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Volume 467: debated on Wednesday 21 November 2007

Before listing my engagements, I am sure that the whole House will wish to join me in sending our profound condolences to the family and friends of Captain John McDermid of the Royal Highland Fusiliers, 2nd Battalion the Royal Regiment of Scotland, who was killed in Afghanistan last Wednesday, and our condolences also to the families and friends of the two service personnel who died yesterday in a helicopter crash in Iraq. We owe them and others who have lost their lives a deep debt of gratitude.

I am also sure that the whole House will wish to send our warmest congratulations to Her Majesty the Queen and Prince Philip on their diamond wedding anniversary yesterday. They have both devoted their lives to public service and we pay tribute to them again today.

This morning, I had meetings with ministerial colleagues and others. In addition to my duties in the House, I shall have further such meetings later today.

May I associate myself with the expressions of sympathy by the Prime Minister?

Many people in my constituency and throughout the country will have been very concerned at the announcement yesterday about the loss of millions of data records from the child benefit office. Can my right hon. Friend assure me and the House that he will take every possible step to ensure the protection of the data of our citizens, not only in Her Majesty’s Revenue and Customs, but across Government?

I profoundly regret and apologise for the inconvenience and worries that have been caused to millions of families who receive child benefit. When mistakes happen in enforcing procedures, we have a duty to do everything that we can to protect the public. That is why bank accounts are being checked now for fraudulent activities and why the banks have agreed to look back to 18 October and beyond to check whether there have been any fraudulent activities—and there is no evidence of that happening. That is why the banking code will ensure that there are no losses suffered by anybody who receives child benefit if there is fraud in their accounts—and again there is no evidence of fraud.

It is also why we have set up the review by the chairman of PricewaterhouseCoopers into the procedures that have been followed. I can also say to the House today that I have asked the Cabinet Secretary and security experts to ensure that all Departments and all agencies check their procedures for the storage and use of data. As the House may know, last month I also set up a review to be chaired by Mark Walport of the Wellcome Trust and the Information Commissioner jointly, to look at the security of personal data in both the public and the private sector. They will look at the work of Government agencies and Departments. We will give the Information Commissioner the power to spot-check Departments, to do everything in his power and our power to secure the protection of data. In other words, we will do everything in our power to make sure that data are safe.

I join the Prime Minister in paying tribute to Captain John McDermid, who was killed in Afghanistan last Wednesday, and to the two service personnel who were killed when their RAF Puma helicopter was lost in Iraq last night. They all died serving our country.

I also join the Prime Minister in congratulating the Queen and the Duke of Edinburgh on their diamond jubilee. They have had a remarkable life together, and a life of public service.

Millions of people will today be worrying about the safety of their bank accounts and the security of their family details, but they will not just be worried; they will be angry that the Government have failed in their first duty—to protect the public. Does the Prime Minister think that the matter should be treated as an isolated incident, or does he believe that there is wider, systemic failure and a lack of leadership at Revenue and Customs?

It is precisely because we have to check all procedures, not just in HMRC but in all departments, that I have asked the Cabinet Secretary to conduct a review. There is also the review that will be conducted by the chairman of PricewaterhouseCoopers into HMRC itself. I have to tell the right hon. Gentleman that there is no evidence of fraudulent activity taking place, and that this was a failure in implementing the proper procedures. It is important that he should know that the procedures that should have been followed are these: only authorised staff must be allowed access to protectively marked information; information must not be removed without appropriate authorisation; and encryption should be used whenever any information is being sent. Those were the procedures. They are in existence now, and they should have been operated.

It is all very well holding reviews, but the Government have had 10 years to sort out the department. I have to say to the Prime Minister that if a junior official in an organisation can access so much information and send it not once, not twice but three times, that is evidence of systemic failure. Last year there were more than 2,000 breaches of security at Revenue and Customs. In May this year, 8,000 families needing tax credits had their bank details revealed, and later in the year details of 15,000 taxpayers, including private pension information, were lost in the post. The Government said at the time:

“We have…reviewed our arrangements and introduced safeguards to prevent this happening in future.”

Clearly, that was completely wrong. Does the Prime Minister accept systemic failure in the department?

What I accept is that the review must look at all the procedures that are adopted by HMRC, but it must also look at other Government Departments and agencies. In relation to the case that the right hon. Gentleman is quoting—that of Standard Life—yes, a review was done, and it proposed that there be changes in both encryption and audit. The problem was that the information that was lost was lost on October 18, and the procedures that should have been followed were not followed. Let me just tell him—[Interruption.]

I think that the House should know that under the “Manual of Protective Security”, which all departments are obliged to follow, any data that are sensitive will attract a protective marking—“restricted/confidential”—and should be encrypted when in transit. There is absolutely no doubt that that is the procedure; it just was not followed, and that is what the investigation has got to look at.

But this has been going on for years. [Interruption.] Yes, let us look at what happened in September 2005, two years ago: Revenue and Customs lost vital data about savings from one of its clients, UBS. The data were stored on a CD-ROM and were not encrypted. The data went missing from a Revenue and Customs office, and what happened? Revenue and Customs claimed it was a one-off incident in a single office. That is what I call systemic failure—when procedures are not followed over and over again. HMRC was the Prime Minister’s department. He insisted that it paid child benefit, and he increased its scope. Clearly there is a problem with its security, its privacy, its culture and its leadership. Does the Prime Minister feel at all responsible for this?

The Leader of the Opposition should know that his party supported the changes that we made to HMRC. The National Audit Office reported on the changes that we brought about and said the performance of HMRC had not been adversely affected. The adjudicator for HMRC said that the changes had not had any negative impact. I have to ask the right hon. Gentleman: what if we had followed his advice at the last general election? He proposed that we cut expenditure on HMRC. His report—the James review that he put into his manifesto—said that his party should cut £660,000 million by what they called the “Rationalisation of data processing”. It was he who recommended further cuts.

I have to say that on a day when the Government have lost the details of 25 million people, to try and blame the Opposition is pathetic. What people want from their Prime Minister on a day like this is for him to stand up, show some broad shoulders, be the big man and take some responsibility. This morning his Chancellor, to give him credit, had the guts to admit that his confidence had been shaken. The Prime Minister was in charge of the Department for 10 years. By definition, that must have been when the systemic failure developed, so has his confidence been shaken?

I said right at the beginning that I apologise for what has happened. Everybody who is a recipient of child benefit should know that we will follow every proper procedure now to improve the working of HMRC and of every Government Department and agency. I have announced not only the inquiry into HMRC, but that the Cabinet Secretary will look at every Government Department and every agency. I have also announced, which is important, that we will look at the collection of private and public data. That is what the Walport review will look into. The idea that we are complacent about the matter is ridiculous. We are taking all the action that is necessary. The right hon. Gentleman raised the question of HMRC and its resources and staff. I am saying to him that the reports have shown that that is not the reason that things have gone wrong. There is no excuse for not following proper procedures.

If the Prime Minister really wants to learn some lessons, will he recognise that this appalling blunder comes at a time when the Government are planning a national identity register to draw together private and personal details of every single person in this country? Will the events of the past few days cause him to stop and think about that policy?

I have already announced the inquiries that we have set up, but let me say that 22 out of 25 European countries have identity cards. The right hon. Gentleman’s own security adviser proposes identity cards. His own reviewer of the national police force—the border force—says that he is in favour of identity cards. What we must ensure is that identity fraud is avoided, and the way to avoid identity fraud is to say that for passport information we will have the biometric support that is necessary, so that people can feel confident that their identity is protected.

People are desperately worried about the privacy of their bank account details and their personal details. They will find it truly bizarre—they will find it weird—that the Prime Minister does not want to stop and think about the dangers of a national identity register. Will people not think that he has completely lost touch with reality? He is demonstrating no common sense at all. Will they not see a Prime Minister who tries to control everything, but cannot run anything?

The right hon. Gentleman talks about running things well. For 10 years we have had the best economic policy in any part of Europe, for 10 years the lowest inflation of any decade, the lowest interest rates of any decade and the highest employment of any decade—something that he could never rival.

Does my right hon. Friend agree that all those who support his call for urgent action on the environment should also support the European reform treaty that will allow an enlarged European Union to put behind us institutional questions and instead concentrate on what really matters, including tackling climate change?

My right hon. Friend has taken a long-term interest in how we can improve our environment. There is no doubt that we cannot have environmental improvement without European co-operation. If the Conservatives want to support environmental co-operation, they should be supporting the reform treaty.

I add my condolences in respect of the servicemen and my congratulations to Her Majesty.

After the twin disasters of £25 billion of taxpayers’ money disappearing down the black hole of Northern Rock and 25 million personal records disappearing in the post, does the Prime Minister accept the wisdom of Tony Blair who said that the Treasury had become far too powerful under its previous incumbent, was no longer fit for purpose and should have been broken up?

This is a new policy from the Liberal party today. I do not know whether the new leader of the Liberal party will want to stick with the policy to break up the Treasury. If the hon. Gentleman seriously believes, as he implies, that we should not be helping Northern Rock depositors and savers, if he seriously believes that we should let Northern Rock mortgage holders go under, then I do not believe he has support in any part of the country. We have taken the right decision—initially supported, of course, by the Leader of the Opposition, who has since backed away from it—to give liquidity to Northern Rock. I hope that the hon. Member for Twickenham (Dr. Cable) will continue to support that position.

May I point the Prime Minister to the next Treasury disaster, with the imminent publication of the report on the privatisation of QinetiQ, which I warned about in the debate 18 months ago? Was the Prime Minister not financially very naive when he agreed to the undervaluation of public assets, enabling an American private equity company to make a windfall profit of £300 million and the chief civil servant involved to make a personal fortune of £22 million?

It is very interesting that the hon. Gentleman has not moved to talk about Northern Rock again. I suppose that he is now supporting us in rescuing Northern Rock. I hope that that is a consensus.

As far as QinetiQ is concerned, we raised £800 million from the sale. QinetiQ is serving its country under its new ownership and QinetiQ is very important to the Ministry of Defence’s future procurement plans.

Q2. Does my right hon. Friend agree that, given the dramatic decline in the number of unskilled jobs in our country, it is absolutely imperative that we encourage young people to stay in education and training up to the age of 18? Will he join me in criticising those orchestrating a campaign of disinformation, who are suggesting that we want to keep kids in schools until they are 18? (166252)

The proposal to raise the education leaving age to 18 over the next few years includes, for example, a young person at 16 or 17 getting a job and doing one day a week of training. I would have thought that just as there was all-party support for the Education Act 1944—the last time the education leaving age was raised by legislation—there should be all-party support for what we are doing. I regret very much that the education spokesman of the Conservative party has called raising the education leaving age to 18 “a stunt”; it is absolutely vital for the future of our country.

Q3. I welcome the speech that the Prime Minister made on Monday about the challenge of climate change, and in particular the decision to locate the energy technologies institute with a consortium of universities in the midlands. However, does he agree that if we are really going to seize the opportunity to become world leaders in the development of environmental technologies, the initiatives that we take need to go far beyond the universities to provide jobs, skills and regeneration in areas such as my part of Birmingham? They have been suffering big changes over the past decade or more. (166253)

Just as information technology created millions of jobs in the 1990s, so environmental technologies can create millions of jobs across Europe and the world over the next few years. That is why the joint public-private energy technologies institute, now funded to the tune of £800 million—half of that from the private sector—is absolutely vital in giving us a world lead in the new products and processes. I am very pleased that my hon. Friend’s constituency and many universities around the country are going to benefit from participation in this. It is an example of public money being used for a public purpose, working with the private sector to create new industries and new jobs.

We know from the statement made by the head of MI5 that we are dealing with a small but important group of young terrorists who are operating in cells, and we know that there are distinct links in our country with the Asian sub-continent; that is one of the reasons why the numbers in Britain are so high. However, we also know that the measures that we announced last week, not only to win the battle of hearts and minds but to isolate extremists, are the right way forward. The right hon. Gentleman should agree with me that we are making substantial advances in persuading young people that this is not the right way forward and in isolating these terrorist extremists in our country, and we will continue to fight the battle against terrorism.

Q4. Yesterday, as part of the parliamentary education service’s excellent programme, students from Newcastle-under-Lyme college of further education visited me here in Westminster. In Newcastle, we will shortly get a brand new £25 million FE college, which is our latest big investment in education in the area. That said, despite regeneration, too many of our youngsters have mainly low-paid and low-skilled jobs in newer industries such as distribution to look forward to. What further measures will the Government take to ensure that our children are equipped with the education and skills that they need to meet their rising aspirations and the rising aspirations of the traditional industrial areas such as north Staffordshire? (166254)

When we came to power in 1997, the apprenticeship system was dying out. Now the number of apprentices is 250,000, and we want to double that to 500,000. I hope that there will be all-party support for improving the apprenticeship system.

I have already answered that question. The Chancellor has done an excellent job both as a former Minister at the Treasury and now as Chancellor of the Exchequer.

Q5. In discussions with students in Ramallah on the west bank a couple of weeks ago, I felt depressed by the fact that those students had done what they were asked to do—they had got themselves a college education and were in their final year at university—but said that they had no hope because there were no jobs. Whatever happens in Annapolis, will my right hon. Friend ensure that economic regeneration and hope for young Palestinians is at the top of the Government’s agenda in the middle east? (166255)

I believe that all sections of the House will want to support the Annapolis talks, which start in the next few days. It is very important to say that the Annapolis talks are part of a framework over the next few months, whereby we then have a donors conference in December and, I hope, build on that with our proposals for greater economic security and support for the Palestinian people. Last week, I announced a $500 million advance from Britain, if we can solve the security problems, to provide jobs for the Palestinian people. I have now talked to other world leaders and they will be prepared to support this fund if we can make progress on security. My hon. Friend rightly says that the levels of poverty and unemployment are intolerable in Gaza and the west bank, and we are ready to do what we can to help people in those areas.

The Prime Minister rightly paid tribute to the servicemen killed in Afghanistan and Iraq. The two men killed in Iraq were possibly in a Puma helicopter that was older than some of the personnel it was carrying. When will the Chinook helicopters ordered by the previous Conservative Government for use by our special forces be delivered for use by our special forces?

I do not think, despite the tragedy yesterday, that anybody should jump to any conclusions about what has happened. A full investigation should and will take place. I want to pay tribute to the courage, dedication and service of the men who have died.

As for equipment, we have ordered more helicopters; more helicopters are there on the ground; and we have the biggest defence programme of capital investment over the next 10 years of any Government at any time.

Q6. My right hon. Friend will be aware that primary schools in Stoke-on-Trent have already benefited from about £50 million for rebuilding and refurbishment. With £200 million, we now have a similar opportunity for our high schools and special schools. Given that this is probably a once-in-100-years opportunity, and that it is absolutely vital to get it right, will he agree to meet heads and governors to discuss their proposals for how that money should be spent across the whole city, particularly, in my constituency: St. Joseph’s, Trentham high, Longton, Edensor, Blurton and St. Thomas More—I could go on— (166256)

My hon. Friend knows his constituency very well. Nineteen schools are being rebuilt in Stoke-on-Trent, and 111 additional classrooms are being refurbished. He is absolutely right: under the building schools for the future programme we have committed to the refurbishment of thousands of schools, primary and secondary, around the country. It would be unfortunate if the Conservative plans announced yesterday were to disrupt a programme whereby people are expecting new schools and new classrooms in the next few years.

I do not know why the Prime Minister was smiling a moment ago about HMRC. There are 25 million people who do not think that it is funny at all. Can he explain why the accounts of HMRC have been qualified for the past four years?

That has happened on many occasions. I just have to read to the hon. Gentleman from this report. The National Audit Office said that HMRC’s performance has not been adversely affected, and that in some areas performance had improved substantially. It added that the adjudicator for HMRC had said that the changes that we brought about in the HMRC had had no negative impact on its customers. HMRC is working as a new unit.

Q7. Although I accept that we have to have a Post Office network of an appropriate size, the closure of sub-post offices in individual localities is a cause of some concern. Those in my constituency currently under threat, so to speak, are good businesses. They serve a high proportion of the elderly and disabled who do not have an easily accessible alternative, and they act as a funnel for other businesses. Will my right hon. Friend assure me that the consultation being carried out by the Post Office is just that, and not a cover for a foregone conclusion? (166257)

It is not only a consultation; I invite him to meet the Minister responsible for Post Office matters at the Department for Business, Enterprise and Regulatory Reform to talk about those issues. The fact is that we are putting £1.7 billion into helping the Post Office network. It is true that many post offices are not widely used at all. In some cases, there is single-figure use during the course of one day. There will be a proper consultation and my hon. Friend’s local residents will have the chance to have their voices heard.

Q8. On the question of trust in this Government, all Members opposite should remember these words about the constitutional treaty: “We will put it to the British people in a referendum”. If the Labour party manifesto was deliberately misleading the British people, what faith can anyone have in anything this Government say? What would the Prime Minister normally call somebody who does not tell the truth? (166258)

The first announcement in Brussels last spring was that the constitutional project had been abandoned. There is no constitutional treaty; it is an amending treaty. We won all our red lines and secured all the agreements that we won. That is why the question for the Conservative party is now whether it will support a referendum, even after ratification.

The Barnett formula is for the whole of the United Kingdom. It is not for one part of the UK. It covers all areas of the United Kingdom, and the formula is based on the needs of each different part.

Is the Prime Minister aware that when the Department for Work and Pensions ran child benefit, it did a full audit on 20,000 names? When it was passed to the Inland Revenue, that was cut to 2,000 names, which is why the National Audit Office had to check its figures. Is he further aware that those protocols were agreed at a high level in March between the NAO and the Inland Revenue, and when the NAO asked for narrow details—not people’s personal bank accounts—the Revenue said that to disaggregate that information would be too burdensome for the organisation? Those decisions were, therefore, taken at a high level. Is that not the image of a department that has had too much work loaded on it at the same time as it is cutting staff?

The hon. Gentleman raises a point that will be the subject of the investigation. I have to tell him that there is a dispute about what the NAO and HMRC said to each other about these particular data, but the important part of the inquiry is that it will reveal the truth of what happened.

Q10. I congratulate the Government on acknowledging veterans, most recently the Bevin boys, for their contribution during the war. Will my right hon. Friend give positive consideration to recognising the Land Army girls who worked tirelessly under extreme conditions for their nation during the same conflict? (166260)

My hon. Friend makes an important point, and the Government are sympathetic to the case for recognising the work of the Women’s Land Army. We are looking carefully at how that should be done, and we shall report back to the House in due course.

Q11. Is the Prime Minister aware of the damage caused to the landscape of Britain by wind turbines, which are often opposed—[Interruption.] (166261)

They are often opposed by local people, then imposed by planning inspectors implementing Government targets for renewable energy. If the Prime Minister is serious about climate change, will he urgently restart Britain’s nuclear programme and stop industrialising the uplands of Britain with wind farms that are ugly, inefficient and unreliable?

No wonder the Leader of the Opposition is blushing and going red—his party is all talk and no action.

We now come to the main business—[Interruption.] Hon. Members must leave the Chamber quietly.