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Westminster Hall

Volume 471: debated on Wednesday 30 January 2008

Westminster Hall

Wednesday 30 January 2008

[Hywel Williams in the Chair]

Maternity Services

Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. Dave Watts.]

I thank Mr. Speaker for granting me this debate on maternity services. I have been planning it for a while, but it is well timed, given the publication of the Healthcare Commission review last Friday.

Along with our colleague, the hon. Member for Macclesfield (Sir Nicholas Winterton), I am an honorary vice-president of the Royal College of Midwives, and very proud to be so. I pay tribute to the college and to midwives. They are professional and effective in the cause of first-rate maternity provision in this country. They are one of the major reasons why giving birth has become safer for mothers and their babies.

I also want to pay tribute to the management and midwives at Whipps Cross hospital in my constituency. It has improved and, in a way, has bucked the trend in London. I shall say a bit more about that later.

Giving birth is a major, life-enhancing experience in a woman’s life—and in her partner’s. It should be a happy experience, not a traumatic one, and high-quality national health service maternity services that are consistent across the country are essential for that.

The Minister was recently the guest of honour at a Royal College of Midwives event to honour those who did a lot of innovating. She will have seen the brilliance and enthusiasm that midwives bring to improving their profession and their service. As a former nurse, she has been on the NHS front line, and she is aware, more than most, that the front line is vital to delivering quality treatment. So it is with midwives for mothers and babies. I hope that she will excuse the pun, but I know that she is keen to have the best service on the NHS front line. However, that requires action.

The Healthcare Commission’s report shows a service that is patchy. It is good in many areas, but inadequate in too many. The trend is in doubt: some factors seem to indicate a worsening. I know that that is not the Government’s intention, but they must act promptly to ensure that the needed improvement happens all over the country.

I shall come back to the commission’s report, but let me quickly give examples of how the press reported the situation: four in 10 maternity units give poor or below average care; nine out of 10 are not meeting the National Institute for Health and Clinical Excellence screening guidelines for maternity; one in five of the 148 trusts surveyed failed to carry out scans, discharged too quickly or did not follow up with post-natal visits; one third of trusts do not have a consultant on the ward for at least 40 hours a week, which is considered the norm; in one quarter of trusts, three times as many babies were readmitted for jaundice or dehydration than in the best trusts—that is a serious disparity; the maternity care in 31 NHS trusts fell below the approved standard. Those were reports in the press, and they are, of course, a matter of concern.

MPs are concerned. An early-day motion was put down by a Liberal Democrat colleague, the hon. Member for Bath (Mr. Foster), in mid-November. It already had 119 signatures yesterday, and the turnout for this debate indicates that many MPs are concerned about maternity services.

On the Healthcare Commission’s report, is the hon. Gentleman aware that the Royal Cornwall Hospitals NHS Trust, which had a very good result in the report, has a maternity unit, the Princess Alexandra suite, where the roof often caves in despite the good and professional standards and dedication of its staff? In fact, the unit itself is structurally unsound, and people often say that they are surprised that it had such a good report, given the capital challenges that the service faces.

I hear that point. Those structural matters must be addressed. It is crucial that the strategic health authority makes provision for and sorts out the problem.

Some key factors are putting the service under intense strain. The Government have guaranteed that by the end of next year, England’s NHS will deliver a world-class maternity service, but with less than 24 months to go, action is needed now. The emerging baby boom is placing additional demand on a service that already has to cope with an inadequate and shrinking budget and insufficiency of the midwifery work force. In addition, there is a declining number of student midwives, which means a failure to produce the next generation of midwives—that is a concern. If action is not taken now, it is difficult to see how the Government can avoid failure to honour their guarantees. That would be deeply depressing to midwives and a let-down for women.

The Government gave guarantees in the past two elections. In 2001, the Labour manifesto stated:

“By modernising all maternity units, increasing the number of midwives and giving women greater choice over childbirth, we will ensure that women receive the highest quality maternity care.”

In the last election, the manifesto stated:

“By 2009 all women will have choice over where and how they have their baby and what pain relief to use. We want every woman to be supported by the same midwife throughout her pregnancy.”

A good document was published by the Department of Health in April last year. “Maternity Matters” included guarantees that by the end of next year, all women would enjoy the choice of how to access maternity care, they would be able to go directly to a midwife or via a doctor, they would have a choice of antenatal care, they would be able to choose between midwifery care or care led by both doctors and midwives, they would have a choice of place of birth, depending on their medical history and circumstances—they and their partners would be able to choose between home birth, giving birth in a midwifery unit or in a hospital with midwives and doctors—and they would be able to choose how and where to access post-natal care. The Royal College of Midwives congratulated the Government on that document, and it still does. It says that it wants to work constructively with the Government to achieve those objectives, which are important.

However, let us look at what happened with the health care report. It was the single most comprehensive assessment ever made of maternity services in England. It was based on evidence gathered throughout 2007, and it found significant variations in the provision and quality of maternity care provided by the NHS. Thirty-eight trusts secured the top ranking, or best performing; 47 achieved the second highest ranking, or better performing; 32 trusts—22 per cent. of trusts—attained the third best ranking, or fair; and 31 trusts finished with the bottom ranking, or least well performing.

In London, the worst performing region, 19 out of 27 trusts—70 per cent. of London trusts—got the worst ranking. Like me, the Minister is a London MP. I do not think she is happy that London is behind the rest of the country. She will want London trusts to reach the best standard. That is a matter of concern that the commission’s report brings to our attention.

I agree with what my hon. Friend is saying. Does he, like me, welcome the Healthcare Commission’s report, because of which we actually know what the situation is now? However, the problem is that we do not know what we are comparing it with, because this sort of survey was never done before. The real answer will tell us whether it has improved next time.

I hear my hon. Friend’s point. That will be a factor, but I do not think that it is the only factor, because the report clearly shows a service that is under strain and that a significant number of trusts, including in the capital, appear to be underperforming and are below the approved standard. The Healthcare Commission review stands on its own in the present as well as being a factor for the future.

I shall run through some important points made by the Healthcare Commission in its press papers. It says that:

“those trusts that were least well performing should as a matter of urgency take steps to improve and we shall be checking that they do so.”

It continues:

“The review raises real concerns about performance in London. There are a number of factors that may have influenced these results, such as lower staffing levels and the mobility and mix of the population. But London trusts need to rise to these challenges.”

In fact, the Healthcare Commission has said that it will do a more detailed assessment of what needs to be done this year, but says that

“very low staffing levels may be associated with poor overall performance”.

That certainly seems to be so in some London trusts. It said that

“antenatal and postnatal care tended to be consistently poorer”

in London and that

“the quality of care around the time of birth was mixed.”

It says that there needs to be

“greater continuity where women are getting different aspects of their care from different trusts.”

The Healthcare Commission mentions mental health issues in respect of pregnant women, which is important, because depression and suicide are associated with pregnancy. It states:

“All trusts ask women about their mental health at a woman’s first antenatal appointment, however only 55% conduct all the mental health checks identified in NICE guidance…42% of trusts said that they did not have access to a specialist mental health service.”

That aspect needs to be addressed.

The commission says that

“64% of trusts are providing women with a named midwife”,


“34% of trusts are providing a named midwife sometimes”


“2% of trusts are not providing a named midwife at all”.

That is a serious criticism. All trusts should provide a named midwife.

In respect of the London factor, on bookings, the Healthcare Commission says that most trusts took

“1.5 weeks or less from the time between a woman making contact and having her first booking appointment.”

However, in some London trusts it took “4.1 weeks or more”. I put it to the Minister that that is not acceptable.

The last point that I want to quote from the Healthcare Commission report is on breastfeeding. Initiation rates are “58% or less” in some trusts, whereas in the higher performing trusts the rates are “78% or more”, because of the quality of the advice. We know how important breastfeeding is for the health—and the future health—of the child. Those are serious flaws that the Healthcare Commission has outlined.

The report also outlines some challenges facing NHS maternity services: the emerging baby boom, cutbacks to the budget, shrinking midwifery numbers and student midwife numbers. I want to deal briefly with each one in turn. On the baby boom, the birth rate in England between 2001 and 2006—the latest year for which figures are available—rose from 563,744 to 635,679, a 13 per cent. increase. The number of births in London increased by 16 per cent. in those five years. Addressing the Labour conference last year, the Secretary of State for Health said:

“We have initially planned an extra 1,000 midwives by 2009. If birth rates continue to rise, we will need to train more.”

Well, they are continuing to rise. I should like to know what the Minister’s reaction is to that. I would also like to know whether that figure of 1,000 is a head count or refers to full-time equivalents, because if it is just a head count it will not do the job. The Royal College of Midwives estimates that some 5,000 extra midwives are needed if it is to meet the targets on one-to-one care that the Government have been talking about.

On a new projection, there would be 652,000 births in 2006-07 and 673,000 by 2009-10. If those official predictions are correct, the number of births in England will have increased by more than 100,000 in less than a decade. The BBC has talked about that in terms of migrant labour, but I think that that is just a factor. The BBC estimates that that increase will add a £200 million bill on to NHS costs in terms of maternity services. The Government are putting in £122 million. Putting those two figures side by side shows that more needs to be done in that respect. Migrant and immigrant labour is vital for the NHS and for many other industries as well, but that factor must be taken into account if we are to meet our aims in terms of maternity services.

The budget has been reduced. There was a cut of £55 million in NHS cash spent on maternity services in 2006-07, which is equivalent to £87 less per birth than in the previous year. In 1997-98, maternity services received 3.1 per cent. of the NHS budget, but by 2006-07 that had fallen to 2 per cent., so those are getting a lesser proportion. If the figure had remained at the higher proportion of 3.1 per cent., maternity services would have received, on average, £1,274 more per birth than they actually received. There have been reductions in the budget. That has to stop. In fact, it must go the other way if we are to achieve the target.

The work force issue is important. There is general party political consensus that we need more midwives; I could quote all parties saying that that needs to be so. However, I want to make a point about what the experts say. The various royal colleges in this field talk about a level of one midwife per 28 women—a ratio of 1:28. Let me give the figures for the increase in births per full-time equivalent midwife in 2006, compared with 2001: in the north-east the number of births is 29, which is an increase of 16 per cent.; in the north-west it is 27, up 8 per cent.; in Yorkshire and the Humber it is 33, up 10 per cent.; it stands at 40 in the east midlands, which is an increase of 25 per cent.; in the west midlands it is 32, up by 10 per cent.; in the east of England it is 38, down 5 per cent.; the figure in London is 36, down by 3 per cent.; in the south-east it is unchanged at 37; in south-central it is 43, up 19 per cent.; and in the south-west it is 31, up 15 per cent. The trend is mainly in the wrong direction and well above the 1:28 ratio that the experts say is needed. That is not good.

In 2004-05, 2,374 NHS midwife training places were commissioned in England. That fell to 2,200 a year later, and fell again to 1,990 in 2006-07. Does the Minister have the latest figures, and do they show a fall? There is a serious problem for future generations, partly because the Government reduced the bursary for midwives—the amount that they receive in training. A big push is needed for more midwives in training, or there will be an even bigger problem.

I am running out time, because plenty of hon. Members want to speak, but I want to draw attention to a few points. UNICEF has introduced a baby friendly initiative and says that in trusts where it is in operation breastfeeding has increased by about 10 per cent., but it is not in operation in the majority of trusts, and it should be.

The Royal College of Obstetricians and Gynaecologists agrees that 5,000 more midwives are needed, but says that more obstetricians are also needed on the wards to provide a consultancy service. It points to the huge litigation costs in maternity services, which are second only to those in general surgery. When something goes wrong, the costs may be in the millions, and the RCOG makes the good point that if there were a better overall service, it would save on some of those litigation costs. I do not have time to give the figures, but the point is relevant and worth making.

More proactive intervention is needed from Ministers and NHS management to address the situation and to achieve our manifesto commitments and aims. There should be more resources. I welcome the £122 million, but that is the figure that will be reached in three years. What will happen this year and next year, and what are the figures for those years? The figure should be higher if we are to have the necessary increase in the number of midwives and student midwives, higher consultant cover, and more choice, as we were promised.

The poorest performing trusts, particularly in London, must be forced to improve their maternity services up to the standard of best practice. The guarantees were clear, and are still being made, but time is running out. I urge Ministers to will the means and to require the relevant authorities to fulfil them. That is what our top-rate midwives and, more importantly, mothers and their babies richly deserve.

Order. I intend to start the winding-up speeches at 10.30. A number of hon. Members have indicated their intention to speak, so I appeal to them to be suitably brief.

I congratulate the hon. Member for Leyton and Wanstead (Harry Cohen) on securing this important debate. He highlighted some of the specific problems in London but, as a predominantly loyal member of the governing party, he downplayed some of those concerns. However, the Minister has plenty of food for thought.

I have direct experience of maternity services. Six weeks ago, my first son was born. It is with some regret that my wife and I decided to go private, partly because of the acute problems with midwifery and maternity services in London. We went to the Lindo wing at St. Mary’s hospital, Paddington where we received tremendous service throughout from Dr. Raj Rai.

I was born in the health service, albeit at a British military hospital in Germany, and I was educated in the state sector, so I did not take lightly the decision to use a private hospital; it was a reflection of the problems in the national health service. Those problems predate 1997 so I am not trying to make a narrow political point. Although we rejoice at some of the great successes of our national health service, there are some real problems, which platitudes from politicians on both sides of the House do little to resolve.

My wife had a caesarean and she had to stay in hospital for four days after the birth of our son, Frederick. I reflected that the service we received, which was tremendous, was unlikely to be received by mothers who had given birth a few hundred yards away in the main St. Mary’s hospital. I know that from a number of constituents. There have been too many horror stories from friends in central London who have gone through the national health service, not just at St. Mary’s, Paddington, but at the Chelsea and Westminster hospital. I shall refer to one or two examples from a letter that I received only this week.

There are problems because women are passed from pillar to post, from trainee midwife to locum midwife during the pregnancy, and there are problems after the birth. Such problems are particularly acute in the capital for a number of reasons. As I have often said, the trade unions may like national pay bargaining, but in a nationalised health service it does no great service for people living in London. That also applies to the education system. There are acute problems with our public services in London, and in the south-east, because the cost of living is so enormous.

There has been an explosion in the birth rate, to which the hon. Member for Leyton and Wanstead rightly referred, largely due to immigration. There is no doubt that a vibrant, young work force have come to work in the UK, particularly in London but also in other parts of the country and in other large cities. Young people in their 20s and 30s are at the fertile age and they are likely to have children. Since enlargement of the European Union three and a half years ago, we have known that there would be an explosion in the number of young people coming to live and work in the UK, yet there has been insufficient planning. The hon. Gentleman was too polite to make the point as blatantly as I have.

The problem applies not just in London, but outside. There is little doubt that in central London there are specific problems of hypermobility and hyperdiversity; many people are moving around and living in our cities, and 90 languages are spoken in the diverse population in my constituency. Regrettably, that puts undue pressure on inner-city health care.

I shall refer to a constituency case. A letter from Mrs. Sarah Meier of St. George’s square, Pimlico arrived in my office only last week. Her experience is not typical, but it is not unusual, and on a personal level it was one reason why I decided that the national health service was not fit for purpose in my constituency. I regret that, but I have seen the problems as a Member of Parliament, and as someone who has friends who have used central London hospitals for childbirth in recent years.

Mrs Meier said:

“I am writing to bring your attention to how dissatisfied I am with the treatment my baby son and I received after giving birth at the Chelsea and Westminster Hospital on 9 November 2007. I am writing so that you can take action to prevent others having to suffer what we endured…the treatment we received afterwards on the…Ward was a disgrace. I had an epidural during labour and also an”—

Episiotomy. I bow to my hon. Friend’s medical knowledge.

Mrs Meier had

“an episiotomy with extensive associated bleeding. So I had to stay in hospital overnight and was moved to the…Ward. The conditions of hygiene and care in that ward were appalling. During my 24 hour stay my bedding was never changed. I had to sit in my own blood and nobody came to check me. Later that week, after I had gone home, it was found that I had an infection. I, and the GP who several days later saw me as an emergency, are both sure that this was due to the conditions in the ward and the lack of interest taken in my wellbeing. I thought the prevention of infection was supposed to be”—

a top priority. That episode occurred only two and a half months ago. Mrs Meier continued:

“The GP also diagnosed me as having anaemia. Again this could and should have been picked up on by someone on the ward, but nobody had bothered to come and check on me…This is my first child and I was attempting to breastfeed him. This was particularly challenging as my milk had not yet come in properly. The midwife on duty shouted at me for not doing it the ‘correct way’. My son and I were discharged from hospital on Saturday 10th November. My son was checked by the paediatrician prior to discharge.”

It transpired that the baby had suffered from post-birth jaundice, so within 24 hours of leaving hospital he had to be rushed back into hospital at the behest of a GP. The whole episode was very traumatic, but it could have been avoided if the paediatrician had picked up the problem before discharge. That is by no means an untypical experience. I am sorry to have to bring it up on the Floor of the House, but it is appropriate to do that in this place, rather than going through a lot of platitudes about various targets and figures and saying how marvellous the health service is.

In many areas, such as central London, the health service is not fit for purpose. Mrs. Meier said her experience was a contrast to the excellent care and attention that her sister-in-law received only last year when she gave birth in Harrogate district hospital. She said:

“It is difficult to believe that both hospitals are part of the same health service.”

That goes to the heart of the issue about a national health service. Mrs. Meier said that in no circumstances would she have another child at the Chelsea and Westminster hospital. She advises all her friends to avoid the place.

As I said, I am sorry that I have had to bring up the matter on the Floor of the House. However, such distressing episodes are increasingly common in central London, and not only in relation to maternity services; there are difficult problems in respect of hypermobility and hyperdiversity, to which I have referred. Problems stem from the explosion in the number of young people who come to the UK and give birth in this country. There are specific problems in London, to which the hon. Member for Leyton and Wanstead rightly drew attention. The Minister, who is also a London MP, will be aware of some of the issues that have been raised, although that is not to say that there are not some very positive stories.

There are positive stories about some of our hospitals, even though they are under great strain in central London. None the less, I hope that the Minister will consider some of my specific concerns, which are not just about money, although the hon. Member for Leyton and Wanstead got it right when he said that we face a financial crisis in London in relation to maternity care. I hope that the Minister will give maternity services proper investment and attention in the months and years to come.

I am aware that other hon. Members wish to speak, so I will keep my remarks as brief as possible. I congratulate my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) on raising such an important and topical matter. We could not have a better backdrop than the current Healthcare Commission report. I have some direct experience of the impact of the restructuring of the health service. A year ago, as a result of the proposals to reorganise health services in Gloucestershire, the maternity unit in Stroud—a small but invaluable unit—was under threat of closure. There was a massive campaign to keep it open. The authorities finally saw sense, and it is now flourishing, which shows that small units have a part to play. I pay tribute to Michelle Poole, who is in charge of that unit. Her stewardship is excellent, and she has always kept me apprised of the different maternity issues.

The Government’s direction is absolutely right. Despite some of the recent criticism, maternity services is an area of which the Government should feel proud. I shall not go over the same ground as my hon. Friend. Clearly, he has made the case very strongly. We are looking at the issues of recruitment, training and retention of staff. From my experience, this, like many other public professions, is an ageing profession, so we have to ensure that we recruit more people into it. I am interested to hear how my hon. Friend the Minister responds to my hon. Friend with regard to getting the numbers right. I would like to put on record my welcome for maternity care assistants. Again, they do not necessarily get much publicity. After some initial worries in the midwifery profession, the role of the care assistants now seems to be both established and welcome.

I raised the issue of insurance in a debate secured by the hon. Member for St. Ives (Andrew George) last May. I am particularly concerned about independent midwives, who are an important part of the service. Have the Government made any progress in their talks with insurers to ensure that such a matter does not militate against smaller units and those who work as independents?

As my hon. Friend said, the numbers are up, and not just in the urban centres but also in areas such as Stroud. That is helpful because one of the accusations was that our numbers were going to decline and that such units would not be viable. That was the prediction in 2006. In fact, in 2006-07, the numbers born at Stroud maternity unit were up by 7 per cent. Again, it is manifest that a lot of that increase is due to migration. We now have a little Polish unit under the leadership of midwife Helen Conway. It is good to see that people can get the best of care even in a rural setting. I am referring here to the translation services. I do not mean midwifery care, but care in the wider social provision. That is very impressive.

I want to discuss the issue of maternal mental health, which was quite rightly raised by my hon. Friend. The problem is highlighted by the Healthcare Commission and the National Institute for Health and Clinical Excellence clinical guideline 45. One of the advantages of smaller units is that they can provide specialist care. Stroud has always prided itself on the fact that it has recruited midwives who, while not suffering medical problems, have learning difficulties, and who may not have English as their first language. That is helpful. There is a question mark over how the midwifery-led units work with the Gloucestershire Partnership NHS Foundation Trust. Mental health is not an area that is well resourced or an area in which one can easily cross boundaries. What does my hon. Friend the Minister aim to do to ensure that there are more resources going into this area, that there is more co-ordination between the different trusts and that post-natal depression is given due attention?

The report “Saving Mothers’ Lives” that was published last year stated that the number of suicides associated with childbirth was down. Will the Minister say how we can further reduce those figures, which reflect a very sad aspect of giving birth? How can we ensure that there is better overall care in this field? It would be good to hear what the Government’s strategy is.

Finally, I want to congratulate the Government on their clear-sighted approach to childbirth and the very early years of childhood. I have been a great supporter of our nursery provision and the drive towards children centres. It makes sense that we have now linked health visitors with children centres. In Stroud, the health visitors are now based in the maternity unit. Okay there was space there, but it also made eminent sense to have health visitors working with midwives in the children centres.

The difficulty is, of course, resources. Children’s centres are not always well resourced. I will not say that there is snobbery, but there is some questioning in the medical profession about the role of health visitors. The Minister smiles, but there is still some prejudice in the medical profession about what health visitors do. As we have moved them increasingly away from purely medical intervention, that has led to some questioning among GPs in particular, so I would welcome what my hon. Friend has to say about how we can reassure the GP community that health visitors are doing vital work, if in a slightly different way, and about joining them up much more with midwives and children’s centres.

It would be remiss of me not to mention that linked to that are organisations such as Home-Start. In rural areas, we accept that because of the lack of concentration of facilities, we will never be able to provide Sure Start or children’s centres in every rural location, much as that is a dream of mine. However, we have excellent organisations such as Home-Start, which fill in the gaps and provide support in the early years for both mother and child. It would be good to know how the Department of Health envisages the role of such organisations, which are very much supported by health visitors. If the Minister will say some nice things about that, I can at least go back to my Home-Start organisation and say that it is well loved even if it is not always as well resourced as we would like it to be.

This is a good story. I know that there has been criticism and that there is a lot of pressure in this area, but I hope that we continue to do what we have been doing and that we provide some more resources to ensure that we can do it properly.

For me, this is a timely debate because tomorrow my right hon. Friend the Member for Witney (Mr. Cameron), my hon. Friend the Member for Daventry (Mr. Boswell) and I will be giving evidence to the independent reconfiguration panel, seeking to persuade it that proposals to downgrade the consultant-led maternity unit at Horton general hospital in Banbury to a midwife-led unit, causing large numbers of women to have to travel some 26 miles to Oxford, is a bad and dangerous idea. I am sure that the House will note that, given the concept of collective government that we have in this country, my right hon. Friend the Member for Witney, part of whose constituency is covered by Horton hospital, speaks not only as the Member of Parliament for Witney but as Leader of the Opposition, and his views therefore reflect those of the official Opposition and the Conservative party. [Interruption.] The hon. Member for Stroud (Mr. Drew) titters, but many communities in this country are desperately concerned at the downgrading of maternity services.

The “Keep the Horton General” campaign, which is ably led by a Labour district councillor, George Parish, evidenced the ambulance transfer times between Banbury and Oxford. These figures represent what actually happens at present. In only 5 per cent. of cases did an ambulance manage to get to Horton hospital in 10 minutes. Only in just under a quarter of cases could an ambulance get there in 30 minutes. In most instances, it took more than half an hour to get an ambulance to Horton hospital. That is before the transfer of a mother has even taken place.

When those figures were put to the Oxford Radcliffe Hospitals NHS Trust, Helen Peggs, the director of communications at the trust, stated the following in an e-mail:

“At the moment, the Horton General Hospital is classified by the Ambulance Service as a ‘place of safety’. This means that the Ambulance Service treats calls from the Horton as ‘urgent’ but not as emergencies, which require a very rapid response, and they have a very long timeframe in which they can respond.

If the proposals are accepted by the Secretary of State, this will change. The Ambulance Service will treat any calls from the Horton General Hospital for women or children who need ambulance transfers as Category A (999) emergencies.”

In other words, at present my constituents have a hospital that is a place of safety. If the changes go ahead, my constituents will no longer have such a hospital. That is disgraceful and disgusting.

I have another concern. Many women choose to attend midwife-led units, and another battle being fought throughout the country is to prevent the closure of such units. Is the hon. Gentleman concerned that in the longer term, if he loses this battle, which I hope he does not, he may be fighting yet another battle?

It is clear that even on the Oxford Radcliffe trust’s own best figures, a large number of women who elect to go to Horton hospital in future will have to have their babies somewhere in transit, because even the most prospectively normal deliveries can go wrong. Indeed, an e-mail from one of my constituents the other day stated:

“My newest cousin Ewan was born at the Horton at 3.19 am on Monday 14 January. It had been decided only half an hour before, that a Caesarean, unplanned and unexpected, was essential as baby, and mother, were becoming dangerously stressed. The consultant-led team of 8 delivered him safely. A 24-mile dash to the JR in such circumstances is unimaginable.”

A large number of women will be obliged to have their babies somewhere along the M40. That is simply unacceptable in the 21st century.

Time is short and I am conscious that the hon. Member for St. Ives (Andrew George) wants to speak, but I have two other points. We hear from the Government continuous rhetoric about choice and patient power. On 9 January, the Prime Minister made a speech on the NHS. Obviously it must have been cleared by the Cabinet and the Department of Health. He said that

“the NHS of the future will be one of patient power, patients engaged and taking greater control over their own health and their healthcare too.”

He talked about

“frustrations with access to services, with a service too often centred on the needs of the providers rather than those of patients”,

and said:

“That is why giving patients choices through reforms to encourage plurality of provision, create a genuine level playing field between competing local providers and allow money to follow the patient are so important”.

Frankly, my constituents and those of my right hon. Friend the Member for Witney and my hon. Friend the Member for Daventry think that that is complete tosh. When they are being denied choice—when choice is being taken away from them and existing services are being taken away—for the Prime Minister to have the impertinence to talk about patient power is just insulting.

We are seeing locally a health service that is in danger of going backwards. That a general hospital is told that it will no longer be a place of safety in the 21st century is insulting to large numbers of people living in north Oxfordshire, south Warwickshire and south Northamptonshire. It is a disgrace. I hope that tomorrow, and sooner or later, the independent reconfiguration panel will have the courage to say to the Secretary of State, “Enough is enough. A line has to be drawn on the downgrading of maternity services in the UK, which is putting at risk the lives of mothers and babies. It is simply not good enough.”

I congratulate my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) on initiating the debate and on the quality of his speech. We sometimes forget—we should say this because there will be women watching the debate who are anxious—that the United Kingdom is one of the safest countries in the world in which to give birth.

The point that I want to make is that things can change. Hon. Members have been going on about the problems in their constituencies and I can understand that. I made a similar speech about 15 years ago. In Carlisle, the maternity hospital was on the site of the old workhouse. The consultants worked at the district general hospital 2 miles away and they had to travel through congested streets if there was an emergency. An independent inquiry at that time concluded that, because of the facilities and the split site, babies were dying. I brought that point to the attention of the House. I shall not go into the politics of it and which Government were responsible; in fact, probably both Governments—Harold Wilson’s Government and the previous Conservative Government—take some of the responsibility.

However, the situation is transformed. We had the first private finance initiative hospital in Carlisle. I can tell the Minister that that was not without its problems—one never wants to be at the cutting edge on such matters. One of the advantages of the new hospital was that we got rid of the split site and provided an excellent maternity facility with birthing rooms for mothers. The Healthcare Commission now says that the quality of maternity care in the North Cumbria Acute Hospitals NHS Trust area is excellent; in fact, it is the third best in the north of England. Dr. Gwyneth Lewis, the medical lead in maternity services, has been to the area recently, and she said that the service is exemplary.

There are problems with the service, but I cannot understand why Members say that we should have a uniform NHS. It will never be that way because provision depends partly on the quality of staff and buildings, for example. We need to bring standards up everywhere. Obviously, Cumbria is a rural county. We have community midwifery services from the north at Brampton down to Millom in the south, and another excellent maternity unit at West Cumberland hospital. Those things have been achieved because of the commitment of the staff in Cumbria, and not only the maternity unit staff. I should like to place on the record my appreciation to the work force in Cumbria, and to the Government, who provided the investment so that we could move forward.

I hope to be going to the maternity unit on Friday to congratulate the staff on their good work. I am sure that the Minister will agree that they should be congratulated.

I congratulate the hon. Member for Leyton and Wanstead (Harry Cohen). Although I endorse much of what the hon. Member for Carlisle (Mr. Martlew) said, I urge him to examine the perinatal mortality figures. The hon. Member for Stroud (Mr. Drew) referred to a debate that I was fortunate enough to secure on 2 May last year. I refer the Minister to my comments in it. Many of the issues raised then are pertinent today.

When I intervened on the speech of the hon. Member for Leyton and Wanstead, I referred to the fact that the Princess Alexandra unit at the Royal Cornwall Hospitals NHS Trust has excellent and professional staff who provide a very good service, despite the tremendous structural problems within the building. Despite the problems, the unit was given the status of one of the best-performing maternity units in the country. People who have experienced the service will say, “If this is the best, God knows what services are like in the rest of the country”.

The issue of community midwives has not been properly addressed in the debate, which is a pity because there is pressure on those services. Community midwives are increasingly being asked to work in maternity suites, and the stress caused to them is significant, particularly for those whose skills and experience are not up to date.

Many Members drew attention to the problems of insufficient recruitment into the service. In the debate to which I referred, the Under-Secretary of State for Health, the hon. Member for Bury, South (Mr. Lewis) acknowledged

“that only 3,000 midwives are needed”.—[Official Report, Westminster Hall, 2 May 2007; Vol. 459, c. 481WH.]

We are still a long way from recruiting those 3,000 additional midwives into the service. They are desperately needed, but many trained midwives are not finding their way into the service.

I wish to ask the Minister some questions about last Friday’s Department of Health press release, which followed the Healthcare Commission’s report. The Secretary of State for Health says that

“funding for maternity services will increase over the next three years to reach an additional £122 million”

nationally. The press release seems to say that the increase will come between 2008 and 2011. Do I understand that correctly? It also says that the money will be used to implement the Government’s “Maternity Matters” strategy, which needs to be in place by the end of 2009, so how come it will not be fully in place until the 2010-11 financial year? The increase is welcome, but can increases in spending be set centrally in the era of payment by results? Perhaps the extra money will filter into the system through increases in the tariffs for maternity care. If that is the case, will trusts not simply siphon off the money generated through payment by results from maternity care and spend it on other services?

In the financial year 2006-07, spending on maternity services fell by £55 million, as was mentioned earlier. We do not yet have the spending figures for 2007-08, but there may have been a further drop. Will the Government commit to a further injection of money into maternity services if NHS spending on maternity services falls again in 2007-08? If not, the extra £122 million will simply make up for money that has been siphoned off out of the service. I hope that the Minister will address those finance questions.

I congratulate my hon. Friend the Member for Leyton and Wanstead (Harry Cohen), and I thank hon. Friends and hon. Members for their brevity, which has allowed me to be the last Back-Bench speaker in the debate.

I should like to deal briefly with three challenges, and then to say something constructive about the future. First, I urge caution on those who describe us as being in the middle of a baby boom, as my hon. Friend the Member for Leyton and Wanstead did. The fact is that in the years up to 2006, there was a gradual decline in our birth rate, such that there are now debates up and down the country about closing schools because of falling rolls. It is true that the Office for National Statistics figures for 2006 show an increase of 30,000 births in England on a total of about 600,000, but it is early days to be calling that a baby boom. There are distributional effects, and issues concerning the diverse ethnicity of mothers create specific problems, which is why, I suspect, the debate has focused on London.

Secondly, there has been an increase in premature births and hence the challenges they create for maternity services—other hon. Members have not mentioned that. For whatever reason, there has been an increase in premature births and, thanks to advances in medical science and in the skills in our health care services, more babies are surviving. Of course, the child and parents must be given support for much longer, and that support is resource-intense, which puts additional pressure on services. The issue was brought to our attention by a BLISS report last autumn, “Too little, too late?”, and was repeated in an article in The Observer last Sunday.

Thirdly, the Healthcare Commission review of maternity services, which was the first of its kind, and which the commission described as comprehensive, draws attention to both best practice and poor services. The challenge is to make the best practice common practice everywhere, which—to be constructive—is where I begin, with one minute of my time remaining.

First, we should praise the staff who work in the service. Often in debates about NHS services, we say how dedicated and committed the staff are, but we can give particularly great thanks to the people who work in maternity services. I have enormous admiration for midwives and health visitors for the work they do. We have put support in place for them and provided a framework. We have the national service framework and the National Institute for Health and Clinical Excellence guidance, but next we need to get training right.

My hon. Friend the Member for Leyton and Wanstead mentioned the baby friendly initiative, which NICE recommended should be part of the level of care that maternity units ought to provide. The initiative is a worldwide programme, created by the World Health Organisation and UNICEF, and accredits units for their level of service; it promotes breastfeeding—a subject that I am very keen on—and it suggests that there are health gains for parents, increases in the rate of breastfeeding and reductions in costs for services if the initiative is followed. I suggest to my hon. Friend the Minister that one important way to spread best practice to all maternity units is to improve take-up of the baby friendly initiative in accordance with the NICE guidelines.

I would have said much more about tackling health inequalities, Mr. Williams, but I am out of time.

I congratulate the hon. Member for Leyton and Wanstead (Harry Cohen) on securing this debate and on his timing; in the wake of the Healthcare Commission report, the issue has understandably become rather high profile. The commission’s report highlighted patchy performance. We see a service under considerable strain.

I am not sure whether there is a baby boom; all I know is that Southampton has seen a large increase in the number of births over the last few years. That is causing considerable strain locally and is forcing the decision to close small midwife-led units in order to centralise services. That has proved somewhat controversial.

All that is unfortunately set against only the tiniest of increases in midwife numbers. In 1997, we had the equivalent of 18,053 full-time midwives in the NHS. By 2006, the number had risen to 18,862—a rise of only 809, or 4.5 per cent. over nine years. Even worse, last year the number had fallen by 87 from the previous year. Put simply, we need the equivalent of about 22,000 full-time midwives, and we need them quickly.

The hon. Member for Leyton and Wanstead highlighted the drop in the number of student midwives, which is serious. The headcount number of midwives also fell by 375 between 2004 and 2006, so despite the Government’s claims over the seven years since I became a Member that they are planning to address recruitment and retention rates, they have seriously failed to address the problem of retention. Many midwives leave the profession after only a few years. We have a demographic time bomb on our hands, because the age profile of the midwife community is skewed towards the upper age limit, with a large number due for retirement within the next 10 years. That will have a real impact on services.

The regional picture is patchy. Areas such as Yorkshire and Humber have seen a decrease of 141 in the number of midwives. It would be interesting to hear from the Minister what exactly is being done to increase the number of student midwives. Will the Government reverse the trend that has been evident over the past couple of years? How will they improve the retention rate?

How do the problems and pressures manifest themselves? The Healthcare Commission report showed that only 64 per cent. of trusts provided a named midwife for antenatal and post-natal care in 2008. That is not good enough. Most women have the realistic expectation that they should know who is to provide their care, but 34 per cent. of trusts meet that expectation only sometimes and, rather worryingly, 2 per cent. do not meet it at all. London trusts experience delays in booking, with consequent effects on the number of antenatal appointments that a woman can have.

The closure of small maternity units has been alluded to briefly. It decreases the choice available to women. Although a lot of women choose to have their first baby in a unit with a consultant unit attached, many women assess the risk and decide that they would prefer to give birth in a midwife-led unit—something they are happy with—so it is a pity that some of those units are closing.

When a woman goes into labour, she should be guaranteed one-to-one care by a midwife. Having heard the previous Prime Minister’s wife exclaim proudly that she had two midwives attending the birth of her last baby, I tabled a parliamentary question to ask for a definition of one-to-one care.

The Minister shakes her head. I was at the meeting when the comment was made.

The Department seems unwilling to provide a definition of one-to-one care during labour. Many people contend that it should mean that a woman has the undivided support of a midwife to give encouragement and to help her through the birth process. That is clearly not happening.

In October, the Royal College of Anaesthetists, the Royal College of Midwives, the Royal College of Obstetricians and Gynaecologists and the Royal College of Paediatrics and Child Health issued a joint report entitled, “Safer Childbirth: Minimum Standards for the Organisation and Delivery of Care in Labour”. To achieve the standards highlighted in the report, we need to double the number of consultant obstetricians and provide an extra 5,000 midwives. The colleges said that unless dramatic changes were made, the shortfalls would become a problem that would have

“disastrous effects for mother and baby”.

It was also disclosed that, of more than 100 obstetric and midwifery units in England and Wales, only 27 per cent. have the equivalent of a midwife for every woman in labour. That is far from the Government’s stated aim.

Other manifestations of the problem can be found in a woman’s opportunity to have her choice of pain relief. Although the Healthcare Commission report highlighted a relatively high satisfaction rate of 78 per cent., it still leaves nearly a quarter of women dissatisfied with the pain relief they receive. That situation can only get worse. If more women are giving birth, it will put more pressure on the system. If an anaesthetist is not available, an increasing number of women will be deprived of their choice of pain relief.

The hon. Member for Stroud (Mr. Drew) touched on some of the mental health issues connected with pregnancy. That is important, because the Birth Trauma Association has established a strong link between a negative birth experience, which is often related to pain control, and post-natal problems. It is not overdramatic to suggest that some women see the problem as akin to post-traumatic stress disorder.

None of us wants to see another Northwick Park, but reports from my local hospitals include some frightening experiences. There are regular reports of one midwife looking after two or three women in labour; of staff being pulled off post-natal wards to help cope with risk periods in antenatal wards, which means that some post-natal checks are not done; and, echoing the comments of the hon. Member for Cities of London and Westminster (Mr. Field), of things such as filthy toilets with dried blood not being cleaned up within 24 hours. If those problems were a one-off, I would not have mentioned them, but there is a consistent theme that unfortunately keeps returning to me and to other hon. Members.

The drive to reduce the length of stay has led to an increase in readmissions. When that happens care must be taken to ensure that women have regular post-natal contact with a midwife, and that those visits are made. Problems can develop post-natally and it is important that we look after those women.

The lack of midwife cover can lead to an increase in caesarean sections. It does not reflect well on our country that the rate of caesarean sections is well over 20 per cent., when the World Health Organisation says that 13 or 14 per cent. is probably the optimum.

The hon. Member for Stafford (Mr. Kidney) highlighted problems with breastfeeding. In some maternity units, only 58 per cent. of women initiate breastfeeding. I fully endorse the hon. Gentleman’s comments about the UNICEF initiative on breastfeeding.

Sadly, I am out of time. However, I must say that what is really depressing is that although there have been numerous Select Committee reports about maternity services over the years, we are still discussing the same old problems. Will the Minister tell us when those problems will be tackled?

The hon. Member for Romsey (Sandra Gidley) has given me my cue to start. She mentioned the number of reports on this issue. I would refer all Members here, including the Minister, back to “Changing Childbirth”, which I believe was published in 1993; it still holds good today. We are still facing very clear gaps in the delivery of service on maternity care.

I congratulate the hon. Member for Leyton and Wanstead (Harry Cohen) on securing this debate. He gave us a very good basis on which to launch this discussion and highlighted many of the issues that the Healthcare Commission has referred to in its report on maternity services. For me, the biggest issue that he raised was choice—where and how a woman has her baby—and the fact that childbirth is meant to be a happy experience for women, not a traumatic one. Although there is scant research at the moment, anecdotally we know that the experience that women go through during labour has a profound effect not only on their own health—including their mental health—in the years ahead, but on their baby’s.

My hon. Friend the Member for Cities of London and Westminster (Mr. Field) highlighted the issue of mothers feeling as if they were being passed from pillar to post. That is a common theme and a number of other Members have highlighted it. My hon. Friend also mentioned the particular problems facing London, including problems with mobility and diversity, which create particular challenges for the capital’s work force. Ensuring that we reach the groups that are hardest to reach, who are often the most mobile and often do not have English as a first language, is vital.

I noticed that while my hon. Friend was speaking, the Minister shook her head. I ask her not to deny the problems, and to accept that he was speaking in good faith and relating the experiences of his constituents, particularly one who had a very sorry tale to tell of poor care that led to infection.

My hon. Friend the Member for Banbury (Tony Baldry) spoke with considerable passion, as he always does, about the Horton hospital, which it has been my privilege to visit. He also raised the issue of travelling times, which, although no other Members here today have raised it, is of concern in places across the country where smaller maternity units are closing. He rightly said that the Horton is a place of safety. Again, we come back to the issue of choice. If the Minister and the Government want to deliver choice, the message from my hon. Friend is loud and clear: his constituents would like to have the choice of their babies being delivered at the Horton hospital.

Although my hon. Friend the Member for Welwyn Hatfield (Grant Shapps) is not present, I should point out that he introduced me to a constituent of his whose wife’s pregnancy sadly ended in tragedy when the doors of the local maternity unit were closed due to staff shortages. Smaller maternity units offer a place of safety. They are often what women and their families want. I ask the Minister specifically to address the issue of the closures of any such units.

We also heard from a number of other Members. The hon. Member for Stafford (Mr. Kidney) raised the issue of premature births. In fact, the figures on premature births are dreadful and I will refer to them again a little later. The hon. Member for Carlisle (Mr. Martlew) praised his local maternity services; it is always good for us to do so. The hon. Member for Leyton and Wanstead began by paying tribute to midwives, and I am sure that all of us would pay our tribute to them and to the administrators, health visitors and members of the other allied professions, all of whom support women in childbirth. I certainly pay tribute to them.

I could go on quoting from similar figures. For example, Mind has produced several sets of figures on this issue. The hon. Member for Stroud (Mr. Drew) talked about mental health problems. In fact, Mind estimates that 13 per cent. of women will face mental health problems in the first 13 weeks after childbirth, and that figure rises to 20 per cent. in the first year after childbirth. That is a significant proportion of women. If we do not have the midwives, if there are staff shortages, and if we lose the smaller, local maternity units, those figures will undoubtedly get even worse, because there will not be the support staff—in particular, the midwives—to identify any problems at an early stage.

The story is one of a rising childbirth rate. The hon. Member for Stafford said that he was not sure whether we were experiencing a “baby boom”; whatever we are experiencing, the childbirth rate is rising by 13 per cent. across the country. I make particular reference to London, where the rate has risen by 16 per cent. The story is also one of closures of smaller maternity units. Indeed, Lord Darzi’s plans open the door for the closure of up to 10 obstetric or maternity units in London. That would have a profound effect on an area whose problems have already been highlighted.

We also have a shortage of midwives. There has been a 4.5 per cent. increase in the number of midwives over the last 10 years, but recently the number of midwives has reduced by 87. I have heard Ministers quote the number of midwives. The trouble is that we hear about the number of midwives and not the number of full-time equivalents. The latter number is what matters when it comes to providing care for women in labour.

We also have a retirement bulge coming up. The Royal College of Midwives estimates that half our midwives will retire in the next 10 years. Furthermore, there are reductions in the money available for maternity services. They used to take 3.1 per cent. of the total NHS budget, but now, that figure is down to 2 per cent. The ratio of midwives to women is also going in the wrong direction—it is getting worse, not better. Moreover, we have problems with staffing levels. The Healthcare Commission’s report on maternity services associated poor staffing levels with poor performance. In addition, there has been a 16 per cent. drop in training places in the last two years.

Other issues have been raised. I have mentioned that of premature babies, particularly premature twins, which the BLISS report, “Too little, too late?”, has highlighted. Some 35 per cent.—more than a third—of sets of twins are looked after in separate units. One can only imagine the trauma for a mother who, having just given birth, has to visit her two children in two separate hospitals. There is also a problem regarding the number of consultants coming through to train as obstetricians. The Royal College of Obstetricians and Gynaecologists estimates that the number of students putting themselves forward for training has gone down from 4.8 per cent. to 2.8 per cent. The issue frequently raised is fear of litigation.

The hon. Member for Romsey mentioned caesarean sections. A quarter of women now have caesarean sections; in 1980, only 9 per cent. did. The current figure is well above what we should expect. We must also consider the issues associated with mental health and breastfeeding; in particular, we must consider those women in society who are vulnerable and hard to reach, and who often have a number of other related problems in raising their children.

I finish by referring to what Dame Karlene Davis, General Secretary of the Royal College of Midwives, has said on this issue. The RCM has welcomed the “Maternity Matters” report, but Dame Karlene, summing up the problems identified in the report so well, says:

“It also shows that everything is far from rosy in the garden, and it should be a wake-up-call that jolts the Government from its slumbers. They need to rub the sleep from their eyes and reverse the lack of action on maternity services and galvanise the NHS. They are sleeping while mothers and babies are not getting the high quality care they deserve, while maternity services are crumbling and while midwives are working themselves into the ground.”

This is a wake-up call for the Government. All that I ask of the Minister is that she tell me what she and, indeed, the Government have been doing for the past 10 years. The problems that we are discussing are not news—they have been around for the past 10 years. Will the Minister therefore tell me what she is going to do about increasing the number of midwives and the percentage of the NHS budget that goes into maternity care? What is she going to do about giving women the choice that she has promised?

I congratulate my hon. Friend the Member for Leyton and Wanstead (Harry Cohen) on securing a debate on the important subject of maternity services in the NHS, and on his fortuitous timing. As always, he has put his finger right on the button. I appreciate all the comments that have been made and I congratulate all Members who have spoken. I particularly congratulate my male colleagues on showing such a remarkable interest in childbirth, as we knew they would, and on being so supportive of mums and families. Members have always held this issue in the highest regard because of its personal nature.

I congratulate the hon. Member for Cities of London and Westminster (Mr. Field) and I wish him and his family well. I should add, however, that the comments that he mentioned should not have been made about the NHS. There is great joy and happiness every day, hour and minute in the NHS and in the independent sector, although there are also tragedies in both sectors. It would be unfair of me not to acknowledge that the NHS is the safest place in this country to give birth, and that is well acknowledged and well recognised. In whichever sector someone chooses to have their children and the marvellous experience of childbirth, they should always expect safety. I hope that the hon. Gentleman will take the case that he raised to the trust and that there will be a satisfactory outcome, given that the care received by those involved appears, from his description, to have been totally unsatisfactory.

Last Friday, the Government announced the funding for maternity services for each of the next three years, which totals more than £330 million. That funding will ensure that mothers get the best possible care and are guaranteed a full range of choices. Trusts will have access to that additional money from April.

I shall deal with that if time allows.

Ensuring that all women and their babies and families receive high-quality, safe and accessible maternity care is a top Government priority. Of course, we have a rising birth rate, which always seems to be the case under a Labour Government—perhaps people feel safer and more secure in their employment and that their families will be cared for financially, so they continue to increase the size of their families.

The recent Healthcare Commission survey of mothers’ experiences showed that 89 per cent. of women are pleased with the care that they receive when they have a baby. That shows that there has been improvement since the survey of maternity services undertaken by the Department in 2005, when 80 per cent. of women said that they were satisfied with the maternity services they had received.

It is worth putting on record that, on publishing the findings of the maternity services review, the chief executive of the Healthcare Commission said:

“Being put in the least well performing category does not mean that a service is unsafe. If we believed any unit to be unsafe, we would take immediate action to ensure patients were protected. We would not hesitate.”

It is important that that be put on the record, because women and families will be watching this debate, and it is essential that Members on both sides of the House unite in saying that the United Kingdom is one of the safest places to give birth. That will have an impact on the recruitment of midwives, which is so important to us all. If a negative view is promoted that does not show the true picture of maternity services in the health service, that could have a knock-on effect on recruitment.

I therefore encourage all those Members who have participated in the debate and all those who have shown an interest at other times to help us work on work force planning with the Royal College of Midwives. The RCM is often quoted, and Dame Karlene Davis deserves to be quoted. As she has said:

“This review provides a good base to measure Trusts’ delivery of maternity services, and it is encouraging that over half of the Trusts are performing well.”

We must remember that this country remains among the safest in the world in which to give birth, and it is Dame Karlene’s members, as well as doctors, who provide the services.

My hon. Friend the Member for Carlisle (Mr. Martlew) congratulated Cumberland infirmary this morning, and I look forward to visiting there to acknowledge its work myself. My hon. Friend the Member for Stafford (Mr. Kidney) certainly supports his local service, and he has raised concerns about premature births. I am of course aware that the hon. Member for Banbury (Tony Baldry) will be giving evidence to the independent panel tomorrow, and it is fortunate to have him there. The hon. Member for St. Ives (Andrew George) mentioned a number of issues, but I shall need to write to him about them, given the time restrictions.

My hon. Friend the Member for Stroud (Mr. Drew) raised some important mental health issues. Following the publication of “Maternity Matters”, which also covered mental health issues, we should never underestimate the fact that although births go well for many mums and families, they can be a traumatic time. Some aspects of the mum’s mental health have been ignored in the past, and we encourage all commissioners to be very much involved in providing integrated maternity services, as part of the maternity mental health networks.

In the time that remains, it is important that I look at some of the other issues that have been raised. In my area, West Middlesex University hospital is part of the UNICEF baby-friendly scheme. My hon. Friend the Member for Stafford, among others, has worked hard on the issues of breastfeeding and a breastfeeding manifesto, and he should be congratulated on that.

There has been much change since I worked in the health service, and there was much change in the ’80s and ’90s, when closures were a significant aspect of meeting financial need. Today’s reconfiguration of many services, however, is clinically and locally led. Maternity units are special to their local communities. “Maternity Matters”, “Changing Childbirth”, which has been mentioned, and past Health Committee reports have all shown the great significance of change to the way in which we manage maternity care for mothers and babies.

The work of paediatricians and health visitors, which Members have mentioned, is very important, because there are still inequalities between families. We have heard reports today about how migrant mums have made a difference to some aspects of our maternity services. However, we should remember that we have a migrant work force in the national health service and that the NHS has provided excellent services throughout the years since its inception in 1948. As we go into the 60th year of the health service, we can be proud that we are the safest country in the world in which to give birth—much safer than America and France. We should be proud of those figures.

When things go wrong, it is important that clinical areas are monitored differently, because such experiences are totally unnecessary in today’s health service, and I look to local management and local leadership to put such things right. I also look to all Members to work with us in the next few months, when we will be ready to launch a bigger recruitment campaign. There is difficulty recruiting, but we must acknowledge that, look at the reasons why and put in every effort to change things. NHS London is certainly doing that, and I shall be happy to let Members know of the work that is taking place.

It is for all of us to raise concerns, but we should not be negative, because there have been improvements. We need to work together to ensure that we recruit and maintain midwives, and that we acknowledge and thank them for their continuing work. I thank my hon. Friend the Member for Leyton and Wanstead for raising such an important debate today.


I am very pleased that we are having this debate today, but sad about the situation facing the people of Gaza at the moment, which is nothing short of a humanitarian crisis. A very large number of people are living—or surviving—with shortages of medicines, food and water and with regular cuts in electricity supplies. Much of this was debated last week during the Westminster Hall debate on the Foreign Affairs Committee report “Global Security: The Middle East”. I am pleased that we can return to this subject today, because I want to put a number of specific points to the Minister.

As one who has had the good fortune to visit Gaza, on three occasions, as I told the Chamber last week, every time I go, I leave feeling that the situation is appalling, and each time we return, it appears markedly worse. I suspect that the situation now is as bad as it has ever been. Some very sad news was reported on all the media this morning. I quote from the al-Jazeera website:

“The United Nations Security Council has abandoned efforts to adopt a statement on the crisis in the Gaza Strip caused by an Israel's blockade after the US refused to support it.”

I would be grateful if the Minister could give us some hope of a possibility of returning to that matter and of the UN Security Council coming to an agreed position. It is more than sad that on an occasion as serious as this the UN is apparently unable to come to a decision.

For the record, Gaza is a 225 km² rectangle originally occupied in 1948 when large numbers of Palestinians were removed from what is now Israel and sent there. It has been a part of Palestine ever since. It is one of the most densely populated places in the world and requires a large amount of aid in order to survive. Its economy is dependent on the ability of Palestinians in Gaza to cross into Israel, where in the past they could work, and of those who produce manufactured goods or grow food on its small farms to export their goods. Traditionally, it has relied on fishing, which is now limited to a very small inshore area, where stocks have more or less disappeared as a result of over-fishing. They cannot fish anywhere else because they are surrounded by the Israelis.

Two weeks ago, the state of Gaza, which effectively is a prison under siege from the state of Israel, changed dramatically when a number of people broke down the wall at the Rafah crossing in the south and crossed into Egypt. The exact figure is unclear, but it is possible that more than 500,000 people—one third of Gaza’s population—have already crossed into Egypt. Furthermore, a large number of people have crossed from Egypt into Gaza, via Sinai and the Rafah crossing. There are many family connections on both sides of the border owing to the original connection between Gaza and Egypt. There are reports that Egypt will attempt to reclose the border between Gaza and Egypt, and if it succeeds, Gaza will once more become a complete prison, and it will be impossible for anyone to pass in or out.

It is very hard for us in this country to understand what it is like to live in what is effectively a prison. People cannot travel in or out; our only life would be television and computers, if we had electricity to turn them on, and watching the world through the internet. There is something deeply poignant about that. Having visited Gaza on a number of occasions, two of my most enduring memories are of talking to an elderly lady who described her life since 1948—all her children had either gone abroad or were in prison in Israel—and of talking to a group of young teenage girls, to whom I said, “What are your ambitions in life?”, to which they replied, “To visit Gaza city”. That was in Rafah. It is no distance at all, but they could not face the roadblocks. Their whole life was this very small dusty town in the southern end of the Gaza strip.

Israel claims that it is necessary to close off the Gaza strip because of rocket attacks made from the northern part of the strip into Israel. Every one of us in this Chamber will absolutely and unreservedly condemn those rocket attacks. We are not here to endorse such activity; it is completely wrong and I am not attempting to defend it in any way. However, I would point out that the casualty rate—deplorable as it is—of Israeli civilians killed by those rocket attacks is matched many times over by the number of people in Gaza killed by aerial bombardments, targeted assassinations and drones in the sky aiming to take out what are believed to be people preparing rocket attacks. The death rate in Gaza is very high, which obviously is terrible for the people of Gaza. The solution is neither the continued imprisonment of its people, nor the continued firing of rockets or bombardment of buildings in Gaza, but a political agreement that brings about some kind of justice for the people of Gaza and indeed all Palestinians.

When the Palestinian elections were held, first for the presidency and then for the Parliament, many international observers were present, including myself, my hon. Friend the Member for Birmingham, Northfield (Richard Burden) and other MPs. We observed the elections and could not honestly say that there was anything wrong with them. They were incredibly well run with unbelievable attention paid to the minutiae. The people of Gaza voted largely for Hamas, as was their right—in fact, Hamas won more than half the seats in the west bank and Gaza.

Last December, I received a letter from the Foreign Secretary, after he had promised to write to me following a question that I asked about members of the Hamas-led Palestinian Legislative Council. He pointed out:

“Since 28 June 2006, the Israeli Defence Forces have arrested 39 Hamas Palestinian Legislative Council members. Wasfi Kabaha, Nasser Al Shaer and Samir Abu Eisheh, all former Ministers of the then Hamas-led Palestinian Authority have since been released.”

The letter goes on to state that a number of them have not yet been charged and are still held in custody.

We cannot stand by and allow elected members of a fellow Parliament to be arrested and held without charge or trial in Israeli prisons. I am a member of the Inter-Parliamentary Union Executive, and every time we meet we discuss human rights issues facing fellow parliamentarians around the world. More Palestinian legislators are in prison than legislators from all the other Parliaments in the rest of the world put together. Surely that is cause for very deep concern. I hope that the Minister will tell us that serious pressure has been put on Israel to release those parliamentarians.

There is also a question about the strategy followed by the west since the Annapolis summit. We want peace and justice for Palestine. It seems that since the election of the Hamas-led Government there has been a process of denying Palestine aid and of refusal to recognise, negotiate or deal with Hamas, on the grounds that it does not unreservedly recognise the existence of the state of Israel. That is not to say that there are not elements in Hamas who want to hold negotiations and make some progress. However, the strategy of cutting off all links with Hamas, thereby cutting off all links with Gaza and acknowledging the Israeli sealing of the Gaza borders, is bringing not peace or justice, but a humanitarian crisis. It does not reduce support for Hamas either; in fact, it is probably having the opposite effect of increasing support for Hamas in Gaza. The reasons why Hamas won control in Gaza by elected means were first, they were not corrupt and secondly, they were delivering real social and health services for ordinary people. The Israeli strategy is clearly illegal under international law. Indeed, the UN representative there has said as much.

The question of settlements is a serious one. When Israel agreed to withdraw its settlements from Gaza, it reluctantly did so, but they were for the most part withdrawn. However, the number of settlements has increased on the west bank, and while the settlement policy is allowed to continue, settlements continue to grow and Israel is able to benefit economically through the exports from those settlements, which increases tension in Gaza and throughout the middle east. Unless something is done to force Israel to withdraw the settlement policy, we will have problems in the long term.

There are International Development questions later this morning, when I shall raise some questions on the Floor of the House, but my more immediate point is that by closing the area’s crossing point between Gaza and Israel, no goods can get through and no food can get in. By cutting off power supplies to the strip, there is unbelievable hardship within that area.

Last Saturday, a group of humanitarian organisations in Israel, led by the revered and highly respectable Uri Avnery of Gush Shalom, organised a convoy of relief aid that was collected by ordinary Israelis who were disgusted by the activities of their Government. Those people attempted to go to the area’s crossing point and take in the humanitarian supplies, but I received a message yesterday from Uri Avnery, who said:

“On Saturday the army representatives at the Erez checkpoint indicated that Monday our truckloads of relief would go through. We didn't rely on this vague promise too much but gave it the benefit of the doubt. After all, we also heard…that PM Olmert had told him personally that our relief would be let through. Meanwhile, Monday passed and the goods did not go through.

While we are still in negotiations with the army and busy mobilizing Knesset members we would very much want activists abroad to strengthen the demand of ‘Let the convoy pass’.”

They are also preparing a case to go the Israeli supreme court. His draft letter says:

“I am writing to urge you to authorize without further hindrance the entry into the Gaza Strip of the humanitarian goods carried in the convoy of Saturday 26”—



They have since been held up, and the convoy includes all necessities.

I also received a message from Mohammed El-Rantisi and his family. In an e-mail describing the situation he said:

“We struggle to secure the basics if we can, to light at night, to have bread, simply every thing in Gaza runs either on Gas or Benzene. Even going to work is a story as most cars stops. The elevator at work is not working and I have to go to the 5th floor in darkness walking. My father is suffering from a type of cancer, we cannot find his medicine. My daughter is suffering from low hearing and I would like to go to Egypt for a better treatment. I am in a better position than many other people. At least I have a salary at the end of every month.”

That means he is one of the less than 20 per cent. of people who are in work. He continued, saying that

“others do not have money, they lost their jobs because the raw materials are not permitted into Gaza. The unemployment reached about 80%. Patients in hospitals are in a real danger as electricity is cut so often and also medicine is not available. I was surprised when my kid Ahmed 5 years old asks ‘is there bags dad in Al Arish?’ His bag is torn!”

Ordinary life for those people has been destroyed, and something must be done about it.

I have some specific questions. Do the Government share the assessment that Israel’s blockade of Gaza amounts to collective punishment within the terms of the fourth Geneva convention? The Prime Minister stated in December that the UK would provide about £243 million in aid to Palestinians if the conditions existed for aid to have any impact. Has that aid got through? If so, will aid continue to get through?

The number of people killed in the Gaza strip since the Annapolis conference is 136. Some 360 have been injured, 76 have been arrested and there have been 415 Israeli military attacks on the strip. There are 1,500 patients who need treatment outside the strip, 322 who need urgent treatment and 470 cancer patients who are suffering. That is a dreadful situation, but it will be dealt with only politically. We need the utmost pressure to be placed on Israel to lift the siege, lift the sanctions and negotiate with Hamas. We also need progress. If the UN’s John Dugard says that he believes Israel is in breach of the fourth Geneva convention on the illegality of collective punishment, what is being done about it? Additionally, what sanctions are we prepared to impose on Israel?

My views are shared by many ordinary and decent people in Gaza and by humanitarian organisations throughout the world who want peace and justice. Are we to watch the disaster unfold before our very eyes on our TV screens, or shall we, politically, do something about it?

I congratulate my hon. Friend the Member for Islington, North (Jeremy Corbyn) on securing this important debate. I know how passionately he feels about the plight of the Palestinians, and that he understands the need for urgency and care in resolving the long-standing political and security problems that continue to generate the crisis in Gaza. He is right to describe it as a crisis.

The Government recognise the impact and scale of the problems and the need to address all of them. We understand the political and economic pressures that nurture and drive them, and that, for example, Israel has a right to defend itself against rocket attacks. I join my hon. Friend in deploring the fact that so-called rejectionist Palestinian groups—including Hamas, I am afraid—fire those rockets indiscriminately from Gaza, with the intention of killing and wounding Israeli civilians. However, in the course of self-defence, it is imperative that Israel remain committed to undertaking its obligations under international law. The United Kingdom continues to monitor the humanitarian situation in Gaza, and my right hon. Friend the Foreign Secretary has said clearly that restrictions on fuel supplies will not achieve Israeli security. He is dead right. Nor will the political aspirations of the Palestinian people be furthered by rocket attacks, so the United Kingdom urges restraint on all parties.

The humanitarian situation in Gaza is an immediate cause of concern for the Government. In statements made on 11 and 21 January, my right hon. Friends the Foreign and International Development Secretaries made clear our concerns. On 21 January, they said:

“We do not support Israel’s decision to close all crossings into Gaza, preventing the delivery of vital humanitarian supplies as well as fuel to the Gaza power station.”

Such restrictions have an impact on water and sewerage systems, both of which are powered by electricity generated from Gaza’s power plant. On 20 January, there was a blackout in Gaza—apparently owing to reduced fuel supplies.

We welcome Israel’s announcement that it will increase the amount of goods and fuel going into Gaza to pre-17 January levels, and we look forward to the resumption of normal operations of the crossings under Palestinian Authority control. Just two days ago, the Foreign Secretary, with his European colleagues in the General Affairs and External Relations Council, called for the continuous provision of essential goods and services, including fuel and power supplies, from Israel to Gaza.

I shall interrupt my contribution to answer the question that my hon. Friend asked about the UN Security Council resolution. I have not seen the wording of the initial draft, and I have certainly not seen the wording of the modified draft. My information is that all members of the Security Council except Libya had agreed to a text on Gaza. Libya made changes that were unacceptable to the United States, which was why the text fell. I shall examine the wording; my hon. Friend has been around a long time and he knows that words matters in such resolutions—people can become sensitive about them. I shall certainly try to find out what happened in the debate on the resolution.

Recent events at Rafah, where Palestinian militants smashed holes in the wall between Gaza and Egypt, have demonstrated yet again how incendiary the position is in Gaza. With his EU colleagues, my right hon. Friend the Foreign Secretary announced on Monday support for the Palestinian Authority’s proposal to take control of the crossings, and we support the efforts of the Arab League, particularly Amr Mussa, in that respect. The EU is ready to consider resuming its border mission at Rafah, which has been dormant since Hamas took over Gaza last summer, as soon as conditions allow.

I understand the overriding imperative for the Palestinian people and their supporters around the world to advance a political settlement that affords them the justice, security and democratic rights that the great majority aspire to, but there is also a need to ensure in the meantime that life and limb can be sustained throughout the crisis that my hon. Friend described. The United Kingdom remains committed to supporting Palestinians in Gaza. We have pledged £100 million over five years to the UN Relief and Works Agency, which works to provide essential supplies and services to Palestinians in Gaza. Last year, the UK provided £15 million to UNRWA and a further £1 million to the International Committee of the Red Cross for its work in the west bank and Gaza. Another £15 million reached Palestinians directly from the UK through the European temporary international mechanism.

We can give that vital help, but it will not solve the problem. It simply helps people to survive in the meantime. We must understand that Gaza is an integral part of any future Palestinian state. It is crucial that we continue to strive for peaceful progress in the region, and Gaza cannot be separated from that progress. As well as the continuation of crucial humanitarian aid, the international community, Israel and the Palestinians must work for a peaceful, political solution involving all Palestinian people.

We welcome the efforts to bring Gaza further into the peace process. The situation there was severely complicated by Hamas’s military takeover of the strip in June 2007, which caused the national unity Government to break down and led to Gaza becoming politically isolated. We continue to call on Hamas to adhere to the Quartet’s principles of non-violence, recognition of Israel and acceptance of previous agreements and obligations, including the road map. Those principles are not set unreasonably high, and they remain the fundamental conditions for a viable peace process. A political dialogue is impossible as long as one party is dedicated to violence and the destruction of the other. The option of engagement is in the hands of Hamas.

The best way to provide a long-lasting solution to the political, economic and humanitarian situation in Gaza is to secure real peace in the middle east. Our aim is to help the peace process be sufficiently robust to survive any setbacks. Since Annapolis, there have been major setbacks. The bedrock of our approach to the middle east peace process is still to give unstinting support for the principle of a two-state solution, to give every support to those who are committed to peaceful progress in the region, and to support economic and social development across the occupied Palestinian territories.

The Annapolis conference, which took place on 26 and 27 November, saw substantial political movement. Prime Minister Olmert and President Abbas committed to meeting each other fortnightly and agreed to a joint bilateral steering committee for specific negotiations. Both parties renewed their commitment to the road map, with the United States providing a much-needed monitoring mechanism. The Paris donors conference in December raised more than £7 billion in pledges for the Palestinian reform and development plan devised by Prime Minister Salam Fayyad, including a significant and welcome contribution from regional partners. As the single greatest contributor at Paris and also through the EU action plan, the EU has demonstrated its commitment to the process.

The Annapolis negotiations are continuing, as is the financial support for Palestinian reform and development that is crucial to a successful peace process. Those are significant breakthroughs, and the UK stands ready to support that progress, but there is a long way to go. Israel must display to the world that it is prepared to take and implement hard decisions to achieve its road map obligations on settlements. We consider settlement building anywhere in the occupied Palestinian territories illegal under international law, including Israeli settlements in both East Jerusalem and the west bank. Settlement construction is an obstacle to peace. We support President Bush’s view that there should be a complete freeze on settlement construction and that outposts should be removed. The Foreign Secretary has made clear our concerns on the matter to his Israeli counterpart, Foreign Minister Tzipi Livni.

The Palestinians, too, must step up their efforts to implement their road map commitments. A reformed Palestinian security force will continue to be the key to the success of the peace process. Militias and gangs that fire rockets and mortars indiscriminately at Israeli civilian targets must be prevented from carrying out their murderous activities by the Palestinians themselves. Israeli security and Palestinian hardship can be tackled only through a political process that creates an economically and socially viable Palestinian state, at peace with Israel. Those issues must be addressed together.

I appreciate the contribution that my hon. Friend makes. I assure him that we have exerted serious—as he put it—and consistent pressure on the Israelis either to charge the elected representatives of the people with a crime or to release them. He is right to pursue that point; the situation is unacceptable and does nothing for the reputation of Israeli democracy. We call on all sides to take the crucial measures, clearly set out in the road map, that will lead to peaceful co-existence between two viable states. I urge my hon. Friend to continue his work on the matter. I shall continue mine, and between us we will try to take a balanced approach that will bring relief to the people of Gaza and sustainable peace to the middle east in the near future.

Sitting suspended until half-past Two o’clock.

Hospices (Funding)

You will be deeply saddened to hear, Mr. Williams, that hospice funding is compromised. Unless action is taken, it will need a life support system. We all know that hospices provide high-quality, innovative care and that their services are free to patients and their families. The NHS has a commitment to providing palliative care to people with life-threatening illnesses. However, charitable hospices play a vital role by providing 80 per cent.—that is four out of five—of the UK’s adult in-patient palliative care beds, as well as important day care services and care in people’s homes. Every UK hospice has to raise, on average, £4,500 a day to provide that care, and £500 a day to maintain and develop their buildings.

The hospice service is growing, but the percentage of annual expenditure funded from Government sources in England has been falling for the past three years. It is now 32 per cent. for adult hospices and 4.5 per cent. for children’s hospices, which are a different case. We can see the results of that fall: in 2005, 43 adult hospices in England were in deficit, whereas a year later that figure had risen to 52. Members will be deeply concerned about that, and no doubt we will hear about specific cases from the excellent Members who are present. Clearly, we need to understand what is happening and to find sustainable solutions. Hospices need to redouble their efforts to secure charitable funds, which are under increasing pressure in the current economic climate, but we must also take action on the provision of public funding.

Like many Members, I should like to pay tribute to the excellent care that hospices provide. I refer in particular to the Earl Mountbatten hospice on the island. It needs £3 million a year to continue providing the excellent care that it provides. Many of my constituents go to great lengths to raise funds for it. Last year, 5,000 people walked the Wight, which is more than 26 miles, raising more than £200,000. Does my hon. Friend agree that hospices such as the Earl Mountbatten provide an invaluable service?

I anticipated correctly that Members would want to talk about their local hospices in this debate, and that is absolutely right, as there are some fantastic hospices around the country. I know that my hon. Friend has not only fought consistently and diligently for his local hospice, but has supported the hospice movement nationally, and I commend him for that.

The whole House will want to pay tribute to the hospice movement, including staff, volunteers and fundraisers. They are all stars and all deserve recognition for their efforts on behalf of people who are going through an unbelievably traumatic time.

I congratulate the hon. Gentleman on securing the debate. I think that there is unanimity on the contribution that hospices make. We want more to be spent on hospices and for them to have a more secure future. I shall talk about that later. Does he accept that we need to consider the amount that has been invested in hospices in the past few years, which has increased, and the amount by which we want to increase it, rather than talking about the overall share of hospice funding? The share of funding depends entirely on the amount of money that hospices might have raised through charitable and other means. It is therefore slightly misleading to compare the share of overall resources.

I accept what the Minister says, and he will make his case in his own way. However, I add that we have to consider whether the outputs that hospices deliver are appropriate and whether those that are met by the public purse are correct, auditable and delivered properly. We need to understand that the demands on hospices are increasing all the time because people are living longer and choosing better ways in which to end their lives—I know that the Minister agrees with me on this—so hospices might spend more money and replace more of what should be done in the NHS. They should be recompensed for that.

People go through an unbelievably traumatic time during their own death or the death of a family member. It is only those who go through such times who can really understand it. My beautiful sister Yvonne passed away just before Christmas, and her funeral, in Bradford, spoke volumes: it was attended by 800 people. She was a star, a wonderful mum and a great youth worker at her local church, hence the big attendance at the funeral service. She had been a district nurse for 30 or 40 years in Bradford, doing superb work, and she was just the same age as me. So, I do understand what families are going through when they have to fall back on hospice services.

I am grateful to Mr. Speaker for selecting this debate and to Members present for coming along and supporting it. I am particularly grateful to Havens hospices in Essex, whose representatives are here in force today, and to Help the Hospices and the UK hospice movement for providing me with information. There is no party political edge to this debate. The Government have made remarkable efforts to support hospices, and the Conservative Front-Bench team rightly sees hospice funding as a priority, so I warmly congratulate both sides. No doubt the Minister will set out the Government’s achievements later.

I shall give way to the hon. Gentleman, who has always been a great supporter of the national hospice movement and his local hospice.

I am grateful for that comment. I declare an interest as a member of the Hospice Hope campaigning organisation in North-West Leicestershire. The hon. Gentleman said that there is no party political edge to this debate, and there really is not, either in this place or in wider Parliament. Does he agree that hospices, particularly children’s hospices, are so embedded in the emotions, culture and lives of their local communities that they get huge and widespread support? The Rainbows children’s hospice in Loughborough, which serves the whole of the east midlands and south Yorkshire, is currently seeking to raise £4 million under its building for the future appeal. The local radio station, Radio Leicester, which is in its 40th year of operation, set itself a target of raising just £400,000 for that appeal, but it soared past that target and the £500,000 mark and is now almost at £600,000 as the appeal year ends. That is a measure of the support for hospices and children’s hospices, and I am sure that the Government will want to reflect on that. What they did a few years ago in giving a short-term boost was very popular electorally, and could be so again.

The hon. Gentleman is right to raise the issue of children’s hospices, which are a very special sector of the hospice movement. It is much more difficult for the adult sector to raise funds. Donations and legacies to the adult hospice sector provide only 52 per cent. of adult hospice funding, whereas in the children’s sector they provide 79 per cent. Clearly, there is a difference, which the hospice movement wants to resolve.

In the early 1990s, the children’s hospice movement started to emerge strongly in this country, and the Little Havens hospice was built in my constituency. Children’s hospices are different from adult hospices in many ways. However, both share the ethos of providing care during terminal illness and through bereavement, and of treating the whole person, addressing their unique physical, emotional and spiritual needs, as well as supporting those who love them. In addition to providing palliative care, they dispense cheer, optimism and fun in equal amounts. In the early 1990s, I secured the first debate in the House specifically on children’s hospices, in which I highlighted funding issues. Since then, Little Havens has become an outstanding exemplar of all that is worthy and wonderful about all UK hospices. It serves a wide area and is much loved. It is part of the Havens hospice group, which includes Fair Havens in Westcliffe. Our local hospices are equally cherished, and we must ensure that they are equally well funded.

I shall just finish this point. I very much welcome the Essex Havens hospices initiative, which includes and overarches Fair Havens and Little Havens and brings them together. They are not in competition; they are equally wonderful and worthy.

I declare an interest, in that I am a patron of Julia’s House, which is a children’s hospice in my constituency. Its chief executive is concerned about Government funding from March onwards. Does the hon. Gentleman agree, bearing in mind all the wonderful work that hospices do, that such great uncertainty—right up to the wire—makes their work more difficult than it ought to be?

The hon. Lady is extremely wise. She works in this area, and anticipates a point that I shall come to shortly.

Over the years, I have made many interventions and held debates on hospices. Last year, I took the Association of Children’s Hospices and the indefatigable Andy Smith of Little Havens hospice to see Tony Blair. The then Prime Minister was magnificent. He tossed aside his bureaucrats’ objections and gave the £27 million that we requested to fill the three-year funding gap that had emerged for children’s hospices. He set up a review of funding not just for children’s hospices but for the whole children’s palliative care sector, which supports some 20,000 life-limited children and their families each year. His courage and decisiveness were remarkable.

Subsequently, during business questions, the Secretary of State for Justice and Lord Chancellor, who was then Leader of the House—a great man, indeed—promised me a debate in Government time on this issue. It will cover the review set up by Tony Blair, the new Government strategy that has since been developed, and the solutions needed to protect the children’s hospice movement’s voluntary ethos while protecting the public purse. It will also cover how we can ensure that statutory sector providers such as the wonderful Diana teams are not driven out of existence for lack of funding. The new strategy must deliver fair play in funding for children’s hospices, and for the children’s palliative care sector as a whole.

I understand that the strategy has been finalised, yet no date has been given for its launch. I urge the Minister to reassure the House today that the strategy will be launched without further delay. Equally, can he state exactly how much money has been made available from the Department of Health to primary care trusts for short breaks for disabled children, which children’s hospices provide, and for children’s palliative care in general? The Department for Children, Schools and Families has stated that it is giving more than £280 million to local authorities for this purpose, and we believe that the Department of Health may have matched that funding, but we do not know. As yet, nothing has been confirmed. May I ask the Minister to tell us today—or, if he cannot, to write to me later—how much PCTs will actually get?

It would be wonderful if, starting today, we could see much-needed major funding increases for adult hospices. Let me give some general background. Hospices and palliative care were started by the superb and innovative British voluntary sector, which characterises Britain and helps make it great. Volunteers contribute massively to the hospice sector, which would not exist as it does without them. The Government now have a commitment to providing palliative care, but hospices have never, under any Government, been fairly funded for the services that they deliver. Hospice funding is locally negotiated on an annual basis with PCTs, so funding varies widely across the country and often changes from year to year. That makes it difficult for individual hospices to plan future services.

The Government have agreed that voluntary organisations that deliver public services should be paid the full cost of providing those services, including a proper overhead element. That goal was to be met by April 2006 but it was not achieved, and it is still not clear how the Government will ensure that PCTs deliver on the promise.

The Parliamentary Secretary to the Cabinet Office, the hon. Member for Corby (Phil Hope), replied to my parliamentary question of 21 January. He stated:

“It is legitimate for third sector organisations to recover the appropriate level of overhead costs associated with the provision of a particular service. Third sector organisations are not expected to deliver a public service contract for which they are not reimbursed on a sustainable basis. We recognise the added contribution that some third sector organisations bring over and above the core requirements of public service contracts, for example, through the use of volunteers.”—[Official Report, 21 January 2008; Vol. 470, c. 1545W.]

That certainly applies to the hospice movement.

Despite Government commitments to a level playing field for organisations that deliver public services, charitable hospices face extra costs that statutory providers do not. There is no mechanism to help hospices meet staffing costs or regulation costs such as Healthcare Commission fees. I ask the Minister to agree today that he will review the practice by which charitable hospices are charged the same amount of regulation fees as NHS or private sector health care providers. I hope that he will challenge the health care commissioner’s decision, which is patently unfair. Hospices cannot recover the cost but other organisations can. Hospices raise cash to care for terminally ill people, and, in so doing, take a massive burden off the state. It is rubbing salt in the wounds for the state then to demand payment from the hospice sector for the privilege of delivering that service and taking that burden off the state. A bit of joined-up government is required, and I am sure that if the Minister can—he may have constraints—he will look at that. The NHS does not pay regulation fees out of its budget, and the private sector can and probably does bill its clients in full for its regulation costs. I hope that the Minister will give an undertaking on that.

From 2008-09, fairer funding for palliative care was to be achieved through payment by results. That system should be based on agreed national costs for specific services. It should be auditable to protect the public purse, and it should ensure that hospices are paid for providing services. However, the timetable for implementing the system is no longer in place. While hospice funding will be considered as part of the Government’s forthcoming end-of-life care strategy, it remains unclear how the Government will meet the cost of care provided by hospices on behalf of the NHS. I respectfully ask the Minister to clarify the policy on that.

I shall try to rush through, Mr. Williams, as many Members wish to speak. The public cherish our hospice movement, as I know you do, sir. An independent survey found 97 per cent. satisfaction among people whose loved ones had received hospice care. Would that the NHS had such satisfaction levels, although I praise and congratulate the hard-working and dedicated doctors and nurses in the NHS.

May I quote The Guardian—I do not often do that—of 9 April 2007? It stated:

“An Ipsos MORI poll commissioned by the charity”—

Help the Hospices—

“found more than three-quarters of respondents said the government should pay at least half the cost of hospice care.”

I accept what the Minister said about arbitrary and unfair funding and not protecting the public purse. We have to find a formula to provide funding on a rational and fair basis. The quote to which I referred continued:

“But adult hospices in England receive on average just a third of their costs from the government, with some receiving much less. Most are suffering a real-terms cut in funding.”

Let me cut to the bottom line. Hospices are not asking the Government to meet all their costs, but just to give fair payment for services that the NHS would otherwise have to provide. As the current Prime Minister promised when he was Chancellor—he made the promise to me personally—

A great man, yes. I am tempted to bring in other promises that the Prime Minister made. The European Union debate is going outside this place.

The gap between what hospices in England spend on NHS patients and what the NHS contributes is estimated to be £150 million to £200 million a year and it is widening, according to the National Council for Palliative Care’s submission of 1 August 2006 to the end-of-life care strategy. The Government have indicated that they will undertake funding for hospices as part of the end-of-life care strategy announced in July 2006, but we still need to see the colour of the money. We need urgent action to ensure that hospices, which are now sinking faster and deeper into deficit, can at least maintain current levels of service. We do not want to see cuts. We must all accept that the services that hospices provide will probably grow in future, and that is what we want to see.

There can be no doubt that the hospice movement needs Government action now. The Government must provide full, fair and nationally consistent payment for the care that is delivered by charitable hospices on behalf of the NHS. They must ensure that future funding arrangements are flexible enough to enable hospices to provide high-quality sustainable services, whether in a hospice building or in the patient’s home. The Government must continue working with all palliative care providers to determine how they will meet the costs of core hospice services, as part of their commitment to patient choice at the end of life and as part of the anticipated end-of-life care strategy.

We would like to see the Government back their commissioning guidance with stronger enforcement to ensure, for instance, that PCTs always offer hospices funding contracts for at least three years, that funding is agreed before the start of the financial year, and that payments are met on time to enable financial planning and security and to prevent cuts.

I am grateful to my hon. Friend for giving way. I apologise to him and to you, Mr. Williams—I am involved in the debates in the main Chamber on the energy elements of the Lisbon treaty, so I am just nipping in to make a point and then nipping out. I mean no discourtesy and I hope that other Members in this Chamber will understand what I am trying to do.

I support my hon. Friend, particularly regarding the point that he just made about primary care trusts supporting hospices. I hope that the South East Essex primary care trust will do more to support Fairhaven hospice, which is local to my hon. Friend and to our colleague, my hon. Friend the Member for Southend, West (Mr. Amess). Fairhaven is an important hospice that does good work. I hope that the PCT will take that into account, even though it is under financial pressures of its own, in helping that hospice to do so much good work for people who so desperately need its help.

I am grateful to my hon. Friend and parliamentary neighbour for supporting this debate. We had a meeting with our local hospices just a week ago, and we both know about the superb work that they do locally. I will come to that in my concluding remarks.

I hope that the Minister will agree to meet a delegation from the adult hospice movement to discuss these issues and share a cup of tea. I suspect that he will; he is a highly distinguished Minister and a caring man. After I have said that, he can hardly deny me the meeting. We must ensure that solutions continue to be developed to the adult hospice funding problems, just as we are doing for the children’s hospice sector.

I thank Members for their patience in listening to me today and for their support, and I thank all those who work with or raise funds for the Havens hospices in Essex, which my hon. Friend the Member for Rayleigh (Mr. Francois) has just mentioned. He will agree that they are all true stars.

Order. I remind Members that we intend to start the wind-ups at 3.30 pm. I therefore appeal for contributions to be brief.

First, I congratulate the hon. Member for Castle Point (Bob Spink) on securing the debate. He and I do not always agree, but on this issue I fully support him and the comments he made during his contribution. He must be congratulated on his sustained and powerful advocacy on behalf of the hospice movement.

I wish to recognise the wonderful work of the hospice movement in general and specifically the work of the staff both at St. Ann’s adult hospice and at Francis House children’s hospice. I am conscious that time is limited so I will mention only St. Ann’s adult hospice, but my comments apply equally to Francis House children’s hospice.

I welcome the Government’s investment in hospices, including the recent £50 million for refurbishment, and for their end-of-life care strategy. However successful our preventive health strategies may be, there comes a time when we have to deliver for the people both the choice of where, and the way in which, they die. That is vitally important for those of us who have gone through the hospice system with our loved ones who have come to the end of their lives. It is only when we go through that process personally that we fully understand just how wide and deep the provision is in the hospice movement. That applies not only to the patient—the person coming to the end of their life—but to other family members’ experience of a hospice, which is equally important because it sets the attitude of families about the hospice movement and the contribution that it makes to health and end-of-life care. The hospice movement helps to deliver dignity and respect and a death that is as pain-free as possible. That is a significant challenge for any health care provider.

Although many people express a preference to die at home, we all know the high regard that patients and relatives have for our hospices, which are a source of expertise and solace. They offer outreach work for those who are dying at home and they also offer training, both of which are greatly valued.

I would like to mention the work done by St. Ann’s hospice and I am sure that my neighbour, the hon. Member for Cheadle (Mark Hunter), will also support it. He has actively provided excellent support for the hospice movement, particularly St. Ann’s. I try, in my own way, to help co-ordinate information going to all Greater Manchester MPs from all parties. Although this is a very political issue, it is a non-partisan one.

St. Ann’s hospice, under the excellent stewardship of its chief executive, Terry McDonnell, serves my constituents and all residents of Greater Manchester. St. Ann’s is one of the largest adult hospices in the UK with 60 in-patient beds. Although cancer-related conditions account for about 95 per cent. of all hospice admissions, St. Ann’s services are available to patients with any life-threatening illness. The hospice provides care free of charge to more than 3,000 people each year across three sites. Some 42 per cent. of patients admitted to St. Ann’s Hospice return home after treatment. Patients are involved with their personal plan of care, which is tailored to meet their needs.

St. Ann’s was voted the second-best company to work for in Britain in 2005—not only the second-best hospice—and has been listed by The Guardian as one of Britain’s top employers in 2007. On my regular visits to St. Ann’s I am always struck by the dedication and expertise of the staff and the atmosphere of serenity and, perhaps strangely, conviviality, experienced by my family and others.

The hospice movement leads the way in palliative and end-of-life care. It needs more Government assistance, but it must remain independent to be free to develop innovative practices from which the NHS can learn and benefit. Like other hospices, St. Ann’s needs to raise £16,000 a day, every day, through voluntary contributions to offer its wide range of services. It costs £8.75 million to run the hospice annually and 35 per cent. of that comes from the Government. More than 80 per cent. of every pound of its income is spent on patient care. Good quality care does not come cheap. For example, £97 pays for one out-patient session; £63 will cover the cost of one session with a bereavement counsellor; £265 is the cost of looking after an in-patient for one day; and it costs £500 to run one of the hospital’s ambulances for two months.

Briefly, there are still problems. I congratulate the Government, as Opposition Members have done, on the improvements that they have made. However, my constituent, Frances Green, lost her husband Denis recently. She knew that he was dying and had to be taken to St. Ann’s hospice. St. Ann’s tried to get an ambulance to take him from home to the hospice but could not, so the family had to ring the normal ambulance service and explain that the hospice required him to be taken there. For them to be told that there would be no ambulance available from the time they phoned, around 1 pm, until 12 midnight is unacceptable. We must look not only at the hospices, but at the surrounding services that families need to call on.

Needless to say, St. Anne’s is as inventive as anyone in raising funds, but it believes that the Government should give more money to hospices, and I support that view. Our hospices offer a wonderful service, but they could do even better if they knew that their funding was secure, and could channel all their energy into delivery of care for patients and their families. The way in which we treat family members of someone who is receiving end-of-life care and palliative care is a measure of our society and decency. I know that the Government, particularly the Minister—we have been together to the Rainbow Trust and other hospice movement events—are sincere. We must turn that sincerity into an identification of how we can improve the situation and the relationship between the hospice movement and families, and the hospice movement and the NHS. I hope that the Minister will listen carefully to the points made by the hon. Member for Castle Point, and I hope that he will address the issues that I have raised. I know that he will try to do so.

I congratulate my hon. Friend the Member for Castle Point (Bob Spink) on securing this timely debate, and I agree with everything that he said. I am delighted that my hon. Friend the Member for Rayleigh (Mr. Francois) was able to intervene. My hon. Friend the Member for Rochford and Southend, East (James Duddridge) would have been here, but his wife has just had a baby, so I am sure that hon. Members understand why he is not.

No hon. Member this afternoon will say that hospices are not wonderful, and the Government think that they are wonderful. All that is understood, but I want to ask the Minister for something. There is no point in hon. Members having Adjournment debates if we just read out our speeches and send out press releases, and they are then forgotten about. I like Adjournment debates that achieve something tangible. I achieved something tangible when I raised the subject of St. Luke’s hospice on 24 May 1985. The then Minister who responded, now Lord Patten, listened to me and delivered.

The Minister will gather that there is a particular crisis in funding in Essex, which I raised in a pre-Christmas Adjournment debate. The conscientious deputy Leader of the House referred the matter to the Secretary of State for Health, and a letter arrived from him two days ago, which I am pleased with. However, as the Minister said during his intervention, the answer is: “Yes, the Government support hospices; yes, the Secretary of State is getting more money from the Treasury, but at the end of the day it is down to the primary care trust.”

I am looking the Minister in the eye and saying that that is a cop-out. The Government say that they are giving more money to the primary care trust, which is responsible for deciding how it allocates it, and that is technically correct. I ask the Minister to listen to what I and other hon. Members have said, and to give a message, at least to my primary care trust, that it should be supported and receive more share of the cake. I am sure that if he gave that message, my local primary care trust would listen to it.

Dame Cicely Saunders was responsible for developing the hospice movement in the 1960s at St. Christopher’s hospice in south London. That inspirational lady said that

“you matter to the end of your life. We will do all we can not only to help you die peacefully, but also to live until you die.”

Until I became a Member of Parliament, I had no experience of the hospice movement. I witnessed a miracle in Basildon, because we had a plot of land and we built a hospice with no wealthy benefactors and no largess from this Parliament or the European Parliament. The Duchess of Norfolk opened it—

—and Princess Diana came to launch a strategy that we enjoyed in the hospice. St. Luke’s hospice in Basildon has become an enormous success.

My next point for the Minister is that the role of hospices has changed enormously. They are no longer add-ons. They provide core services.

The hon. Gentleman is absolutely right. The service has developed to include day care, essential respite care, which is the most crucial of all, and terminal care, for which hospices are well known. Because of the value that hospices provide, we should be close to the last days of their finances depending on weekly raffles, cake stalls, and collecting tins. Important as those are, they should not provide core funding; they should provide add-ons to improve the quality of service, not the fundamental day-to-day, week-to-week funding of £50,000 a week that the Rainbows children’s hospice in Loughborough needs merely to survive. That must not be allowed to continue.

The hon. Gentleman, as always, makes an excellent point. Fair Havens hospice in my constituency receives 72 per cent. of its funding from charitable giving, which is huge. The hon. Gentleman also made an excellent point earlier about children in hospices. We found locally that everyone will give to children’s hospices, but it is a great struggle at the moment to raise money for hospices for older people. I represent the area with the most senior citizens in the country, and we have a particular crisis.

To return to the point that I want to make to the Minister, I have spoken about St. Luke’s hospice in Basildon. He could not resist making his little gibe, but I just smiled broadly at his little joke. When I became the Member of Parliament for Southend, West, I was delighted to find that it already had a hospice—Fair Havens—which was founded 25 years ago by Dr. Michael Stuart and Mrs. Daphne Hall, two wonderful people. But 25 years on, it can no longer survive just on charitable giving. We have a real crisis.

The range of services is first class, as was the most recent Healthcare Commission inspection report. Fair Havens provides day care, community Macmillan nursing, home care, spiritual and pastoral support and diversional therapy treatment. When I think of those heady days in Basildon, I remember the founder of St. Luke’s hospice. Trudy Cox was a district nurse who, when out nursing once day, went into a lady’s bedroom and found her dead with the children gathered around the body, not even realising that their mother had died. She resolved that she would never, ever allow anyone to die in such circumstances again. That is why she became so involved with the hospice movement, as did Cicely Saunders.

We have a crisis of funding. I have any number of testimonies to Fair Havens hospice’s wonderful work in Southend. It costs £2.6 million a year to run with only £600,000 provided by the Government. During 2007, Fair Havens has experienced progressive difficulties in fundraising. I am not being party political, but the worldwide economy is in difficulty, so we are finding that it is not as easy as it used to be to raise money locally, and that trend will continue.

The hospice receives a sizeable grant from the primary care trust, but it simply is not enough to cover costs. Fair Havens will experience a funding deficit of £250,000 in the period to 31 March 2008 and another £250,000 shortfall soon after, bringing the total deficit to £500,000. Although the funding that it receives from the PCT has increased by 8 per cent. in cash terms over the past four years, that funding has decreased by 6.8 per cent as a proportion of total care costs.

The reasons for that are clear: increased demand, the negotiated contract with doctors, increasing salaries for nurses—a number of things have added to the financial crisis. At a time when Fair Havens has been increasing its services and stepping in to help plug the gaps that have been opening up in the publicly funded sector, it has suffered a real reduction in its funding from the PCT. Staff costs, have risen from £135,000 a year and will reach an anticipated £243,000 this financial year, which is an 80 per cent. increase. Without the staff, one can hardly run a hospice.

If the situation is not addressed, the number of beds at Fair Havens will have to be cut, the at-home service will be halted, the hospice’s Macmillan nurses will find that they cannot be employed and the bereavement and family support services will also have to be cut. The hospice immediately launched a funding campaign and is trying to raise £250,000 by 31 March. The appeal has raised £32,000 and hopes to raise £100,000 by Valentine’s day, and all local Members of Parliament will be supporting it.

To conclude, I repeat that there is no point hon. Members having an Adjournment debate if we simply smile at one another and share platitudes, but nothing happens. I ask the Minister please to send a message to my local PCT asking it to support Fair Havens hospice.

It is a particular pleasure to serve under your chairmanship, Mr. Williams. I pay tribute to the hon. Member for Castle Point (Bob Spink) for securing this important debate. I know that he feels strongly about the issue and has a fine record of campaigning on it.

When I looked at the World Health Organisation’s definition of palliative care, I was struck by the size of the issue. The definition referred to

“the active total care of patients whose disease is not responsive to curative treatment. Control of pain, of other symptoms, and of psychological, social and spiritual problems, is paramount. The goal of palliative care is the achievement of the best quality of life for patients and their families.”

In practice, that involves a huge range of services, including occupational, physical and complementary therapies, as well as core medical services. It is a vast area, but care, by its very nature, must be tailored to the needs of individual patients, their families and carers.

In discussions with the hospice movement, all hon. Members will be clear that there must be a partnership between the national health service and the hospice movement. The movement strongly feels that it is best equipped to deal with the innovative practices that we need to develop, and I shall come later to how that work will be resourced.

Let me start, however, by paying tribute to the hospice movement, which has been at the forefront of developing special services and raising the profile of the care given to the dying. In my constituency, we are privileged to be served by the charity Beacon of Hope, which was set up in 2000 by Mrs. Elizabeth Murphy. The charity provides immediate comfort and ongoing practical support to people in Ceredigion with terminal and life-limiting illnesses. It subscribes to an holistic package of care, which complements nursing care and supports carers, and includes a volunteer service to help with respite, which is crucial, as the hon. Members for Castle Point and for Eccles (Ian Stewart) said. The charity also provides bereavement counselling and runs a limited benevolent fund.

Mrs. Murphy told me that the problem facing Beacon of Hope—the experience of many hospices across the UK—is that a range of possible funders will not fund capital or revenue costs. When asked what they fund, people say “Projects”, but projects must surely involve a capital or revenue-cost dimension. Other funding streams, such as the lottery, are laudable, and I do not denigrate them in any way, but they have often changed their criteria for awarding grants. Some changes have hit hospices hard and caused immense frustration in the sector. Beacon of Hope secured a three-year voluntary community and sector grant of nearly £250,000 from the lottery, but that has now come to an end. The lottery’s criteria have changed, and funding now comes through the people and places programme, which has new criteria, based on revitalised communities, improved community relations and enhanced local environments. That has not helped the charity to secure the kind of funding that it requires.

I was slightly surprised when the hon. Member for Castle Point talked about the proportion of funding that he was looking for, and I understand what the Minister said in his intervention. In the Welsh context, Beacon of Hope wants core funding in the region of 50 per cent. and is confident that it can continue to raise the sums it requires from its local community.

I was trying to say that there should not just be an arbitrary percentage. The figure might be 40, 50 or even 70 per cent., but the point is that there should be funding from the public purse for the core services that the hospice sector provides and that the NHS would otherwise have to provide.

I am pleased that the hon. Gentleman made that point, particularly given that some charities are looking for an upper threshold.

The sad reality for adult hospices in Wales is that only 36 per cent. of funding comes from the Government, and I gather that the figure is little more than a third for hospices in England. Beacon of Hope’s running costs next year could amount to £400,000, not least because there is renewed demand for its work, which it hopes to expand much further.

That is not a criticism of the Government—I applaud what they have done, in so far as they have done something—but Government policy in Wales has been characterised by a series of not insubstantial yet, critically, one-off announcements that have not addressed core funding. Last October, funding of £2 million was announced and £10 million was announced in 2003, but the kitty is very limited and will not address concerns such as those expressed in Essex, which the hon. Member for Southend, West (Mr. Amess) mentioned.

I want to draw a distinction between hospices in urban and rural settings. Alarmingly, a 2005 report dealing with mid-Wales identified no palliative care service that met the definition of specialist levels of service across the whole of Powys and Ceredigion. That shortfall is now being partly met by charities such as Beacon of Hope and by the excellent Ty Geraint facility at Bronglais hospital in Aberystwyth, which was named after one of my predecessors in the House, and provides some palliative services.

I want to focus, however, on the challenge of providing hospice services in a rural area. The hon. Member for Eccles talked about the outreach work of St. Ann’s in his constituency, but outreach work is hospice provision in rural Wales. Mrs. Murphy of Beacon of Hope told me that it is highly unlikely that there would ever be one dedicated building to provide services in a big rural area such as Ceredigion. Schemes such as the charity’s palliative hospice at home service are much more responsive to the needs of community, and it is for such services that the charity needs its core funding. Beacon of Hope has recognised the importance of those services and last year set up a three-month pilot scheme, with two contracted nurses and 10 bank nurses responsible for 350 hours of care in some of the most remote rural communities that one could imagine. That is very important in areas such as mine.

As hon. Members have said, we are talking about lifting the burden from the national health service, which is why core funding is so important. In Wales, as in England, a review is being undertaken. The palliative care planning group set up by the Assembly is looking into the issues.

Thank you, Mr. Williams. It is particularly appropriate that you should remind me of that. I was complimenting the experience of Wales and its interface with England. The message is the same. From whichever side of Offa’s dyke we function, the issue is much more than the laudable shaking of collection tins on street corners; the need for core funding is something that Governments on both sides of the border must address. I wish the reviews the best of luck in both England and Wales.

I congratulate the hon. Member for Castle Point (Bob Spink) on securing the debate, which highlights the real and valuable work that hospices undertake. I am aware that the hon. Member for Cheadle (Mark Hunter) is anxious to contribute to the debate as well, so I will be brief.

I want to highlight some of the difficulties that are faced by people who carry out valuable work, and in some cases good Christian work. The Bethesda care home and hospice in Stornoway on the Isle of Lewis is one such great example. It is a charitable institution that provides excellent and conscientious care. Based in the heart of the community, the hospice raises a lot of money locally for its vital work. I would not be surprised to hear that relatives of the Chancellor of the Exchequer, whose mother lives on Lewis, had benefited from the hospice’s professional compassion. The funding and the services provided by the care home and others like it help the Government. Unfortunately, the help is not always reciprocated, although I am sure that is something the Government will try to rectify in the best way they can. I see that I have the Minister’s attention on that point.

To meet the requirements of new legislation, the already excellent Bethesda care home and hospice has to upgrade its facilities and build an annexe, for which, unfortunately, it has to pay VAT. Although the institution already reduces the burden on the state, it will have to pay an extra £94,000 as the construction takes place. It has to pay VAT because there has been no decision from the relevant VAT office. I have a letter from the Financial Secretary to the Treasury, which starts, “Dear Angus” but then vacillates a little about the decision. In the last paragraph, as far as I and the chief executive of the hospice can make out, the Treasury seems to indicate that zero VAT would be appropriate.

Surely, when tax collectors vacillate, there is no case for raising the tax at all. The current indecision is costing £94,000, which should be used for patients. Worse, it will not be possible to claim or debit the VAT through the contractor, and the hospice will have to go through the long and tortuous process of VAT reclamation, if it is determined that zero VAT is the correct decision.

Should charitable institutions spend money, which has been raised through hard work and community good will, on VAT? I urge the Minister to use his powers and influence to push for the correct decision. We cannot continue with the current limbo that is costing us so much money. It is a scandal that such charitable institutions have to pay VAT. I am not asking for changes in VAT designations, I simply want to ensure that Bethesda is in the correct classification.

We do not want Bethesda to be taxed to a standstill. We want it to continue its good work. The hospice is valued in my constituency of Na h-Eileanan an Iar and provides a tremendous service on the Isle of Lewis. I commend it to all hon. Members as a great example of what can be done when the will is right. I hope that the will of the Government—the Minister is nodding—is to achieve a zero rating and to help the hospice continue its good work.

It is pleasure to contribute to this debate under your chairmanship, Mr. Williams. I congratulate the hon. Member for Castle Point (Bob Spink) on securing this important debate on hospice funding. I would also like to thank him for being one of the first MPs to sign my early-day motion, tabled last year, on St. Ann’s hospice in Heald Green, in my constituency. This issue is very close to my heart and I and other Members feel very strongly about it.

I have visited St. Ann’s hospice on many occasions and have seen for myself, in both a public and personal capacity, the truly exceptional work that hospices do and the difference that such provision makes for those in need of palliative care and their families. I continue to be genuinely shocked by the lack of Government support for all the hospices that play such a vital role in the national health service. Despite Government assurances that the voluntary organisations that deliver public services should be paid the full cost of providing such services, hospices still receive, on average, only one third of their total costs.

St. Ann’s is a case in point. As the hon. Member for Eccles (Ian Stewart) pointed out, it receives only £3 million out of the £9 million that it needs each year, so it has to find the other £6 million itself. That equates to a whopping £16,000 a day. Surely the Government want such hospices to spend more of their time providing the excellent care that the NHS needs, rather than having to spend time and energy raising so much money each and every day of the year.

Charitable hospices provide 80 per cent. of adult in-patient palliative care beds, yet their funding has dropped in real terms over the past few years, leaving 28 per cent. of independent hospices in deficit in 2006. Palliative care is a core service for patients—it is not, and never has been, an optional add-on. If independent hospices cease to exist, the NHS will have no option but to pick up the slack. The Government should be acutely aware of that fact and address the funding shortfall while there is still time. We do not want excellent hospices such as St. Ann’s and the others that have been mentioned today to be unable to continue because of short-sighted funding arrangements.

We are all aware that hospices ask only for a level playing field; they want to be treated in the same manner as other NHS service providers. Hospices such as St. Ann’s fulfil a necessary function in a society in which debilitating and life-threatening diseases such as cancer are sadly on the rise, and they do so in a manner that is truly laudable. They provide a unique and personal service that improves the quality of thousands of patients’ lives. They also support patients’ families and carers. When the Minister responds, I hope that he can tell us what action the Government intend to take to put right this desperate situation, and to ensure that hospices get the stable funding regime they so desperately require.

I congratulate the hon. Member for Castle Point (Bob Spink) on securing this debate, and I pay tribute to him for his consistent commitment to hospices. I also pay tribute to all the other Members who have contributed; they have provided powerful accounts of their experiences of the hospice movement in their constituencies. We are all very aware of the wonderful work that hospices do in dealing with those who have a terminal illness. Hospices provide not just palliative care but a whole range of services—a point that often does not come out—including not only skilled nursing care, pain relief and counselling, but activities such as art, music and physiotherapy. Of course, hospices offer services not only for patients but for their families, as other Members have made clear.

The key issue is, and the purpose of the debate is to discuss, the consistency of funding across the hospice sector. Members on both sides of the House have related some very interesting and concrete examples. Each and every hospice faces a struggle month on month, year on year, to secure the funding that it needs to continue doing its vital work. We have heard from Help the Hospices that, on average, just 34 per cent. of funding comes from Government—a little over one third. I think that we heard a slightly lower figure for Wales from my hon. Friend the Member for Ceredigion (Mark Williams). Of the £1.2 million needed by hospices every day, only £360,000 comes from the Government, so every day hospices have to find an extra £840,000 to carry on their work.

Inequality of funding—I am referring to the proportion of money that hospices receive—has been touched on. For some, it is potentially as high as 62 per cent.; for others it is considerably lower. My hon. Friend the Member for Cheadle (Mark Hunter) made the point, which was clearly not acknowledged by the Minister, that funding for hospices has dropped in real terms in recent years. That is putting considerable extra pressure on the hospice movement.

In speaking on behalf of my party from the Front Bench, I point out that I am proud to have a hospice in my constituency—Wheatfields hospice, in Headingley. Like the other examples that we have heard about, it does wonderful work in dealing with patients and their families in the tragic situation of the end of life. Wheatfields needs about £2.25 million every year to keep going, and the Wheatfields fundraising team has to raise approximately £1 million a year for it to continue its work. I have visited Wheatfields and seen the amazing fundraising operation—the remarkable and professional sales that it organises all week, and the twice-weekly public sales. It runs a joint lottery with the equally excellent St. Gemma’s hospice, in the constituency of my neighbour, the hon. Member for Leeds, North-East (Mr. Hamilton). Together, they run a lottery and do so much for that area of Leeds.

The key point that has been brought out, particularly by the hon. Member for Castle Point but also by my hon. Friend the Member for Cheadle and others, is that we do not have equity with other areas. My hon. Friend said that there is not a level playing field, and the hon. Member for Castle Point referred to unfair treatment. The message is clear: there simply must be equity for hospices and other partially funded sectors of the health service. The reality is that we are talking about mainstream NHS palliative care. Unfortunately, the hon. Member for North-West Leicestershire (David Taylor) has left his place, but he put it very clearly when he said that fundraising should provide add-ons to core services, not the core funding itself. Many people in this Chamber will feel that that was an astute analysis.

Sue Ryder Care has estimated that the state receives about £200 million-worth of palliative care from the hospice sector at no cost to itself. That is the level of contribution that the sector makes. Sue Ryder, which runs the Wheatfields hospice, estimates that it subsidises primary care trusts and social services up and down the country to the tune of £7 million, and that is one organisation. Clearly, this is a real concern for the hospice movement, which I am sure the Minister will acknowledge. I am conscious that the Government are considering the issue, which is why this debate is particularly timely. I hope that the Minister will accept that there are real concerns, and that several questions are being asked in the hospice movement about funding, equity and the differing proportions of funding for some hospices.

Liberal Democrat Members welcome the grant that was announced to refurbish hospices, but as I am sure the Minister will acknowledge, that is not a long-term answer to the questions being posed. In the new strategy, will he commit to an increase in hospice funding not only overall, but proportionately? Will the Government seriously consider that? Will he address the issue of equality of funding across the hospice sector? Will he comment on the idea of a tariff-based system for hospice care, which has been mentioned by Sue Ryder? Given the Government’s commitment to full cost recovery and closer partnership with the voluntary sector, the simple question is: why does that still not apply to hospice care, and when will it?

I again pay tribute to all Members who have taken part in this most important debate; I look forward to the Minister’s contribution. One thing that Members on both sides of the House are absolutely committed to and 100 per cent. behind is the view that we must do whatever we can to support the wonderful work done by hospices.

I, too, congratulate my hon. Friend the Member for Castle Point (Bob Spink) on securing this very important debate. He is a tireless campaigner on behalf of hospices both in this place and outside it, in his constituency and beyond it. I applaud his priority in campaigning and seeking to hold the Government’s feet to the fire on this issue. His speech and, indeed, securing the debate itself is a touching and fitting tribute to his sister, to whom he paid a tribute in which we all join. I dare say that as a district nurse, she was as inspired as my wife—who is a district nurse by training—by the example of Dame Cicely Saunders and the work that she did in Sydenham. I am sure that that has been an inspiration to all those who have given their lives and careers to nursing and caring for others.

All the speeches today have shown the deep care and genuine compassion that we have as elected representatives on behalf of all our constituents, particularly those who dedicate themselves to the excellent work of hospices. Notwithstanding the fact that health is a matter for the devolved Administrations, we heard speeches from the hon. Member for Ceredigion (Mark Williams) about Wales, and from the hon. Member for Na h-Eileanan an Iar (Mr. MacNeil), whose constituency I regard as the highlands and islands when I enjoy my holidays there.

I pay tribute to the hospice in my constituency. St. Luke’s hospice—another St. Luke’s hospice—in Winsford is absolutely wonderful and it is close to my heart. I spend a lot of time at and have a great deal of concern for that hospice, particularly because my wife has been nursing there as a volunteer over the past eight years.

I echo the concerns expressed by my hon. Friend the Member for Castle Point about the financial stability of hospices throughout the country. He noted that on average every UK hospice has to raise £4,500 a day through fundraising just to continue providing care, and a further £500 a day to fund building expenditure. Of course, those figures can vary from hospice to hospice. He also noted that the number of hospices in deficit rose from 43 in 2005 to 52 in 2006. Against those background facts, a National Council for Palliative Care survey last year found that about 60 per cent. of hospices were experiencing a decrease in the value of the funding contribution from the NHS, in part because of the constraints on NHS cash that applied.

I hope that the Minister will shed some light on why the number of hospices in deficit appears to be rising as we speak. Many people—mainly those who are thinking about continuing to contribute to hospices—are saying to me that they do not understand whether that has to do with financial mismanagement or inefficiency at hospice level, in which case they would lose confidence in that being the right place to send their money, or the Government failing centrally. It would be helpful to have the Minister’s view, to ensure that we send what messages we can from this place and give reassurances.

The remarks of my hon. Friend the Member for Castle Point, who was characteristically gentle with the Minister, were slightly short on emphasising where things have got to. I hope that my attitude will be seen as unaggressive and all-party, but it is fitting that we should be debating hospices in this Chamber when in the main Chamber, a debate is taking place on the Lisbon treaty. There is a great problem in respect of that treaty because one has a real sense—if one is not a Government Member—that one is dealing with a broken promise. We all expected, as a result of the Labour party manifesto, that there would be a referendum.

In contrast to that, here in Westminster Hall the Minister has an opportunity to take the opposite approach, and I am confident that he will take it, given that some 40,000 people per annum receive palliative care in hospices and 120,000 receive some sort of palliative care, and considering the 300,000 people—around two thirds of whom will die each year—who would benefit from some sort of palliative care in the last year of their lives, according to Professor Irene Higginson, head of palliative care policy at King’s college, London.

The Government have promised to double funding for palliative care and to introduce payment by results. We need to examine those commitments. The 2005 Labour party manifesto said:

“In order to increase choices for patients with cancer we will double the investment going into palliative care services, giving more people the choice to be treated at home.”

That promise to double investment—we take that to mean spending, from the way the Government use the word—was repeated in the 2006 White Paper, “Our health, our care, our say”. However, there is a problem with that: to double anything, one needs to know the number that one is starting with.

I was being non-aggressive.

The Government have said that they do not know how much is currently spent on palliative care. The former Health Minister, now a Transport Minister, the right hon. Member for Doncaster, Central (Ms Winterton) admitted that the

“Department does not routinely collect data on palliative care”.—[Official Report, 14 July 2006; Vol. 448, c. 2170W.]

Will the Minister explain the basis for the Government’s claim that they will double investment? Is that still their position? When can we expect to see the figures?

The Government’s 2005 response to the Health Committee report on palliative care said:

“We remain on course to implement Payment by Results (the national tariff) with respect to palliative care in both the NHS and the voluntary sector by 2008/9”,

which is almost upon us. It went on to say:

“In palliative care the national tariff will, in effect, provide the full cost recovery recommended by HM Treasury’s Cross Cutting Review on Voluntary and Community Sector in Public Service Delivery.”

However, in a letter to me, the former Health Minister, who is now the Secretary of State for Culture, Media and Sport, admitted the following:

“Since this statement was made”—

the statement to the Health Committee—

“our priorities have changed”.

He also said that the Government intended to publish

“proposals for a consultation”

on the future of payment by results, and said:

“This will include discussion of whether and how we can expand the current range of services and providers covered by PbR”.

The use of the conditional “whether” is obviously very significant.

The Minister is here, live, as it were, and we will welcome his answers to those points in couple of minutes. Let us not, on this vital matter, have the normal knockabout by saying “Labour and Health Ministers have broken their promises”, as my hon. Friend the Member for Southend, West (Mr. Amess) so invigoratingly suggested. However, let us examine the context in which the Minister will, hopefully, stand up to give us some welcome news.

The Government response to the Health Committee was issued when the current Prime Minister was Chancellor of the Exchequer. As I said, it stated:

“In palliative care the national tariff will, in effect, provide the full cost recovery recommended by HM Treasury”.

The Treasury gave a commitment in “The Role Of The Voluntary And Community Sector In Service Delivery: A Cross Cutting Review”, which arose out of the 2002 spending review, that by April 2006, full cost recovery funding should be in place. It stated:

“Funders should recognise that it is legitimate for providers to include the relevant element of overheads in their cost estimates for providing a given service under service agreement or contract…All departments will incorporate the review’s funding recommendations fully into their procurement policies by ensuring that the price for contracts reflects the full cost of the service, including the legitimate portion of overhead costs”—

core funding—by April 2006.

Those principles were reflected in the compact with the voluntary sector, so I am sure that the Minister will not be content to allow the voluntary hospice sector to continue to subsidise the NHS, two years after such arrangements were supposed to come to an end. The official Opposition promise to implement the national tariff with respect to palliative care. In effect, that will mean offering full cost recovery to voluntary sector providers. I hope that the Minister will join us by doing likewise.

Will the Minister also explain the second delay in the publication of the end-of-life care strategy, which was originally due to be published in the autumn of last year? In response to a parliamentary question on the issue, the Minister told me that publication had been deferred until after the publication of Lord Darzi’s next stage review, but in the noble surgeon’s interim report, no mention was made of end-of-life care, other than to flag up a talking shop on the issue. Will the Darzi review bring forward concrete proposals that will deliver on the Government’s previous promises?

The Government will require the Healthcare Commission and all other regulators in England to recover the full costs of regulation from fees by the 2008-09 financial year, which is almost upon us. In the past, fees for hospices have been at discount rates. The commission works from the principle that the fees should reflect the actual costs of regulation, not what establishments can afford to pay. The commission said:

“We believe that if a special case were to be made for voluntary organisations’ fees, it would be for democratic Government–not the regulator–to decide that public funds or other establishments’ fees should be used to subsidise them…We do however acknowledge that voluntary organisations and small business feel the impact of a fixed overhead such as regulatory fees more acutely than large businesses. Our fees scheme takes this into account”.

The commission has proposed charging increases for 2007-08 of £2,376, which is a frozen fee, for hospices with four or more beds. A hospice with, for example, three in-patient beds, would see the burden of costs rise from £907—that includes a registration fee plus a flat rate for inspection costs—to £2,213, which encompasses the doubling of the registration fee for small hospices, plus the new, increased flat-rate inspection fee, plus the removal of the exemption from the per bed charge for hospices with fewer than four beds. The impact on smaller hospices will be disproportionate, but it also seems to run counter to the commission’s stated goal of

“finding a balance between full cost recovery and affordability for voluntary organisations”.

I hope that the Minister will take a serious look at that.

The Royal College of Physicians has reported that terminally ill patient’s access

“to palliative care services…is inadequate and inequitable”.

I hope that the Minister will commit to the meeting with the delegation asked for by my hon. Friend the Member for Castle Point in his outstanding speech, and ensure that commitments are made in Lord Darzi’s review and in the end-of-life care strategy—whenever that is published.

I congratulate the hon. Member for Castle Point (Bob Spink) on securing this important debate and on the passionate and authentic way in which he goes about championing the cause of hospices. Parliamentarians often do not focus enough on how we can make a major difference. There is no more important issue than this, frankly, and we can make such a difference to it.

The hon. Gentleman paid tribute to a number of organisations, and I join him in doing so. He mentioned the Association of Children’s Hospices, the Rainbow Trust, Help the Hospices, and Sue Ryder Care, and there are many other individual hospices to which we should pay tribute in a debate such as this. He also described the current Prime Minister, the previous Prime Minister, and the Secretary of State for Justice as great men. I can tell the hon. Gentleman that an application form is in the post.

More seriously, he dedicated his contribution to his beautiful sister Yvonne, as he described her. He spoke movingly about the experiences that she went through, and those of himself and his family. I had a similar experience last year when, unfortunately, my mum Gloria, who was only 64 years of age, died in April. It was one of the most difficult experiences that I have ever had to cope with. More importantly, I shall never ever forget my mum’s dignity and courage towards the end of her life. As the hon. Gentleman said, unless one has been there, the emotional rollercoaster that the person concerned and their immediate family inevitably go through is incredibly difficult to describe. I pay tribute to the hon. Gentleman for personalising the debate.

The hon. Gentleman was right to say that end-of-life care is a growing issue—inevitably so. Because people are living longer, because people’s aspirations and expectations are different from what they once were, because of medical advances and technological change, and because of our public service reform agenda and vision, we now have the capacity to offer end-of-life care that is very different from that offered in the past. I shall return to the hon. Gentleman’s speech—he raised a number of issues—but I want first to deal with some of the specific issues raised by other hon. Members.

The hon. Member for Eddisbury (Mr. O'Brien)—he was not described by the hon. Gentleman as a great man, but I am sure that that was an omission—paid tribute to St. Luke’s hospice, and I join him in that. More important, he spoke of his wife. She must be a wonderful woman for all sorts of reasons that it would be inappropriate to put on the record. She is a volunteer at a local hospice. We should remember that thousands of people give of their time selflessly in order to make hospices work, working alongside some incredibly dedicated and skilled professionals. In paying tribute to Mrs. O’Brien, not only for living with the hon. Gentleman but for the tremendous contribution that she makes to the hospice movement, we pay tribute to many.

I do not know of any evidence that hospices are poorly managed. Of course it would be inappropriate to generalise, and I am sure that like any other public service sector some hospices could be better managed, but on the whole the hospice movement can be proud of its record of management, prudence and governance.

My hon. Friend the Member for Eccles (Ian Stewart) spoke movingly about St. Ann’s, a hospice that I know because it is not that far from my constituency. He also mentioned Francis House. He rightly spoke of dignity and serenity, but the most important point that he made was that a crucial measure of civilised society is the way that it treats people towards and at the end of their life. My hon. Friend was right that there can be no more important measure.

The hon. Member for Southend, West (Mr. Amess) mentioned Cicely Saunders, and he will doubtless have read my right hon. Friend the Prime Minister’s recent book on heroes, in which he identified Cicely Saunders as one of those who have made the most difference to our society.

The hon. Gentleman was uncomfortable about my body language at the mention of Basildon, so I shall pass over the subject rather quickly. However, it is good that he keeps in touch with his former constituents. He also challenged me on his local hospice and I shall respond to that challenge in the following way.

It is best practice for every primary care trust to sit down with the hospices and to seek three-year commissioning agreements in order to give the hospices a sense of long-term stability. That will be based on the needs of the local community. I urge the hon. Gentleman’s PCT—indeed, every PCT—to adopt that approach. To be fair, at the moment they have a one-year allocation, but within the next few months they will know their allocation for the next three years. Best practice will give them an opportunity, and I believe that they should take it. I hope that the Exchequer Secretary to the Treasury who has joined us, agrees with that principle.

Most of these issues are devolved, but the hon. Member for Ceredigion (Mark Williams) raised the important issues of specific project funding when hospices need core funding and their importance in rural areas. The hon. Member for Na h-Eileanan an Iar (Mr. MacNeil)—it is difficult to pronounce—raised the question of VAT. That, of course, is a matter for the Treasury; I would have said that anyway, but I shall stick to my script given who has just joined us.

I return to the contribution made by the hon. Member for Castle Point. It was he who raised most of the substantive issues—and he did so most appropriately. Hospices are part of a network of palliative care in every community. Sometimes, however, the whole of palliative care is presented as hospice treatment. We have to remember that an increasing number of people choose to end their lives at home. In that context, we should pay tribute to Macmillan and Marie Curie nurses, and others who do such a remarkable job. There are also residential nursing homes and hospitals.

My view is that we should not be neutral about the matter. Given a choice, the vast majority would choose to end their lives in a hospice rather than a hospital. That has implications for some of the commissioning decisions that PCTs have to make. If people want to die at home, unsupported, they should be allowed to do so. If the choice is between hospital or hospice, I believe that the vast majority would choose the hospice, because it is personal, sensitive and intimate. Primary care trusts should accept that fact.

We have made £27 million available for children’s palliative care, as the hon. Gentleman said. We have conducted a review, and I can tell the House that we will be publishing a national strategy for children’s palliative care in the middle of February. That is confirmed today. The hon. Gentleman was right to speak about Diana nurses, who do an important job. We are looking at ways to support and develop their continued contribution to children’s palliative care.

I turn to the end-of-life strategy. It is very simple. One of the major streams of Lord Darzi’s review of the NHS is end-of-life care. When considering world-class end-of-life care, every strategic health authority area is talking about what it should offer people. It would be nonsense to produce a strategy in advance of that process being concluded. When Lord Darzi publishes his final report on the future of the health service, which will be this summer, we will publish the first national end-of-life strategy. That is a clear commitment, but we want to get it right, and it is worth each strategic health authority spending the coming months discussing the subject.

The question of funding has been raised. The Government’s record is excellent, relatively speaking, but a tremendous amount remains to be done. Help the Hospices shows that NHS funding for adult hospices in 2004 was £97.8 million, an increase of about 50 per cent. over 2000. Funding increased further to £113.7 million in 2006.

The only partisan contributions made during the debate were made by the hon. Members for Cheadle (Mark Hunter) and for Leeds, North-West (Greg Mulholland). They turned it into a party political issue. They talked about a real-terms cut in the amount of funding for hospices based on those figures. That was absolutely opportunistic and disgraceful.

Will the hon. Gentleman be writing a blank cheque to the hospice movement? Is he saying that if the Liberal Democrats ever formed the Government, they would meet all the hospice costs at 100 per cent. recovery? Of course not, but that is the impression that Liberal Democrat Members always give when contributing to debates.

I will not give way.

On regulation costs, I shall consider the question of the consultation that the Healthcare Commission is undertaking—

—and the nature of regulation costs. That was not very parliamentary language, Mr Williams.

On the question of—

No, I will not.

On the question of future funding, let us be clear. As part of coming up with an end-of-life strategy that is fit for purpose, we have to resolve a fundamental issue. What is the appropriate balance of responsibility between the state and other forms of funding for hospices? We also have to consider the relative contribution of hospices to palliative care in every local community. Those are the fundamental issues that we have to resolve. We then have to take account of the fact that every locality will make different decisions, depending on population need and historical provision. We must also take account of the fact that the hospices want to retain some independence from the state, which is quite appropriate.

As part of the publication of that national strategy, I commit to seeking once and for all a final settlement that is clear about the respective responsibilities of the state, the voluntary sector and other forms of contribution for the funding of the hospice movement in the context of how palliative care is funded on a long-term basis. When we have come to that settlement, it will be transferred into the policies and actions applied by PCTs.

Will the Minister speak with the delegation and will he repeat what he said about regulation costs?

I am willing to look at the consultation that the Healthcare Commission is currently engaged in on the regulation costs. I will, of course, be willing to grant the hon. Gentleman a meeting.

Private Equity/Venture Capital Industry

Change is afoot in the world of private equity. Only a diehard few would now oppose the principle that there should be some tightening of the generous capital gains tax regime for private equity investment. The Government have made an utter mess of their capital gains tax reform, culminating in the need for clarification only last week. That confusion risks further anti-avoidance measures being required.

In fairness, it is worth looking at the issue in some perspective. A capital gains tax regime that is simplified is something to be welcomed, especially if it is simplified at a relatively low level, historically, of 18 per cent. It is fair to say that most business folk who operated during much of the period between 1945 and 2002 would have rejoiced at the prospect of a sale of business giving them some 82 per cent. of tax-free gains.

In relation to private equity, it is crucial that we do not undermine the future prosperity that will be generated by the industry, not least in invisible exports. It is an industry in which the UK has become a world player second only to the United States. Some 60 per cent. of Europe’s private equity industry comes from these shores. The political and fiscal decision makers must recognise the appeal for many players in the industry of working in what is now a truly cosmopolitan environment.

Barely 12 months ago, few people in the UK had heard of private equity. Indeed, even in the United States, it was only the listing last year of Blackstone, which is widely regarded as one of the three leading practitioners of the dark arts of private equity, that helped to create a culture of greater public scrutiny.

For a time last summer, thanks to people such as the Minister, who was perhaps playing a somewhat different role then, as a member of the trade union-loving Treasury Committee, from the one she might play today—we look forward to hearing her comments later—the newspapers, and not just the business pages, seemed to talk of little other than private equity matters. Although the catalogue of Government misfortunes, from Northern Rock to the credit crunch to domestic economic difficulties, has taken private equity out of the news today, I think that that situation will change.

The tax treatment of businesses bought up by private equity firms is likely to remain a hot political potato. For sure, that will largely be down to campaigns orchestrated by trade unions that are worried about job losses, but it will also be because the issue of private equity firms has been a backdrop to the recent contest for the deputy leadership of the Labour party. However, the real catalyst for public debate has been the concerns expressed, often by middle-class professionals outside the financial services industry, about the astronomical wealth earned by affluent private equity principals in the industry. In short, the controversy about private equity is, to my mind, a symbol of the increasingly nagging concern that the benefits of globalisation have not been spread either equally or fairly.

Much of that discussion belongs to a far broader debate; indeed, I suspect that it will be the backdrop to quite a lot of debates that will take place not just in this Chamber but more widely in this country and across the western world in the decades ahead, particularly with the emergence of China and India as great economic superpowers of the future. I think that we will return to that issue—the way the spoils of globalisation appear to be very unequally spread—during many of those debates and they will no doubt agitate public policy makers. However, the important issue, and it also applies to private equity, is not to take too much of a short-term view. There needs to be a sense of perspective, taking in both the past and the future, to determine what is in the broader interests of this country.

Over recent years there has been a relatively generous tax regime for private equity investment, about which I will say a little more later. That regime was designed in part to reflect the value that was added by innovative venture capitalists and the risks that they incurred. On balance, I believe that it is difficult to fly in the face of the evidence. Generally, although not exclusively, businesses owned by private equity concerns have grown considerably faster, created considerably more jobs and generated vastly higher profits than the public companies from which they were originally spun off. Indeed, the evidence is plain: leading management in public companies display less motivation, innovation or flair than decision makers in companies where private equity involvement has restored value and undone the damage caused by previous managerial deficiencies. More often than not, the transformed businesses are more profitable and grow faster. The positive effects of private equity result in enhanced corporation tax receipts and, of course, a boost to broader employment.

Contrary to the views of some of its more vocal critics, private equity rarely brings with it job losses and asset stripping, except for those struggling businesses that otherwise would probably have gone under without the resurgence that often accompanies radical business restructuring. Indeed, for the financial year 2006-07, the last for which we have reliable and up-to-date statistics, it is estimated that private equity-backed companies generated total sales of some £310 billion, created exports of £60 billion and contributed some £35 billion in taxes to the UK economy. That is all very much a good news story, and one that perhaps has been somewhat lost in some of the negative publicity that venture capital and private equity have received.

It seems that the real problem is that, even after recent economic hiccups, the financial services sector is increasingly regarded by a sceptical and bemused general public as a one-way bet to untold riches. That perception is leading to enormous resentment, not least from the middle classes, whose material expectations, particularly in London and the south-east, are becoming increasingly bleak.

The fact is that London’s financial services industry is a leading global performer. The rewards that flow to its most talented players reflect that fact. By contrast, the civil service, the senior rungs of the NHS and education, and indeed many respectable private sector professions fail to offer such astronomical rewards. As a result, the markets in housing and private education, to name just two, have spiralled out of control and out of the reach of those who, in a previous generation, might have expected to enjoy such returns from their often highly skilled qualifications.

The Labour Government have rightly encouraged the private equity industry to thrive on these shores, and they have to take a certain amount of credit where credit is due. The private equity industry here is a world trend-setter, which otherwise might have left these shores to operate somewhere else, for example, Switzerland. The UK is at the forefront of that global industry. The private equity industry here employs some 18,000 people in 1,500 firms and it helped to generate some £5.5 billion domestically last year in fees for legal, accounting and other professional service firms.

It is also worth reflecting on the positive effects that the threat of private equity involvement has had on many of our leading public companies. Unarguably, management in the public markets has been inspired to sharpen up its act in the face of the potential for radical restructuring by potential bidders.

Nevertheless, the generous tax regime, although it is justified for those entrepreneurs who take enormous risks, is less easy to justify for many of the operators in the private equity field. The taper relief arrangements, which from 2002 reduced corporation tax on holdings of two years or more to just 10 per cent., encouraged—perhaps over-encouraged—the structuring of corporate refinancing transactions to maximise the amount of debt. That has had the effect of allowing companies to benefit from a more generous taxation treatment, not least in the creation of “shareholder debt”, which behaves in some ways like equity but is treated as debt for tax purposes.

Many in the private equity field are, in effect, financiers rather than risk takers. As such, it is surely more equitable for their rewards to be treated more like income, and therefore subject perhaps to higher tax rates, not least because so much of the debt created in the structuring of their transactions is rapidly syndicated out to other banks. Therefore, I firmly believe that the creation of a standard 18 per cent. simplified rate of capital gains tax is to be welcomed. I hope that that will be driven through properly by the Government in the months ahead, not least in view of the confusion that has reigned supreme recently.

Also controversial has been the treatment of “carried interest” on private equity funds, which is taxed as a capital gain rather than as income. No one is suggesting that anyone in the private equity world is doing anything wrong. However, it is clear that the Treasury’s granting of a more favourable regime in the past was intended to reward genuine entrepreneurs. In principle, that surely must mean that, where “carried interest” looks like income, it should be treated as such for taxation purposes. Incidentally, it also makes good sense to treat capital gains and income more evenly, and I anticipate that a future Conservative Treasury would seek in time to reduce to 18 per cent. the basic rate of income tax in line with the level of CGT to apply from April.

Given the strangulating effect of ever more obtrusive regulation on public companies, it is of little surprise that many companies have chosen to go down the private equity route. They have not done so simply out of a desire for greater secrecy; it is a reflection on the level of transparency expected of public companies in the modern age.

For clarification, the reason that the UK is so successful in attracting private equity is our historically—in recent years—attractive tax regime. I hope that my hon. Friend is not suggesting that carried interest should be viewed as income, because all other major western countries view it is a capital gain. It is important that, in order to remain competitive, the UK maintains a competitive carried interest regime.

I accept my hon. Friend’s point. He has a track record in private equity and has been a big supporter of it in various debates in the Treasury Committee. I want income to be treated as income, and capital as capital. There has been a muddying of the water, and if it were my job to look after such matters, as it is the Minister’s, I would take a slightly harder line than perhaps my hon. Friend would prefer. In considering carried interest, we should look beyond the benefits that perhaps have applied in recent years. In effect, some elements of carried interest constitute income, and should be taxed accordingly.

I shall return to the causes of so many of the problems in the public markets. A level of transparency is expected of public companies that is out of kilter with the desires of many who run them. The disequilibrium between public and private company requirements makes the latter route attractive.

The hon. Gentleman is making some interesting points. If he thinks that there is a problem with transparency of public companies, does he think that the answer is to level the playing field on transparency by ratcheting up private equity to public company level, or by ratcheting the latter down to private equity level?

I am coming to that.

As I was saying, I think that the disequilibrium is such that there has been too much regulation and expectation, not just of transparency—we all want transparent markets—but of bureaucracy in the hands of public companies, which runs the risk of some businesses moving to different shores. We are living in a globalised world, for which we should rejoice.

Although I might disagree with my hon. Friend on his tax analysis of the regime that we should have, he makes an excellent point about regulation. On transparency, which was a point brought up during Treasury Committee hearings, I hope that he supports the Walker review and its suggestions for the behaviour of private equity.

I have learned that getting one out of two from my hon. Friend is never a bad score. I thank him for his support.

If public markets worked efficiently, there would be very little need for private equity. Hitherto, most companies subject to private equity have been ostensibly underperformers in the public market, and the alchemy of talented fresh management has helped to transform their fortunes, which is why the leading players in UK private equity and venture capital are comfortable adopting in full Sir David Walker’s guidelines on transparency and disclosure. The industry recognises the need to comply with effective self-regulation, with financial statements and annual reviews being the norm. That rather than Financial Services Authority or Government intervention is the right way forward.

As private equity becomes more popular, however, so too does the level of complexity in the debt instruments being created. There are many even in the financial services and banking industry who do not properly understand the operation of some of the debt obligations being created and sold off, as we have seen to our cost globally in recent months. The buoyant global economy and the wall of money available to financiers, given historically low interest rates, bring with it the risk of a systemic collapse. Once more it is important to stress that relatively few jobs are at risk. If a private equity-backed company bought out at a price representing the top of an economic cycle were to fail, once financially restructured, relatively few jobs would be lost. The real losers in the event of a high-profile private equity failure would be banks—and by extension, their shareholders and pension fundholders who are naturally the type of people who might be used to paying higher rates of tax. The original private equity players are likely to be long gone.

The year ahead for private equity will, I suspect, be dominated by the emergence of sovereign wealth funds. The fear is that their investment in UK business will simply reopen the debate on transparency and disclosure, which the Walker report was designed to close. Indeed Delta 2, the Qatari sovereign wealth fund, whose bid for Sainsbury’s last autumn fell only at the final hurdle, had agreed to abide by the terms of the Walker report, which is to be supported. These SWFs, from India and the middle east in particular, but also from places such as Russia, I suspect, given the sustained high oil and gas prices, will look to invest aggressively especially where falling stock markets provide good value in public company shares. It has been estimated that those funds have anything up to $3 trillion at their disposal. Ideally they too should be subject to Walker-style self-regulation, as a matter of course.

In conclusion, traditionally in the UK we have an open approach to overseas investment. The City, and the UK as a whole, rightly welcome business from investors of all nationalities. If that culture is not to be threatened by public outcry, it is to be hoped that 2008’s new big thing—sovereign wealth funds—will recognise that the spirit of the age demands responsible investment with a code of conduct governing its behaviour.

I congratulate the hon. Member for Cities of London and Westminster (Mr. Field) on securing today’s timely debate on one of the most interesting phenomena in our ever-evolving and changing dynamic marketplace. It is important and true to say that although private equity has been growing it remains a relatively small part of our overall economy. It is not a form of ownership that the Government particularly favour over other models.

With the hon. Gentleman’s expertise as secretary of the all-party group on private equity and venture capital, he made a positive case for private equity where it works well. I do not particularly disagree with any part of his analysis. However, we think that what matters for investors, companies, employees and the economy as a whole is not the form of ownership, but how effectively it is exercised in promoting the long-term creation of value, investment, growth and employment.

As the hon. Gentleman was gracious enough to hint, and possibly even state explicitly, over the past 10 years, the Government have made real progress in promoting long-term decision making on investment. We have taken important steps to make our economy more dynamic, to enhance competition and to deal with the challenges of globalisation. We could have a very interesting debate on how that might play out in popular belief, and on the fact that worries and insecurities are never the right basis for taking long-term decisions. However, those on both sides of the House will admit that we have to deal with those insecurities and worries if we are to continue to make the case for what has been the UK’s traditional approach to living and doing well in the world—an open and dynamic economy facing out to the world rather than turned in on itself.

We believe that the changes we have made have helped businesses to raise finance. The private equity sector is disparate; it ranges from private equity by-outs to the provision of venture capital and investment by business angels in small start-up companies, and includes everything in between. Evidence at the smaller end of the scale shows that most businesses are raising the finance they need—in fact, more than 85 per cent. obtain it at the first attempt. However, for the minority of businesses that are unable to do so, the Government have designed a range of measures to help; the enterprise capital funds, for example, are intended to address the equity gap that many small but potentially high-growth businesses face. The funds are run by private sector fund managers who make commercial investments, but they invest a mix of public and private money, with the Government providing up to £2 for every £1 of private money. The total Government commitment to those funds is more than £140 million, and it will continue at £50 million a year by 2010-11, providing the seed corn for a generation of new and potentially high-growth businesses. That is in our interest.

The Government have also reformed the tax system to encourage innovation and investment. I discerned from the hon. Gentleman’s comments a basic agreement with the approach to capital gains tax. Despite issues about the detail, he was gracious enough to point out that we now have one of the lowest and most competitive rates of capital gains tax—at least we will by April.

We have also reformed the tax system. For example, the enterprise investment scheme has raised about £6.1 billion, which has been invested in more than 14,000 small, higher-risk companies. Venture capital trusts have invested another £3.3 billion in more than 1,400 companies. Those schemes help to encourage the creation and growth of new firms, and they can also be a less focused-upon part of private equity. They ensure that anybody with the potential to succeed in business has the opportunity to do so if they can sell their ideas to the funds, and they have helped the number of small businesses in the UK to rise by 760,000 since 1997.

The Minister has quite rightly given more details—as I did not in my additional comments—about seed-corn finance for smaller businesses, and the Government rightly place much importance on innovation and flair. One could not possibly disagree. Likewise, the simplified capital gains tax regime is an important element. However, my concerns were about when private equity clashes with public companies. Are the Government not concerned that the public markets seem to be so unattractive to companies of that size that they choose private equity as the route to run their businesses?

We must examine the trends of the different choices that business people can make, and the balance between them, and the different business models that can be adopted. I recognise the point that the hon. Gentleman makes, but at the same time, it is also important to recognise that transparency in public companies is to ensure that shareholders have appropriate access to the information they need to make business decisions. Some of the private equity issues that the Walker report dealt with were precisely about valuation and trying to assess what is going on in funds, to ensure that in the private equity model, investors are certain about what is being done in their name, and with their money.

There is a general case for transparency, and the hon. Gentleman made it when he talked about possible issues in the future with sovereign wealth funds and transparency. We must keep the issues under review, but the recent changes to company law got the balance about right. We note with approval the Walker report and its comments about transparency, annual reviews and the need to ensure that the private equity industry addresses the detail of valuation and activity, which the Myners review also pointed out.

On buy-outs, the hon. Gentleman is quite right: at their best, private equity companies can make changes to businesses through restructuring, efficiency to give the business a better future, a shorter management chain, clearer targets and accountabilities and stronger incentives. There are good and bad examples of how private equity works, as there are with all generic models. The hon. Gentleman can cite some good ones, but there have been some not so good examples, too. The Government want best practice in all areas, leading to fitter companies that can deal with change more effectively and, therefore, survive in good health to provide growth and investment opportunities. That is what we want to encourage, and I hope that there is no disagreement in the Chamber about that.

On executive remuneration, the hon. Gentleman’s view was disputed by his hon. Friend the Member for Braintree (Mr. Newmark), and I do not want to interfere in what is obviously an interesting debate on the Opposition Benches. However, I make it clear that we remain interested in all aspects of rewards to people involved in private equity. That includes application of the legislation on employment-related security, some of which touches on the issues that the hon. Member for Cities of London and Westminster raised, and the tax treatment of carried interest and management fees. We will continue to keep those issues under review. The hon. Gentleman has his own views, but his hon. Friend the Member for Braintree disagrees—at least on that point. We keep a close eye on what is going on to ensure that tax treatments and rules are properly followed, and that there is no attempt to reclassify debt as equity or income as capital gains outwith the existing rules.

But is the heart of the matter not the concern that because tax treatment of income and capital is so disparate it generates a perverse incentive to behave in a particular way? The ideal scenario would be to return to the regime that Lord Lawson brought in about 20 years ago, when he moved towards looking on income and capital in the same light. That would render any minor disagreement that I may have with my hon. Friend the Member for Braintree (Mr. Newmark) entirely redundant.

Obviously—the ultimate simplification. I noted the spending commitment of the hon. Member for Cities of London and Westminster to bring income tax down over time from 22 per cent—possibly he was talking about 40 per cent.—to 18 per cent. I shall look with interest at his explanation of how it can be paid for.

A very long-term aspiration, I suspect. Should there be the calamity of a Conservative Government who wished to do that, I should like to see how they would fund even a tiny part of the public services such as schools, hospitals and so on, in which we have just spent the past 10 years re-investing. It is important both to remember that tax-take finances such services, as well as to examine what might—in an academic exercise—be welcome, such as the same taxes on capital and income across the piece. The idea has certain implications, as the hon. Gentleman knows.

That is very kind—the Minister is giving me a little more rope to hang myself with. [Laughter.] At least that is what she might be hoping.

I am sure that early in the Minister’s political career, about 20 years ago, she opposed tooth and nail Lord Lawson’s Budget, to which I referred. However, even the Labour Government will recognise that we are in a global economy and that, as a result, we need downward pressure on our tax rates because we must remain globally competitive. Surely, that is the lesson. The Treasury has learned it fairly well over the past 11 years; none the less, we must consider it a work in progress.

Of course, those points are true as far as they go, but as a Government we have other issues and other requirements, such as looking after the social development of our society. For that, one needs tax revenues and transfers, which must be balanced out. On the hon. Gentleman’s side of the political argument there is a slightly different way of doing things than on our side. Perhaps that is what general elections are about.

The transparency of the private equity industry is important. It is in the industry’s interest to provide information that will improve public understanding, so that it can demonstrate its contribution to the UK’s economy and employment. The Government therefore welcomed the announcement by the British Venture Capital Association and leading private equity houses of an independent working party chaired by Sir David Walker, which would draw up a comply-or-explain code to improve disclosure and transparency. We welcomed the report, and Sir David’s code has set a challenge for the private equity industry to improve transparency and disclosure. The Government will watch with keen interest how the industry responds.

British Association for Central and Eastern Europe

This debate is intended to pay tribute to an organisation that, in the 40 years of its existence, has made a real difference. It fostered and encouraged democracy in eastern and central Europe well before that was a fashionable thing to do. This may be the point to declare an interest: I have had the honour of serving as one of its political governors for almost seven years, under the admirable chairmanship of the noble Lord Radice.

The British Association for Central and Eastern Europe started life in 1967 as the Great Britain/East Europe Centre. It was set up by a group of MPs, journalists, academics and trade unionists, with the support of the Foreign and Commonwealth Office, and changed its name in 1991. The original drive came from a belief in a common European destiny. It is easy to forget what the world was like in the 1960s. The iron curtain and the cold war were firm reality. The Berlin wall stood. Communist regimes prevailed in eastern and central Europe. People were not allowed to travel. There was no freedom of the press, and Tito was firmly in charge of Yugoslavia. I do not know for certain, but I have a hunch that the founders were encouraged by signs of the first thaw—the Prague spring. They wanted to build a bridge across the then divided Europe, and for Britons interested in eastern Europe, the organisation provided an alternative focus to the communist-dominated friendship societies.

In the early years, the majority of activities took the form of exchange visits, discussions and support for individuals undertaking short-term study in the UK. Politics was avoided. The aim was to build links between members of a liberally minded intelligentsia that might gradually erode the authority of one-party states. The four countries originally covered were Bulgaria, Czechoslovakia, Hungary and Romania. Poland was added in 1986 and the Baltic states and Albania in 1992, followed later by the successor states to the former Yugoslavia, Moldova, Belarus, Ukraine, Turkey and Montenegro.

Predictably, the Governments of the original partner countries were at first suspicious and tried to control the association’s activities. Gradual progress was made and friends were won, and by the ’80s there was more open discussion, especially with the Hungarians and Poles. After the collapse of the communist system, many Ministers in the new democratic Governments were, as private citizens, BACEE alumni.

Since 1991, more than 5,000 politicians, civil servants, judges, journalists and business men from countries of central Europe have participated in courses, seminars and conferences organised by BACEE. The association has contributed to improvements in civil society in countries that have revived democratic systems after years of authoritarian one-party rule. Through the transfer of expertise and know-how, it has helped Governments, the media and key institutions of states in transition, and thus the lives of the people of central Europe. The popularity of BACEE’s programmes in central European states is linked to its long-standing approach of responding to requests from states rather than trying to impose something upon them.

It is impossible to describe all the matters that BACEE has covered over the years, but a few examples of projects undertaken just during this Parliament might make the point. There was a visit of 30 mayors and municipal development officials from Serbia to study best practice at British regional development centres in Newcastle and Belfast; a conference on climate change for journalists from 17 non-European Union central European states including Kosovo; a three-year programme in Croatia from 2004 to 2007 to establish a system of out-of-court alternative dispute resolution, and a visit of a group of 20 politicians and journalists from non-EU states during the final week of the general election in 2005. I shall never forget the face of a hotel manager in Edgbaston when one of the participants in that visit met me early in the morning and, when asked what he would like to drink, said, “A small beer would be fine”. It was important for them to come to the UK to see how we run elections.

There was also a round table in Estonia on energy security, a visit by Ukrainian officials responsible for ensuring fair media coverage of elections to meet their British opposite numbers and study best practice, and visits from parliamentarians from Bulgaria and Macedonia to discuss how to ensure the appropriate scrutiny of EU legislation by national Parliaments. I could go on. The back of one BACEE newsletter, published in December 2000, lists the programmes going on at the time, which were a typically wide spread. The newsletter had as its headline “Hope for Yugoslavia—The New Serbia Forum” and began by stating:

“The defeat of Milosevic in the Yugoslav Presidential Election in September should be the last nail in the coffin of European dictators.”

It went on to describe some developments. The Serbia forum was established in 1999 with the support of the FCO and the Swiss and Hungarian Governments to allow moderate Serbian politicians, journalists and academics dedicated to the restoration of democracy to meet beyond Milosevic’s writ in the former Yugoslavia, to discuss policy options and a future democratic Government. It is now widely acknowledged as having been extremely influential; it made a significant difference to the establishment of a democratic system in Belgrade after Milosevic’s fall.

Another example that illustrates the work done with countries trying to restore democratic government is the seminar in Riga on reporting human rights, which was attended by, among others, a number of Belarusian journalists. Only last year, BACEE hosted an informal meeting for Belarusian opposition leaders with British academics, journalists and think-tank members. Over the years the emphasis has shifted, and the overwhelming majority of programmes are now for countries outside the EU and on subjects on which it is important that British policies and views are understood. But—there is always a but—the British Association for Central and Eastern Europe will close in its present form on 29 January, after 40 years. That is the direct result of the FCO’s decision to withdraw its grant in aid.

I think that the FCO made a mistake, and to do so at present, when developments in Serbia and Kosovo are of such concern, compounds the error, especially as the sum of money concerned is so relatively minor—about £260,000. It gives a lamentable impression of reduced British interest in the new member states of the EU, particularly the countries that aspire to join the EU.

The point was put appropriately by one of my fellow governors of BACEE, Peter Preston—I am sure he does not mind being quoted. In an article in The Guardian on 3 December 2007, he wrote:

“Here is a sad little tale with a big, sad conclusion. It begins a decade ago, when I did some Guardian Foundation work with the British Association for Central and Eastern Europe…and joined its governing body. It organised seminars all over the newly free countries of Europe, brought study groups to Britain, and helped train politicians, judges and journalists in the rhythms of democracy. When central Europe was EU-embraced, it moved on to the parts that Brussels hadn’t reached yet: the Balkans and beyond.

But then, suddenly, a minor mandarin arrived announcing that priorities had changed, that the Foreign Office grant that helped make Bacee possible was going, gone. Europe didn’t matter any longer, it seemed. Only the Middle East counted when disposable funds had to be disposed of. And that, after many gallant efforts, turns out to be the end of active life. Bacee goes into indefinite hibernation next year.”

I, too, am a board member of BACEE. Does the hon. Lady agree that the grant the organisation received was extraordinarily good value for money for the Government, because BACEE was able to call upon senior people in universities, business and the media, who gave their services free? They led seminars, went on visits and received people from overseas, and they did not charge. No commercial organisation could ever have obtained such value for money. The outlay from the Foreign Office was very small but the return on capital was enormous. It is extraordinarily short-sighted to cut off such a productive use of limited public funds.

I utterly agree with the right hon. Gentleman. Even people such as the then editor of The Guardian, Peter Preston, gave their time for free to serve on the board and run courses. Considering that, as I have said, 5,000 politicians have gone through the doors in the past 15 years and been involved in programmes, a quarter of a million pounds was extraordinarily good value for money.

Peter Preston also says:

“The Balkan problem - unlike the West Lothian problem - is deemed ‘solved’ for all relevant financing and face-saving purposes.”

He goes on to say, “except that that’s rubbish”. That is a blunt way of putting it, but the next few weeks may prove him right; the problem is far from solved.

The hon. Lady knows the Serbian and Macedonian region well. My experience with BACEE both in the UK and in those regions has been entirely positive. At such a vital time in BACEE’s history, the actions of the FCO are incredibly short-sighted. I am former student of the School of Slavonic and Eastern European Studies, where I think BACEE will be housed, and although I am sure the association will do its best, it will not be the same without the weight of the Foreign Office behind it.

I am grateful to the hon. Gentleman for his intervention and I hope that we can convince the Foreign Office to throw some weight behind BACEE’s new home in SSEES.

The problem is that the Foreign Office’s decision is irreversible and, as politicians, we all know that there is nothing more unpopular than someone who says, “I told you so” because to do so is backward-looking. BACEE has not entirely ceased to exist, which is why I ask the Minister for support for this proposal. Following discussions between the directors of BACEE and SSEES a way has been found of perpetuating the principles that have underpinned BACEE’s work in the last 40 years—through the creation at SSEES of an annual lecture on a broad European theme, which will be funded, initially at least, by BACEE’s remaining reserves. I am delighted that the FCO has welcomed that development. Indeed, it has proposed that the inaugural lecture be held at the FCO.

I would like to suggest some additional ways in which the FCO could help. I do so because the association works in an area of the world that we ignore at our peril. Developments in central and eastern Europe will continue to affect Britain’s domestic and international interests. An annual lecture in no way replaces the range of projects BACEE has undertaken over the years in response to requests from central and eastern European countries—often through British embassies, but also directly through the association itself. Moreover, funding is limited. I have two suggestions as to how the Government could help maintain interest in and understanding of an area of strategic diplomatic, cultural, social and trade importance to the UK.

First, could the FCO commit itself to meeting half the expense of an annual lecture at SSEES for the next five years? The cost would be minuscule compared with its overall expense and would be no more than the cost of a couple of flights to Brussels for a Minister accompanied by supporting staff.

Okay. It would be no more than the cost of a couple of trips on Eurostar to Brussels accompanied by staff—first class Eurostar is probably more expensive than a flight, actually.

Secondly, over the past three years the present director has initiated a series of informal meetings between influential visitors from central and eastern Europe and small, carefully selected groups of specialists on the country or subject concerned. Such specialists are from the press, universities, and international institutions based in Britain, as well as from research units and party foreign policy experts. That has allowed valuable exchanges on sometimes sensitive issues in a relaxed environment, which would be impossible in more formal or high-profile surroundings. The funding required has been minimal—often no more than a buffet lunch—and is disproportionate to the benefit of the increased understanding for all participants. Occasionally, the FCO visits group has contributed to the cost. Will the Minister consider instructing the head of the group to discuss with the director of BACEE, who will be involved with the lecture, how such occasional meetings might be supported in future?

I hope that the Minister is open to going a little way toward putting right the damage to Britain’s reputation caused by a misguided decision that reduces our capacity to support the promotion of civil society in all the states of Europe. I pay tribute to my fellow governors. One of those is the right hon. Member for Skipton and Ripon (Mr. Curry) who is present today; another is the hon. Member for Hereford (Mr. Keetch), who would have been here if some schoolchildren were not currently petitioning him. I also pay tribute to Lord Radice, who chaired the association extremely successfully. However, I pay particular tribute to the current director, Nicholas Jarrold, and his staff, who have overseen an extremely difficult period, during which they discovered that funding had been withdrawn. They have used great skill, expertise and determination to find a way to allow the spirit of BACEE to continue to live on.

Even in its final week of existence, BACEE has continued to contribute to the promotion of British civil society and ideals. It has done so through three topical projects: a visit to the UK by senior representatives of the office of plenipotentiary for Roma communities in Slovakia; a visit by officials of the Kosovo Ministry of Local Government; and a visit by a group of Croatian non-governmental organisations. Given that we know that the FCO has made its decision, BACEE’s determination to work and to give value for money up to the very last moment has allowed the spirit of the institution to continue. I hope that the Minister will look kindly at our modest proposals.

I congratulate my hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) on securing this timely debate. I echo her warm words about the achievements of the British Association for Central and Eastern Europe in central and eastern Europe during the last 40 years.

The association’s founders believed that both halves of a then divided Europe shared a common destiny, which has proved to be the case. Ten of the central and eastern European countries where the association operated are now members of the European Union. Croatia, Macedonia and Turkey have candidate status and others aspire to join the EU in time. The map of Europe has changed since BACEE was set up in 1967. The association has played a part in the reunification of Europe by forging links with central and eastern Europe during the cold war and by helping Europe’s new democracies transform successfully, but also peacefully, after the fall of the Berlin wall.

The Foreign Secretary recently wrote to Lord Radice, chairman of BACEE, to acknowledge the invaluable contribution it has made to a closer understanding between Britain and central and eastern Europe and to thank all those who have worked for the association for their dedication. I thank Members who have attended this debate and who served on the governing board. I also thank the hon. Member for Hereford (Mr. Keetch), who cannot be with us today.

Of course, I recognise that there is sadness that the work of BACEE has come to an end, but we should see its end as a celebration of its success and an opportunity to deal with the new challenges that face us now in Europe and beyond. My hon. Friend has already mentioned many of the association’s achievements. The organisation was set up in 1967 during the cold war at a time when there were difficult relationships between us and many of the countries of central and eastern Europe. Just a year after its birth, in 1968, we witnessed the Soviet invasion of Czechoslovakia. That was a difficult period for the Foreign Office and it was hard for our embassies in the region to build bridges with the other half of our continent.

The association, then known as the Great Britain/East Europe Centre, was able to get beyond the formal Government-to-Government relations and it forged links with many different people from many different countries. It helped establish a closer understanding between the British people and the countries of central and eastern Europe. It promoted democracy, human rights and the rule of law in Europe through conferences and seminars both in the UK and abroad. It also arranged study visits on a range of subjects, such as the judicial system, the media, minority rights, banking, public administration and the electoral system. It supported what the Foreign Office itself was, of course, trying to achieve in the region.

The association’s role changed radically in the late 1980s and early 1990s. The fall of the Berlin wall, the collapse of the Soviet Union and the emergence of countries keen to join the EU changed the nature of central and eastern Europe. There was a major transformation in European politics without bloodshed and conflict.

The association helped to underpin the remarkable reforms in the region in recent years. It promoted the evolution of democratic institutions and market economies, freedom of expression, the effective administration of justice and respect for human rights. It ran projects, study tours and conferences and enlarged its sphere of interest to include Ukraine, Belarus, Moldova and Turkey. I understand entirely that Members who have been involved with BACEE will feel sadness and concern that we are no longer offering it support. It is right, however, that that has been done in a way that allowed for a period of planning over several years. That does not in any way detract from my thanks and gratitude to the director and staff, who have had to deal with this issue for three years.

Before the obituary goes on for much longer, I should like to know whether the Minister is saying that the task that BACEE did no longer needs to be done, or that other organisations can do it. If she is saying the latter, which organisations can do it? Alternatively, is she saying neither of those things?

The right hon. Gentleman served on BACEE, so he well knows that it is a non-departmental public body. We always review the reasons why such bodies exist and whether they should continue to receive Government financial support. We believe that as the world has opened up and civil society has grown, so has our ability to engage directly with local partners, and that the need for such organisations is shrinking. That is a reflection not on the quality or importance of the work that it has done, but on the existence of other options for continuing that work and for direct contact.

Does the Minister agree with the hon. Member for Birmingham, Edgbaston (Ms Stuart) that this moment, as the final status of Kosovo is being decided, is as crucial a period for the Balkans as any in the past 20 or 30 years? Trying to say that the job has been done is a gross mistake.

I am not saying that the job of the UK in engaging with the region has been done. I am saying that the view was taken some time ago, given the opening up of those societies and the different ways in which people can engage, that that was not the appropriate way to continue. I repeat that we must continually review and decide to which organisations we should give financial support. Now that our relationships with countries in the region have been normalised, we can talk to them openly and frankly in a spirit of friendship, and our embassies can work directly to support and promote stability and democracy.

We accept that there is still a need for project work, but the UK Government, non-governmental organisations, trade unions and universities are able to work directly with those countries, often with local non-governmental organisations as partners. Our embassies can represent interests directly. In Serbia, for example, we work directly with a local NGO, Transparency Serbia, on a project to improve public contracting. In Romania, we work with the ministry of justice and local civil society to improve management of the justice sector. The UK continues to fund projects through a variety of bilateral and EU programmes—including “Reuniting Europe”, the global conflict prevention pool, the instrument for pre-accession assistance and the European neighbourhood and partnership instrument—as well as through twinning. There are some snappy titles in there. We continue to work on these issues, so I am not saying that we are not going to engage or to work on projects.

As my hon. Friend outlined, BACEE has decided to perpetuate its name and the valuable work that it has done in its lifetime through an annual lecture on a theme appropriate to its work, under the auspices of the School of Slavonic and East European Studies. That is not only a fitting tribute to the organisation’s past, but a useful way in which it can continue to affect the future of central and eastern Europe. Given its formidable contacts in the UK and in the region, I am sure that its annual lecture will have authority and resonance with policy makers across the region. As my hon. Friend said, BACEE’s first event will be in October, and the Foreign Office has already offered the use of one of its Fine Rooms for that inaugural lecture.

It is rare for a Minister to get away from a debate of this kind without having to respond to some specific points. My hon. Friend asked about continuing Government financial support for the organisation in several ways, but I am unable to give her an answer on that today. We support several organisations in a very different way from the way in which we supported BACEE, but we will seriously consider her requests and whether we have any scope to provide it with financial support.

I repeat our thanks to BACEE for all that it has done in the past 40 years. The greatest tribute to it lies in the unprecedented security and prosperity in Europe today.

Question put and agreed to.

Adjourned accordingly at four minutes to Five o’clock.