statement?

On 23 July the Second Reading of the Criminal Justice and Immigration Bill will take place, but yesterday the Prime Minister said that he would add the recommendations from the Flanagan review to the Bill in the autumn. How can we give the Bill a Second Reading when part of it is not even written? May we have an urgent statement on that Bill?

The conclusions of the Brussels European Council say:

“National parliaments shall contribute actively to the good functioning of the Union”.

Presumably, “good functioning” will be determined by the European Court of Justice. That would constitute a fundamental change in the relationship between our sovereign Parliament and the institutions of the European Union, so may we have a debate in Government time on the need for a referendum on the European treaty?

Leaders of the House are, by tradition, Chairmen of the Modernisation Committee, but the Government’s motion to appoint the right hon. and learned Lady as Chairman of the Committee has been withdrawn twice. Why? Failure to move the motion means that the Committee remains in limbo, so may we have a statement on that?

Successive Leaders of the House have briefed the Lobby every Thursday about forthcoming House business. The right hon. and learned Lady has refused to do that, but I understand that she will brief the Lobby in her job as chairman of the Labour party. Will she take time from her duties as Labour party chairman to make a statement to the House on the relationship between Parliament and the media?

Finally, the right hon. and learned Lady has said that the law that she would most like to pass would mean that

“All jobs must be available part-time”,

but as she is unable to take her place as Chairman of the Modernisation Committee, and is unable to brief the Lobby, does she not think that being chairman and deputy leader of the Labour party, Minister for Women and Leader of the House is taking part-time working just a little too far?

I look forward to working with the right hon. Lady, and I say to her and to the whole House that it is right for all Members of the House to hold Ministers to account. I expect the House to do that, and as Leader of the House I will protect it in doing exactly that. She asked me about the important issue of inquests for those members of the armed forces who have tragically lost their lives in Iraq. There will be questions to the Secretary of State for Justice before the House rises for the summer recess, and no doubt the issue will be raised then, but I remind the House that we did act to ensure that there were no delays to those inquests.

We gave the Oxfordshire coroner the resources to appoint two assistant deputy coroners to expedite those inquests. On inquests for those whose bodies have been repatriated to RAF Lyneham, which comes under the jurisdiction of the Wiltshire coroner, the Government and I made it clear that we will not allow a backlog to arise in the way that it did in Oxfordshire. If the Wiltshire coroner makes it clear what resources are necessary, those resources will be forthcoming. We are all absolutely clear that we cannot have delays to inquests. Indeed, when I was Minister of State at the Ministry of Justice I wrote to the Wiltshire coroner and asked him whether he would like to have a meeting with my officials so that we could establish what extra resources, if any, he needed, and provide those resources. No backlog has built up since RAF Lyneham took over from Brize Norton, but my colleagues in the Ministry of Justice are taking the issue seriously.

The right hon. Lady mentioned the Leitch review and asked whether there would be an oral statement on skills. I can say that there might well be.

The right hon. Lady asked about casinos. I remind her that there will be Culture, Media and Sport questions and if there is something to be announced, no doubt there will be a statement, written or oral, from my colleagues in that Department. I remind the right hon. Lady and the House what the position is with respect to casinos. Agreement was not reached between this House and the House of Lords about the substance, or about the process whereby we would try to reach agreement. That being the case and there being deadlock, my right hon. Friend the Prime Minister told the House yesterday that the gambling prevalence study is under review, and that he would take the opportunity of the summer to reflect on whether further consideration would be given to how to regenerate areas that are greatly in need of regeneration, including east Manchester. Both the process and the substance are important matters for the House, and I can assure the right hon. Lady that we will do everything we can to make sure that information is brought to the House, following the Prime Minister’s remarks to the House yesterday.

On the Criminal Justice and Immigration Bill, the right hon. Lady is aware that the Flanagan review is under way. So long as any proposed amendment is within the scope of the long title, it would be quite normal for the Government to table an amendment. If it met with the support of the House and was within the scope of the Bill, it would be included in the legislation. There would be nothing unusual there.

No, there will not be a debate on the need for a referendum because there is no need for a referendum of the British public. However, there will need to be proper scrutiny by the House of any amending treaty.

With respect to the Modernisation Committee, I hope, like the previous Leader of the House, to be Chair of that Committee. The House will know that the procedure is that a motion is tabled to replace the previous Leader of the House with myself, as Leader of the House, as a member of the Modernisation Committee. That motion has been tabled and will be moved in due course, and I expect to take up my position on the Modernisation Committee. I regard its work as extremely important to the House. It has already made great progress in the years that it has sat, and I congratulate all the Members who have been part of the Committee on the good work that it has done and the difference that it has made in the House.

With reference to the right hon. Lady’s question about the briefing to the Lobby, if I as Leader of the House have something to say about the business of the House, I will seek to say it today in business questions. I will therefore not need to hold a Lobby briefing after business questions in the House. If I have something to say to the House, I will say it in the House. However, as a Member of Parliament I have obviously spoken to journalists for the past 25 years and no doubt I will continue to do so. As the right hon. Lady has asked, I can tell the House that I have no standing arrangement to brief the Lobby in my role as chair of the party. I hope that if I fail in my job as Leader of the House, she and all other Members will call me to account. That is only right. But it does not make sense for her to say that I am not doing my job, when I have just started it with absolute and complete commitment.

Will my right hon. and learned Friend take time to consider arranging a debate on civil service dispersals? In my constituency in the past few weeks there has been an announcement about the possible withdrawal of jobs in another of the sectors of civil service, to the detriment of an already serious situation, as there is a dearth of civil service jobs in the constituency.

Perhaps I can suggest to my hon. Friend that he raises that issue with my right hon. Friend the Chancellor of the Duchy of Lancaster, who will answer questions next Tuesday. I am sure that he will have heard the points that my hon. Friend has made about his constituency.

The Leader of the House’s statement is welcome, as is the announcement of the debate on the draft legislative programme announced yesterday which will enable the whole House to make its contribution before we rise for the summer. In that context, may I reinforce the point made by the right hon. Member for Maidenhead (Mrs. May) about the Criminal Justice and Immigration Bill? It is clearly illogical to start to debate a major Bill when we know that significant changes will be made on the other side of the summer recess. Will the Leader of the House think again, talk to colleagues in the Ministry of Justice, and see whether the Bill can be deferred so that it can be introduced in its final form, as the Government want it, rather than in its initial form?

Will the Leader of the House deal with three things that were not in yesterday’s statement but might have been, that are absolutely to do with House business and that I thought were on the Government’s agenda? Will she bring proposals before the House so that we can discuss whether Parliament, rather than the Government, should have control of parliamentary business and decide who chairs its Select Committees, and will we get the promised statement about Lords reform that we were told would happen before the summer but have not heard anything about yet?

On serious matters, one of which was touched on by the right hon. Member for Maidenhead, Liberal Democrat Members continue to share the concern about inquests into the deaths of those killed on active service abroad. If necessary, can we have a statement before the end of term? I am grateful for what the Leader of the House said, but there is widespread concern that there should be no delays.

I hope that there will be a statement on the state of the Prison Service, given today’s indication that we have probably the highest suicide levels in our prisons for many years. Given that the Government have taken an initiative, controversial as it may have been, which means that things are slightly more settled, can we have an opportunity for a less heated debate about the future of our prisons this side of the summer so that we can be reassured that things are under control, not out of control?

Lastly, given that we are coming up to the summer holidays, let me say that there are some good things in the Government’s programme about the future of youth provision. The Leader of the House has expressed a great interest in that important matter. Could we have a statement on leisure provision for young people as well as the necessary statement on casinos and possible changes in leisure provision for older people, which are clearly implied in what the Prime Minister said yesterday?

I heard what the hon. Gentleman said about the Criminal Justice and Immigration Bill, and no doubt my ministerial colleagues will reflect on that. However, I am sure that he would agree that if any amendment that is within the scope of the long title wins the support of the House, there is no reason for not tabling it. Like the right hon. Member for Maidenhead (Mrs. May), he raised the matter of proportionality—whether there are a great many new amendments that override issues that have been settled on Second Reading. That point will no doubt be clear to my colleagues in the relevant Department.

On Parliament taking control of business, what is important is that we agree through the usual channels the business that comes to this House and that I, as Leader of the House, put it to the House in a statement on Thursdays. There are no plans to change that. As for Parliament deciding who chairs Select Committees, Parliament does exactly that. Proposals are made and it is then for Parliament to decide whether it approves and supports them. On our side of the House, Members of Parliament actually vote on who should be nominated on to Select Committees. On the Lords reform statement, yes, it was promised that it would happen before the House rises, and that will be the case.

As regards the very important question of inquests for those in our armed services who have tragically lost their lives in Iraq, we have the Coroners Bill in the legislative programme that we will debate before the House rises. The problems that arose in Oxfordshire that caused so much heartache to bereaved relatives and were very difficult to sort out would not have arisen in such a way if the coroners legislation were already in force. The Bill is an important one that will do much to remedy the situation. I reaffirm that there is not a backlog of inquests in Wiltshire arising from the fact that bodies are now repatriated to RAF Lyneham. Officials in the Justice Department will discuss with the Wiltshire coroner how they can keep up to date and ensure that he has the resources he needs.

The hon. Gentleman mentioned the state of the Prison Service. The suicide rate is actually down from the level it reached in 1997, but any suicide is one too many, and it is a matter of concern that there has been an increase in the suicide rate compared with last year. My right hon. Friend the Secretary of State for Justice is addressing that matter, and the hon. Gentleman can no doubt ask about it during Justice questions next week.

Is there going to be a very strong protest from the Government against the insistence of the Iranian regime again to start stoning people to death, in order to raise the issue internationally? Is it not totally undesirable that in the 21st century such a barbaric practice should be encouraged and carried out by the Iranian regime? One hopes that efforts will be made by the Government to make it an international issue.

My hon. Friend has made a very important point indeed. This country, along with our counterparts in Europe, and working internationally through the United Nations, wants to be sure that we not only protect the human rights of people in this country, but that we are a strong force for the defence of human rights internationally. No doubt we shall raise that matter through the international institutions.

Can the Leader of the House explain why it has been comprehensively leaked that the Government are proposing to abolish regional assemblies? Yesterday the media carried stories that the Prime Minister wished to undo the handiwork of the former Deputy Prime Minister. It is quite wrong that such important decisions are made in this way. We were promised a document or a Green Paper today, but it has not appeared because of some last-minute hitch. It is vital that Parliament is kept up to date and told what the Government intend to do about this important matter.

I cannot comment on what the hon. Gentleman says about reports in the newspapers, but I agree that the question of local governance and regional assemblies is an important issue that concerns Members throughout the House. If any policy is to be announced, or change to be made, it should be done in this House, and no doubt it will be.

May I first say how delighted I am with the appointment of the new Leader of the House, and welcome her to her position? I am particularly pleased with her promise to protect the rights of Back Benchers.

Is the Leader of the House aware that the Scottish Grand Committee has not met at all during this Parliament? Will she have a word with the new Secretary of State for Scotland and ask him to discuss the matter with the usual channels in order to call a Scottish Grand Committee as soon as possible? It is long overdue and if she wants to protect the rights of Back Benchers, a Scottish Grand Committee would be the best way to do that.

I thank my hon. Friend for bringing this matter to my attention. I will do as he suggests and raise it with my right hon. Friend the Secretary of State for Scotland. Hon. Members can raise issues during this question time, and it provides an important opportunity for them to do so, but if issues arise between Thursdays, they are all welcome to come to talk to me in my office, which is outside, behind the Speaker’s Chair—turn left, and it is the second on the right.

Presumably the new Foreign Secretary will open next Thursday’s debate on Zimbabwe. If so, will the Leader of the House ensure that he says in the simplest and clearest terms that it is totally unacceptable for Mugabe to come to the EU-Africa summit in Lisbon? That summit will achieve a lot and it should go ahead, but it should not do so if Mugabe comes. If we are to protect human rights in Zimbabwe and stand up for the people there, it is essential that the Foreign Secretary makes our position absolutely clear. He would have support for that from all parts of the House.

That position has already been made clear by the Government and no doubt it will be reinforced. There will be a debate on Zimbabwe next week. There is a great strength of feeling throughout the House on this matter, and a great deal of frustration and concern for those who are suffering in Zimbabwe.

The reputation and success of British companies abroad, particularly in the United States, rests largely on their responsible behaviour and support for international labour laws. Will the Leader of the House give us time before the House rises for the summer to debate the behaviour of bus companies operating abroad, and whether they are supporting sensible and important trade union rights that are fundamental to any Member of this House?

My hon. Friend raises an important point, but I cannot immediately say where this point could be taken further so that hon. Members could follow it up. On this side of the House, we all believe it is very important that individuals at work have the right to join a trade union and to have it recognised. We also believe that the standards British companies operate with workers in this country should not be double standards; the same ones should apply to companies abroad. That is why we included a responsibility to report on such matters in the Companies Act 2006. The hon. Lady raises an important point; I will ascertain which Minister is responsible for taking the matter forward and write to them.

The Leader of the House might be aware that in Scotland more than 65 per cent. of children who leave care aged under five return to their parents. In England, more than 60 per cent. of children taken into care aged under five are adopted. The children in care Bill will be debated later this year, but will the Leader of the House ensure that Government time is given to debate such issues before the draft Bill is published?

The hon. Gentleman raises an important point. We need to be absolutely sure that children at risk of neglect or abuse are put in a place of safety and well cared for. We also want to ensure that if parents can care for their own children, they are supported in doing so. For too long, the family justice system has been a poor relation to the criminal justice system. What it does affects people’s lives for ever, and it is a big priority for the Ministry of Justice. The Secretary of State for Justice will answer questions next week, and perhaps the hon. Gentleman can raise the matter then.

Yesterday the media were briefed that the Manchester super-casino was dead in the water. It has profound constitutional implications for our relationship with the other place if we are to kowtow to its decisions. If the super-casino does not go ahead, we also need to know how we will replace the 3,500 jobs that will be lost. Can my right hon. and learned Friend arrange a debate on these matters that are very important to the people of Manchester?

We recognise that there was a difficult situation and a deadlock was reached. Therefore, the question is one of how to take matters forward. My right hon. Friend the Prime Minister said that while we await the gambling prevalence study, further consideration will be given to the question of the regeneration of east Manchester. I know that my hon. Friend will play a big role in the discussion, along with the local authority, about how needed regeneration is brought to Manchester.

Will the Leader of the House ensure that we have a debate in the near future in Government time on FRES—the future rapid effect system, which is the biggest procurement project by the Army, with costs that started at £6 billion but now stand at £16 billion? It will fix the Army’s military direction for the next 30 years. I secured a half-hour Adjournment debate in Westminster Hall some considerable time ago, but the issue is far too important for just Back Benchers. Will she speak to the Secretary of State for Defence and ensure that we have that debate?

I will draw the hon. Lady’s point to the attention of my right hon. Friend the Secretary of State, who will answer Defence questions on Monday. All hon. Members would agree that the way in which we effect the procurement of the Ministry of Defence is important for supporting our armed services and their work. It is also important for our manufacturing industry.

I am concerned that we are facing another postal strike today after Royal Mail’s refusal to enter into meaningful negotiations with the Communication Workers Union. However, the root cause of Royal Mail’s problems appears to be the damaging impact of unfair competition, which could easily jeopardise the universal service obligation if it is allowed to continue. That worries me because I have a large rural constituency, and I therefore ask the Leader of the House to my pass on my concerns to the Secretary of State for Business, Enterprise and Regulatory Reform and to arrange an urgent debate on the matter.

My hon. Friend has raised an important issue. We all want that dispute to be settled as soon as possible by negotiation. She also questioned the structure of and framework in which the negotiations are taking place. I will do as she asks and draw it to my right hon. Friend’s attention.

I welcome the right hon. and learned Lady’s announcement that we are to have nearly a full day’s debate on the draft legislative programme—that is an enormous improvement on her proposal of last week. Does not the new process, which I welcome, have two consequences? First, might not the Loyal Address be a little shorter since so many details of the Bills will already be in the public domain? Secondly, are there implications for the traditional five or six-day debate that we normally hold after the Queen’s Speech?

If the right hon. Gentleman is asking about the length of what the Queen reads out in the Gracious Speech, I do not anticipate its being shorter. Her Majesty will announce the legislative programme; we will simply be able to debate it before it is done and dusted and set in stone. People will have an opportunity to discuss what should be in the Gracious Speech. I do not expect the debate after the Queen’s Speech to be shortened, unless that appears to be acceptable.

My right hon. and learned Friend will know that the recently published White Paper on planning has generated considerable debate outside this place, especially about public involvement in the planning process. Will she arrange an early debate in the House so that hon. Members can express their views on the White Paper proposals before they are drafted into a Bill?

There will of course be many further opportunities for discussing the important and difficult question of planning. We need to ensure that necessary developments that are in the public and local interest are effected as swiftly as possible, with as little expense and effort as possible for those who implement them, and that local people who are likely to be affected have an opportunity to respond. The debate is important and will doubtless continue in the House.

I welcome the right hon. and learned Lady to her new job. Today, The Scotsman published a story that cited a report by Scottish Widows, which suggests that some 41 per cent. of people in Scotland—39 per cent. throughout the UK—save nothing for the near future. That is worrying. Will the Leader of the House ask the Chancellor of Exchequer to make a statement on the Government’s attitude to savings, their plans to encourage people to save more, and especially their view of one of Scottish Widows’ recommendations, which is to increase the annual contribution limit for those with individual savings accounts?

The hon. Gentleman could raise ISAs with my right hon. Friend the Chancellor of the Exchequer. I thank him for his words of welcome to me in my new position. The Government’s approach to pensions has been to offer people the possibility of saving more for their retirement safely, with the amount being topped up by their employers. I also draw attention to safe savings for those on low incomes—for example, the regulation that we introduced to protect people and support those who invest in credit unions.

May we have a debate in Government time on the performance and behaviour of Greenbelt, a factoring company, which charges homeowners up to £400 a year and provides little or no service? It is Farepak for homeowners. Yesterday, its lawyers wrote a threatening letter not only to me but to my constituent, Paula Hoogerbrugge. Paula has been monitoring the company’s performance nationally. She is a single mum, yet it not only sent her a threatening letter, but its representatives contacted her employers with a clear view to having her silenced or sacked. Will my right hon. and learned Friend join me in condemning that despicable behaviour?

I thank my hon. Friend for raising the matter in the House. The behaviour that he describes is worrying and I will raise it with my right hon. Friend the Secretary of State for Business, Enterprise and Regulatory Reform. Important financial sectors must have proper methods of probity.

The Wycombe rape crisis centre in my constituency supports approximately 200 victims of rape, sexual assault and childhood abuse a year. According to the National Council for Voluntary Organisations, it faces closure because

“it was only given a matter of weeks’ notice that it wouldn’t receive funding in the coming year”.

I know that the right hon. and learned Lady, as Minister for Women, takes such issues seriously. I gather that up to 190 other projects are affected. May we have a debate in the near future on sexual assault and rape?

I pay tribute to the important work that the voluntary sector contributes to supporting women and men who have been the victims of serious sexual offences. The rape crisis centre movement does important work, which is funded by a combination of national and local finance from health and social services budgets. Wearing my hat as Minister for Women, I undertake to look into the position in the hon. Gentleman’s constituency. The Government have invested a great deal in developing a network of sexual assault referral centres to ensure that women who suffer violent sexual assaults are properly supported. That is important not only to help them with the aftermath of that terrible crime but to support them to give evidence in a prosecution so that perpetrators can be brought to justice. Rape is a repeat offence; until perpetrators are brought to justice, they continue offending.

May I draw my right hon. and learned Friend’s attention to early-day motion 1872, about the Holocaust Educational Trust?

[That this House commends the Holocaust Educational Trust for its tremendous work in educating about the horrors of the past, reaching thousands of students across the country; congratulates the Trust for its flagship Lessons from Auschwitz Project which has seen over 4000 sixth-form students and teachers visit the Nazi death camp Auschwitz-Birkenau; notes that the project provides participants with a unique insight into the catastrophic results of what can happen when racism spirals out of control; further notes that the project encourages young people to use their rights as citizens and contribute positively to a future free from discrimination, racism and hatred; further notes Government support for the project which now enables the Trust to facilitate these visits to Auschwitz-Birkenau for two 16 to 18 year old students from every school and further education college in the UK; recognises the far reaching impact this funding has on young people across the UK; and calls upon the Government to continue this vital support of this project and its commitment to ensure Holocaust education remains an integral component of school teaching in the UK.]

The motion commends the trust’s work and the Government for their funding, which allows visits to Auschwitz for two 16 to 19-year-old students from every school and further education college in the UK. May we find time to debate the trust’s work so that we can encourage the Government to continue the funding in future and ensure that holocaust education remains an integral component of school teaching in the UK?

It is important to recognise and support the work in schools to remember and understand the terrible events of the holocaust. I join my hon. Friend in congratulating the Holocaust Educational Trust on its work. The Government’s financial support is important but I know that its work is mostly done by volunteers. I pay tribute to the volunteers who keep that important work going. We must never forget.

I am sure that the Leader of the House will be aware that, as a progressive but traditional moderniser in the House, I would be very happy indeed to chair the Modernisation Committee if elected, if she has some difficulty in that. But seriously, I have very much appreciated the private conversations that she and I have had about her job and modernisation. Will the right hon. and learned Lady be more specific about when the motion on her appointment to the Committee will come before the House, so that I can be there personally, as the veteran member of the Committee, to support her appointment as Chairman?

I thank the hon. Gentleman in two respects. First, I thank him for all the work that he has done over the years on the Modernisation Committee, which has made a difference to the House. As a Member for 25 years, I can see the difference that the Committee has made to how Members can do their work here. I thank him for being the backbone of the Committee, along with colleagues on my side of the House. Secondly, I thank him for the sentiments behind his offer to nominate me to chair the Committee, were the House to see fit to put me on it. I assure him that he will not regret that offer and the trust that he has placed in me. I undertake to do my job properly as Leader of the House and, if I am chosen, as the Chair of the Modernisation Committee.

I wonder whether my right hon. and learned Friend could find time for a debate on support for working carers, and on the operation of the carers allowance in particular. It discriminates against those on low pay who are trying to keep themselves in work, particularly those whose hours fluctuate. Before the Government’s review of the national carers strategy is complete, will she ensure that the House has a proper opportunity to debate how financial support for carers should operate to keep in work those who wish to work?

There will be an opportunity to debate those issues in the Health and Social Care Bill, but my hon. Friend raises a very important point indeed. There are a growing number of older people in this country, and the front line for the support and care of those people is the family. That is what most older people want and what most families want. We do not want to have to make people choose between their job and the care and support that they want to give older members of the family.

Perhaps as Minister for Women I could tell my hon. Friend that one of our three priorities will be supporting those families who are supporting older relatives. That includes not only rights at work to flexibility, but financial support. We have gone a long way to give financial support to families with young children. We need to do more to give financial support to those doing the incredibly important work of caring for older relatives. I shall bring my hon. Friend’s points to the attention of the relevant colleagues with whom we are working.

May we have a debate on the Floor of the House and in Government time on sexual health and reproductive rights? Given that the UK still has the highest rate of teenage pregnancies in western Europe and that many young women understand neither how their bodies work nor how to access contraception, does the right hon. and learned Lady agree that we need dramatically to improve the quality of sex education in this country, not least in schools, in order both that children can acquire the biological facts and that they have the opportunity to discuss their views, their values and their relationships?

I thank the hon. Gentleman for raising that point, which was discussed in the debate on the Opposition motion yesterday. It is important that we recognise that it is a crucial issue not only for young women and girls, but for young men and boys. There is still much too high a rate of sexually transmitted diseases, although progress is being made on that, and although the rate of teenage pregnancy is falling, it is still much too high. One of the things that will affect that in future is the issues that my hon. Friends concerned with education have raised. The issue is about ensuring not only that young people receive the right advice and information, but that they have aspirations and want to make absolutely sure that they get on with their lives and not have early, unwanted and unintended pregnancies.

When can we have a debate on the Prime Minister’s impressive proposals for constitutional reform? It looks as though we are reaching a position where we might have a written constitution or a new Bill of Rights. Before any decision is taken on who should be drafting such important documents, will my right hon. and learned Friend undertake to ensure that we have a discussion in the House on the proposals, so that we can have an input into who is selected?

I understand that my right hon. Friend the Secretary of State for Justice has said that if there is further information, he will give it in a statement to the House. As my right hon. Friend the Prime Minister said when he introduced the paper on constitutional reform, there will be a number of proposals to improve the accountability of the Government to Parliament and to improve and strengthen the relationship between Parliament and the people. A number of proposals will come forward, and we shall obviously want the fullest possible debate and engagement of hon. Members.

I need to mention to the hon. Member for Macclesfield (Sir Nicholas Winterton) that I perhaps did not respond to his point about timing. I hope that the motion will be moved early next week, but since I have unfortunately not given him quite the right information twice on this matter, let us hope that I get it right third time lucky.

Members in all parts of the House agree on the need to curb CO2 emissions. However, given that the international activities of UK companies account for some 12 to 15 per cent. of global CO2 emissions, could the Leader of the House please find time for a debate on the impact of climate change on people in developing countries?

The point that the hon. Gentleman raises is a big concern not only to my right hon. Friend the Secretary of State for Environment, Food and Rural Affairs, but to my right hon. Friend the Secretary of State for International Development. The people who contribute least to the problem of global warming, but who are first to suffer its effects, are those in poor countries. I assure the hon. Gentleman that that is one of the main motivations behind the Climate Change (Effects) Bill and is embedded in our international development programme. As for British companies, one of the important things in the Companies Act 2006 is the openness that they are required to have about their corporate responsibility, not only when they are doing things in this country, but in their operations abroad.

In view of the comments made by the new Minister for Trade and Investment—that trade unions are a backward-looking irrelevance with no place on today’s agenda—and of his past campaigns to curb maternity leave, freeze the minimum wage, frustrate environmental law and block corporate killing legislation, could the Leader of House find time in this place to hold a pilot confirmation hearing for the former Digby Jones, as a precursor to all such appointments to the House of Lords in future years?

My hon. Friend will know that we believe strongly in good minimum standards for all people at work, including in respect of health and safety and the minimum wage, and that we think that the Corporate Manslaughter and Corporate Homicide Bill is important. Nobody should go to work and lose their life as a result of a business trying to cut costs. I can further say to him that it is for the Prime Minister to choose his Ministers and that all Ministers are collectively accountable for Government policy, including me.

On 14 June, I raised with the right hon. and learned Lady’s predecessor my concern that the Department for Transport’s high-level output specification for the railways would be kicked into the long grass over the summer recess. I am pleased to have received a letter from the former Secretary of State for Transport, which states:

“I agree that a debate on the HLOS would be useful.”

He also felt that it would be welcomed by Members of the House. With just two weeks left before the House rises, will the Leader of the House tell us what progress has been made on the publication of the report and a subsequent debate on it?

I thank the hon. Gentleman for bringing this matter to my attention. I am not able to give him an answer, but I undertake to look into it. I would say to him and other hon. Members that, if they need an answer on an important issue that relates to undertakings that Ministers have given the House, it is a good idea to let me know in advance. I can then investigate the situation with my ministerial colleagues and report substantively to the House. Twenty-four hours’ notice would be good.

Following the sub-national review and the appointment of regional Ministers, which I welcome—especially the appointment of the Minister for the North East, my right hon. Friend the Member for Newcastle upon Tyne, East and Wallsend (Mr. Brown) to my very own region—may I ask the Leader of the House for more details of how Parliament will have democratic oversight of regional issues? Does she agree that new structures should include social partners, such as Northern TUC and the trade unions, to ensure that we get the best possible public policy delivery for all our regions?

I thank my hon. Friend for raising that point. She is a champion for her region, both in the House and back in her home town. I join her in congratulating my right hon. Friend the Member for Newcastle upon Tyne, East and Wallsend, who will be the Minister accountable for the north-east. Accountability for work in the regions will be established not only through the regional Ministers at the Dispatch Box but through the Department for Communities and Local Government, the Department of Health and all other Departments with an important regional impact.

I should like to join my right hon. Friend the Member for Maidenhead (Mrs. May) in pressing for an urgent statement from the Secretary of State for Justice. I listened carefully to what the Leader of the House said in her reply to my right hon. Friend. I understand from reports that Wiltshire’s coroner, county council and chief constable have all requested a meeting with the Justice Secretary or representatives of his Department to discuss more funds for inquests. They have been told that they will have to make their case in the autumn. The backlog of inquests into the deaths of our service personnel has been increasing rather than declining, and our brave men and women are, unfortunately, being killed in theatre faster than we can carry out the inquests. It is unacceptable for their families that the backlog is increasing, and I ask the Leader of the House to urge her colleague to meet the Wiltshire coroner as soon as possible to ensure that the backlog increases no further during the summer.

The hon. Gentleman raises an important issue. I have spoken to my right hon. Friend the Justice Secretary this morning. He is going to have a meeting with the Wiltshire coroner, and it will not be in the autumn—it will be much sooner than that. On 17 June, when I was Justice Minister, I wrote to the Wiltshire coroner to invite him to meet officials in the Justice Department in order to ensure that delays did not build up. We had very bad delays building up in Oxfordshire, and when I was Justice Minister I took action with the Oxfordshire coroner to sort out that very bad problem. I said at the time that I was not prepared to see a similar problem arise in Wiltshire, and that remains the Government position. My right hon. Friend the Secretary of State for Justice will not allow delays to arise.

Hon. and right hon. Members are right to raise this issue, but I want to reassure the House that we will not let a backlog build up. So far as a statement is concerned, when I first raised this issue, I offered statements on a regular updating basis so that people could see all the inquests that were waiting to be heard. I updated that information at the end of last month. The situation has not changed materially since then, so I will not suggest to my right hon. Friend the Secretary of State that he issue another written statement. He will, however, meet the coroner in Wiltshire to assure himself that no more delays will build up.

In warmly welcoming my right hon. and learned Friend to all her new posts, may I venture to suggest that she might not—at least, not yet—have had time to read the proceedings of the third international congress of the Asia Pacific Society of Infection Control in Kuala Lumpur this week? If she had read it, her eye might have been caught by the paper entitled “Ultraviolet sterilised bedroom air protects patients from MRSA”. Will she take the opportunity to congratulate Dr. Peder Nielsen, the consultant microbiologist who is the director of infection prevention and control at Northwick Park hospital, where a significant trial on MRSA control has just taken place with great success? Might the Leader of the House enable a debate—

Order. I am trying to do my best to get every hon. Member in at the tail end of business questions. That is not easy when hon. Members seek to congratulate constituents. There are other ways of handling these matters.

I join my hon. Friend in his congratulations to Peder Nielsen. Infection control at Northwick Park hospital, and in hospitals throughout the country and world wide, is a big challenge that we want to take forward. The matter will no doubt be raised in Health questions.

May we have an early debate on the Government’s proposals to change the national curriculum? It is disappointing that an announcement was made, yet again, to the BBC before being made to the House. There has been no oral or written statement on the matter today. I see the Minister for Lifelong Learning, Further and Higher Education, the hon. Member for Harlow (Bill Rammell), in his place, and it would have been nice to hear the announcement in the House first. When we have that debate, may we discuss the need for any global theories on climate change to be taught in a balanced way, looking not just at man-made issues but at atmospheric factors, so that climate and global changes are not presented as a quasi-religion or as pantheism?

This matter has been under consideration by the Select Committees, and it has also been discussed on the Floor of the House. The Secretary of State for Children, Schools and Families, my right hon. Friend the Member for Normanton (Ed Balls), has already made an oral statement on it. In addition, he will answer oral questions on Thursday week. No doubt, these questions will be put to him then.

Will my right hon. and learned Friend arrange for a statement on what progress has been made on reviewing the security at UK airports? She may be aware of the public statement by Conservative Members that people standing in queues at airports could be targets for terrorists. I am sure that she will agree that it does not fall within the remit of hon. Members to advise terrorists. Travelling through airports is frustrating, but the security measures that are in place are there to safeguard all of us.

I know that my hon. Friend is working with all who work at Glasgow airport, which serves his constituency. That is important work, and I support the points that he has raised.

Following the changes to the machinery of government, there will no doubt be an oral or written statement on the changes to the Select Committees. Does the Leader of the House accept that the Government have a good reputation in the science community, and that the science community at large, as well as Members on both sides of the House, wish to see the continuation of the Science and Technology Committee, which is able to scrutinise science across government, leaving the scrutiny of individual Departments to the appropriate departmental Select Committees? Will she pass that message on to the usual channels or to those who decide these matters?

There is discussion on the future of the Science and Technology Select Committee in the light of the changes to the machinery of government affecting schools, children and universities. Those discussions are ongoing and, should there be any change, an announcement would no doubt have to be made to the House and voted on, if necessary.

Council tax in the constituency of Monmouthshire have risen by 184 per cent. over the past 10 years. Will the Leader of the House ask a Minister to make an urgent statement to the pensioners of Monmouthshire to explain how they can possibly deal with these exorbitant rises while keeping a roof over their heads?

This question relates to a devolved matter, but I will draw the hon. Gentleman’s points to the attention of my right hon. Friends the Secretaries of State for Wales and for Communities and Local Government.

May we have an urgent debate on the Floor of the House in Government time on the accountability of the Health and Safety Executive? On 11 December 2005, my constituency was rocked by the Buncefield explosion. Safety at that depot was the responsibility of the Health and Safety Executive, but we have now been informed that Crown immunity will be claimed, should—I stress should—any action, civil or criminal, be brought against the HSE. In the 21st century, how can it be right for Government agencies to have Crown immunity, rendering my constituents unable to receive any due compensation?

I cannot give the hon. Gentleman an immediate answer on accountability, but I will raise the matter with the relevant Secretary of State, as health and safety is a very important issue.

May I draw the House’s attention to early-day motion 813, which stands in my name and is supported by 53 hon. Members, about the nomination of the Antonine wall for world heritage site status?

[That this House welcomes the nomination of the Antonine Wall for UNESCO World Heritage Site status; notes the historical significance of the Wall as denoting the true north-western frontier of the Roman Empire; further notes that the Wall's distance slabs form one of the most important groups of preserved Roman military sculptures; further notes the importance both of preserving the Wall and educating the public about its historical significance; and supports the ongoing work in other countries to denote more extensively the borders of the Roman Empire as World Heritage sites.]

This summer, UNESCO inspectors will visit my constituency in Dunbartonshire and several others through which the wall runs in order to evaluate the bid. Can we have a debate on the Antonine wall and the contribution that the UK’s world heritage sites make to our local communities, economies and cultural life?

Bearing in mind the fact that one of the Bills included in the draft Queen’s Speech is a heritage Bill, there might be an opportunity for the hon. Lady to raise the issue there.

Can we have a debate on early-day motion 1761, on the future of the Territorial Army?

[That this House is concerned at the impact of the 5 million saving required to be made by the Territorial Army (TA) over the next two financial years; acknowledges that the proposed implementation plan put forward by Commander Regional Forces will stop all recruiting in TA units that are not making a significant contribution to current operations, delay the establishment of six squadron size units until April 2009, cancel Cambrian Patrol, cancel all TA involvement in the Nijmegen marches, cancel divisional skill at arms meetings and freeze the recruitment of 244 non-regular permanent staff; and, given the disproportionate impact this will have on the morale and effectiveness of the Territorial Army, urges the Government to reconsider the requirement to implement these savings.]

Only yesterday, the Prime Minister said that he had “nothing but praise” for those in the Territorial Army and continued by saying that he believed that the whole House would want to say that we owe them “a debt of gratitude”. What he did not say was that the Government are cutting the TA budget by £5 million. Given the likely effect, is it right for Ministers to praise the Territorial Army from the Dispatch Box only to cut its budgets?

We would all agree with what the Prime Minister said about the important work of the Territorial Army. I draw the hon. Gentleman’s attention to Defence questions next Monday, when he will have an opportunity to raise the matter with the Secretary of State for Defence.

Will the Leader of the House join me in pressing the Department for Transport to make publicly available the environmental modelling results currently being passed to BAE in relation to Heathrow expansion, but not to me as an MP? I have tabled a parliamentary question about this and made a freedom of information request, but so far these results have not been made available to me. It is a matter of great concern to my constituents. Will the Leader of the House find out from the Department for Transport when it plans to make these results publicly available?

I will draw the hon. Lady’s points to the attention of my right hon. Friend the Secretary of State. There are some exemptions to the Freedom of Information Act and the hon. Lady’s question may fall under the commercial confidentiality exclusion. I am not aware of the detail on that, but I will find out and ask my right hon. Friend to respond directly to the hon. Lady.

Last week, I drew the House’s attention to Mrs. Ruby Waterer, who was going blind, but was denied treatment on the NHS and would have had to go privately. Immediately after the Leader of the House’s reply, she was granted treatment on the NHS, so I would like to thank the right hon. and learned Lady for her involvement. Unfortunately, four more people in my local area contacted me yesterday, as they had been told that they would have to go blind because the NHS would not treat them. Their only option is to go privately and pay up to £8,000. Would it not be appropriate for the Secretary of State for Health to make a statement on what is clearly a very important issue?

I will bring, again, the hon. Gentleman’s points to the attention of my right hon. Friend the Secretary of State for Health. The case raised at business questions last week was a heart-rending but quite complex one, involving questions of referral and the appropriateness of diagnosis. It raises important concerns. If the hon. Gentleman would like to give the details of the four other cases to the Secretary of State, I am sure they will be looked into.

The future of sub-post offices in the Kettering constituency, across Northamptonshire and, indeed, across the whole country hangs in the balance, awaiting the Government’s announcement of its detailed closure programme. Will the Leader of the House confirm when the details of which post offices are to be closed will be announced, and when they are, will the Minister responsible for the Post Office make an oral statement to the House and respond to hon. Members’ questions?

Consultation and discussion are under way, led by the Department for Business, Enterprise and Regulatory Reform. All hon. Members recognise the important role for sub-post offices. We want to ensure that we have the right level of public subsidy and the right services provided to local people.

Orders of the Day

Further Education and Training Bill [Lords]

As amended in the Public Bill Committee, considered.

New Clause 5

Functions of Learning and Skills Council for England in relation to education and training for persons aged 16 to 19

‘(1) LSA 2000 is amended as follows.

(2) Omit section 2 (education and training for persons aged 16 to 19).

(3) In section 3D(1) for “sections 2 and 3” substitute “section 3”.

(4) In section 13(1) omit “2,”.’.—[Sarah Teather.]

Brought up, and read the First time.

With this it will be convenient to discuss the following amendments: No. 26, in clause 6, page 6, line 31, leave out subsection (1).

No. 27, page 6, line 37, leave out ‘that Act’ and insert ‘LSA 2000’.

No. 28, schedule 2, page 28, line 2, column 2 , at beginning insert ‘Section 2.’.

New clause 5 and consequential amendments Nos. 26 to 28 are essential probing amendments designed to tease out the Government’s intentions with regard to 16-to-19 funding, following the announcement of a new departmental structure. The effect of those amending provisions, taken together, is to remove the statutory duty on the Learning and Skills Council to provide education, training and leisure activities to 16 to 19-year-olds.

The Minister for Lifelong Learning, Further and Higher Education may recall our previous debates on the subject. For example, he said:

“Lord Leitch made it clear—as the Government have made clear—that the role of the LSC can and should continue to evolve and change, but Lord Leitch also made it clear that instinctively he was not in favour of ripping up structures and starting again simply for the hell of it, but that we had to reform the process overall.”

He also said:

“The hon. Member for Brent, East (Sarah Teather) made a criticism of 16 to 19 funding, and she advocated that it be transferred to local authorities. I am not convinced by her argument, and it is usually the case in these issues that the Liberal Democrats support the view of providers. In my experience of talking to college principals up and down the country, there would not be support for her proposition. .”—[Official Report, 21 May 2007; Vol. 460, c. 171-74.]

That is interesting, as just two weeks ago the Prime Minister announced that that money would be transferred to local authorities.

First, I warmly welcome that announcement and that change and I invite the Minister to do likewise. I believe that if it is done well, this could offer an exciting shift in policy. It could finally allow us to join up 14-to-19 education in a genuinely coherent way. It could provide an opportunity finally to end the invidious gap between students in the sixth form and those at further education colleges. It could herald the opportunity mentioned in the White Paper for funding to follow the student, so that people in the 14-to-19 range could move between institutions if required in the light of the Government’s reforms of diplomas. I view this as genuinely exciting and I hope that the Minister has reflected on the change over the past two weeks and will feel as excited as I am and willing to embrace it.

In order to generate the necessary change, we need legislation. I am trying to be helpful by tabling amending provisions to repeal part of the Learning and Skills Act 2000, which would be required for enactment. It will also be necessary to amend the Education and Inspections Act 2006 to place a new statutory duty on local authorities for 16 to 19-year-olds. That is not in order for this Bill, so I cannot do that, but I have done what I can to help. I hope that the Minister will receive it in the helpful spirit in which it is intended.

I assume that the Minister will respond in a few moments and say that he does not wish to enact these provisions now, but to go away, consult and consider them very carefully. If so, will he tell me when he wishes these changes to be brought forward and whether it is his intention to repeal the relevant section of the Learning and Skills Act? If not, why not? Does he intend to continue to use the Learning and Skills Council as a conduit for money for 16 to 19-year-olds? If so, does he not think that it could be an extra barrier of bureaucracy? If he thinks that the LSC should continue to play a role in 16-to-19 education, is it mainly in respect of apprenticeships?

There seems to be a bit of turf war going on at the moment between the Department for Innovation, Universities and Skills and the Department for Children, Schools and Families. I hope that the result of that turf war will be that, eventually, many apprenticeships will be transferred to the DSCF and not continue to remain with DIUS. Only in that way will we get genuinely joined-up treatment of all 14-to-19 provision. It would be unfortunate if that were to generate weird barriers between part-time and on-the-job learning.

The important thing is how the transfer of 16-to-19 money is done: the transfer alone will not generate what we want if the money continues to be ring-fenced, and if the 0-to-16 funding continues to be ring-fenced in a separate grant. If there must be ring-fencing—which, on the whole, I am not in favour of—it would be much better to ring-fence 14-to-19 funding, and then to have 0 to 13, or at least 0 to 10 and 11 to 13, in separate grants.

The announcement has enormous implications for the Bill. Indeed, it renders some aspects of the Bill redundant. Does the Minister intend to bring forward legislation at a later stage to amend the Bill in the light of the announcement? We are being asked to pass a Bill that contains a number of powers that will be irrelevant if the Government move the 16-to19 money—in particular, clause 17, which we will debate at some length on the next group of amendments, which gives intervention powers to the Learning and Skills Council. Were the money for 16 to 19-year-olds moved, however, many colleges would no longer have the LSC as their funding partner. That would seem to bring the proposal into question. Similarly, with regard to clauses 14 to 16, which refer to the merger, dissolution and publication of proposals for new colleges, the Learning and Skills Council may not fund such colleges at all, and would certainly never be the major funder. Of the £9 billion now provided by the LSC, the Government propose to move £6 billion to local authorities.

I hope that the Minister will tell us whether he intends to amend the Bill in the future. I do not feel comfortable passing a Bill now that gives powers to the LSC that will clearly become irrelevant in a relatively short period. It will be unhelpful if the Minister cannot assure me on the record that the Bill will be amended when the new proposals come forward, with respect not only to the duties on local authorities, but to other clauses that relate to LSC powers over colleges.

Lastly, what will remain with the LSC and what might its role be? In Committee, the Minister said:

“Even under the demand-led approach that we are moving towards—we envisage most of the funding going through the demand-led process—there would still be a relationship with the Learning and Skills Council. Funding would still come from the council. If it will not have the ultimate power of intervention, and if we want to protect the public purse and the public interest, who will take on the responsibility?”––[Official Report, Further Education and Training Public Bill Committee, 14 June 2007; c. 110.]

In the light of the recent announcement, does the Minister still believe that to be the case? Does he still see a role for the LSC? Many rumours abound about the Government’s intention to move that money for 19-plus adult skills to regional development agencies or to sector skills councils. I was hoping that the Treasury sub-national review might have been published by now to give us at least some hint of the direction of the Government’s travel. Although ministerial appointments have been published, those proposals have not.

The hon. Lady is very knowledgeable in this area, and I was not privy to the Committee’s discussions. What is her view of what should happen to the LSC, which seems increasingly endangered?

At the moment, we are simply consulting on what should be done with the money. An internal party working group is in the process of taking evidence, and I would be happy to discuss such proposals at a later stage. I am interested to know the Government’s intentions and whether they have a view on the matter. A move from a £9 billion organisation to a £3 billion organisation would seem to undermine the future of the LSC.

The hon. Lady raises an entirely proper point. Does she agree that for those of us who have sometimes been critical—perhaps not always fairly critical—of the administrative costs of the LSC, it is self-evident that if the volume of traffic or turnover through the council is reduced, the ratio of overheads to final expenditure is commensurately increased?

I agree with the hon. Gentleman. I do not want to criticise the announcement, as we have been calling for it for a long time, as the Minister knows. I am extremely pleased that the Government have announced their intention to move 16-to-19 money to local authorities. My question is: what happens next? Certainly, the announcement has enormous implications for the LSC. I have been similarly critical of some of the LSC’s overheads, although I have not used the same language as the hon. Gentleman. I am aware that the LSC has been through several restructuring processes and that staff face quite a lot of uncertainty. It would be helpful if the Government were to put on the record their intentions for the organisation, at least to indicate to staff employed by that organisation the future direction of Government travel.

It is good to welcome the Minister back to his job, albeit in a new Department, and I look forward to exchanging various comments and ideas with him over the coming weeks and months, in the happy spirit that has pervaded our previous exchanges.

I digress from that sentiment in no way by saying that the new clause and amendments seem to highlight a fundamental flaw in the Government’s thinking. In a sense, the amendments prise open a gap between the Bill and the Government’s strategy. The hon. Member for Brent, East (Sarah Teather) was measured in her comments; she could have been altogether more direct. She might have asked why we were debating a Bill in isolation from the Government’s approach to the Leitch review of skills. We still await the Government’s response to that fundamental review, which, we think, will come out next week—it has been delayed three times already. We understand that one of the reasons for the delay was that the first draft was simply not up to scratch: one agency told me that it could have been written by a seven-year-old child with chickenpox.

Given the paucity of the Government’s approach and the delays suffered, it is unsurprising that we are debating in isolation a Bill that might contradict some of the Government’s response to Leitch, and which certainly contradicts much of Leitch’s analysis. The new clause and amendments relate to the departmental reorganisation and its implications for the LSC. The Chairman of the Select Committee, the hon. Member for Huddersfield (Mr. Sheerman), asked the hon. Member for Brent, East what she thought about the LSC, and in doing so prompted the question of what the Government think about it. Leitch does not mention the LSC until about page 75 of his report, and then talks about further rationalisation in that body. We are not clear whether the Government see a long-term future and a central role for the LSC. We certainly do not know whether the Government’s response will merely be to bolt on a new structure to the existing one. I suspect that we might end up with that, and that would be thoroughly unsatisfactory.

As the hon. Lady said, the decision to create two new Departments to cover education and skills has significant implications for FE colleges because of the plan to route funding for 16-to-19 education via local authorities. That is what the new clause and amendments address.

Does my hon. Friend agree that the last thing that the sector needs is more bodies, or a further proliferation of bodies? I am already uneasy about splitting the Department. What the sector needs is a simple line of funding and communication so that it can get on with its job.

My hon. Friend, in his typically learned and well-informed way, makes two points. First, he makes the point that the split into two Departments creates a problem of clarity—it is difficult to know where responsibilities will lie for different aspects of the previous Department’s work. He then made a second and even more profound point about the bureaucracy, over-regulation and micro-management that has typified the Government’s approach to further education and to skills more generally.

Because I have high hopes of the Minister—rejuvenated by his reappointment—I hope that he will take the opportunity of the response to Leitch to clear away some of that bureaucracy and lift some of the burden on our excellent further education colleges, so that we can meet the skills targets that he wants to be met and on which we share a view. I do not take a negative view—I am not pessimistic—but unless the Minister rises to the challenge identified by my hon. Friend, I am afraid that my hopes will be dashed and the whole House, indeed the whole country, will be disappointed.

According to the Times Educational Supplement,

“Billions of pounds in funding for colleges is due to be taken from the Learning and Skills Council and put under the control of local authorities. The handover of about £7 billion of the LSC’s £11bn-a-year budget will be the culmination of Gordon Brown’s reorganisation of education.”

The reform will require yet more legislation, presumably as part of the proposed Bill to raise the school leaving age to 18. We had a taste of it in what could be described as the early Queen’s Speech—the pre-Queen’s Speech Queen’s Speech—which hinted that there might be further legislation to do just that.

The hon. Gentleman will have observed that the publication accompanying yesterday’s statement contained no information about the proposed Bill. That suggests that the Government will use it to amend the process of funding 16-to-19-year-olds.

I agree. It is not as though we did not tell the Government—we said that this Bill was not fit for purpose because it had come to the House irrespective of the Government’s response to Leitch. We may well see, in the autumn, a further Bill dealing with skills and further education and making structural changes to the way in which skills are funded and managed, although this Bill will have only just hit the statute book. It strikes me as bizarre to publish the Leitch report and the Bill simultaneously, given that the one bears very little relation to the other.

Would it not be very much in the interests of the Learning and Skills Council for the Government to clarify their thinking on its future? The Bill talks of moving from a local to a regional structure. The LSC will inevitably need to do some work on that, which may come to nothing if the Government change their mind later.

The Government’s approach has a touch of rearranging the deckchairs and changing the sheet music for the dance band on the Titanic as we face our journey to the lifeboats. One wonders whether, expecting some massive change, the Learning and Skills Council is desperately trying to reorganise itself before it is reorganised in a way not of its own choosing. We need the Government to be straightforward, and the hon. Lady’s new clause and amendments give them an opportunity to be so. Do they envisage a long-term future for the LSC in its current form, in the context of the new clause and amendments? Do they expect it to continue much as it is now, or do they anticipate fundamental reform of the funding and management of skills of the kind that is hinted at, indeed identified, by Leitch, and which Members in all parts of the House consider now to be necessary?

As I have said, there is mention of further legislation, presumably as part of the proposed Bill to raise the school leaving age to 18. Conservative Members have concerns about the proposal to return college funding to local authority control. We are proud of what many further education colleges achieve. I make no apology for repeating what I have said before—that the House should celebrate their work, congratulate the professionals in them, and applaud the achievements of the many students who pass through them. Conservative Members trace those achievements back to the crucial Further and Higher Education Act 1992, which gave further education colleges their freedom from local authority control and set them on a path to the success that they now enjoy.

Order. I wonder whether the hon. Gentleman will now confine himself to the new clause and amendments under discussion.

I shall be delighted to do so, Madam Deputy Speaker.

The Association of Colleges is concerned about the plan to route funding for 16 to 19-year-olds via local authorities, which is precisely what is dealt with in the new clause and amendments. The proposed changes are creating considerable uncertainty in the sector, as I was told by the principal of a further education college that I visited earlier this week. The colleges are not certain what the change means, and they are not confident about their future. They are not even confident that the Government see a long-term future for further education at all. I do not share the Armageddon view of the Government’s position, but I do think that a lack of certainty and clarity is causing a problem with morale in the sector, particularly in relation to the issues dealt with in the new clause and amendments.

Many young people cross boundaries to attend colleges in other local authority areas, but changing funding responsibilities may make it more difficult for them to exercise that choice. I ask the Minister to comment on that problem in particular. The Bill also creates confusion by extending the role of the LSC in training for 16 to 19-year-olds. Clause 6 would give it a new duty in relation to education and training provision for that group

“with a view to encouraging diversity in the education and training available to individuals”.

It seems to be critical for those individuals to be able to exercise maximum choice, but the fact that the new powers will soon be obsolete again raises the question of the Bill’s purpose. On Second Reading I argued that it was not fit for purpose and that further legislation might well be required. We now learn that the Learning and Skills Council is likely to be stripped of many of its current functions, but we have yet to hear the Government’s detailed response to Leitch.

In the past, the Minister has been dismissive of the inquiries made by the hon. Lady and me, and mentioned by the hon. Member for Huddersfield, about the possibility of new legislation. Will he tell us whether he anticipates further legislation, and whether it will deal specifically with the points raised by the hon. Lady and amplified by me? If he says that he does, it will contradict what he said in Committee, namely:

“To move the system in a more demand-led direction one does not need to legislate”. ––[Official Report, Further Education and Training Public Bill Committee, 12 June 2007; c. 19.]

I was doubtful about that at the time, and I remain doubtful. It appears to me that the Government have changed their position and are now suggesting that they may well need to legislate. The former Leader of the House said that the Government were “planning legislation” on Leitch when he was questioned on the matter as early as 21 June. Can the Minister confirm that, and can he tell us what reason the Government would have to legislate on Leitch if not to introduce the demand-led system that Leitch advocates?

Conservative Members are in favour of reducing the mountain of bureaucracy that stifles the delivery of training and prevents the establishment of a system tailored to the needs of business and learners alike. The Government have been complacent. Debating these very matters in Committee, the Minister said that concern expressed by my hon. Friends, particularly my hon. Friend the Member for Rugby and Kenilworth (Jeremy Wright), about the £1 billion of public money spent by the LSC for purposes other than training was “erroneous”. City and Guilds takes a rather different view. Under the heading “The Cost of Bureaucracy”, it suggests that the regulatory impact and overall burden on providers warrants “serious and sustained attention”. Will the Minister deal with the concerns of third parties such as City and Guilds?

In essence, and in conclusion, the hon. Member for Brent, East has done the House a service by proposing the new clause because there is a gaping hole in the Government’s position. It is not clear where responsibility will lie in the medium term, nor is it clear, as my hon. Friend the Member for Daventry (Mr. Boswell) said, whether contradiction and confusion will be a permanent feature of the Government’s strategy or whether it is merely that the Bill and the Government’s other plans are not consistent. It is not clear whether the Government will have to legislate further. It is not clear whether the Minister will be responsible for these things for very much longer, or whether they will pass to another agency or Government Department. That lack of clarity is doing the sector no favours and the House no service. I hope that the Minister will be able to reassure me that he is rather clearer than he has given the impression of being thus far.

I welcome the hon. Member for Brent, East (Sarah Teather) to her new position and, for the avoidance of doubt, I confirm that I continue to be the Minister with lead responsibility for the Learning and Skills Council. The hon. Lady referred to some of the remarks that I made in Committee and referenced them with the position we are in today. I need simply remind her that the role of Ministers is to argue current Government policy with conviction; I did that in Committee and I am more than happy to do it here today.

It is the Government’s intention to provide strong strategic leadership for the reforms to the 14 to 19 curriculum and qualifications and for increasing participation and attainment by young people by the age of 19. That responsibility, announced as part of the recent machinery of government changes, sits with the Department for Children, Schools and Families. We intend that the new Department will have responsibility for overall planning and funding for 14 to 19 learners to achieve that ambition. It will focus on those young people who are not in education, employment or training, who often need personal support services to help them engage. It will take responsibility for raising the education leaving age.

With that responsibility, we intend to transfer funding for 14 to 19 learners—I am pleased that the hon. Member for Brent, East has welcomed that—to the local authorities’ ring-fenced education budgets. Crucially, the Department for Innovation, Universities and Skills—in effect the Department for the knowledge economy—will lead the work to ensure that this country has the skilled work force that it needs to compete in the global economy. At the heart of that task is the development of funding and performance management of further education in England—a vital and continuing role. Included within that role are efforts to make sure that the system is able to deliver the 14 to 19 reforms to which I referred earlier. If ever there was a need for joined-up government, it is in this area.

Both those reforms are logical developments of the Government’s policies, such as Every Child Matters, the 14 to 19 reforms, the challenge set by Sandy Leitch and the further education reform agenda. Those are welcome and both Departments are now working on the practical implications of the announcements. It is clear that the reforms will require legislation. The Prime Minister has indicated that the Bill to raise the education leaving age from 16 to 18 will be one of the measures on the Government’s legislative agenda next year. We will seek to secure on the programme for the following year a Bill to deliver the reforms announced in the machinery of government changes. Before then we will, rightly, consult on the details and timing of the funding transfer to ensure no disruption to schools, colleges and training providers. That is the fundamental issue.

One issue that my hon. Friend has raised, and which I raised on Second Reading, was that of NEETs—those not in education, employment or training. They are not tracked at all and, in my constituency, there is no knowledge of what happens to them after the age of 16. Would it not be simple to instruct local authorities to make a list of people who appear to be missing from education and training as soon as they leave school at 16, and to do that fairly quickly?

I respect my hon. Friend’s intentions; he has worked on this matter for a long time. It is not fair or accurate to say that no tracking takes place. The Learning and Skills Council, local authorities and the Connexions service work together to provide advice, guidance and support and to track young people in those circumstances. One issue that we debated in Committee is that the NEET group is changing; it is somewhat simplistic to say that they are all suffering from a lack of opportunities. As a result of that discussion, I committed to write to members of the Committee and I will be happy to forward that correspondence to my hon. Friend.

I thank the Minister for that letter and for exploring the issue in more detail. Why does he think the number of NEETs has grown since 1997? It is not absolutely clear why and he must have a pretty good idea of what strategic changes have brought that about.

If one looks at the long term trend, it is not accurate to say that the number has grown. Broadly, the percentage has remained similar. I am not denying that this is a significant challenge for us. Across Government, real effort is going into this area. Some of the reforms we are looking at now will enable us to take that body of work further forward.

Yesterday, I took four young women aged 16 and 17 who were NEETs around the House of Commons and spoke to them for one and half hours. Three of the four said that they fell off the education radar because of bullying. What message can the Minister give to those three young women from my constituency that that issue is being tackled, not only in Wales but in England?

My hon. Friend raises a serious and important point. The new Department takes bullying extraordinarily seriously, as we did in the former Department. We must ensure that there is best practice in every school. We must also ensure that schools are not blind to the problem and do not carry on as if it does not exist. Within every school we need proper procedures to expose the issue, tackle it and give children and young people the confidence that there is security within the classroom and the school.

We also will ensure that there is no disruption to 14 to 19 reforms, including the introduction of new diplomas, and to the skills reforms, including the move to a system which is more demand-led. We will continue the vital work of employer engagement, which Opposition Members have been particularly interested in. The hon. Member for South Holland and The Deepings (Mr. Hayes) asked about further legislation. I reiterate that moving to a demand-led system does not require legislation. We are already moving to a demand-led system; the significant proportion of funding through Train to Gain and skills accounts will, under existing arrangements, move to a demand-led approach. We do not need further legislation to increase the proportions. Other elements will require legislation and I will come on to those.

The Minister has provoked this intervention. Surely he is not telling the House that fundamental changes to the responsibility of the LSC and new powers for the sector skills councils—another element of Leitch that I assumed the Government would take seriously—as well as changes to the funding regime would not require some changes to legislation. There are statutory powers and responsibilities embedded in the system that would have to be changed if we were to adopt the Leitch agenda in its fullest form. I do not understand why the Minister is being so defensive; if there is to be legislation, let us say so and have an open and honest debate about the public policy implications.

I am not denying, and I have not denied, that there will be a need for further legislation. However, a move to demand-led funding does not require further legislative change. That is possible and is happening at the moment. The proportions of demand-led funding are increasing significantly as of today. As I said, we are moving to a more demand-led system, which is vital to employer engagement.

All of this will take time, however, and although we will seek to effect early changes that can be made under current legislation—for example, our commitment to close further the funding gap between schools and colleges as resources allow might be enabled by the new system, and lessons from the dedicated schools grant might be used to inform how funding methodology can be developed—I estimate that we will not be able to give effect to the full legislative changes until the academic year 2010-11. In the three full academic years between now and then, the LSC will retain the legal responsibility for securing and funding all forms of post-16 education and training outside higher education. In particular, it will retain the duty to secure the proper facilities for young people aged 16 to 19.

As the LSC will for the time being retain that duty for young people, we must ensure that it can operate effectively. Establishing the performance management and viability of colleges, including their work with young people and adults, will be discharged on behalf of the Government by the LSC until such time as new legislation is introduced. Therefore, now is not the time to make changes to the LSC’s duties in respect of providing proper facilities for young people.

I thank the Minister for that answer, but may I return to an earlier point I made? Will the Government give an undertaking now that, when the funding changes are introduced, they will amend the legislation so that the performance management assessment of colleges is no longer done by the LSC? I would not feel comfortable passing the Bill if I did not have confidence that the Government would make such changes in a few years, because otherwise we would effectively be giving powers to assess the management of a college to an organisation that would no longer have any relevance to the college.