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Commons Chamber

Volume 474: debated on Wednesday 26 March 2008

House of Commons

Wednesday 26 March 2008

The House met at half-past Eleven o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions

Northern Ireland

The Secretary of State was asked—

Fuel Smuggling

In February, my right hon. Friend the Secretary of State established a new multi-agency group within the Organised Crime Task Force to prepare a detailed enforcement strategy on fuel fraud. Later this week, I will meet my right hon. Friend the Financial Secretary to consider progress.

As the Minister will be aware, more than two thirds of illegal fuel seizures in the UK occur in Northern Ireland, yet the conviction rate is declining and forfeiture orders are uncommon. Some time ago, the Secretary of State suggested that he was considering the introduction of a specific offence of fuel laundering. Can the Minister tell us what progress has been made in that regard?

My right hon. Friend the Secretary of State did suggest that that specific offence was being considered. That is one matter that the working group in the Organised Crime Task Force will consider. I will consider those issues with my right hon. Friend the Financial Secretary when we meet tomorrow and subsequently. It might be that such an offence would help. I am also interested to ensure that we pursue landowners who rent out land and property and then turn a blind eye to the activities that go on there. The hon. Gentleman can rest assured that the full force of law and order in Northern Ireland needs to and will bear down on the issue.

The Minister will be aware that there is concern that in future the full force of law will not bear down on those involved in fuel smuggling. With the disappearance of the Assets Recovery Agency and the retrenchment and reduction of already stressed Revenue and Customs services, people are worried that fuel smuggling and other criminal enterprise in the category of level 2 crime will not be pursued. Clearly, the police service will pursue level 1 crime and the Serious Organised Crime Agency will pursue level 3 crime. Who will pursue and have the resources and capacity to pursue level 2 crime in Northern Ireland?

What it demands, of course, is a strong partnership among all the forces of law and order and, indeed, legitimate trade. Business partnership is an essential prerequisite of enforcement action, but we need to bring together the Police Service of Northern Ireland, Her Majesty’s Revenue and Customs and also the merged SOCA and Assets Recovery Agency. All those agencies need to work together and I assure my hon. Friend that we will not let up on this. Some £15 million of criminal assets have been taken back from fuel fraudsters in recent years. That effort will be undiminished when the new merged agency comes into operation.

Does the Minister accept that the effort needs to be increased? It is disturbing that so many people have got away with this crime, which is not a victimless crime, and that those who have been caught have not been adequately punished. Will he redouble his efforts?

Of course, the punishment of offenders is in the end a matter for the courts to determine. We are considering whether a new specific offence for fuel laundering should be introduced, but many existing offences can be prosecuted. It is important that Revenue and Customs, the police and the other agencies work together, gather the evidence and bring to justice those who break the law in such a way, because it undermines legitimate trade. That is key at a time when we are trying to build up the economy of Northern Ireland. I know that the Northern Ireland Affairs Committee, which the hon. Gentleman chairs, is deeply concerned about the matter. The full force of law and order will continue to bear down on the issue.

Whether or not the situation is getting worse, the Minister is right to say that it is very serious. Will he give the House an assurance that he is satisfied that the cross-border arrangements are working satisfactorily? Given that some of the worsening situation seems to have been attributed to the merger of Customs and Excise and the Inland Revenue a couple of years ago, will he assure us that the proposed merger between the Assets Recovery Agency and SOCA will not lead to a further problem in this area?

I warmly welcome the hon. Gentleman to his new position as his party’s spokesman on Northern Ireland. I look forward to constructive exchanges with him. I assure him that cross-border co-operation on law enforcement is a high priority. Indeed, we are considering including representation in the working group of the Organised Crime Task Force that deals with such issues from the Criminal Assets Bureau, which is based in the Republic of Ireland, and from the Irish Revenue commissioners, who are the equivalent of HMRC. We seek to bring the forces of law and order together.

I repeat the assurances that I gave to my hon. Friend the Member for Foyle (Mark Durkan). From next month, the Assets Recovery Agency and SOCA will be merged. In my view, that will toughen up our attack line on organised crime rather than diminish it. It will combine the intelligence brought by SOCA with the practical hands-on experience of asset recovery work brought by the Assets Recovery Agency. The combined agency will be even more effective.

The Minister talks about the merger of the Assets Recovery Agency and SOCA in glowing terms, but does he accept that, given what people have said today and during the consultation, there is fear that the big fish in Northern Ireland in fuel laundering and other serious crime will escape when we consider the overall objectives and priorities of SOCA? Will the Minister assure us that the godfathers in Northern Ireland and elsewhere will be pursued relentlessly and brought to book and that their assets will be seized?

I can give the hon. Gentleman an absolute assurance on that matter. There will be no thresholds imposed on Northern Ireland that relate to the rest of the United Kingdom. We will determine our own local priorities in Northern Ireland. Indeed, as soon as possible after the merger of the Assets Recovery Agency and SOCA, I shall publish a new asset recovery action plan for Northern Ireland, which will lay out what every agency is doing in order to pursue the criminal element and to recover the criminal assets that it has taken.

When I used to help run businesses in Northern Ireland, nothing undermined confidence in markets more than smuggling and cross-border illegal trade. Given the single land border in Northern Ireland between ourselves and Ireland, we need a border police force that really operates effectively in order to stop that undermining of confidence. Markets and market recovery in Northern Ireland are one of the best underpinners of peace, and that is why this is so important. Does the Minister agree?

The hon. Gentleman makes a very constructive remark. We have to bear down on any organised criminal activity intended to use and manipulate the border to criminal advantage. I say to the hon. Gentleman, however, that the proportion of UK duty-paid petrol that is currently consumed in Northern Ireland is up to 86 per cent. from 82 per cent. just a few years ago. Of course, some of the missing 14 per cent. is legitimate cross-border shopping. We are improving the position, but we need to do even more. He has my assurance that we will do that.

Irish National Prisoners

As of today, there are 107 prisoners who have declared themselves to be of Irish nationality—7 per cent. of the total prison population.

What steps is the Northern Ireland Office taking to return to their country of origin any Irish nationals, as well as nationals of other countries? There is growing concern across the United Kingdom about the number of foreign national prisoners held in British jails.

We of course have to be careful as we approach this issue because, as the hon. Gentleman will know, as a result of the Belfast agreement anybody born in Northern Ireland can declare themselves as Irish, British or both. He asks how many prisoners in the Northern Ireland system have a home address in the Republic of Ireland. That figure is 19. We will seek to deport people if it is ordered by the court or if the Secretary of State determines that it is in the public interest so to do. For other foreign national prisoners, of whom there are around 80 in the Northern Ireland system, we liaise closely with the Border and Immigration Agency, which takes the appropriate action when those prisoners are released.

Employment remains a crucial feature of keeping young people out of prison. What has my hon. Friend done to ensure that young people in prisons have access to workplace training placements?

My hon. Friend makes an extremely important point. The Prison Service of Northern Ireland is absolutely committed to ensuring that we improve educational opportunities and training, so that when prisoners move back into the community they are able to access jobs, have a home to live in and play a purposeful and positive role in the community, rather than return to offending.

Fine Defaulters

6. What proportion of those serving a custodial sentence in Northern Ireland were convicted for defaulting on fine payments. (195502)

Although on average fine defaulters occupy up to 30 prison places at any one time, they represent 30 per cent. of all committals to prison. Ministers have made a commitment to deal with that overuse of custody by a range of alternative community-based penalties.

The Minister will be aware that the Northern Ireland Affairs Committee, in a report on the Northern Ireland Prison Service, said that the sending to prison of fine defaulters placed an unreasonable demand on the scarce resources of the service, and recommended that immediate steps be taken to ensure that short-sentenced fine defaulters did not abuse the system. What steps exactly are being taken to ensure that?

I warmly welcome the report from the Northern Ireland Affairs Committee, which put its finger on a number of important issues, including that one. It is quite a misuse of public resources that 2,000 prisoners each year are committed to prison in Northern Ireland because of fine default. They stay an average of four days, and usually their fine is of less than £600. In the new criminal justice measure that I shall shortly bring before the House, a new supervised activity order will put in place unpaid work instead of prison placement. Also, later this year, the fine default working group will produce further recommendations, which will include a proposal to introduce deduction from earnings and benefit, which of course should be in place well before custody is ever considered.

Does not the presence of fine defaulters in the Maghaberry high-security prison illustrate the Government’s failure to implement the recommendations regarding the treatment of those prisoners who require the lowest level of security management? When will the Government implement those recommendations, which will go some way to dealing with what the Secretary of State said in February was an “outrageous waste” of prison time and resources?

The hon. Gentleman suggests that that is an important issue that needs to be tackled, and to that extent I agree entirely. I have said that it is being tackled, and my right hon. Friend the Secretary of State has set out a prospectus to do just that. We are beginning with the supervised activity orders that I have described, which will be followed by deductions from earnings and benefits. We are rebalancing the criminal justice system in Northern Ireland: those who pose the greatest risk of harm to fellow citizens will go to prison for longer than was the case in the past, while less serious offenders will be given robust, community-based punishments.

Will the Minister give an estimate of the number of women in prison in Northern Ireland for defaulting on the television licence?

I cannot give a precise response to that question, but I shall write to my hon. Friend with the clear answer that he has asked for. However, it would be wrong to hold women or anyone else in prison for the non-payment of the television licence fee, or for any other minor matter. Such people should be dealt with robustly and their fines should be enforced, but they should not be detained in prison.

What does it say about the Government that they have found time to pass legislation granting amnesties for mass murderers in Northern Ireland, but not for legislation that would deal with fine defaulters and keep them out of prison? Will the Minister look at the legislation that was introduced in the old Stormont Parliament after the Social Democratic and Labour party held a rent and rates strike? The legislation meant that money could be docked from benefits as well as from earnings.

I am always grateful for the right hon. Gentleman’s advice about things that were tried in the past, but I hope that he will agree that committing 2,000 people to prison each year in Northern Ireland for defaulting on fines is entirely wrong. In certain exceptional cases, it may be necessary to use prison as the last resort, but there needs to be a series of alternative, community-based punishments. I look forward to working with the right hon. Gentleman and others to make sure that the necessary reforms are made, so that fine defaulters are dealt with robustly but in the community.

The House is aware of the problem with fine defaulters, some of whom are in prison for as little as 24 hours, but there is also a problem with the number of remand prisoners in Northern Ireland. They make up 37 per cent. of the prison population there, compared with 15 per cent. in England and Wales, and that proportion is rising. What does the Minister consider to be wrong with the criminal justice system in Northern Ireland, and what can he do about it?

As I have said already, we are reforming the criminal justice system in Northern Ireland to make sure that those who pose the greatest risk are dealt with most severely, while less serious offenders are dealt with in the community. The hon. Gentleman rightly states that about a third of people in the prison system in Northern Ireland are on remand. We must speed up the administration of the criminal justice process in Northern Ireland, but we are absolutely committed to doing so and have put in place targets to that end. Also, the criminal justice order that he and I will no doubt be debating soon contains a proposal to introduce electronic tagging to enforce curfews. Where appropriate, that will be another alternative to remanding people in custody, and it shows that we are taking action to rebalance the system to make it work more effectively.

Paramilitary Organisations

I am looking forward to receiving the next Independent Monitoring Commission report at the end of April. More work still needs to be undertaken by loyalist organisations, and dissident republicans continue to pose a limited but real threat.

The Secretary of State must be concerned about the apparent increase in paramilitary beatings, especially in some of the most deprived districts across the Province. What action is he taking to ensure that the police get a grip of those areas, and that the paramilitaries do not pose as defenders of local communities?

The police have got a good grip on dissident activity, and they do an extremely brave job. The right hon. Gentleman will know that at the end of last year two police officers were targeted by dissident republicans. I am pleased to report that they have made a good recovery. They do an extremely important and brave job, but the overall crime figures—and we should view that activity in the context of crime—reveal just how successful the PSNI is.

Will the Secretary of State inform the House whether, over the past two years, he has had negotiations or discussions with the Ulster Volunteer Force, the Ulster Defence Association, dissident republicans and other such groups, for the purposes of obtaining ceasefires and decommissioning? If not, what has led to the change of Government policy and strategy?

Again, the figures demonstrate the huge elements of progress that have been made. Whether we are talking about dissident republican activity or dissident loyalist activity, to which the hon. Gentleman referred, regrettably there are still elements out there who wish to behave in a criminal way. There is, of course, as the last IMC report indicated, more that needs to be done through action, and not just words, by dissident loyalist groups, but I look forward to receiving the next IMC report, which I am confident will show that further progress has been made.

Will the Secretary of State make a statement on the serious rioting in Londonderry at the weekend? When illegal parades on the Protestant side of the community take place, an attempt by the police to stop those involved from gathering is usually successful, but it seems that in the incident in question people could gather. In fact, for the first time in a very long time, 40 petrol bombs were recovered by the police, and there was a savage attack on the police in Londonderry. Would the Secretary of State not think it better, at this time, to concentrate on helping the police, rather than to enter into an engagement on whether power should be devolved to Stormont? Any organisation that has an army council associated with violence should not have anything to do with the police.

I think that this is the first chance that I have had since the right hon. Gentleman announced that he will stand down as First Minister in May to put on record in the House what a huge debt the House owes him for the work that he has done, both in leading his party and as First Minister.

On the events that the right hon. Gentleman mentioned in Londonderry, I think that no sensibly minded person would do anything, in any shape or form, other than condemn the behaviour on the streets over the weekend. Petrol bombs and attacks on the police are a thing of the past and should be utterly condemned. I remind all hon. Members that this weekend Sinn Fein were as strong as any in condemning the activity that took place. He is right to talk about the importance of devolution of policing and criminal justice, and to point out the attention that the Government continue to pay to the issue. I just say to him that, while I condemn without reservation the behaviour of those criminals on the streets in Londonderry this weekend, I make no apology for continuing to encourage momentum on devolution, because that is the best way for us to secure long-term peace on the streets of every part of Northern Ireland.

Criminal Justice and Policing

5. If he will make a statement on the progress of devolution of criminal justice and policing to Northern Ireland. (195501)

Since May last year, huge progress has been made in Northern Ireland, not least with the publication of the Assembly’s progress report, which I laid before Parliament yesterday. Perhaps there is no better indication of the progress made in Northern Ireland than the visit last week by Her Majesty the Queen, who was able for the first time to attend a maundy service there—and, even more significantly, a maundy service in Armagh.

The St. Andrews agreement is due to come into effect in May, and criminal justice and policing in particular go to the heart of that agreement. We have just heard that there may well be reasons why that deadline is not met. Will the Secretary of State meet that deadline, and if not, what does he expect will happen?

The St. Andrews agreement began in May last year with the first stage of devolution, and I am pleased to report just how successful in all the areas where devolution has taken place the power-sharing Government have been. There remains the second stage of devolution, which in the agreement was envisaged to take place this year, hopefully in May. However, the hon. Lady rightly asks whether we will be able to complete it. The Government will have completed their promises and their arrangements, so that when the Assembly and the Executive have cross-community support and ask for devolution to take place, the Government will be able to fulfil their promises and objectives.

The Secretary of State will be aware of the comments made by Mary McAleese, the President of the Republic of Ireland, when she said that Her Majesty the Queen could be invited to the Irish Republic only when policing and justice powers were devolved. Does the right hon. Gentleman agree that that statement was scandalous and shameful?

I understand the emotions that are inevitably raised on the issue, and I understand the comments made by the hon. Gentleman, but the comments made by President McAleese last week must be seen in the context of a reply to a question from a journalist. They were heartfelt and they followed what had been said by the Taoiseach. Let us be clear. A visit by the Queen to the Republic will be agreed between the Palace and the Irish Government, and it will be a matter decided upon by the Queen at a time of her choosing.

The key to devolution of policing and justice is to build cross-community confidence. What discussions has the Minister had with senior members of the republican movement to ensure that the IRA army council is disbanded?

The hon. Gentleman is right to talk about cross-community support. As he knows, recent polls in Northern Ireland have consistently shown that a majority of people not only support the devolution of policing and justice powers, but that they support that sooner rather than later, and that a majority would like it to be in May this year. On the specific question about discussions with republicans about the future of paramilitary structures, let me be equally clear. All the paramilitary structures, the army council included, are vestiges of the past. It would be better if they were gone this afternoon, and the sooner any leaders in any party can bear down on getting rid of the vestiges of Northern Ireland’s paramilitary past, the better.

Actions speak louder than words. What steps is the Minister taking to encourage full republican co-operation, which is essential to solving the McCartney and Quinn murders and would go a long way to encouraging Unionists to support devolution?

The hon. Gentleman is right; actions do speak better than words, which is why we are seeing an unprecedented level of co-operation between the community and PSNI precisely in areas where, for example, the terrible Quinn murder happened, as the hon. Gentleman is aware from his own discussions with the Chief Constable. Further to that, let me say once again to the hon. Gentleman that none of those structures, the army council included, has any place in tomorrow’s or even today’s Northern Ireland, and I welcome his support in joining me to apply pressure wherever it can be applied to ensure that those paramilitary structures belong in the dustbin of history.

Surely the greatest leverage that the Government can apply on the republican movement is to insist that the army council is removed before there is devolution of policing and justice. That is the one lever that the Government have, and instead of putting it up to the political parties in Northern Ireland, is it not time that the Government used their position and influence to press for that and insist on it before there is any question of further devolution?

Let me put on record again my thanks to the right hon. Gentleman for the work that he has done with his Assembly and Executive Review Committee over the past six months to prepare the political parties of Northern Ireland for devolution. It is perfectly clear that he shares with all other hon. Members the view that there is no place in the future for any vestiges of paramilitary activity. He knows as well as I do that it is intention that matters. For that reason, I urge him to be careful about setting pre-conditions and to remain focused on intent and on building cross-community confidence. I remind him of what he said about policing and criminal justice only last week:

“I think that indicates that the political parties are almost at the point where they can take on this responsibility”.

Provisional Army Council

I am sure that everybody looks forward to the day when all vestiges of Northern Ireland’s paramilitary history, including the army council, have been relegated to where they belong: the past.

The Provisional army council is not some branch of the Royal British Legion, but a terror command structure. Given that the Government’s policies have put terrorists and murderers into government in part of the United Kingdom, and given that the self-same people were and may still be members of that terror command structure, how can the Secretary of State even contemplate having them in charge of policing the criminal justice system?

I am sorry to disappoint the hon. Gentleman, but he will know that the Belfast agreement, subsequently built on by the St. Andrews agreement, enables the politicians and people of Northern Ireland to determine their future. As such, we built into the St. Andrews agreement that it would be for the parties to agree on the matter, that it would be an issue of cross-community confidence, and that when a motion was brought before and agreed by the Assembly, it would finally have to come before this House before we could move forward on devolution.

As for the idea of terrorists being put into positions of power, I simply say this to the hon. Gentleman: all those members of the Executive have taken an oath of office, and they are required, both now and in future, to live up to that oath.

Prime Minister

The Prime Minister was asked—


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

No one knows better than my constituents the huge effects that cross-channel co-operation and our new border controls have had on clamping down on illegal immigration, but there is more work to be done. What will my right hon. Friend be discussing tomorrow with our new friend, President Sarkozy, to continue the work of improving and reforming our immigration schemes, to strengthen our economies and to get a grip on the militants at Calais—[Interruption.]

Let me first of all thank my hon. Friend for his question, and welcome President Sarkozy and his wife to Britain. I believe that our talks in the next few days will be very constructive. My hon. Friend is absolutely right about illegal immigration and I hope that in our talks today and tomorrow, the President and I can agree to tighten up controls at Calais. I hope also that we can have an agreement that there will be no further immigration centres like Sangatte, and that they will not exist in the future. Given the present global financial turbulence and the fact that in one country in the last day interest rates have moved to 15 per cent., I also believe that it is right that France and Britain agree measures, which we can put to the international institutions over the next few days, that will strengthen the stability of our economies, deal with problems of lack of transparency in financial information and make sure that the European economies can continue to grow together. That is possible only because we want a Britain at the heart of Europe and not detached from Europe.

I join the Prime Minister in welcoming President and Mrs. Sarkozy to Britain.

It is now nearly eight months since the start of the credit crunch, and one of the key questions is how well prepared we are. Does the Prime Minister now accept that in terms of financial regulation, the UK has been shown to have some serious failings?

We have already looked at some of the changes that can be made, both in the Financial Services Authority—there is a report of the Treasury Committee today—and in the Bank of England. But if I may say so, if the right hon. Gentleman now looks around the world and sees what happened to Bear Stearns, sees that three banks have fallen in Germany and sees what happened to Société Générale in France, he will realise that we have been better protected than other countries against the global financial turbulence, and that that is precisely because we did not take the Opposition advice that would have caused instability.

People around the world are making a contrast between Bear Stearns, where a rescue was organised in just a few days, and Northern Rock, where there were months of dithering. I know that the Prime Minister created the regulatory system, but he needs to be frank about its failings. Today’s FSA report is a remarkable report, which says:

“The supervision of Northern Rock revealed the most significant combination of shortcomings”,

yet not a word about that from the Prime Minister. The director general of the CBI says that this was the first new test of the tripartite system, and it failed to deliver the goods. So that we are better prepared in future, does the Prime Minister agree that the Bank of England, not the Financial Services Authority, should be in charge of rescuing banks that fail?

First of all, until a few weeks ago the right hon. Gentleman supported what we did on Northern Rock, so it makes no sense for him to criticise now. Secondly, as far as the Financial Services Authority is concerned, it is true that it has been regulating for solvency, and it has done a good job. The problem arose in terms of liquidity, and that is where further efforts have got to be made. That is true, as the President of America’s report is saying, for the American financial system, and it is true of the French and the German financial systems as well. All countries are realising that more has to be done to protect against illiquidity, and they also know that there has to be greater transparency in the financial system. I repeat: the lessons that are being learned are being learned around the world.

The Conservative party published a document in the past two days saying that far from Britain doing badly, real living standards in Britain among pensioners had risen by £1,500 since 2001; for single women pensioners, by £1,000; and for couples, by £700. That is on page 16 of the Conservatives’ own document.

I tell you what that document said: it said that since this man became Prime Minister, the price of milk is up 17 per cent., the price of eggs is up 28 per cent. and the price of bread is up 34 per cent. That is the real cost of living under Labour.

In his answer, the Prime Minister said an extraordinary thing—that the Financial Services Authority has done a good job. What he has not read is the report out today by the Financial Services Authority that says:

“The Financial Services Authority is short of expertise in some fundamental areas, notably prudential banking experience and financial data analysis.”

Are not those the absolutely key things that are needed to be a regulator? Is not that why the Bank of England should be in charge of these rescues rather than the Financial Services Authority? The Chancellor—[Interruption.] They do not like to hear the extent of the failure of the system put in place by the Prime Minister. The Prime Minister and the Chancellor have made several U-turns recently; why do they not make one more U-turn and make the Bank of England responsible?

I know what the chairman of the right hon. Gentleman’s defence commission, Frederick Forsyth, meant when he said that David Cameron has a

“sketchy grasp of basic arithmetic”,

because he does not understand what is happening. The FSA has admitted that it must do more about liquidity problems, but every financial organisation around the world that is regulating markets is accepting the need to do more. He would be better addressing the real problems that we face—off balance sheet activities, write-offs that have not been properly declared, and credit rating agencies that have done the job of being advisers as well as raters. Those are the problems that have got to be addressed. Instead of just blaming the Financial Services Authority, he should look at the real problems that President Sarkozy and I will address. The real problems will not be solved by someone who has no basic grasp of arithmetic. [Interruption.]

It is time that the Prime Minister and the Chancellor realised that one of the real problems facing Britain is their economic mismanagement. It is frankly pathetic to listen to the Prime Minister of the United Kingdom read out quotes from a novelist when he ought to be reading out from the Financial Services Authority’s report. A key point in terms of how well prepared we are is the size of the Government’s budget deficit. Out of 55 major world economies, only three economies have a bigger budget deficit than Britain. That is why he is putting up taxes. Most other countries are helping families with the cost of living; this Government are hitting them. Can he name one other major country that has just introduced a Budget putting up taxes? Name one.

We are injecting more money into the economy this year. We are not taking money out of the economy; we are cutting the basic rate of income tax to 20p. Let us compare what was happening during the last world downturn: 15 per cent. interest rates, 10 per cent. inflation, 3 million people unemployed, public spending being cut, and taxes rising dramatically with VAT on fuel. Let us compare that with what is happening now: we have low inflation, low interest rates, the highest levels of employment in our history, unemployment at its lowest since 1975 and public services continuing to expand. If the right hon. Gentleman does not accept that today, he should remember that he said on Monday on BBC Radio London:

“Interest rates still look low historically”.

We have kept interest rates low.

Not only has the Prime Minister not read the report from the Financial Services Authority, it is pretty clear that he has not read his own Budget. Pages 111 and 112 of the Red Book show taxes going up in the Budget. Everybody knows that taxes have just gone up. Every time you fill up the car, taxes have gone up; every time you buy a car, taxes have gone up; every time the family goes shopping, and so on. No wonder every pub in Britain is trying to ban the Chancellor from having a pint. The Prime Minister has not answered a single question so let us just try this once again. Can he name one other major country that is responding to the downturn by putting up taxes? Name one.

We are injecting more money into the economy—the right hon. Gentleman simply does not understand basic arithmetic. The basic rate of income tax is going down to 20p. Let us look at our record. Inflation in Britain is 2.5 per cent, in America it is 4 per cent. and in the euro area it is over 3 per cent. So which country has the lowest rate of inflation of the major countries? It is Britain. We have kept interest rates low, and whereas unemployment is 8 per cent. in Germany, 8 per cent. in France and rising in America, it is at its lowest in Britain since 1975, at half the rate of our European partners. That is a Government who are better prepared for a world downturn. The problem is that the Conservatives want £10 billion of tax cuts, they want to say that they will raise public expenditure, they want to say that borrowing should fall and they say that they want tax cuts at the moment to boost the economy. That is the same recipe that they followed in 1992, and it led to the worst recession since the war. And who was the economic adviser to the Treasury at the time? None other than the Leader of the Opposition.

The Prime Minister has not answered the question. He cannot name one other major country that is putting up taxes in a downturn. He asked for some basic arithmetic; I will give him some. One Prime Minister plus one Chancellor equals economic incompetence. Every other Government have put aside money in the good years to build up their surpluses. Instead, this Government, at the end of a period of worldwide economic growth, have achieved a unique double: the highest tax burden in our history and the biggest budget deficit in western Europe. Does he feel any responsibility for any of this, or is he totally incapable of admitting his mistakes?

The highest tax burden in our country happened under a Conservative Government in the 1980s. The rising deficit in the world is a rising deficit in America, which will be higher than ours. I just wish the right hon. Gentleman had known something about economics when he came to this House and started to tell us what to do. The truth is that we have cut corporation tax from 30p to 28p, and we will cut income tax from the beginning of April from 22p to 20p. All he can give us is slogans and not substance; the Conservatives have learned nothing from their experience of the 1990s.

Are the Government on course to deliver the Prime Minister’s commitment to take all vulnerable households out of fuel poverty by 2010?

In the Budget, we put in more money to help low-income households deal with their fuel bills. We have done more to deal with the problems of homelessness and fuel poverty in the last 10 years than the Conservatives ever did in 18 years. In the Budget, we raised the winter fuel allowance, we raised the amount of money available for insulation and we will continue to do more to meet our social housing targets.

Home repossession orders now stand at 100,000—the same as in 1990—and house prices are falling faster than they were even then. Does the Prime Minister still deny that the crisis facing British home owners today looks at least as bad as the Tory recession of the early 1990s?

I do not know when the Liberal party will ever learn. Interest rates were 18 per cent. at one point in the early 1990s; they are 5.25 per cent. today. The number of repossessions in the last year was 27,000; in the first two years of the 1990s, it was 200,000. We are dealing with a quite different situation and the reason is that we did not take the advice of the Liberal party, but pursued policies for economic stability.

Is complacency the only thing that the right hon. Gentleman has to offer the thousands of British families who are frightened of losing their homes? Will he now instruct the Bank of England to take house prices into account when setting interest rates, to stop the boom and bust in the housing market? Will he also stop banks from repossessing homes at will and force them to explore all other options to keep British families in their homes?

But the way to deal with the economic problems is to keep inflation low and to keep interest rates low, and that is exactly what we have done. Inflation is lower than in the rest of Europe and lower than in America. That is why interest rates have managed to come down twice in the past few months, whereas that has not been possible in the euro area. I tell the right hon. Gentleman this: we take seriously our responsibility to home owners in this country. That is why there are 1.5 million more home owners now than there were in 1997, why interest rates are on average half what they were in the Conservative years and why mortgage rates are lower than they were on average in those 18 years. We will continue to ensure that inflation and interest rates are low, to the benefit of home owners. One way we will do that is by not taking the advice of the Liberal party.

Q2. After cancer and heart disease, the fear of falling victim to stroke is one of the greatest anxieties felt by elderly people. In Greater Manchester, the decision will be taken shortly to establish three new specialist stroke centres. The Prime Minister will know of the outstanding work done by the stroke service at Fairfield hospital in my constituency. Does he agree that Fairfield will be an ideal location for one of the new specialist stroke centres? (196464)

I know that my hon. Friend will push the case hard for Fairfield general hospital, which I understand does a very good job. There is a Manchester-wide integrated stroke service strategy to be published. We have already put in £105 million of Government funding to support the general stroke strategy. Up to 6,000 deaths could be avoided as a result, and 15,000 strokes could be averted through preventive work. That is why we will take seriously not only what my hon. Friend says about his hospital, but the need to improve stroke services throughout the country. That is possible only because we are increasing the money available to the national health service.

Would the Prime Minister give to the people of Northern Ireland the assurance today that the Government will not countenance supporting any attempt to use the embryo Bill to legalise abortion in Northern Ireland through back-door legislation, keeping in mind that all parties in Northern Ireland are opposed to this? Surely that decision should be made by Stormont, and Stormont alone.

First, this is the first time that the right hon. Gentleman has been in the House since he announced that he was giving up his job as First Minister, and I want to thank him for everything that he has done as First Minister. The whole House—indeed, the whole of the United Kingdom—owes him a huge debt of gratitude for the way he has brought together the parties in Northern Ireland and been a very successful First Minister over the past few months.

The matter of an amendment on abortion to the Human Fertilisation and Embryology Bill is a matter for this House. I do not believe that the House will wish to change its mind on these issues, but that is a matter of a free vote of the House of Commons.

Q3. Does the Prime Minister think that energy companies should do more to help vulnerable groups deal with the cost of their fuel? Does he think that they should all introduce standard social tariffs to assist such people, and if they do not, is he prepared to legislate? (196465)

This is exactly the area where we are working with the energy companies at the moment. We are talking to them, and we have said that they need to deliver a package of social assistance to vulnerable households that will increase their spending from £56 million a year to £150 million a year. We want the energy companies that have benefited from the windfall as a result of the European licence trading in relation to climate change to put an extra £100 million a year into helping the very households that my hon. Friend is talking about. That is on top of the winter allowance, which we have just increased, and on top of the help with insulation that we are giving. I understand how difficult it is for people at the moment. Oil, gas and coal prices have risen by between 60 and 80 per cent. around the world. That is why, with the winter allowance and the extra £100 million that the energy companies will be expected to put in, we will do our best by those people who face, or are threatened by, fuel poverty in this country.

Q4. I have an interest to declare on this question. If the media were to be believed a few months ago, the ravages of dental decay were becoming widespread. The Prime Minister will be aware that fluoridation is generally considered to be the best way to prevent that disease. The Water Act 2003 promised to bring in fluoridation, but not a single water supply has been fluoridated since then. Will the Prime Minister confirm that he agrees with the need for fluoridation, and will he meet a small delegation to discuss the changes needed to implement it? (196466)

I am personally very sympathetic to what the hon. Gentleman says. I have seen the benefits of fluoridation myself. One reason for us putting extra money from the health budget into fluoridation is to encourage that to happen around the country. I would be very happy to meet a delegation, as the hon. Gentleman suggests. Also, the Health Secretary has just told me that £14 million of extra money is being put in to help with this, and that is one way in which we can encourage local authorities and others to take up fluoridation. It is a good thing for the teeth of the people of this country.

Did the Prime Minister hear the very warm words—almost a love letter—that President Sarkozy sent to Britain via the “Today” programme this morning? When he meets the President, can we reciprocate? Does he agree that the default setting for our political class, for Whitehall and, above all, for the media is often to express contempt and derision for France? Can we not try to turn the entente cordiale of the last century into an entente amicale, or even an entente fraternelle, for this century?

My right hon. Friend is absolutely right. President Sarkozy and his French Government and our Government have a great deal in common and a shared agenda for the future. We will be discussing co-operation on matters relating to energy and security. We will also be discussing how we can work together on the environment and the economy. I believe that, coming out of these talks, we will find a shared agreement to move things further. I believe in the international institutions when it comes to the reform of the economy, and we will now vote together on crucial areas in which we must reform the international economy. My right hon. Friend is absolutely right to say that the entente cordiale is moving into a new era, and I hope that Members on both sides of the House will welcome that, but it does require Britain to be at the centre of Europe and not isolated from it.

Castle Point

Such a shame. Canvey Island will soon have 50,000 residents, and we need a new access road from a different point on the island for environmental and regeneration reasons, and particularly for safety reasons, in case we ever needed to evacuate the island again. The Prime Minister will remember that 58 people lost their lives on Canvey Island in the last great flood because they could not be evacuated. Will he join me in pressing Essex county council, which is Conservative controlled, to make that its top priority? If it does, we will get the access road that we need. If it does not, the people will know who to blame.

I am grateful to the hon. Gentleman for his question, because it allows me to point out that we have increased spending on roads by 80 per cent. in real terms since we came to power, and that that spending will have more than doubled in real terms in the years up to the next decade. However, it is the responsibility of Essex county council to bring forward a scheme that provides value for money and meets environmental objectives. I know that Essex county council is neither of the hon. Gentleman’s party nor of ours, but I hope that it will listen to his representations.


Q6. Will my right hon. Friend take the opportunity over the next few days to talk to President Sarkozy about working closely and helpfully with the Chinese Government in order to find a peaceful and lasting solution to the Tibet question? Will he do that? (196468)

I am grateful to my hon. Friend, as this issue concerns not just France and Britain, but the whole world. As I said last week, I have talked to Premier Wen about it. My hon. Friend may know that a human rights dialogue took place with the Chinese Government at the beginning of the year, and officials from Britain visited Tibet and reported on it. We are determined to draw to the Chinese Government’s attention changes that need to be made. We urge restraint where there has been violence and we urge reconciliation where there is a lack of dialogue. I repeat that the authorities in China and the Dalai Lama should, subject to the conditions laid down, get into talks. We are determined to help and facilitate a process of dialogue and reconciliation.

Q7. Given reports that embassy staff in Washington have been forbidden from using the expression “the special relationship”, will the Prime Minister—for the benefit of the people of this country and perhaps of President Sarkozy—define his understanding of the meaning of “the special relationship” between the United Kingdom and our closest ally, the United States? (196469)

As the right hon. Gentleman says, it is our closest ally and our single most important partner, so I use the term “special relationship” with pride.

Q8. As my right hon. Friend knows, the Foreign Secretary launched the Government’s annual human rights report at the Foreign Office last night. Will the Prime Minister join me in congratulating the many volunteer organisations that contribute so much to fostering human rights across the world—including my fellow members of Soroptimists International in north Wales, who, through their project Sierra, aim to transform the lives of orphan children following the war in Sierra Leone? (196470)

I believe that the House should congratulate the Soroptimists and all those who work for human rights in every part of the world, particularly those who work for the achievement of the Geneva convention, but who do so under dangerous and risky conditions that can sometimes threaten their lives. The human rights report published by the Foreign Secretary yesterday draws attention to areas in the world where human rights abuses have to be addressed. One important area that will be in the eye of the world this weekend is Zimbabwe. It is important that we draw attention to the abuses there and call for a restoration—a full restoration—of democracy in that country.

Does the Prime Minister think it right that the west coast main line should have to wait until 2012 for new carriages? Will he intervene in the dispute between the Department for Transport and Virgin Trains in order to secure a resolution to the problem?

I just have to tell the hon. Gentleman that we have spent £7 billion modernising the west coast main line and that no Government could have done more to make it possible for more people to travel on that particular line and on railways more generally. Indeed, the number of passengers using the railways is now more than 1 billion for the first time since the second world war.

Q9. What would my right hon. Friend say about a local authority that has slashed services to disabled people in such a cavalier fashion that they are threatening to take the council to court for its failure to comply with its equality duties under the Disability Discrimination Act 2005? (196471)

It used to be the Conservative councils that were the only ones making huge cuts, but it is now Scottish National party and Liberal Democrat councils, which explains what has happened in Aberdeen. I think that people will be particularly sad to hear that members of the disabled community in Aberdeen are the biggest victims of the cuts being brought in by that administration. I hope that public opinion will express itself and say that disabled people should not suffer in that way.

In the spirit of the entente amicale as well as that of our special relationship with our American allies, may I draw the Prime Minister’s attention to the state of relations between the EU and NATO, which the Defence Committee has urged should be a priority matter for next week’s NATO summit? May I urge him to address what the American ambassador to NATO has called the senseless and frozen conflict between the two institutions and to secure the agreement of President Sarkozy, whom we welcome in London today, to resolve the problem so that neither the EU undermines NATO, nor NATO the EU?

I believe that both NATO and the European Union have important jobs to do. In my discussions with President Sarkozy, I believe that we will see him being amenable to changes in NATO that will bring its European members closer to the heart of NATO in the near future. I also believe that a relationship between the EU and NATO in which the EU does more of the civilian reconstruction work, matching the military work of NATO, as is happening in Kosovo, is one of the ways in which we can cement a better relationship between the two organisations. We are proud to be a member of both NATO and the European Union.

Q10. As science is so important to the north-west and to the UK economy, will my right hon. Friend ensure that the science research council retains key scientific skills at Daresbury laboratory so that we can continue to produce world-leading science there? (196472)

I can tell my hon. Friend, who has fought hard for all the investments made at Daresbury science park, that the Department for Innovation, Universities and Skills is committed to creating a science and innovation campus at Daresbury. That was announced in the Budget of 2006 and confirmed in December 2007. The next step is that Sir Tom McKillop, the chairman of the Royal Bank of Scotland, has been asked to include Daresbury in his north-west review. We are committed to additional investment in science and technology in my hon. Friend’s region, and to all the jobs that flow from that, making it possible for the north-west to continue to increase employment during a difficult period for the world economy.

In his article in The Daily Telegraph yesterday, on why we must stand up for the Union, with which I heartily agree, the Prime Minister mentioned Scotland, Wales and England. Will he now tell the House what his predecessor once said: that he values the Union between Great Britain and Northern Ireland?

Not only do I value the Union but I will work to make that Union strong. If the hon. Gentleman looks at the Daily Telegraph website, he will see that Northern Ireland was included in that article, not excluded.

Points of Order

On a point of order, Mr. Speaker. Would it be possible to know whether the appeal by the House of Commons Commission to the Appeal Court is limited to the question of addresses, or extends to the wider question of second homes? If it is the former, that would be perfectly understandable on grounds of security. If, however, the appeal against the information tribunal is on the wider question of expenditure on what are described as second homes, it should be noted that some Members, certainly myself, are very much opposed to the appeal being lodged. In my view, it is unfortunate that no way of voting—

Order. This matter is before the court, and while I know that the media can talk about it, the rules are clear that it is sub judice for the House of Commons, and I cannot discuss it. In relation to many of the questions that the hon. Gentleman raises, there is nothing to stop him going to the court and finding out the grounds for the appeal.

bill presented

microgeneration (definition) amendment

Mr. David Drew presented a Bill to amend the definition of “microgeneration” in certain Acts: And the same was read the First time; and ordered to be read a Second time on Friday 25 April, and to be printed [Bill 155].

Orders of the Day

Local Transport Bill [Lords]

[Relevant documents: The Ninth Report from the Transport Committee, Session 2006-07, on the draft Local Transport Bill and the Transport Innovation Fund, HC 692, and the Government’s Response, HC 1053.]

Order for Second Reading read.

I inform the House that I have selected the amendment in the name of the hon. Member for Chipping Barnet (Mrs. Villiers).

I beg to move, That the Bill be now read a Second time.

May I give the apologies of my right hon. Friend the Secretary of State for Transport, who is unwell today?

Reliable, high-quality public transport makes a real difference to people in their everyday lives. We depend on it to get to work, to the shops, to essential services such as schools and hospitals, and to visit friends and family. It can help to promote social inclusion, particularly as the most vulnerable in our society often depend on public transport to the greatest extent. Good public transport also helps to tackle congestion, contributing to improved economic performance and the fight against climate change.

The bus has always been the workhorse of the transport system. Back in the 1950s, up to 13 billion journeys across the country were made by bus each year. Sadly, for the rest of the last century, the number of people using buses fell year on year. The previous Tory Government’s solution in the mid-1980s was to deregulate the bus market outside London. Too often, that led to services being cut back, and in some places aggressive competition in the form of bus wars gave the industry a bad name. That is why bus patronage fell from 5.8 billion journeys a year across the country in the mid-1980s to below 4.4 billion by the late 1990s.

We on the island are hopeful that the Office of Fair Trading will be persuaded to look into market failure regarding ferries. However, provision of free public transport for elderly people is outside its remit. Elderly people can travel by bus, free of charge, when visiting relatives in other parts of the mainland. Why are my elderly constituents penalised by being forced to pay for a ferry if they want to visit a relative outside their constituency? I hope that that is something that the Minister can look into.

I am not sure why the hon. Gentleman is bringing the OFT into this. I think he is referring to the national concessionary fares scheme, which we debated in the House last night and the Labour Government introduced. He is right: something like 11 million people over 60 and disabled people will benefit from it this year, but it is true that that is confined to buses. It is open to local authorities to extend the scheme if they wish to do so. He may like to approach his local authority to see whether it wishes to extend the scheme to the ferry service, which it is at liberty to do with the discretionary powers available to it.

Will my right hon. Friend join me in congratulating South Yorkshire and West Yorkshire on not just giving free bus travel to all people over 60, but giving free train and tram travel too across the boundaries of both metropolitan districts?

My hon. Friend is right to highlight South Yorkshire as an exemplar of good public transport provision. I am glad to say that it has continued—like, I have to say, some Conservative and Liberal Democrat councils—the concessionary fare schemes that were previously available. It obviously shows that Labour councils value older and disabled people and want to give them those extra services on top of the national concessionary fares scheme, in which the Government are investing something like £212 million this year.

My right hon. Friend will know that Merseytravel is now the most successful rail operator in the country, offering on-time delivery more often than any other provider. However, that has been brought about only by the significant investment that this Government have placed in public transport on Merseyside, an area with the least car ownership and where people are absolutely reliant on public transport—£13 million was spent in 1997; it is now well over £60 million. Merseytravel delivers the sort of services that people, quite frankly, have a right to.

My hon. Friend is right to point in particular to some of the integrated transport schemes that have been developed by some of our successful passenger transport executives. The idea of the Bill is to enable them to go even further in improving public transport, in contrast, as I said, to the Conservatives, who during their time in power deregulated the bus services, causing enormous problems for all our constituents.

As the Minister knows, the Liberal Democrats will probably support the Bill, but may I take up the point that she made earlier about concessionary bus fares? I do not wish to revisit last night’s debate, but it is simply not true that local authorities do not care about the extra discretionary services. All local authorities of all parties want to provide such services, but there is a genuine issue over funding. Will the Minister give me the assurance that she would not give me last night? Will she undertake to conduct a review after, say, a year to establish whether or not the formula that the Government have applied is fair to local authorities? She needs to do that.

Clearly we are revisiting last night’s debate. As I have said, about £1 billion will be invested in concessionary fares this year, including an extra £212 million. We believe that that is a generous settlement, and that there is no need for local authorities to cut the services that they provide for elderly and disabled people.

Will the Minister confirm that the Bill will allow local authorities such as Durham county council to draw up plans to improve public transport, particularly bus services, and to create better integration between commercial bus operations and, for instance, community transport initiatives so that they can start to deliver for their populations in a way that was not possible before because of the last Government’s lack of investment?

My hon. Friend has highlighted three points: the way in which the Bill will improve bus services, the integration of transport services that it will allow, and the fact that it will allow better planning so that our constituents can benefit from the improved public transport that we all want.

I know that what I am about to say will interest my hon. Friend the Member for Preston (Mr. Hendrick), and I will give way to him in a second.

Under the deregulation introduced by the last Government, competition became very aggressive. That led to bus wars in some parts of the country, and gave the industry a bad name. We saw a fall in bus patronage across the country under the stewardship of the last Government, and the Bill is intended to put that right. In stark contrast to what the last Government did, this Government have been reversing the legacy of underinvestment that we inherited in 1997, and have made it a priority to get people back on to buses.

I thank my right hon. Friend for visiting Preston recently to observe and discuss its Civitas programme. She will be well aware of the current bus wars between the Stagecoach bus company and Preston Bus. How will the Bill facilitate improvement in services, given the problems that deregulation has caused in places such as Preston?

There are instances in which it has not been in the public interest to provide services that do not meet our constituents’ needs. I will not comment specifically on my hon. Friend’s area because I know that the traffic commissioner is undertaking an inquiry, but I am aware that he has followed developments closely and has been very concerned about the effect on his constituents. However, there are a number of ways in which the Bill allows local authorities to plan services more effectively and introduce better quality partnerships and, if necessary, quality contracts. I will say more about that shortly.

We shall be able to reassure our constituents that their real needs will be considered. It will be possible to sit down with bus operators in a spirit of co-operation, and discuss how it can best be ensured that services meet the needs of local people. The Bill provides a range of ways in which that can be achieved.

If the Minister is so strongly opposed to the deregulated system that the Government inherited from their predecessor, why is it that in 10 years all they have done is introduce two schemes, quality contracts and quality partnerships, that have been used by no local authority except one that has used a quality partnership? Clearly the Government’s concern about the present system has not motivated them to do anything to amend it.

That is an interesting comment, because I understand from it that the hon. Lady believes that the introduction of quality partnerships and contracts should be encouraged, so I am surprised that her reasoned amendment says her party will vote against the Bill because of the introduction of quality contracts.

I would be the first to say that we need to go further than the powers available in the Transport Act 2000. It has been recognised that the threshold was set too high, which is why we are changing the legislation, improving on the 2000 Act to make co-operation easier. I am astonished that the hon. Lady and her party do not recognise their constituents’ concerns, and wish to vote against the Bill because of the introduction of quality contracts.

The concessionary fares scheme for elderly people has been enormously successful and popular. Does the Minister agree that exactly the same arguments that supported the case for a national concessionary fares scheme for the over-60s also support the case for such a scheme for the under-18s? Will she keep her mind, and the collective mind of her officials, open to the possibility that when considering the next transport Act we should look seriously at introducing a national, standardised, basic minimum concessionary fares scheme for under-18s?

My hon. Friend reinforces the point that without a Labour Government there would not have been a national concessionary fares scheme at all; in particular, it would not have been possible without the extra investment that the Labour Government have put in. Of course, any extension of schemes requires extra investment. We are doing lots of things to encourage younger people to use public transport—and we also encourage other initiatives, such as cycling schemes to make sure that they get the benefits of exercise.

I take on board my hon. Friend’s point, but we must consider it in the context of the investment we are already putting into the bus industry. About £2.5 billion each year goes into bus services, up from just £1 billion a decade ago. It was this Government who introduced the rural bus subsidy grant, and since we came into office we have nearly doubled it to £55 million a year. That means that over the 10-year period we have spent about £450 million a year subsidising rural bus services.

As we debated in the House last night, the investment we are putting in through the national concessionary fares scheme gives about 11 million older and disabled people the freedom to travel free on any off-peak local bus in any part of England. That scheme has boosted the number of people using buses, and has brought people greater freedom and independence. As a result of all the changes and investment I have outlined, almost 500 million extra journeys are being made each year on local buses since 1998.

The Minister mentions rural areas, but what is her view of the EU driving times and rest periods directive of last April which bans drivers from covering more than 31 miles at any point in a single trip unless they have had a 45-hour period off in the same week? That is causing mayhem in counties such as Norfolk. A firm called Norfolk Green has contacted me about it, saying that it will have to cut a number of rural services. Is this not another example of crazy Euro-interference in our own business?

The hon. Gentleman would do well to remember that that measure was brought in on safety grounds. We should not underestimate the importance of that. However, I understand that the matter is being examined by the Vehicle and Operator Services Agency, and that the bus operators will shortly be meeting to discuss how the directive can be successfully implemented. It is important to remember that it was to do with safety issues about which we should all be concerned.

As I said, the 2000 Act created new opportunities for local authorities to work with bus operators towards real improvements for the benefit of passengers. It included measures to support voluntary partnership arrangements between local authorities and bus operators, and gave powers to local authorities to implement quality partnership and quality contracts schemes.

The Government have been getting it in the neck from both local government and the private sector, which may suggest to some that perhaps they are on the right track. Does the Minister agree that the Bill’s success will be tested in how the bus companies and local authorities come together to solve the problems that exist in providing services to communities that are not well served by bus companies? The real test of the Bill’s success when it is enacted will come when local authorities and the bus companies start seriously to talk together about improving services.

My hon. Friend is right, and I thank him for the work that he did in the Transport Committee, scrutinising the Bill. It allowed us to make amendments to the Bill to improve it, and I shall come to those later. He is right to say that the Bill’s success will depend on its practical implementation and the relationship that can be built up between local authorities and the bus operators in a positive way for the benefit of bus users.

As I was saying, the actions that we have taken during the 10 years of the Labour Government have made a real difference. They have meant the development of not only the partnerships to which reference has been made, but the partnership between central and local government. It has meant that we have managed to halt the decline in bus usage and delivered the first sustained year-on-year increase in patronage. About 500 million more journeys are made than was the case 10 years ago.

What the Minister says is right, and I have seen the improvement in my constituency. Some 10 days ago, a consultation document on subsidy was published, yet the Bill will go into Committee without our knowing what recommendations come out of that consultation. Is that not unfortunate timing? Surely subsidy is an important word in the context of the Bill.

How we deliver the bus service operators grant in future is important, and that is open to consultation. It would not have been right to delay the whole Bill until we had been through the consultation and then examine the Bill in that context; things can be done the other way round. We know that powers in the Bill will give local authorities and bus operators the ability to move forward together. If the hon. Gentleman were to examine the consultation document, he would see that it contains a few suggestions as to how the grant might be used to support the increased usage of bus services. So, it would not have been right to wait until the whole thing had been finished before considering the Bill.

Does the Minister agree that the major bus success stories in the country have been brought about by voluntary partnerships, and not by the statutory partnerships or quality contracts proposed in the Bill?

My hon. Friends said it all. If the hon. Lady thinks that the current situation is perfect, I do not understand how she can be talking to her constituents or those of other hon. and right hon. Members in her party. Voluntary partnerships have worked in some cases. In cities such as York and Cambridge, and sometimes in rural areas such as Warwickshire and Cheshire, bus services have been transformed and are consequently attracting growing numbers of passengers. Such examples show that people will return to buses if services are improved through effective partnership working between bus operators and local authorities, but for each place where partnership is making a real difference, there are many others where that is not the case and where more still needs to be done to provide the services that people want. I find it astonishing that the Conservative party does not recognise that.

I agree with the Minister, and I want to see how we can move forward from this position. I have delivered petitions to this House from my constituents because bus services have been savagely cut in my constituency by First. I am looking forward to hearing her tell us more about how local authorities can move forward on the contracts and bus partnerships, because large parts of my constituency have no bus services any more.

My hon. Friend is right, and her comments show that she is in touch with the needs of her constituents. She recognises that although voluntary partnerships can work in some areas, in others they do not and more needs to be done. We know that more needs to be done, and that is what the Bill is all about.

Is the Minister aware of the existence of an inter-authority organisation called the Partnership for Urban South Hampshire—PUSH—which has undertaken considerable discussion on the question of integrated transport arrangements? It would be interested in the possibility of becoming an integrated transport authority under the terms of the Bill. Is she aware that the majority of PUSH’s members are Conservative-controlled authorities? Does she share my concern that the Conservative party appears to wish to vote against the entire Bill and thus to deny those authorities the opportunity to provide the sort of integrated transport system that I believe south Hampshire urgently needs?

Again, my hon. Friend makes an important point. I know from my visits around the country that politicians from all parties say that they would like to have greater powers in order to sit down with bus operators and make progress on schemes of exactly the type that he is talking about. He will know that the Bill gives areas the ability to examine their governance arrangements and to decide whether they want to establish integrated transport authorities. He rightly says that, again, the Conservative party does not seem to be in touch even with its own local councillors on this issue, because its approach does not reflect my experience when going around the country—all I can say is that perhaps Conservative Members need to get out a little bit more.

I shall come back to the hon. Gentleman in a minute.

The Bill is a direct response to what local authorities, transport users and, in some cases, transport operators have told us about the different challenges and circumstances faced in different parts of the country. In the summer of 2006, the Government launched a wide-ranging review of bus services across the country. In December 2006, we published our conclusions in “Putting Passengers First”, and in May 2007, we published the draft Local Transport Bill. That was followed by a period of consultation. As I said, I made a series of regional visits to listen to people’s views about how the draft Bill could help in their areas and to their suggestions about how it could be further improved.

As a result of our public consultation and scrutiny, including a report from the Transport Committee, we were able to make some very significant improvements to the Bill before it was introduced to Parliament, including the following: taking powers to set up a statutory body to represent bus passengers; ensuring that the provisions of the Transfer of Undertakings (Protection of Employment) Regulations, following representations from the trade unions, apply where staff are affected by a quality contract scheme; and giving traffic commissioners the power to require operators to invest in improvements or compensate passengers where services are not operating properly. The Bill was introduced in the other place in November, where it benefited from further changes, including measures to boost community transport and to improve the accessibility of taxi buses.

Further to the comments by the hon. Member for Chipping Barnet (Mrs. Villiers), is it not the case that the voluntary agreements that she extols exist solely on the basis of terms dictated by the bus operators and tend to be concentrated on a minority of highly profitable corridors?

There are several instances in which voluntary agreements have been reached, but my hon. Friend is right to say that we need to look further at how we can increase the effectiveness of these agreements. That is what the Bill sets out to do. I know that he has been extremely concerned about local bus services in his area, and it is important that authorities are able to work with bus operators to reach an agreement. The Bill will give such agreements statutory force and I will describe later how that will make these partnerships more effective.

May I tempt my right hon. Friend to go a little further? Is there not a case for giving excellent transport authorities such as South Yorkshire passenger transport authority the ability to introduce quality contracts, without reference to external organisations, just as the Mayor of London can do? If she will not go that far, will she at least listen to the Transport Committee, which said that there should be a time limit on how long applications for quality contracts should be considered by the approvals board and the transport tribunal to prevent inordinate delays that would not be in the interests of bus passengers?

I will address that particular point when I move on to some of the details of the Bill, but I understand the point that my hon. Friend makes.

I share the Minister’s surprise that the Conservatives have apparently decided to vote against Second Reading. She has emphasised the importance of the quality contracts and the quality partnership agreements, but if they are so important why has there been such a dismally low take-up so far? What will the Government do about that?

As I said earlier, there were powers in the Transport Act 2000 to allow the making of quality contracts and some partnership schemes. The problem with the quality contracts was that the threshold was set too high. That is the feedback that we have received. In a sense, that is why we are replacing the test of the only practical way of delivering services with the public interest test. The intention was to be able to make the quality contracts possible, in a similar way to some of the arrangements in London, but unfortunately that did not happen in several areas and that is why we are changing the situation. It was a good attempt, but we recognise that it has shortcomings.

My right hon. Friend mentioned community transport. What estimate has she made of the potential impact of the welcome changes in the Bill, and does she share my surprise that the Opposition intend to vote against the Bill? That will upset the Opposition Chief Whip, my constituency neighbour, who has applauded the fact that these provisions will, with some adaptations, enable us to bring the dial-a-bus services in Derbyshire into the concessionary fare scheme.

It is rare that my speeches are greeted with standing ovations, but when I spoke to the Community Transport Association and announced the changes that we intended to make in this Bill, there was immediate applause. I was quite taken aback, but it showed that the changes we are making to community transport—especially the ability to pay drivers and a change made in the House of Lords to allow local authorities to lease vehicles to community transport organisations—have been widely welcomed by the community transport sector. It is astonishing that the Conservatives do not recognise the importance of the change, which will have a real effect in rural areas. Why they have taken the view that they have taken is very surprising, and I suspect that it will not be very welcome to the local voluntary organisations with which they work. What repayment for the work that people do is it to vote against such a Bill? Their stance will undermine community transport provision when we are trying to improve it.

I shall now turn to the Bill in a little more detail. Part 1 includes measures to strengthen the capacity of the traffic commissioners, who play an important role in the regulation of both the goods vehicle and bus sectors. This is important because, as I will explain shortly, other parts of the Bill will strengthen the commissioners’ role in relation to bus services.

Part 2 will reform the framework for local transport planning. It will enable integrated transport authorities to play a stronger role in planning local transport across local authority areas, by making them responsible for the preparation of local transport plans. That will help to ensure a consistent and coherent approach, for example in planning a network of bus lanes across a conurbation. Future local transport plans will also need to include proposals for implementing an area’s local transport policies, and authorities will be under a new duty to have regard to the Government’s environmental policies and guidance.

Part 3 of the Bill will ensure that local authorities have a variety of realistic options for working with the bus industry to provide the services that passengers want. The Bill will give local councils the flexibility to choose the approach that is best suited to their particular local needs.

Clauses 13 to 18 will enable quality partnership schemes—first introduced in the 2000 Act—to make more of a difference. Last year, as my hon. Friend the Member for Sheffield, Hillsborough (Ms Smith) mentioned, we saw the first quality partnership scheme come into force in Sheffield. This is now delivering a package of improvements, combining new vehicles with measures to reduce the impact of congestion on bus services. Similar schemes are now being considered in other places. However, this Bill will now enable these schemes to cover frequencies, timings and maximum fares—matters that are of crucial importance to passengers. It will allow, for the first time, quality partnership schemes to include “registration restrictions”—the Conservatives say that they oppose this in their reasoned amendment—so that operators who have not signed up to the scheme cannot run along the route if their doing so would undermine the scheme. That is the point that my hon. Friend the Member for Pudsey (Mr. Truswell) made. The partnerships need strengthening so that they cannot be undermined by someone choosing to interfere in the agreement that bus operators and local authorities have reached.

Clauses 19 to 40 will make bus franchising a much more realistic option for local authorities where they believe it is the right thing to do in their area. We have listened to the concerns of local councillors of all political persuasions that the existing legislation is too restrictive, and this Bill will put that right. Of course, authorities will still need to be satisfied that quality contract schemes are in the public interest, but they will no longer have to prove that they are the “only practicable way”.

My hon. Friend the Member for Selby (Mr. Grogan) raised a point about the approvals board for quality contract schemes. Our proposals would make quality contracts a more realistic option for local authorities, while ensuring that the legitimate interests of all parties are taken into account. If we can do that, it will dramatically reduce the scope for challenge.

The proposals are in line with the recommendation of the Transport Committee that an independent approvals board should ensure that local authorities have undertaken the correct process for making a scheme. Of course, a local authority’s policy—I know that that is what my hon. Friend is getting at—is a matter for that authority and its electorate. The role of the approvals body is to provide a robust check on whether a proposed scheme is consistent with that policy, provides value for money, satisfies the criteria prescribed in legislation and is in the wider public interest, as well as whether due process has been approved.

The approvals process will provide a robust check and balance in the process but will also significantly reduce the risk of a scheme being taken through a costly and time-consuming judicial review. We agree that the process should not cause undue delay and the Bill includes a power to specify in regulations a time limit within which the approvals board should reach its decisions. We understand that the process needs to be efficient and quick. Regulations will include the ability to give an indication of that. However, if months are required to make a quality contract, we need to compare that time with the years it could take for a challenge under judicial review. This is a belt-and-braces approach for local authorities to ensure that they have that security when they make a contract scheme.

That point goes to the heart of an important issue. I listened very carefully to what my right hon. Friend just said about the processes for quality contracts, but is it not true that judicial review is essentially a challenge to a process that has not been carried out properly? That option will still be open to operators if they do not like the quality contracts and want the free-for-all that we have now. My right hon. Friend has just set out the fact that the approvals board will have the power to consider issues such as value for money and the wider public interest. Could there not be simply a difference of view between an approvals board and an elected passenger transport authority? The view of the approvals board would triumph in such circumstances, overriding the democratically elected body. Is that really acceptable?

We do not envisage that the process would involve a straight yes or no. It could be iterative. We would envisage that the approvals board would have, under the traffic commissioner, an economist and perhaps a transport expert to ensure that it could consider the economics of the scheme. Judicial review might not just be on the grounds of a process that was not followed. Other issues come into play, for example when a business can no longer operate in an area. Those are different grounds that could be used. We are trying to have a process that could be iterative at the same time—that is, that could involve discussions about maximum fares or the viability of routes. It is not an attempt to make it more difficult to get quality contracts, but to ensure that quality contracts can work and can be introduced effectively and efficiently without the huge delays caused by a judicial process.

I entirely accept that if an approvals board agrees with the passenger transport authority that quality contracts are the way forward, that could be a stronger position to defend if a judicial review eventually happened. That goes without saying, but is it not possible that the approvals board, simply as a matter of opinion, could reach a different view on the right way forward for bus passenger services in an area from the passenger transport authority? In such a situation, is it not true that under the Bill the approvals board could overrule the decision of the passenger transport authority and decide on a way forward of which the authority did not approve?

It will not be for an approvals board to design a system for a local area. The board will consider the proposals and say whether it believes—this could be done through discussion—that they will stand up and deliver what the local authority thinks they will. It is not a question of a transport expert going to an area and saying, “We will have an entirely different approach in this matter.” We expect the boards to be a facility that will enable local authorities to introduce quality contracts, if that is in the public interest, as quickly and effectively as possible. It is important that we put in place a mechanism that means that local authorities are not constantly taken to judicial review. I am sure that we shall continue to discuss this subject in Committee, but I ought to move on.

I understand the Minister’s desire to ensure that there is a robust system in place to prevent unnecessary judicial review, but we also have the hurdle of the transport tribunal. If the approvals board is the external validation process that provides that rigour and defence, why is there further recourse to the transport tribunal? Why is that provision in the Bill as a further hurdle?

If we want to be absolutely sure that the route will mean that it will be more difficult to go to judicial review, there has to be an option of appeal against the approvals board. That is why we put that provision in the Bill. It is a belt-and-braces approach. Because one could if necessary judicially review the approvals board, there is a further appeal.

Let me move on to voluntary partnership arrangements. Clause 41 and schedule 2 make some important changes to competition law as it applies to the bus market. The aim is to ensure that competition law does not prevent local authorities and bus operators from coming together at the partnership table. At the moment, if bus operators come together with local authorities under a voluntary partnership to discuss, for example, times when they might run complementary services, they risk falling foul of competition law. The Bill will mean that operators can sit down with local authorities and plan services more effectively.

Part 4 contains various further measures on passenger transport. For example, clauses 52 to 56 will help to create new opportunities for the community transport sector, which plays an important local role, often in the areas with the greatest social need. As I said, the Community Transport Association has given a warm welcome to measures in the Bill that will allow its members greater flexibility over the types of vehicles that they can use, and that allow drivers of community bus services to be paid.

Clauses 57 to 60 will help to ensure that action can be taken where, for whatever reason, bus services are consistently unreliable. Traffic commissioners will still be able to apply financial penalties when bus operators are at fault, but now in a way that directly benefits passengers, requiring the operator to invest in service improvements or to pay compensation to passengers.

The Bill will also enable the traffic commissioners to hold local authorities to account if their failure to meet their traffic management duties contributes to the poor reliability of bus services. They will be able to make recommendations to bus operators and local authorities alike about how things might be put right. We have done that to respond to the legitimate concerns of bus operators, who have sometimes said, “We’ve made improvements in local areas, but the local authority has not kept its side of the bargain.” Again, it is astonishing that the Opposition wish to vote against that.

My right hon. Friend makes a very important point that goes back to what she was saying about the new role for integrated transport authorities. Often, some local authorities in a metropolitan area are good at introducing quality bus measures, but others are appalling at it, which has a knock-on impact on the level of service. Does she agree that the changes proposed in the Bill will mean that across a whole metropolitan county there could be a proper network with proper quality bus measures? That will mean that the reliability of bus services, which she has mentioned, can better be guaranteed.

Absolutely. My hon. Friend is quite right. I should add again that when I have visited local areas and talked to people who are trying to deliver transport, councillors of all parties have said that they have sometimes come across that problem. They have said that they could do much more if the powers in the Bill were already in place. They say, “Please get these powers in place as soon as possible.” The Opposition Front-Bench team do not want them at all.

There is widespread agreement that at the same time as strengthening the traffic commissioners’ role, we need to give passengers a stronger voice about the services that they use. Talking to passengers makes it very clear what they want: buses that go where they want to go, when they want to travel, and are clean, comfortable and not overcrowded, and reliable services that get to their destinations quickly and efficiently.

We need to put passengers at the heart of our bus services, and give them the opportunity to hold those services to account. There are already well-established bodies that are helping to do just that, often operating at local or regional level. Many people have argued, however, and I agree, that there is a good case for establishing a statutory body, with statutory powers, to act as a champion of the needs of the bus passenger. We launched a full public consultation last December, and we are now carefully considering the many responses that we have received. There is a clear consensus about the need for a bigger passenger voice, and we will announce our conclusions shortly. Clauses 68 and 69 contain the primary powers that would enable us to take forward that important agenda in future secondary legislation.

Many of the transport challenges that our communities face require local areas to work closely in partnership with each other. That relates to the point made by my hon. Friend the Member for Denton and Reddish (Andrew Gwynne). Those partnerships must have the powers and authority to make the decisions that are needed. Passenger transport authorities and passenger transport executives play a crucial role in delivering public transport in our major cities outside London, but the current arrangements have been in place for several decades and do not always lead to coherent transport planning across our major urban areas. We therefore want to support those urban areas that are now starting to explore the options for reform.

Instead of taking a prescriptive approach to local transport governance, part 5 of the Bill lays the foundations for local areas themselves to examine the strengths and weaknesses of their existing arrangements. They will be able to develop their own proposals for reforms to suit their local needs, which could then be implemented in secondary legislation tailored to the needs of the individual area. That process could lead to a stronger role for integrated transport authorities, perhaps with stronger powers on important matters such as bus lanes, leading to a more coherent and consistent approach such as my hon. Friend described.

I am grateful to my right hon. Friend the Minister, who is being very generous in giving way. Under the Bill, would it be possible for an integrated passenger authority to cover a whole region, for example the north-east of England, if proper consultation took place and authorities were prepared to buy into it?

What we have said is that we want local authorities themselves to consider what will work best. We would expect wide consensus in the setting up of new bodies, and my hon. Friend will know better than I whether such consensus is likely to be reached at regional level. Of course, other transport planning measures are possible under other legislation, such as multi-area agreements. It is quite possible for local authorities to get together much more effectively than was previously the case and to plan more widely, and we are already seeing that. I am sure my hon. Friend knows that the changes that are taking place in relation to the regional development agencies and so on are causing people to look closely at how to deal with transport.

Governance reforms could obviously be particularly beneficial in areas that are considering the role that road charging could play alongside investment in local public transport. The Bill makes it absolutely clear that it is for local authorities, not central Government, to decide whether local road charging is right for their areas. It confirms that scheme revenues are for the local authority involved to spend on local transport, even after the first 10 years of a scheme. It also ensures that the right powers are available to secure consistency and interoperability between schemes, helping to avoid confusion and complexity for road users.

In 2005, the Labour party manifesto stated that, if re-elected, the Labour Government would move away from

“the current system of motoring taxation towards a national system of road-pricing.”

If road pricing schemes get the go-ahead under the Bill, which existing motoring taxes will be reduced or abolished?

The Bill is not about a national road pricing scheme. It is about local road pricing schemes, if local areas want them. Frankly, the type of changes that the right hon. Gentleman is talking about would be impractical in a local area and a local scheme, and I am sure he knows that. What we have said, however, as I have just stated, is that any revenue raised will be ploughed back into public transport even after the first 10 years of any road pricing approach.

I thank the Minister for giving way; she continues to be very generous with her time. She says that decisions about road charging schemes will be taken locally and should be in the hands of local authorities. What is her view of the current situation in Greater Manchester, with which she will be familiar? Seven of the 10 boroughs are apparently in favour of such a scheme, but the other three are most definitely not. Does she intend that the Government will continue with their policy and effectively force the scheme on the rest of the conurbation of Greater Manchester, whether it likes it or not?

Obviously, the discussions about the Manchester transport innovation fund bid are still going on, and we will examine the proposals when they come to us.

As I hope is clear, the Bill has a strong focus on empowering local communities to address the transport challenges that they face today and will face in the years ahead. It does so by ensuring that the right powers are available at the right level to deliver the changes that are needed locally, by giving a stronger voice to transport users and by ensuring that the right governance arrangements can be put in place locally so that the decisions that are needed can be made. There is a great deal of support for the Bill, not least because transport users, local government and central Government agree that we need local communities to be empowered to secure services that are designed around the needs of passengers—local transport that genuinely puts the needs of the travelling public first.

This Labour Government have vastly improved the provision of bus services in this country, after the disastrous actions of the previous Tory Government. I hoped that all parties would support the Bill today, but the Opposition have apparently decided not to do so. That shows exactly how out of touch they are with the real concerns of people in this country. It will remind us of the real attitude of the Conservative Party, which goes back to Margaret Thatcher’s view that if a man was using a bus after the age of 30, he was a failure. What nonsense. Millions of people use our bus services, and if the Opposition do not support the Bill, they will be turning their back on those people. It will be frankly astonishing not to support these changes, and I am amazed that they are even considering that. I know it will be against the will of many of their representatives in local government. Without a Labour Government there would be no national concessionary travel scheme, nor the increase in bus use that has been evident over the past 10 years. This Bill is a further step on that journey of improvement, and I commend it to the House.

I beg to move,

That this House declines to give a Second Reading to the Local Transport Bill [Lords] because it encourages the introduction of Quality Contract schemes to reregulate bus networks, thus preventing free competition between bus operators, undermining service quality for passengers and jeopardising the partnerships between operators and local authorities that have helped to improve service quality; because it fails to give due weight to the importance of consultation and local consent when local congestion charging schemes are considered; and because it transfers revenue-raising powers to the National Assembly for Wales without proper constitutional justification and in doing so allows Wales to be used as a test bed for the Government’s untried, untested national road pricing scheme.

I want to start by emphasising one thing very clearly—buses matter. Any Conservative Government led by David Cameron will do all that they can to improve bus services for passengers. Two thirds of all journeys by public transport are made by bus every year. That is well above the combined total of journeys on both the London underground and the whole national rail network. For thousands of people across the country, the bus is the only option when it comes to local public transport.

So buses matter to our quality of life and to our economic prosperity. Critically, of course, they now also matter when it comes to tackling problems caused by climate change and worsening traffic congestion. Increasing bus ridership should play a significant part in a successful strategy to tackle both those vital issues for our country, so I welcome the fact that this Bill gives us time in Parliament to debate the future of the UK’s bus network.

Given what the hon. Lady has just said, and given that her party leader is in favour of improving bus services, why are the Opposition not voting for the Bill today?

We have tabled the amendment because we do not believe that the Bill is the best way to improve local bus services. As I shall explain, not all of the Bill is controversial. We agree with some elements, but we think that significant parts of it take our bus network in the wrong direction.

I do not doubt that the hon. Lady values buses, but unfortunately her hon. Friends do not. She could fit into a London taxi the Conservative MPs present for this debate; she would not need a bus. [Interruption.] I declare my interests. The hon. Lady said that bus deregulation had worked outside London. If that is so, why has overall bus ridership outside London fallen rather than risen?

There are many differences between the London example and the rest of the country. It is clear that the level of subsidy in London has a much more significant impact on ridership than matters to do with regulation or deregulation. It is simply not possible to make a causal link between the regulatory structure in London and levels of ridership. That equation does not add up.

I listened carefully to the answer given by the hon. Lady. The Select Committee on Transport has produced a number of reports on the question of subsidies, however, and if she has read them, she will know that virtually no subsidy was given to the regulated London bus system until the city got a Mayor. Even so, the passenger figures for London remained static, while those for metropolitan areas in the rest of the country fell. Does not that make the case for regulating the bus system outside London, or would she prefer to deregulate bus services in London, since they are so good?

I assure the hon. Gentleman that we have no plans to change the system in the capital, where special circumstances apply. However, he fails to make the case for a causal connection between the regulatory system in London and the recorded increases in ridership. The subsidy in London amounts to £638 million, and that clearly makes a significant difference. The disparity between ridership in London and the rest of the country is not due to the regulatory system in place in the capital.

I want to get this right. The hon. Lady has said that there is no causal relationship between the regulatory system that operates in London and bus ridership. However, she accepts that the capital has been very successful in increasing bus ridership. If there is no causal relationship between the two, why does she rule out the possibility of changing the regulatory environment in London?

As I said, we have no plans to change the regulatory system in London.

I turn now to the Bill itself. We welcome the provisions on community transport that the Minister outlined earlier, and those aimed at preventing competition law from getting in the way of sensible arrangements to co-ordinate and improve bus services. Of course it is vital to police anti-competitive practices effectively, but it makes no sense if competition law actively frustrates arrangements that benefit passengers.

Competition law, as some people currently interpret it, can put a very real barrier in the way of efforts to improve local bus services. Even a low-key discussion between bus operators to consider co-ordination measures aimed at benefiting passengers can potentially give rise to dawn raids by competition authorities and the police. It is a matter of serious concern that this problem remains unsolved so long after deregulation.

In that regard, I want to pay tribute to the work done by the Campaign for Better Transport. The Opposition can see some appealing arguments in favour of the call that that organisation makes in its briefing on the Bill for a wider remit for the revised competition test set out in schedule 2. The campaign’s ideas on taking into account the competition provided between car and bus, and not just between bus operators, is also something that we consider well worth exploring.

The hon. Lady seemed to suggest that competition needs to be somewhat regulated in the interests of users. Will she explain why the amendment proposes free competition between bus operators?

We are saying that some competition laws get in the way of the effective provision of better services for passengers. Those laws need to be reformed to ensure that they work more efficiently and do not get in the way of the provision of better services for passengers.

We also welcome efforts to strengthen the voice of bus passengers and to establish a “bus champion”, and we recognise the valuable work already done in that respect by Bus Users UK. We note the observations made by the National Consumer Council on this aspect of the Bill, and its call for the new organisation to be a strong national advocacy body with a clear remit to improve bus travel for the consumer. The NCC is correct to emphasise the importance of founding the work of the new body on sound ongoing qualitative and quantitative research. In that regard, we can learn from the precedent set by the high-quality research produced by Passenger Focus in the rail context.

I turn now to the Bill’s more controversial provisions, and specifically to clauses 13 to 18 on statutory quality partnerships. An invention of this Government, these statutory arrangements have lagged behind voluntary partnerships in delivering service improvements. According to the passenger transport executive group, only one statutory quality partnership has been implemented since the partnerships were introduced in the Transport Act 2000, and I understand that it is to be found on the A6135—the Barnsley road—in Sheffield.

I very much hope that that scheme is successful, but the fact that it appears to be the sole example of the use of this fundamental element of the Government’s bus policy must lead us to question the effectiveness of such arrangements. I have yet to hear from the Minister exactly what can be achieved using a statutory arrangement that cannot be delivered using the voluntary arrangements that already have a proven track record in many areas of the country.

I represent part of the city of Sheffield, and I draw the hon. Lady’s attention to the fact that it proved extremely difficult to put in place the contract for the Barnsley road quality partnership scheme. Does she agree that that underlines the need for this Bill, as it will make quality partnerships easier to use in future?

No. I believe that the Barnsley road example illustrates the fact that it is voluntary partnerships that are delivering around the country. There are many examples of that, some of which I shall come to in a moment.

We believe that the move in the Bill to include fares and frequencies in quality partnerships must be accompanied by measures to ensure that transport authorities take a reasonable approach to such arrangements. There must be proper safeguards in place to ensure that it is not possible for a local authority to put provisions in its quality partnership arrangements that would be uncommercial and impractical to implement. That is why we will scrutinise with great care what is meant by an “admissible objection” as set out in clause 18, and how the reasonableness test envisaged by the Bill will work in practice. It would clearly be wrong for local authorities to be able to impose regulation via the quality partnership system without putting in place the safeguards envisaged for quality contracts.

The concept of admissible objection will be pivotal in determining whether that risk materialises and whether the quality partnership provisions will be workable, so clear guidance on the meaning of the term is needed at the earliest opportunity. I therefore appeal to the Minister to publish the guidance—the Government tend to rely on guidance—on the clause as soon as possible, preferably before the Bill goes into Committee. That would be extremely helpful in establishing the meaning of that important term.

Clauses 19 to 40 are on quality contracts, which are another centrepiece of the Government’s bus policy, but which take us in the wrong direction. It is no surprise that they have sat on the statute book as a white elephant since their introduction, unused and irrelevant to effective attempts to improve bus services for passengers. I am the first to admit that the history of the deregulated bus network has not always lacked controversy, but I believe that the private sector has, in general, made a positive contribution when it comes to quality of service for passengers. There are undoubtedly some bus operators who underperform; that happens in all markets.

In one moment. I believe that, overall, the investment stimulus, innovation and entrepreneurial skills and expertise in product development and marketing that the bus companies have introduced have had a positive impact on services. It seems clear that private enterprise has facilitated a more rapid renewal of the bus fleet and a more efficient cost base than would ever have been possible under the old system.

I must confess that I am struggling to follow the logic of the argument. Quality contracts have often not worked because their structure has been too inflexible to meet local requirements. The point of the Bill is to free the system up a little, so that contracts can reflect local circumstances and services can be tailored to local needs. I do not know why the hon. Lady and her party do not support that as a way forward.

We are not supporting that because we do not believe that quality contracts will deliver the service improvements and increased ridership that we all want. I do not believe that those benefits will be delivered by winding back the clock to the 1980s and re-regulating the bus network. That is why we oppose moves in the Bill to make the quality contract route back towards regulation easier for local transport authorities to use.

Will the hon. Lady answer the simple question that has been asked several times by Labour Members: if she thinks that regulation in London is good and acceptable, why is it bad for my constituents, her constituents, and the vast majority of constituents represented in the House?

What I have said repeatedly is that the increase in ridership in London is not due to the regulatory system in use in London. It is due to the £638 million a year that is spent on subsidising the bus network. It is also partly due to Transport for London taking an aggressive approach to enforcing bus priority. Both those circumstances distinguish London from the rest of the country.

I thank the hon. Lady for giving way; she is very generous with her time. Do I detect a change in Opposition policy? Are the Opposition actually in favour of subsidy, given that their argument is that it has worked in London? If so, does she recant Tory Bromley council’s judgment against the Greater London council in the early 1980s, which outlawed subsidy?

Did the hon. Lady not hear the intervention made by my hon. Friend the Member for Manchester, Blackley (Graham Stringer)? He pointed out that before there was subsidy in London, bus ridership was decreasing outside London, but stayed stable in London, and when there was subsidy, bus ridership further increased in London? Does she not agree that that proves the point? The figures show that regulation helped bus ridership in London, and those figures were given to her in an earlier intervention.

If the hon. Lady looks at the figures, she will see that the steepest fall in bus ridership occurred before deregulation, when there was an increase in car ownership across the country. The decrease in bus ridership started to level off in the years immediately after deregulation.

If I understand the hon. Lady’s argument on London and other metropolitan areas—I represent a seat in one such area, the west midlands—she is saying that the reason for the increased patronage in London is high levels of subsidy, rather than the regulatory regime. If that is her argument, is she telling the House that she would cut the subsidy in London? Or would she increase subsidies in metropolitan areas to encourage patronage?

What I am saying is that introducing the regulatory system applicable in London to the rest of the country would not deliver the service improvements that we want. In future, we would certainly look to remove quality contracts altogether as an option outside London; we think that they are neither necessary nor effective in improving bus services in the UK. The Opposition believe that successful partnerships between local transport authorities and bus companies are the best way to deliver improvements in reliability and service quality.

I thank the hon. Lady for giving way again. Let us look at the issue in a slightly different way. My understanding is that the Opposition are now in favour of greater freedoms for local authorities. That is their policy. As I understand it, the Bill does not force local authorities to enter into quality contracts; it gives them the right to do so if they wish, because of local circumstances. The Conservative-controlled Local Government Association has actually called for councils to have

“stronger powers to deliver better bus services.”

Does that not conflict with the policy statement that the hon. Lady made to the House this afternoon?

It does not conflict. The hon. Gentleman misunderstands localism, which does not always mean devolving to local bureaucracies. It means vesting power in the customer and the consumer. We believe that a deregulated bus system is the best way to vest power in the consumer and the passenger.

What representations on the Bill has the hon. Lady received from local Conservative councillors, and does her local group of Conservative councillors approve of the amendment that she has tabled?

I have had many representations on the Bill from a number of groups, including Conservative councillors.

The best examples around the country demonstrate what can be achieved when a transport authority is prepared to take difficult decisions on bus priority, and when bus operators respond with investment in better training, better vehicles and better facilities. Areas such as Brighton and Hove, and Telford and Wrekin, demonstrate that successful partnership working can produce better vehicles, more investment, better information, simplified fare structures and ticketing, higher-quality services and, most important of all, increased ridership.

No, I will make progress now. Close partnership working in Brighton delivered a 5 per cent. year-on-year growth in ridership and a 10 per cent. decrease in town centre traffic. The Government are wrong to see statutory quality partnerships and quality contracts as ends in themselves. The rarity of such partnerships and contracts is further proof that in many areas, voluntary partnerships can work well for local authorities and bus companies that have the mutual confidence to work together for the benefit of passengers, without the need for the local authority to resort to formal powers to control and regulate services.

Far from encouraging that kind of partnership working, the Government recently lobbed a hand-grenade into the relationship between transport authorities and bus operators. I am referring, of course, to the way in which they are introducing concessionary fares. Of course, the goals of the scheme are entirely laudable, but the way it is being put into practice is damaging the relationships that are vital to making bus partnerships work. It is clear that the scheme is leaving local authorities with a huge funding headache and council tax payers with a large bill.

Ironically, in some cases, as a result of the local authority funding crisis caused by the concessionary fares scheme, bus routes are under threat, either because the local authority is concerned that it can no longer afford to subsidise routes, or because the bus company finds routes uneconomic as a result of the financial pressures of the scheme. In a further ironic twist, Brighton and Hove—a striking bus success story in recent years—is one of the areas hardest hit by the problems with the concessionary fares scheme. That scheme has all the hallmarks of a proposal rushed through on Budget day without proper thought about how it would be set up or funded. That was playing politics with the bus network in a way that is simply unacceptable.

A moment ago the hon. Lady spoke about transport authorities that had taken tough decisions to get quality bus measures on the ground. The example that she gives, Brighton and Hove, is a unitary transport authority. How does she reconcile what she is saying with the measures in the Bill that she opposes? In the metropolitan areas, the transport authorities are the passenger transport authorities, which will become integrated transport authorities. In Greater Manchester, where there are 10 highways authorities, getting them to agree to a single standard for quality bus measures is difficult. The measures in the Bill will give those powers to the integrated transport authority. How does she reconcile that—

That takes me on to my next point. Some of the changes proposed in the Bill in relation to the structure of transport authorities and the Government’s arrangements could be useful. We would not oppose every single one of those governance changes. I particularly welcome the representations on the issue that I have received from the PTE group.

The Opposition share the PTE group’s view that there should be no scope for imposition by the Secretary of State of non-elected members on the renamed integrated transport authorities. There will be consensus across the House with the PTE group’s point that we should not seek to impose uniformity on passenger transport authority areas or PTE areas or their governance arrangements, as no single model will be right for every area. With reference to the example given by the hon. Member for Denton and Reddish (Andrew Gwynne), the arrangements clearly worked in that context. It is not necessarily the right model for other parts of the country, which is why it is important to ensure flexibility in the Government’s arrangements.

Does my hon. Friend agree that not for the first time, one of the key problems with the policy is that there is no robust methodological analysis of the likely take-up of the scheme? That has significant financial implications for local authorities. It is all very well for the Government to announce it, but the fact that they have not done the detailed work to assess the likely take-up will impact on council tax payers across the country, including those in my constituency.