House of Commons
Thursday 11 December 2008
The House met at half-past Ten o’clock
[Mr. Speaker in the Chair]
Oral Answers to Questions
Business, Enterprise and Regulatory Reform
The Minister of State was asked—
The credit crunch and the global economic downturn are, of course, having a serious effect on small businesses. As well as the measures to increase the availability of credit that have been set out by the Government in the pre-Budget report, my noble Friend the Secretary of State has established the Small Business Finance Forum, which involves all the major high street banks and the main business organisations. That body has drawn up a revised statement of principles covering business lending and is also monitoring the availability of credit to small business.
Some would say that the banks have been treated more than fairly, yet they have not passed on that largesse to their customers. Will the Minister look into a case where the Royal Bank of Scotland, which is one of the banks that has been bailed out, has increased fivefold the repayments required from one of the businesses in my constituency, despite an existing six-month agreement, and the fact it was a long-standing customer? That could, effectively, put 80 jobs at risk. Does he think that is fair and, given such agreements, what will he do to ensure that customers and businesses are treated fairly by the banks?
Ministers will not seek to place themselves in the shoes of bank managers and judge individual credit applications. However, of course, it is also true that many businesses have raised the difficulties of accessing credit with right hon. and hon. Members from all parties. The hon. Lady mentioned the RBS Group, which, with the NatWest Group, announced on 23 November that it would maintain existing overdraft pricing for small businesses until the end of next year. Some measures have been taken, but we are not saying that there is not an issue. That is why the Small Business Finance Forum has been established, and, indeed, why both the Chancellor and the Secretary of State will meet the high-level lending panel later today to pursue the issue further.
My right hon. Friend’s comments will give some comfort, but I draw his attention to one specific group of small firms that, even in easier times, have traditionally found it difficult to obtain finance: those firms involved in research and development. They are at the cutting edge of technology and are vital businesses in terms of the creation of future manufacturing strength and employment. Will he have a particular look at how such firms can gain access to finance in these difficult times?
In the pre-Budget report, my right hon. Friend the Chancellor of the Exchequer set out a number of measures that should help businesses to gain more access to credit. In addition to the existing small firms loan guarantee scheme, those measures included a small business finance scheme to support up to £1 billion of bank lending, a separate £1 billion guarantee facility to support bank lending to small exporters, and a £50 million loan facility based on swapping debt for equity. That is in addition to the measures announced by regional development agencies for transition loan funds. The Government have taken a number of measures to try to ease the problems of access to finance and credit, which small businesses across the country are raising with us.
The Prime Minister boasted yesterday that help has been given to small business, yet all the small businesses that have contacted me say that the banks are not well informed about the scheme, some are reluctant to promote it and many small firms are unaware of it. The Minister talked about monitoring, from which one assumes he has had some results. Will he tell us what results he has had, because my information is that things simply are not working?
I think the hon. Gentleman is referring to the small firms loan guarantee scheme. The measures that I listed in response to my hon. Friend the Member for Manchester, Central (Tony Lloyd) are in addition to that scheme and are coming on stream precisely because we recognise how important access to credit finance is to small businesses. Without such credit, businesses cannot take investment decisions and they cannot operate in the way that they should. That is why we are so active in this matter.
The measures that the Government have announced to help small business are clearly welcome, but there is a problem with small businesses knowing where to go. A plethora of initiatives has been announced, but the Government should take steps to improve one-stop shop access to make it clear to small businesses what initiatives are available. I would be interested to know what the Minister is going to do to address that problem.
My hon. Friend makes a good point. The Government have recognised a need for the simplification of information in business support schemes. Indeed, prior to the pre-Budget report, we announced a large-scale simplification of advice to businesses, collating all the different support schemes into a much smaller number. I hope that the process of obtaining advice about what help is available and where to go will be easier than it is at present. Business Link is the key place to go for businesses looking for advice on what help is available from the Government. I also think that the banks have a role to play in ensuring that an appropriate level of lending is available, so that the economy can work in the way that we all want it to.
Sharp practice by the banks clearly must be exposed and challenged, but Government interference is often not helpful itself. Why is the much-promised European Investment Bank money yet to reach our small businesses? Czech businesses have reportedly received €100 million, Spanish firms have received €200 million and French firms have received €300 million. Could the Minister tell us how much of the EIB money UK small businesses have received? I am talking about the actual businesses, not their banks.
We are closely engaged in supporting the UK automotive sector, both at a European level, through pressing the European Investment Bank for an €8 billion automotive support fund and domestically, through our investments in low-carbon research and development and training, and our package of support for small and medium-sized enterprises announced in the pre-Budget report.
The Minister will be aware of speculation in the newspapers that secret talks are taking place between the Government—Ministers and perhaps his officials—and the owners of Land Rover and Jaguar about some kind of financial support. I would be grateful if he would tell the House whether that is the case and whether, given the severe situation in America and in its automotive sector—General Motors is in trouble over there—the Government are also having talks with Vauxhall, which is owned by GM.
I do not want to speculate on talks that the Government may or may not have been having with a range of automotive companies. What I want to say clearly to the House is that the automotive sector is extremely important to the UK. Peter Mandelson and I publicly had a meeting with a wide cross-section of the automotive manufacturers, suppliers and retailers on 27 November. We continue to engage closely with the sector, and I am determined that we shall do everything we sensibly can to help viable businesses during these exceptional times.
Clearly these are difficult times for the motor industry. Some of the major manufacturers are going on extended breaks as a result of falling sales. Does my hon. Friend agree that, although understandable, that can cause major problems down the line in the components sector? Does he also agree that we need to take real action to ensure that our technological base in motor sport, components and other parts of motor manufacturing is maintained, not just for the sake of jobs right now, but to secure our prowess in those areas in the future?
My hon. Friend is an expert in these areas, and I agree that the integrated nature of the automotive supply chain brings real challenges for suppliers when the automotive manufacturers decide to take extended breaks. We are acutely aware of the pressures that the situation is causing a number of supply chain companies. As he is aware, the UK has about 200,000 jobs in the supply chain alone, about 500,000 in retail and about 180,000 in direct automotive production. This is a vast and important sector of the UK economy, and we need to examine what more we can do to support companies that are going through very difficult times at the moment.
I heard what the Minister said, and he cited the statistics that I was going to cite about the manufacturing and retail sectors. But continuing to engage closely is not enough; action is urgently needed. I have just come from a meeting with the Retail Motor Industry Federation, which has suggested a range of practical measures that would help it and manufacturers. Such measures include abandoning the Government’s proposals to remove the right of car retailers to claim back vehicle excise duty in respect of unused car discs and ending the Government’s punitive attack on void rates. The pathetic measures introduced by the Chancellor just will not be enough for car dealers, who will have empty premises next year. A range of things, such as introducing 100 per cent. capital allowances for commercial vehicles, could be done now—urgently—to prevent an imminent disaster, not just for manufacturers, but for retailers.
There is a range of things that the Government are already doing, such as the small business finance scheme, the £1 billion in loan guarantees, the schemes to convert business debt into equity and the transition loan fund, of which the hon. Gentleman will be aware, that exists in the west midlands and other places. I have already written to supply chain companies, through the manufacturers, outlining the package of measures that are already available from the Government. However, we need to see whether we can do anything further, because we recognise as a Government that the UK automotive industry is of critical national importance. The Government are taking action. The action that we took on the recapitalisation of the banks and through the £20 billion fiscal stimulus, which the Opposition have opposed, is about responding. We are trying to kick-start the economy and help companies through difficult times, and I hope that the hon. Gentleman appreciates the actions that we are taking.
My hon. Friend is quite right to say that the car industry is of national importance, but so is the steel industry, which provides it with the basic raw materials. He knows that Corus recently had a meeting with the Prime Minister and other Ministers. Corus is making efforts to keep the work force together, which is a welcome break from the past, because losing a skilled work force makes it difficult when things turn around. Will my hon. Friend assure me that the Government will give Corus whatever assistance is appropriate to see it through this difficult period?
As I have said, we want to do all that we sensibly can to help viable businesses. My right hon. Friend will be aware from reports in the newspapers today of the discussions that Corus has been having with the unions about taking a pay cut, and of the other measures being taken to see people through difficult times. Whether we are talking about the steel, automotive or construction industry, the global credit crunch and the recession that we are all facing are bringing enormous challenges to companies, to people who work in them and to Governments. We need to ensure that we are up to the mark and are taking action to support our companies through these difficult times, and that is exactly what we are going to do.
As has already been said, the car manufacturing industry is a major part of British industry, as well as a substantial employer. Given that President-elect Obama has decided that the US car industry is too large to fail, what assessment has the Department made of the potential for a failure in the car industry to give rise to a systemic failure in UK plc? Would the Government consider a similar decision, and if so, what criteria would they use to make the judgment?
I have already quoted figures that demonstrate the importance of the automotive sector to the UK economy, and I do not need to repeat them. The Government are engaging with the automotive industry on a daily basis about the problems that it faces. We have already taken a range of measures to support companies, particularly some of the small and medium-sized companies in the supply chain, with the schemes that we have made available, which we are widely publicising to the industry.
There is a case for saying that we need to do more and we are actively considering that. I can only repeat that the circumstances in which we find ourselves are circumstances that we have not seen for more than a generation. Sales have fallen off a cliff. The November figures show that UK car sales are down by 37 per cent. The situation is the same in the United States and sales are down by 50 per cent. in Spain. Although they have declined less in France, Germany and Italy, the declines are still significant. When companies’ sales disappear, we need to ensure that we bring back confidence to the market as quickly as possible, which is why the fiscal stimulus is so important and why it is irresponsible of the Conservative party to oppose it.
We understand that credit is a serious issue for business. That is why the Chancellor announced a number of measures in the pre-Budget report to improve access to credit, including the new small business finance scheme, which could make available up to £1 billion of additional credit, the export lending scheme and the transition loan funds that will be available through the regional development agencies in many parts of the country.
I would be interested to learn from the Minister about the methodology involved in the Government being able to get information, other than that provided by the banks, on the provision of credit to small businesses. He might be interested to know that, according to the Croydon Guardian, the chief executive of South London Business reports that many perfectly solvent businesses are being damaged, as many other Members have said, by the speedy removal of credit and the early calling away of debt. Many companies that are cashed out and close to being in default will be at risk if the Government are unable to bring forward measures in a speedy way to ensure that such companies are bailed out.
We are bringing forward measures, as I have said. There is a disjunction between what small businesses are reporting to the hon. Gentleman and many other hon. Members on both sides of the House, and what the banks are saying about the availability of credit. That is precisely why we have brought business and bank representatives together in the Small Business Finance Forum to examine the facts and to find out exactly what is happening in the lending market.
The Minister is a fellow west midlands MP, and he will know that many businesses throughout the region cannot get credit from the banks. Why is it that, within hours of coming to the Government, the banks received a big fat cheque from the taxpayer, when businesses in Shropshire, even after many weeks, cannot get the credit that they need to run on a day-to-day basis?
Had we not taken the action that we took to recapitalise the banks and inject more credit into the system, there would have been a danger of a complete seizure in the banking system, which could have had a catastrophic effect on the wider real economy and on the businesses that the hon. Gentleman is worried about. That is why it was entirely right for the Government to take that action to stabilise the banking system. We now need to ensure that lending at an appropriate level is available to businesses in the wider economy, and that is why we are working with the banks and why we have taken the measures that were announced in the pre-Budget report.
I recently met representatives of the Civil Engineering Contractors Association to discuss the impact of the downturn on its members, which include small businesses and some of my constituents. They broadly welcomed the measures that the Government have introduced to assist them with credit, but said that there were still some issues. They were also concerned about the small firms loan guarantee scheme, and gave me examples of their members being told that it would take four months for the process to go through. That is causing real hardship. Will my hon. Friend look into those delays and see whether anything can be done to speed the process up, so as to avoid the loss of jobs and skills in the sector?
It should not take four months for loans to be processed through the small firms loan guarantee scheme, and I will certainly follow that up for my hon. Friend if she gives me the details. The combination of measures that we have taken, including that scheme and the other measures announced in the PBR, are designed precisely to take action with regard to the problem that we are all concerned about—access to finance for small and medium-sized businesses, which are the lifeblood of our economy and which provide so much employment for our constituents.
As it is clear that, in this recession, the biggest single problem facing most businesses is a lack of credit, does the Minister not see that his small firms loan guarantee scheme is inadequate, and that he should take up our proposal for a national loan guarantee scheme? It would cost a lot more money, but it would be paid for by scrapping the ridiculous reduction in VAT, which has not helped industry at all.
Our proposals are not restricted to the existing small firms loan guarantee scheme because, as I said, the Chancellor announced additional measures. As to the right hon. Gentleman’s party’s proposals, the Conservatives really need to make up their minds. The other day, his party leader attacked us over our level of spending and borrowing; the Conservatives have now announced a new scheme, but we have not yet been told about the balance of risk between the Government and the banks or the exposure of the taxpayer to the scheme. If more action is needed, this Government have said that we will take it, but I can assure the right hon. Gentleman that, unlike what happens in his party, any measures we announce will be properly costed and thought through.
When the Secretary of State appeared before the Business, Enterprise and Regulatory Reform Select Committee, he made the valid point that it was important that bank bosses’ promises on lending got through to banks on the ground. This morning, I received a Christmas card from the Federation of Small Businesses Scotland—[Hon. Members: “Ah.”]—and a very nice one it is, too. It is a letter to Santa, which refers to overdrafts renegotiated, rates trebled and charges of £150 for the privilege. That is the reality on the ground. When the Minister has a summit with bank leaders, what other action will he take to ensure that any promises made to small businesses are actually carried out by bank managers on the ground?
It is important that any statements made by banks about the availability of lending are reflected in the reality on the ground. That is why the Small Business Finance Forum has updated the statement of principles that govern lending by banks to small businesses. I referred to RBS earlier, but Lloyds TSB has announced a charter for small businesses, which commits to maintaining overdraft limits and margins at existing levels, and HSBC has announced a £1 billion business support fund for UK small businesses to fund working capital. Some action has been taken, but we will, of course, continue to work with the banks to ensure that the sort of statements made by the banks and mentioned by the hon. Gentleman actually feed through to the small businesses in his and other constituencies.
The real truth is that businesses are increasingly desperate because their credit lines are drying up, the cost of borrowing has increased dramatically and credit insurers are refusing to underwrite the payment chain. Surely the Minister would agree that the recapitalisation of the banks has not yet filtered adequately, if at all, into the real economy. Why, then, has he chosen to reject our clear policy for a national loan guarantee scheme that would augment and underpin credit lines in a way that no Government policy yet does—or is he really saying that the Government have no ideas of their own and are simply rejecting it because it has on it the label, “Not invented here”?
We announced a loan guarantee scheme in the pre-Budget report, based on a balance of risk sharing between the Government and business. As far as the hon. Gentleman’s proposal is concerned, as I have already said, the Conservatives have not made clear what proportion of the loans would be underwritten or what balance of risk will be shared between the Government and the lenders. It is important that proposals in this area are properly costed. That is what we have done and if further action is needed to help small businesses, we will not hesitate to take it.
But one thing the Government could definitely do to extend credit to businesses is to let them delay their VAT payments. Yesterday the Prime Minister said at Prime Minister’s questions that that was his policy and it should happen, but businesses are saying that, in fact, they are not being allowed to do that because Her Majesty’s Revenue and Customs says, among other things, “Oh no, it would give such a company a competitive advantage.” How can the Minister reconcile what the Prime Minister says one day with what is actually happening on the ground, and what instructions—what clear instructions—have the Government given to HMRC about the deferral of businesses VAT?
The Chancellor announced in the pre-Budget report that HMRC would, on a case-by-case basis, allow businesses to spread their tax and VAT payments over a longer period of time. It is not the case that they have all been refused, as the hon. Gentleman claims that they have. It is judged, as I said, on a case-by-case basis.
In terms of policy—I know that the Conservatives like a leak—perhaps I should draw attention to the hon. Gentleman’s approach. I have an e-mail to him from his colleague, the hon. Member for Hertford and Stortford (Mr. Prisk)—
We have wide-ranging contact at all levels with the automotive industry. The Secretary of State for Business, Enterprise and Regulatory Reform and I met automotive manufacturers, suppliers and retailers on 27 November and we continue to have close dialogue.
Factories such as Nissan in Sunderland, Honda in Swindon and Toyota in south Derbyshire have components supplied by extensive networks of much smaller firms, which, lacking significant cash reserves, suffer disproportionately as car production is scaled back. Does the Minister agree that a possible erosion of jobs in parts suppliers by up to 25 per cent. will reduce the anchorage of car plants in the UK, with remaining firms sourcing much more from abroad? Further to the question asked by my hon. Friend the Member for Birmingham, Northfield (Richard Burden), what steps is the Minister taking to ensure British component firms have the necessary access to credit to enable them to trade through the deepening recession?
My hon. Friend is absolutely right to point to the importance of the supply chain and UK automotive manufacturers sustaining it in the future. Clearly, some of the major difficulties that the automotive industry faces have an impact on the supply chain. We saw Wagon Automotive going into administration in the UK only very recently. Any job losses are regrettable.
As a Government, we need to ensure that we continue to provide measures—the finance that is available—to the sector. As I explained, I have written to automotive suppliers, through the lead manufacturers, outlining a range and package of measures that are on the table and available now or will be available very shortly. Again, we need to see whether there is more that we can do to help some of the companies that are viable but are facing unprecedented shocks to their businesses as a result of the problems that we are seeing internationally.
Will the Minister confirm that it is not just about the manufacturers, or even the component manufacturers, but about the national network of dealerships, which employ dozens, if not hundreds, of people in each of our constituencies? As we know, they are struggling and have had a very bad year. Will he help them by the clarifying precisely which cars will have their vehicle excise duty increased over the next year or two, because people out there are still completely confused by this and it is acting as another deterrent to cars being sold? Will the Government enter into a campaign to demonstrate precisely which cars will have their VED reduced or increased, and clarify the situation for the people at large?
The hon. Gentleman is right to point to the importance of the retail end of the industry and the car dealership networks that exist in the UK. They employ significant numbers of people. While they might not be as geographically concentrated as some of the big automotive plants, the cumulative effect is that something like 500,000 people work in that retail sector. What we said about VED in our pre-Budget report was clear, but I will talk to some of my colleagues and officials in the Treasury to see whether there is more that we might need to do to ensure that that information is widely available. The industry as a whole has welcomed the announcement that we made on VED. We need to ensure that we actively promote it.
My hon. Friend will be aware that many small companies in my constituency are second, third and fourth-tier suppliers to the car industry. If they go under, it will not only be a tragedy for the employees of those companies, but it could undermine our future industrial capacity to meet the upturn when it takes place. Will he undertake to listen to their submissions and work on policies, but above all will he examine the potential role that Government procurement could have in the motor industry to sustain demand at this time when it is most needed?
My hon. Friend has made some key points. Obviously the development of lean production techniques and “just in time” manufacturing has led to a hugely interrelated supply chain. If one part of it suddenly breaks down, major problems can be caused to the process of making cars, so it is right for automotive companies themselves to take a close interest in the financial performance of their supply base. A number of companies have given their suppliers credit to ensure more prompt payment and to help the supply chain through difficult times.
I am not sure that a major Government programme of purchasing new cars would be effective. What we want is for people to start buying cars again because they feel confident about the future, and there are some pretty good car deals around at the moment.
The Government have already introduced a substantial bail-out package for the banks, and there have been calls for them to do the same for the automotive sector. Will the Minister tell us precisely what the policy is on the use of further taxpayers’ funds for future rescue packages, to enable the half million employees in the sector to whom the Minister referred to know exactly what they can and cannot expect from their Government?
We were absolutely right to make the decision to recapitalise the banks. Even the Conservatives have welcomed that decision, although they have cavilled at measures such as our credit guarantee scheme. The scheme is effective, and by the end of the year some £100 billion worth of guarantees will have been issued.
As I have said, it is important for us, as a Government, to see what we can do to help viable businesses through difficult times. We are engaged in a contingency planning exercise and we are considering a number of possibilities, which is the right thing for us to do. We will continue to consider what further sensible measures we can take to support the automotive industry during the current incredibly difficult period.
Our Department is concentrating fully on working with businesses through what is a difficult economic period, and ensuring that British business can emerge from the downturn in as strong a position as possible.
In the absence of the Secretary of State, I must rely on my right hon. Friend, as his political amanuensis, to interpret Lord Mandelson’s views as reported in The Sunday Times last week. He said that
“it was up to individual companies to sort out their own future if they ran into trouble… ‘We”
—the Government, that is—
“‘are not going to step in when banks and other lenders are capable of doing it themselves.’”
What does my right hon. Friend think Lord Mandelson meant by that, against a backdrop of potentially the worst economic situation for generations?
What that means is that the Government cannot and should not seek to replace the role of the banks as the main lenders to the economy. We have introduced a number of measures—which I have mentioned several times today— to give small businesses access to finance, but the main lenders must be the banks themselves, and that is precisely what my noble Friend Lord Mandelson meant.
The hon. Gentleman did give notice of the question. My understanding is that the company has laid off a number of people and is having difficulty meeting the redundancy payments that may be involved in doing so. There is a scheme: the financial difficulties scheme under the Insolvency Service. It is designed to avoid both stress and delay in employees applying under such a scheme. Under this scheme, the Redundancy Payments Office can pay employees the redundancy payments to which they are entitled against an agreement from the employer to reimburse the national insurance fund over time. I am happy to look further into that matter for the hon. Gentleman.
My noble Friend the Secretary of State yesterday met major businesses and the Institute of Credit Management to agree a code of prompt payment from large businesses through their supply chains. The Government have said they will do their best to be a good and responsible customer during this period, and we understand the importance of prompt payment to small businesses. I entirely agree with my hon. Friend that this is a job not just for Government, but for the many large businesses upon whom countless thousands of small businesses depend for prompt payment and their day-to-day business.
The hon. Gentleman might be aware that the Business and Enterprise Committee is currently looking at the issue. We are closely watching the different strands of evidence that are presented to it, and we will carefully consider any recommendations arising from the Committee’s work. As he alluded to in his question, pubs are crucial small businesses in many communities and, as he will be aware from the answers that my ministerial colleagues have already given, the Government are taking a series of initiatives to help small businesses, and pubs might be able to access them as well.
A written statement was issued this morning extending the compensation given to Icelandic waters fishermen to aggregate service not interrupted by 12-week breaks. That will be warmly welcomed in all the fishing ports, but will my right hon. Friend tell us what estimates he has of the number of fishermen affected? In terms of the unacceptable proposal to extend the conditions to requiring two years of service during the cod wars, will he bear it in mind that there were in fact three, if not four, cod wars, two of them in the 1970s?
I thank my hon. Friend for his welcome for the written ministerial statement tabled today, which is in response to the ombudsman’s recommendations on the Icelandic waters trawlermen’s compensation scheme issued last year. The statement says that we will run a new scheme based on aggregate service and not using the previous breaks rule. We estimate that that will benefit about 1,000 former trawlermen, who should receive additional payments. I pay tribute to my hon. Friend and all Members representing port communities who campaigned so hard and effectively for their constituents on the issue, and I hope he is right that this news will be warmly welcomed in port communities that have been affected over the years.
May I add my warm congratulations to my right hon. Friend the Minister for Employment Relations and Postal Affairs on the statement that he made this morning about opening up the cod war trawlermen’s compensation scheme and on finding an answer to a very difficult problem? He will be aware that many of the people who will qualify under the new scheme are elderly, and some have died and their widows are also elderly. Can he give us some idea of the programme for the introduction of the scheme, because it needs to be done quickly?
My hon. Friend makes a good point and I know that he has campaigned hard and effectively on that issue. We are aware that this has taken a long time. It is a complex scheme because, as my hon. Friend the Member for Great Grimsby (Mr. Mitchell) said, we are often dealing with fishing records going back for some decades. I can assure my hon. Friends and other Members with an interest in this area that we will implement the new scheme as quickly and efficiently as possible.
If I may quote the Secretary of State who, when asked about the timing of that report in the House of Lords a couple of weeks ago, said, “Not before too long.” I echo that. In terms of the USO, I remind the hon. Gentleman that it was this Government who enshrined the USO in primary legislation.
The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
Collections in churches totalled £56 million in 2006, the last year for which figures are available. However, that is only a small part of the regular committed giving of members of the Church of England, most of which is by standing order. Total income from donors was nearly £537 million, including £70 million of reclaimed gift aid.
I congratulate the Church Commissioners on the staggering amount of contributions from the worshipping public. Do the Church Commissioners anticipate a reduction in the amount received because of the credit crunch? If so, will the hon. Gentleman join me in renewing our campaign to obtain a reduced VAT rate on church repairs, now that we have established the principle that the Prime Minister is minded to lower VAT in certain circumstances?
I am grateful to the hon. Lady for making that point. I should point out that the average donation to the Church of England is £8.64 a week, or £450 a year, but that is more than double the amount given by the average adult in the UK to all the other charities they support, so the Church clearly benefits from that dedication. The question of reducing VAT further is a problem throughout the European Union, as we need the consent of all the other member states. We have a reduction in VAT through a method introduced by the Prime Minister when he was Chancellor of the Exchequer. That is still available and it has no time limit.
Public Accounts Commission
The Chairman of the Public Accounts Commission was asked—
The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
Church Estate (Water Services)
It is estimated that the new annual charge for surface water drainage will cost Church of England churches and cathedrals around £5 million or more. Churches using the public sewers will also be liable for highways drainage contributions at an estimated cost of around £10 million per annum.
By way of a statement, we are deeply concerned about the impact of these charges on the local work of the Church and other faith groups.
I am grateful to my hon. Friend for that question. Representations have been and continue to be made to the Government on that issue. We have looked at it carefully and are not convinced that it is all a matter of water company profits. The companies maintain that the change will be cost neutral as it redistributes charges falling on different categories of non-household customers. That includes businesses, churches, charities and community bodies. However, it is having a considerable effect on our churches.
I have been working on this problem with the diocese of Salisbury, and it has been reported to me that Wessex Water believes that the changes to the charging regime would come into operation only on change of ownership of the property involved. On the face of it, that would seem to make it unlikely that a church would be affected, but what would be the impact of a change from freehold to common tenure? I do not expect the hon. Gentleman to know the answer to that question today, but will he please let us know?
Is it not absolutely outrageous that the water companies charge churches and other similar bodies for the disposal of surface water? Rain comes from heaven: it does not cost the water companies anything yet they charge us for it. Why the devil are the Government allowing them to charge churches for the disposal of surface water? It is outrageous.
I am sure that the hon. Gentleman does not wish to answer his own question. I am happy to do that, but he knows that mercy is like the rain, gentle from heaven above. Unfortunately, the water company charges are not from heaven, but are induced and calculated. I support what he says, and agree that this is a Church-wide issue: a Teesside clergyman at St. Luke’s, North Thornaby has reported to me that his church has experienced a rise in its water charge of 1,300 per cent. His church warden created a petition on the No. 10 website, and so far it has attracted 37,000 signatories. Given the hon. Gentleman’s views, perhaps that total will now rise to 37,001.
Public Accounts Commission
The Chairman of the Public Accounts Commission was asked—
I am grateful for that answer. Is it not the case that the NAO has a target of saving the taxpayer £9 for every pound that its operations cost? Would the NAO not be able to do that much more easily if it had a proper grip on the £250,000 million-worth of private finance initiative projects, which are prohibitive in cost, flawed in concept and intolerable in consequence? Alternatively, the NAO could get a grip on Her Majesty’s Revenue and Customs to bridge the tax gap, which at a minimum is at least £25 billion a year, in tax avoidance by the best-off individuals and the 700 largest corporations.
I should like to comfort my hon. Friend, as I know he gets very anguished about the National Audit Office. It has in fact progressively increased its performance. When I first went on to the Public Accounts Committee—I think it was in 1990—the ratio was 5:1 and at the request of the Public Accounts Committee and the Public Accounts Commission, the ratio has gradually increased to 9:1. A nice ballpark figure for my hon. Friend to remember is that as a result of that, in the last 18 months the NAO has saved the taxpayer £1 billion.
The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
Church of England staff have been meeting officials from the Treasury, the Department for Culture Media and Sport, the Department for Communities and Local Government, the Office of the Third Sector and the Department for Environment, Food and Rural Affairs. The Church Commissioners encourage continued financial support for the English Heritage and Heritage Lottery Fund places of worship grant scheme. The Church’s discussions with the Government are focused on securing equal access to national and local government funding streams, and are ongoing.
I thank the hon. Gentleman for his reply. Does he agree that churches are a vital part of our Christian heritage and that everything possible should be done to protect and restore English churches? Will he accept an invitation to my constituency to visit St. Alban Protomartyr in Princes road, Romford to see the exceptional work of Father Roderick Hingley, who has raised money through public donations? Will he come to see that work, which is an example to others?
I am grateful to the hon. Gentleman for his kind invitation. He has made me an offer I cannot resist. Nearly half the population think that central taxation, local taxation, the national lottery or English Heritage should primarily be responsible for providing money to maintain churches and chapels. It is not something that I would wish to lay entirely at the state’s door but it should not be left entirely to the Church. I should like a better funding partnership. I welcome the hon. Gentleman’s invitation and I shall be happy to take it up.
Chancel repair obligations remain a medieval scandal and a nice little earner for the insurance industry, or a total disaster for the people who find that they are liable for them. There is a terrible degree of uncertainty among the churches where such obligations apply. There have been suggestions that the obligations should end, but the Church Commissioners appear to be running a policy of raising more money through chancel repair obligations, which will mean that more of our constituents become subject to a financial disaster of which they had no knowledge. Will the hon. Gentleman recommend the ending of that obligation?
Public Accounts Commission
The Chairman of the Public Accounts Commission was asked—
We agree with John Tiner’s recommendation, subject to retaining the requirement that the commission approve the auditors’ appointment. The NAO’s audit committee will recommend a firm to the NAO board, which will appoint the auditors, subject to the approval of the Public Accounts Commission. The NAO already rotates its auditors—something that concerns the Government—in line with best practice.
Business of the House
The business for next week is as follows:
Monday 15 December—Conclusion of the debate on the Queen’s Speech. The economy, pensions and welfare will be debated.
Tuesday 16 December—Estimates (1st Allotted Day). There will be a debate on energy prices, fuel poverty and Ofgem, followed by a debate on dental services. Details will be given in the Official Report.
[The details are as follows: Energy prices, Fuel poverty and Ofgem (Eleventh Report from the Business and Enterprise Committee, HC 293; Government response— Seventh special Report HC1069; and further Oral Evidence of 24 and 25 November); and Dental services (Fifth Report from the Health Committee, HC 289; and Government response—Cm 7470).]
At 10 pm the House will be asked to agree all outstanding estimates.
Wednesday 17 December—Proceedings on the Consolidated Fund Bill, followed by Third Reading of the Banking Bill, followed by motion to consider the Value Added Tax (Change of Rate) Order 2008, followed by motion to approve a resolution relating to parliamentary pensions. I have tabled that motion today. Copies of the explanatory memorandum and the motion are available from the Vote Office. That will be followed by motions relating to the Electoral Commission.
Thursday 18 December—Motion on the Christmas recess Adjournment.
The provisional business for the week commencing 12 January will include:
Monday 12 January—Second Reading of the Business Rate Supplements Bill.
Tuesday 13 January—Second Reading of the Saving Gateway Accounts Bill.
Wednesday 14 January—Opposition Day (1st Allotted Day). There will be a debate on an Opposition motion. Subject to be announced.
Thursday 15 January—Topical debate: subject to be announced, followed by a general debate on armed forces personnel.
We expect to have an oral statement on Equitable Life in the week commencing Monday 12 January.
I should like to inform the House that the business in Westminster Hall for January will be:
Thursday 15 January—A debate on the report from the Northern Ireland Affairs Committee entitled “Policing and Criminal Justice in Northern Ireland: the Cost of Policing the Past”.
Thursday 22 January—A debate on the Department for Culture, Media and Sport annual report 2008.
Thursday 29 January—A debate on the Inter-Parliamentary Union.
Before I come on to the forthcoming business, as these are the last business questions before Christmas, may I take the opportunity to wish you, Mr. Speaker, all the staff of the House and all right hon. and hon. Members a very merry Christmas and a happy new year? [Hon. Members: “Hear, hear.”]
On the future business, however, I note that the Leader of the House announced a statement on Equitable Life in the first week back after Christmas. Last week, the Prime Minister promised to the House a statement on Equitable Life before Christmas. So will the Prime Minister come to the House to explain why his Chancellor is not doing what the Prime Minister promised the House he would do? Given that the Leader of the House, on numerous occasions, told us that the statement would be given in autumn, perhaps she can explain why this is the first time in living history that autumn has extended into January?
Climate change! [Laughter.]
I will give the hon. Gentleman that one.
Following the disclosure yesterday by the chief executive of Ofsted that three children are killed by abuse every week, the Secretary of State for Children, Schools and Families is today due to announce a major shake-up in social services under the children’s plan. This announcement is in a written statement. Why has the right hon. Gentleman not come to the House to be questioned by Members on this crucial issue?
When the Government announced approval for two new aircraft carriers in July 2007, the Defence Secretary made an oral statement. Today, when it is widely reported that he is to announce a delay in their approval, the Defence Secretary is making only a written statement, which, I understand, was not even available in the Vote Office or the Library at the start of business questions. That written statement will, of course, prevent Members from asking key questions about the impact on the defence budget, on jobs and on national security. Again, why is the Defence Secretary not making an oral statement to the House?
Yesterday, the Secretary of State for Work and Pensions made an oral statement on welfare reform, but will the Leader of the House explain why, the day before, the right hon. Gentleman released an extract from his statement to the press? That was a blatant disregard of his duty to the House. Will the right hon. and learned Lady reassure us that she will speak to her Cabinet colleagues and tell them that this House takes precedence over the media?
Last year, in the final business questions before Christmas, I asked the Leader of the House to
“commit to a debate on the economic slow-down, and the problems in the banking industry and their effects on the housing market”.—[Official Report, 13 December 2007; Vol. 469, c. 465.]
She did not give us a debate in Government time then, and she has not given us that debate a year later; the debates on the economy have been chosen by the Opposition. Given that that the pound has now hit its lowest level against the euro and the German Finance Minister has said that the Government’s switch to “crass Keynesianism is breathtaking”, when will the Government give us a full debate in Government time on the economy?
Yesterday, I had a meeting with representatives of Derby and Nottingham chamber of commerce, who expressed dismay at the Government’s announcement this week on home information packs. As the housing market continues to plummet, the Housing Minister is cancelling provisions that allowed sellers to put their homes on the market before the HIP was completed. Sellers will now have to wait longer and have a raft of paperwork in place before they can even put their home up for sale, which is hardly the way to stimulate our stagnant property market. Can we have an oral statement from the Housing Minister, so that Members can question her on that ridiculous policy?
The Leader of the House recently asked the women’s institute to put pressure on local newspapers not to carry advertisements for the sex industry. What a pity that she cannot persuade the Secretary of State for Work and Pensions to join her campaign. A new report shows that Jobcentre Plus advertised 351 vacancies in the adult entertainment industry last year, including adverts for
“topless/semi nude bar staff”
and “nude cleaners”. Two jobseekers complained that they were asked to perform sexual services after contacting an employer about a vacancy advertised at Jobcentre Plus. Will the Leader of the House, in her role as Minister for Women, take steps to end this hypocrisy within Government?
Finally, last week at The House Magazine “Year ahead in Parliament” conference, when talking about the economy, the right hon. and learned Lady said
“I know what it’s like for everyone, stuck in a job with an outrageous boss”.
How can she possibly say that about the man who saved the world?
The right hon. Lady mentioned Equitable Life. I acknowledge that we said that the statement would be ready in the autumn, but it is important to note that the issue has its roots in problems that started in the 1980s. In the summer, there was a substantial report from the ombudsman that needed consideration. We are talking about important issues, and if the Treasury needs to dot the i’s and cross the t’s, it should do so. Surely it is more important that the report is properly considered before it is brought to the House than for us to have an artificial timetable. The statement will be made in January.
The Secretary of State for Children, Schools and Families has made a number of statements on the children’s plan. Issues to do with it were set out in the draft legislative programme, and there have been a number of statements, debates and discussions on it.
The right hon. Lady also mentioned aircraft carriers and the armed forces. There will be a debate on that in the week in which we return from the recess. [Interruption.]
The right hon. Lady talked about welfare reform—[Interruption.]
On welfare reform, we make no apology for constantly considering how we can ensure that people who lose their jobs are helped into work as quickly as possible, and how we can increase the requirement on people not only to look for a job, but to be prepared to receive support that gets them to a position in which they can get a job. I absolutely agree with the right hon. Lady that there is no way that jobcentres should be used as places in which to advertise jobs in sexual services, lap-dancing jobs, and jobs in sex encounter establishments. I raised the issue with the Secretary of State for Work and Pensions, and he is reviewing the situation. We do not want any of those sorts of jobs in our jobcentres.
The right hon. Lady wished the House a merry Christmas. She obviously hoped that there would not be a business statement next week, but I have to disappoint her; there will be a business statement next week, so she can repeat her Christmas greetings then.
The right hon. Lady mentioned the economy. There will, of course, be a debate on the economy next Monday. As far as the German Finance Minister is concerned, Germany went into this world economic crisis with higher levels of unemployment and Government debt than us. However, it, too, has sought to recapitalise its banks; it, too, has benefited from a cut in interest rates; and it, too, has provided fiscal stimulus—in its case of €31 billion. It has taken action on its economy, and we have taken action on ours.
As for the man who saved the world, I would rather have Superman than the leader of the right hon. Lady’s party, who is the Joker. [Interruption.]
The Opposition obviously did not like that. Wonder Woman does it again.
Seriously, I am sure that my right hon. and learned Friend will join me in congratulating Mr. Ron Cox, one of our Doorkeepers. He is nicknamed “the father of the Doorkeepers” because he is the longest-serving of them. He looks an awful lot younger than he is—I did not believe that he was up for retirement. Will my right hon. and learned Friend join me in putting on record the House’s thanks for all his hard work, done in an efficient, professional and pleasant way, and wish him and his family well in his retirement?
May I first associate myself with the timely request from the hon. Member for East Lothian (Anne Moffat)? We send our best wishes to Ron Cox, his family and his colleagues.
May I join the strong protests from the right hon. Member for Maidenhead (Mrs. May) on two matters that are quite inexcusable? First, every week, my constituents ask me about the Equitable Life statement, and I am sure that that is the case, too, for other hon. Members. We have told them, “Yes, it has taken too long for the Government to respond to the ombudsman’s statement, but there will be a statement before Christmas.” Autumn ends on21 December according to the latest definition, but the statement has now been postponed until the new year. Will the Leader of the House relay to the Prime Minister, the Chancellor and to other colleagues that to promise a statement of such importance to so many people, but then not to deliver it, undermines confidence in their ability to respond?
Secondly, may I make the strongest protest about the fact that yesterday we had a full day’s debate on foreign affairs and defence, but there was no word of an announcement about the aircraft carriers, HMS Queen Elizabeth and HMS Prince of Wales. The Order Paper, however, shows that there is a written statement today, which clearly indicates that there will be a postponement of that aspect of defence procurement. On behalf of many of my right hon. and hon. Friends, and of many people with jobs and job interests in all parts of the country, may I say that it is not acceptable to announce good news on the Floor of the House and bad news later, so we cannot quiz the relevant Minister on the basis of the statement, when it is placed in the Library and the Vote Office?
May I ask the Leader of the House to amend her planning for next week to make sure that the Minister for Trade, Investment and Consumer Affairs appears before the House? On 26 November, there was a credit card summit, at which I gather the Secretary of State for Business, Enterprise and Regulatory Reform and the Minister for Trade, Investment and Consumer Affairs asked credit and store card companies to consider a reduction in the amount of interest that they charge on credit cards. Those charges have gone up in the past 12 months to an average 17.7 per cent., which, for most people who face the prospect of having to buy things at Christmas, is not the right way for them to go—they are far too expensive. There is a meeting today between those companies and the Minister for Trade, Investment and Consumer Affairs, at which the companies will report whether they have heeded the Government’s request to cut profits and help consumers. Will the Leader of the House make sure that the Minister comes to the House to answer questions, so we can see whether the Government have persuaded those companies that they have to help consumers?
Next Thursday’s business for Westminster Hall is a debate on the report by the Foreign Affairs Committee on human rights around the world, which is very welcome. However, before we break for Christmas, may we have a debate on human rights in this country? May we have a statement from the Home Secretary on what she is going to do about the case of S and Marper, in which the European Court decided that DNA samples from innocent people cannot be kept—many of us have been saying that for a long time—so the Government will have to change their policy? May we have an explanation why my noble Friend Lord Lester of Herne Hill has resigned as the Government’s adviser on constitutional affairs, saying that, after a good start, the Government’s recent record was “dismal and deeply disappointing”, and why the Government persist in wanting to go ahead with identity cards, even though all the evidence is that they are going to be ridiculously expensive and inefficient?
Finally, on the business of the House, will the Leader of the House tell us about any follow-up to the debate on Monday, and whether she has had a conversation with you, Mr. Speaker, or your office, about what is going to happen to the Committee that she, with her colleagues, forced on the House against our understanding of your wishes? I am sure that she knows the figures: only one colleague not in the Labour party voted for her position on Monday, and colleagues from the Labour, Conservative and Liberal Democrat parties, Plaid Cymru, the Scottish National party, Respect and the independent groups voted against her. All but a handful of Labour Ministers were present, but the Government majority was four. If she wants to have the confidence of the House, may we have a new proposal for a Committee, as Mr. Speaker recommended, and may we have it soon?
The hon. Gentleman returned to the question raised by the shadow Leader of the House about Equitable Life. During the course of business questions in earlier months, I tried to give a sense of timing with regard to when this important statement would come before the House. If hon. Members think that that raised expectations and was insufficiently specific, I could have said, “This statement will come before the House when it is ready,” but I was trying to be helpful. It is in that spirit that I say that I hope that there will be an oral statement next week, but we are trying to be as helpful as possible, and the House will recognise that this is a big issue. There is a big report to be considered and we cannot be that specific about when it will be available, but we will try to give as much indication as possible.
As far as defence procurement is concerned, work is under way on the aircraft carriers that have been procured, and that work will be carried forward. It is important that Government policy is that public procurement, whether in housing, transport or defence, is brought forward, because many jobs depend on it.
The hon. Gentleman asked about consumer affairs and credit cards. I have said that there will be a debate on Monday on the economy, but we had Business, Enterprise and Regulatory Reform questions just this morning, when he could have put those questions to Ministers. We know that those issues are important, and that they should be kept before the House, which should be given an opportunity to hear from Ministers as regularly as possible.
The hon. Gentleman mentioned human rights and the European court case that dealt with the retention of DNA. I have two things to say about that. First, I find it ironic that other hon. Members—not the hon. Gentleman—protest about the violation of human rights, but would abolish the Human Rights Act. That is inconsistent. The hon. Gentleman does not share that inconsistency, but if one of his constituents were the victim of crime, they would want the police to be able to find the offender and bring them to justice. DNA evidence is vital in ensuring that the police can find people, especially in cases of rape and other sexual offences. It means that offenders who would have escaped justice are brought before the courts and punished. DNA records are very important in the detection and investigation of crime, but we will, of course, consider the implications of the European court judgment for our policy. When we have considered it, if we have anything to say, no doubt we will say it.
On the question of the search of the House in relation to the hon. Member for Ashford (Damian Green), the hon. Member for North Southwark and Bermondsey (Simon Hughes) will know that the Public Administration Committee is looking into the question of leaks, and the Cabinet Secretary has appeared before that Committee. He made it absolutely clear that he will not comment on any issues that are the subject of a police investigation, and that is rightly the case. The Home Affairs Committee will look into the police search of the House, but when I gave evidence to that Committee the day before yesterday, I suggested that it should not put itself in the position—especially as it is the Home Affairs Committee—of carrying out the same investigation as the police. Progress on the Speaker’s Committee, which was the subject of a motion of the House on Monday, is a matter for the Speaker.
Will the Leader of the House join me in welcoming the decision of the England cricket team to return to India for the test series? Could we have some parliamentary time to look at the implications of what happened in Mumbai for the fight against global terrorism? Will she confirm that there will be a ministerial visit to India at the earliest opportunity? So far, no British Minister has visited, and it is important to show solidarity with a country that is so close to ours.
I welcome my right hon. Friend’s welcome of the England cricket team’s visit to India. Ministers in our Foreign Office have been highly active, working with their colleagues in the Indian Government and the Pakistan Government. Everybody shares the huge concern and grief for those who lost their lives and were badly injured in Mumbai, and remembers that Pakistan suffered with the Marriott hotel explosion. Not only have our Ministers been active in supporting the Indian and Pakistan Governments fight against terrorism—we hope that they work together in that endeavour—but they have been working with the Pakistan and Indian community here. We will continue to be active in international work to tackle terrorism.
The Leader of the House will be aware that in the foreign affairs and defence debate yesterday, concern was expressed on both sides of the House about what is happening in Afghanistan. Unfortunately, given the length and breadth of the debate, we were not able to deal with that subject in the depth that it deserves. She will also be aware that a review of future strategy on Afghanistan is taking place in the United States at the moment. Will she arrange for the Prime Minister to come to this House to make a statement on future policy in Afghanistan, and provide a full day for a debate on Afghanistan where the House can fully explore, in depth, the concerns that exist?
I take the points that the right hon. and learned Gentleman has made, and I will raise those with the Prime Minister and the Secretaries of State for Defence and for Foreign Affairs. We recognise that those on both sides of the House want to debate our involvement of Afghanistan and hear from Ministers about it.
The House will be aware that Holocaust memorial day takes place on 27 January next year. The theme for that day is “stand up to hatred”. It is very timely, given the European and local elections held later in the year. This year, my right hon. and learned Friend allowed the House a debate on Holocaust memorial day that was supported by all parties. It was an excellent debate, and it gave us time to give credit to the work of the Holocaust Educational Trust, among other organisations. Will she consider a similar debate to mark 27 January next year?
May we have an early debate on the written statement made last week by the Financial Secretary to the Treasury on the closure of Her Majesty’s Revenue and Customs offices? As I explained to the House in a point of order yesterday, his statement indicated that the Lerwick office in my constituency would be retained, and that it was not part of the review. At the time when that statement was made, HMRC management were arranging to remove the last of its staff, so we might have an office that is open with nobody working in it. I do not question for a second the good faith of the Financial Secretary, who is a man of integrity who is respected on both sides of the House, but it is clear to me that elements in HMRC management do not feel accountable to anyone. We need to make them accountable, and an early debate in this place would be an important start to that process.
Can we have a debate in Government time to look at the behaviour of the management of the Sunday Herald, The Herald and the Evening Times? Those are quality campaigning newspapers in Scotland, and this time last week, 240 journalists were brought into a room and summarily dismissed. Bizarrely, they were given 90 days’ notice, and then even more bizarrely, they were told to reapply for far fewer jobs. That is totally unacceptable behaviour and shows the need to look at trade union legislation again.
I am sure that the journalists and staff at those newspapers will have the solid support of my hon. Friend and their trade union. Their management will no doubt have heard the points that he has raised and reflect on the fact that there is support on this side of the House for those points.
The autumn has long since gone but
“Now is the winter of our discontent”
because the Prime Minister reneged on a solemn commitment to the House, which was given in the debate on the Queen’s Speech last week, that we would have an Equitable Life statement before Christmas. What are we to say to those of our constituents who are affected, most of whom are elderly and many of whom live on modest means? Indeed, some have already died. When will the Government make a statement to ensure that those people are able to live better in the future, because they have been seriously disadvantaged through no fault of their own?
No one thinks that this is not a serious issue, and it is because it is a serious and important matter that we wanted to ensure that the Treasury has the time necessary to consider it. On the question of what the hon. Lady should tell her constituents, she should say that the statement will be in January.
Many of us have constituents who work for Woolworths. Will the Department for Work and Pensions issue a statement in the near future that gives advice about where those people can go for assistance if they need it, particularly in relation to some of the measures that the Government have recently introduced to help people through these difficult times during the economic downturn? May we have a statement to provide at least some respite to those who have had the worst possible news this side of Christmas?
I share my hon. Friend’s concern for those employed by Woolworths, many of whom have worked there for many years. This has been devastating news for them, and I reassure them that the Government will do everything we possibly can to help them with a difficult situation before Christmas. Jobcentre Plus will be on hand to ensure that they are pointed in the right direction for any training that they might need and towards any vacancies that are available. We will certainly not simply stand by and say that unemployment is a price worth paying and that they can get on their bike. We will give those affected every help possible.
What kind of Government will not even come to the House and make an oral statement about serious defence procurement delays? Journalists outside the House were being invited to a briefing at the Ministry of Defence, while the written statement was not even available to Members. That is totally unacceptable. When can we have a debate in Government time about the complete hash that they are making of defence procurement funding arrangements?
That is not the situation at all; we are pressing forward with important defence procurement. Regarding the enthusiasm for that subject shown by Opposition Members, I say to them that receipts coming into the Treasury are decreasing because of stamp duty and the retail sector is declining, so VAT receipts are decreasing. If defence spending is to be maintained at such a time—we have committed to maintain it—borrowing has to increase. I hope that all of those who want defence procurement to continue will support our decision to allow borrowing to rise.
Will my right hon. and learned Friend either initiate a debate in the House or consult the appropriate House authorities about an important matter? A few weeks ago, Scope had an event in the Terrace Pavilion. Most of the representatives were wheelchair bound and had to go through a designated smoking area to gain access to that part of the Palace. That is disgraceful and totally unacceptable. Will my right hon. and learned Friend have another look at that so that we show the rest of the country that we practise what we preach?
I agree with my hon. Friend that it is a serious issue when people who need wheelchair access have to go through a fog of tobacco smoke. Perhaps the shadow Leader of the House, other members of the House of Commons Commission and I can consider that matter.
The plans for the publication of Members’ expenses are: to ensure that we comply with the laws passed by the House and that the public have the information that they need to reassure them that public money is being spent properly by Members as we do our work; to ensure that there is a redrafted green book; and to ensure that there is better audit and assurance to reassure the public. However, the amount spent on gathering information for the public must be proportionate, and there has to be a sense of balance. The public have the right to know and we must ensure that they have the information they need, but that has to be done at a reasonable and proportionate cost.
Has my right hon. and learned Friend seen the recent report “Carers in Crisis”, which shows, notwithstanding the improvements the Government have made, that carers continue to struggle and their true worth continues to be undervalued and under-rewarded? May we have a debate soon on the huge contribution that carers make to our country, as that would provide an opportunity for Ministers to spell out what more they intend to do to ensure that carers are supported properly?
I will look at finding time for a debate specifically on carers. The increase in the number of people with disabilities and in the number of people aged over 85 means that the issue will only get bigger. Most people want to ensure that their families can provide care, and that is what most families want. We have already taken action on the right to request flexible working for carers, and important services—the local authority health service, voluntary and respite services—support family carers. Providing cash to those who are unable to work as often as they would have been because they are caring is also important. I will consider the points my hon. Friend has raised and see whether we can find an opportunity to debate the matter.
May we have a statement from the Secretary of State for Culture, Media and Sport early next week on what has gone wrong with the latest Stonehenge project? It is not just a local or regional issue; it is a matter of national and international concern, because the visitor facilities are a national disgrace. Will the right hon. and learned Lady confirm that the Department for Culture, Media and Sport, the Department for Transport and the Treasury are in agreement about the matter, and that the problem lies with one or more of the stakeholder partners in the project who cannot agree a compromise? Alternatively, as the chairman of the National Trust wrote in an article entitled “The neglect of our heritage is shameful” in The Guardian on 12 September, is it the case that
“In Britain, nobody gives a damn”?
It is certainly true that there has been a big focus on Stonehenge, and I know that the hon. Gentleman, as the local Member, has been anxious to be at the forefront of that. He will know that the stakeholders’ group met yesterday. This is a question not of whether Stonehenge will, as a site, be improved, protected and made more accessible, but of where the visitors centre will be, and of knocking heads together to ensure proper agreement. It is not that the Government have been holding back, but that we need to work with all the stakeholders to agree where the visitors centre should be.
May we have a debate on the role and powers of local authority trading standards services, because as trading conditions get more difficult, the likelihood is that there will be more disputes between consumers and retailers? I shall tell the Leader of the House about the long struggle that my constituent, Mr. James McMahon, has had with the major national company, Everest Windows, to get recompense for a faulty product. It took Mr. McMahon two years to fight his case through the county court. He was eventually vindicated and received compensation, but if trading standards services had had the power to intervene more forcefully in civil cases, all of that time, expense and anxiety could have been avoided to the benefit of the consumer and the retailer.
May we have a debate next week on a motion to refer the matter of the search of the offices of my hon. Friend the Member for Ashford (Damian Green) to the Committee on Standards and Privileges? The Leader of the House knows that the vote on Monday was profoundly unsatisfactory and that the result was distorted by the activities of the Labour Whips. It denied Mr. Speaker the purpose of his statement and kicked the matter into the long grass, where I know that the Leader of the House wants it to be. That is a disgrace and ought to be debated by the House on a motion to refer the matter to the remit of the Committee on Standards and Privileges.
If a Member wants something to be referred to the Standards and Privileges Committee, and if a motion is introduced to that effect, the Government make time available as soon as possible thereafter so that the House can express a view on whether it wants something to be referred to that Committee.
Will my right hon. and learned Friend urgently consider the inclusion of small-scale wind devices and air source heat pump devices in the terms of the general permitted development orders? She may be aware that the orders in respect of other microgeneration were laid last spring, that the devices I mention were excluded and that considerable distress is being caused to manufacturers by the fact that the orders have not yet been laid.
I wonder whether the Leader of the House could find time for the Secretary of State for Transport to come to the House next week to explain the Highways Agency’s extraordinary decision to close the A303 entirely for three months early next year. Aside from the west country, I can think of no region of the country where the main arterial route could be closed for a quarter of the year for the convenience of contractors, rather than being operated in the economic, environmental and social interests of the people whom I represent.
This is just the sort of issue that the hon. Gentleman’s regional Committee will want to address. As we will have that new accountability mechanism, he will not need to raise such an issue in business questions; he and his fellow Members who represent the region will be able to get to grips with it with the Highways Agency directly.
My right hon. and learned Friend will be aware of the strong support across the House for the campaign run by the Federation of Small Businesses to “Keep Trade Local”. Is she aware of my early-day motion 107, which calls on hon. Members to move on from that and to support the campaign by procuring their Christmas dinner from local shops and retailers in their constituency?
[That this House congratulates the Federation of Small Businesses on their Keep Trade Local campaign; notes that local high streets are increasingly under threat with 2,000 local shops closing each year; believes small businesses form an essential part of local communities and economies; and calls on hon. Members to source their Christmas dinners from small independent retailers in their constituencies in order to support local businesses at this time of economic difficulty.]
Only 29 Members have signed it so far, but, ever optimistic about the great generosity of all hon. Members, will she encourage Members to sign it and to procure their Christmas dinner from local suppliers, thus making it a merry Christmas not just in their households, but in those of our small retailers?
I am always anxious to give the Leader of the House the benefit of the doubt, so I accept that she was acting in good faith when she told the House in July, when the ombudsman’s report was published, that there would be a statement on Equitable Life in the autumn. I am less able to give the Prime Minister the benefit of the doubt about what he told the House during the debate on the Address:
“There will be a statement before the House rises at Christmas. I can say to the hon. Gentleman that that will be done. There will be a statement”.—[Official Report, 3 December 2008; Vol. 485, c. 38.]
That was only a week ago. What has happened in that week? Has the Prime Minister saved the world but lost his grip here?
What was said then was that there was an expectation—[Interruption.] Well, it stands to reason, does it not, that if the statement had been ready, it would have been made, so what was being talked about was a statement that was under preparation? The preparation has taken a bit longer than anticipated, but I think that Members are going way beyond things if they are asserting that there has somehow been some calculation about the timing and that Ministers are not acting in good faith. All we have been trying to do is give a reasonable estimate of when the statement might be ready, and the latest estimate is that we hope it will be ready in the week of the 15th.
The right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) has just asked that the privilege issues relating to the search of the House be referred to the Standards and Privileges Committee. If he moves the motion that the Leader of the House advises, will she ensure that there is an opportunity to amend the motion to ensure that the standards issue inherent in the apparent suborning of a public servant to breach the civil service code is also considered by that Committee?
The Public Administration Committee and the Select Committee on Home Affairs are both looking into aspects of this. I understand that if there was a reference to standards and privileges, the Speaker would decide whether there should be a reference and a debate would then be held on a motion to the House.
On behalf of all colleagues whose constituencies have interests relating to dockyards or shipyards, or substantial defence interests, may I impress upon the Leader of the House that today’s written statement by the Secretary of State for Defence announcing a two-year delay in the procuring of both the aircraft carriers, on which thousands of jobs depend, which appears to fly in the face of Government policy to bring forward major spending projects, is completely unacceptable? Has she any idea of the dismay that this is causing thousands of constituents up and down the country? Will she, even at this late stage, bring the Defence Secretary to the Chamber so that we can quiz him about the implications for the jobs of our constituents?
We are very concerned not only that the right defence equipment should be procured, but that the jobs and skills dependent on it should be secure. The hon. Gentleman may rest assured that with this Government’s support for capital expenditure and for public expenditure, we will sustain the capital investment that we have announced. Obviously, that involves a question of phasing, which will depend on the circumstances and on priorities. Unlike the Conservative party’s policy, our policy is to make sure that we sustain public investment.
Will the Government consider including in the Bill on political party funding that they announced they would introduce this Session measures to make political parties that receive donations that result from the proceeds of crime return the cash to the people from whom it was stolen? Will the Leader of the House examine the issue?
I am about to write to the hundreds of Equitable Life policyholders who have written to me about their concerns. Could the right hon. and learned Lady offer me a form of words so that I can explain to them, first, that they will have to spend another Christmas in a state of uncertainty and, secondly, why her promise that there will be a statement in the first week back in January is any better than the Prime Minister’s statement of a week ago or than her statement last July that this would be dealt with in the autumn?
May I also emphasise to the Leader of the House that the treatment of today’s written statement on defence equipment is disgraceful? May I suggest that she take some advice on the difference between personnel and equipment when she suggests that we will debate this next January?
The question of defence spending is a question of prioritisation between different sorts of equipment available for our armed forces personnel. Therefore, I was assuming that if Members were to catch the Speaker’s eye during the debate that will be held in our first week back, the question of what equipment is available for our armed forces would be within the remit of that debate. I was trying to assist hon. Members by saying that there would be an opportunity to debate these concerns. The hon. Gentleman does not need to patronise me and assume that I do not know the difference between a tank and somebody serving in the Army—I do.
On Equitable Life, I can only say what I have already said; I do not want to repeat it too often, but this was an expectation—[Interruption.] There was an expectation of when the statement would be ready, and I tried to assist the House by sharing that expectation with it. Hon. Members should be focused not only on the timing, but on what we are focused on: the substance of ensuring that we get the answer right on Equitable Life.
May we have a debate on the issues in early-day motion 229, which is about mobile termination rates?
[That this House notes that mobile telephones remain a popular gift for Christmas time, with an estimated one million telephones waiting under the tree this year; but regrets that in spite of this popularity, fixed and mobile customers in the UK will be charged in excess of £3 billion in unnecessary call charges in 2009 due to mobile termination rates; and calls on Ofcom to take immediate action to lower these outdated and unnecessary charges so that consumers can get a better deal from their new mobiles this Christmas.]
This Christmas many of our constituents will receive mobile telephones as presents, but £3 billion of unnecessary call charges will also be under the Christmas tree. May we therefore have a debate to explore those costs and expose the companies responsible, either on the Floor of the House or elsewhere with the Minister for Trade, Investment and Consumer Affairs?
My hon. Friends in the Department for Business, Enterprise and Regulatory Reform have been looking into the issue to ensure that there is no unfair charging. One of the things that my hon. Friend and others will welcome is the fact that the VAT reduction of 2½ per cent., which I am afraid Opposition Members have so derided, will help people with their mobile phone bills.
There is a sense of betrayal on the island of St. Helena at the Government’s failure to build an airport, which has been promised for many years. On Monday, there was a written statement, which said that there had been “a pause in negotiations”. For “pause” read: the dead hand of the Treasury cancelling the project. May I refer the Leader of the House to early-day motion 175, which is about the airport for the island of St. Helena, an overseas dependency, and reinstating the airport project?
[That this House agrees with the people and government of the island of St Helena that the construction of an airport is crucial for the island's economic future; notes that the British Government has for many years promised that an airport would be constructed, and that plans had reached an advanced stage where the award of a contract to build an airport was imminent; is therefore appalled at the announcement, by means of a Written Statement on 8 December 2008 by the Secretary of State for International Development, that there is now a pause in negotiations over the St Helena airport project which brings it to a halt; believes that the dead hand of the Treasury is responsible for the betrayal of this loyal overseas dependent territory; and calls on the Government to proceed with the award of a contract for the construction of an airport on the island of St Helena without further delay.]
Getting an airport is the only way in which the island and its people can have an economic future.
Will my right hon. and learned Friend assist the Minister for the West Midlands in securing a meeting between the Coventry MPs and Mr. Adam Crozier, with whom we have been trying to arrange a meeting for many months about the relocation of the sorting office in Coventry to Northampton? The proposed relocation has the potential to cause an industrial dispute and, equally, has generated vast public concern in Coventry.
May I ask the Leader of the House, as I asked her colleague the Deputy Leader of the House some time ago, to investigate why the Department for Transport seems to be incapable of meeting deadlines for freedom of information requests? I know of at least two outstanding requests that took several months to receive a substantive answer. Today the Department will breach the 40-day maximum limit on internal reviews, and those answers that I have received have been shoddy. Will she investigate the matter and ask the Department why it seems to feel that it is above all guidelines set by the Information Commissioner?
Just over two hours ago, in the most important lottery in central London, 20 hon. Members were successful in the private Members’ Bills ballot. Assuming that none of them decides to adopt the excellent draft autism Bill, which the hon. Member for Tiverton and Honiton (Angela Browning) introduced on 7 October, may we have what is by now a long-delayed debate on autism and in particular on improving the local planning and commissioning of services for people with autism? Two thirds of adults with autism say that they do not have access to appropriate services and only one in seven is in work. We need to ensure that they do not have to struggle to access the services that they deserve, so let us have a proper debate.
May I take the Leader of the House back to the plight of the hundreds of small businesses in Britain’s ports and the enormous backdated rating demand, which many of them are quite unable to pay? I understand that since I raised the matter last week some informal guidance has been issued saying that they may not have to declare that on their balance sheets. However, all the legal and accounting advice is that the requirement remains. Those businesses will have to close on 1 January unless the Government improve their offer of simply phasing the payments.
My hon. Friend the Member for Shrewsbury and Atcham (Daniel Kawczynski) asked the Prime Minister for a “concrete date” for when the Equitable Life statement would be made. The Prime Minister said:
“There will be a statement before the House rises at Christmas. I can say to the hon. Gentleman that that will be done.”—[Official Report, 3 December 2008; Vol. 485, c. 38.]
If we cannot believe the Prime Minister’s word, whose can we believe?
The point was that at the time he said that, obviously the statement was not ready; otherwise it would already have been before the House. The statement will be ready, we hope, shortly, but the important thing is not only that it comes forward as soon as it is ready, but that the substance is right.
Is it possible to have an early debate on the “Alice in Wonderland” workings of the Child Support Agency? I have a constituent with four children who is separated from her husband. She made a claim from the father, who built up arrears, but when one of the children went to live with the father temporarily while he was doing an education or training course, the father claimed from the mother, who had to pay him. That is absolutely nonsensical. As BT said, “It’s good to talk.” Is there any chance of the people in the Child Support Agency talking to one another, at least so that the payments that the mother would otherwise have made could be taken out of his arrears?
The hon. Gentleman should not minimise the important work done through the Child Support Agency. If people have children, they should be responsible for their financial upkeep and should not expect the taxpayer to foot the bill. The Child Support Agency has to deal with complex family circumstances, and he has just illustrated that. The more people there are who do not pay up and have to be chased, the more difficult it is for the CSA to devote its time to sorting out those sensitive and difficult cases. I am sure that the hon. Gentleman and other hon. Members will welcome the fact that the Queen’s Speech said that we will introduce a Bill—this was the subject of yesterday’s statement by the Secretary of State for Work and Pensions—so that all child support payments will be disregarded in income-related benefits. That means that when parents—usually fathers—pay up, all the money will go to the children.
I received a letter this week with a postscript in the handwriting of the Minister concerned saying that the Government would make a statement to the House on Equitable Life. If the Minister who sent me that letter, which I received 48 hours ago, cannot be accurate, why has there been such a delay in bringing forward a statement from the appropriate Minister? To my mind, that is unacceptable. I do hope that the Leader of the House will accept that the matter is one of deep concern to hon. Members in all parts of the House. This has gone on long enough. The statement should be delivered to the House before Christmas.
Today is the third anniversary of the Buncefield disaster in my constituency and I know that the Leader of the House will not be surprised that I am raising it with her. Today, Lord Newton will conclude his inquiry, which has been conducted behind closed doors. The Department for Work and Pensions has washed its hands of the explosion, yet we still have problems, with people who will never be able to return to their homes and thousands of workers, at this difficult time, with businesses that are just not safe enough to return to. Which Department will take responsibility from today onwards, and may we have a statement from a Minister from whichever Department that happens to be?
As the hon. Gentleman says, the third report—the major incident report—will be concluded today. The first two have already been published and the Government have responded to them. There is no question of the Government washing their hands of that important incident. We will reflect on the report and take the appropriate action.
Next week, will the Leader of the House investigate and make a statement on what seems to be a significant problem relating to the setting up of the regional Select Committees, resulting from the sloppy drafting of an amendment? If she looks at Hansard for 12 November, she will see that amendment (a) to her main motion, tabled by the hon. Member for Thurrock (Andrew Mackinlay), inserted the words:
“except that Chairmen of regional select committees shall not be paid.”—[Official Report, 12 November 2008; Vol. 482, c. 810.]
I understand the intention of that amendment, but because of its sloppy drafting, it means that no hon. Member can be the Chairman of a regional Select Committee—because all hon. Members are paid, as Members of Parliament.
The intention of the amendment was clear. It means that the Chairs should not be paid for their work as the Chair. It does not refer to their being paid in respect of their work as Members. I do not think that the hon. Gentleman is right to say that it will not be possible for Members to chair those Committees because they would then lose their parliamentary salaries as Members; they will not.
With permission, Mr. Deputy Speaker, I wish to make a statement on benefits uprating, particularly in the context of the Government’s commitment to provide real support to people in the current economic climate. I will, as usual, place full details of the uprating in the Vote Office and arrange for the figures to be published in the Official Report.
As in previous years, I can confirm that most national insurance benefits will rise by September’s retail prices index, which is up by 5 per cent. Most income-related benefits will be uprated by September’s Rossi index, which is RPI less housing costs, and is up by 6.3 per cent.
We are not alone in experiencing the shock waves reverberating through the world’s economic systems. Effects emanating from the epicentre of the American banking system are being felt around the globe. We believe that when the economic situation is more difficult, people need all the help they can get to deal with the situation. When things get tougher, people need more help, which is why our response to the current climate is twofold.
We are not only focusing on providing immediate support for those who lose their jobs; we are also determined to continue with our radical programme of welfare reform, to ensure that those further away from the labour market are not forgotten, as they have been in the past. As my right hon. Friend the Secretary of State for Work and Pensions made clear yesterday in his statement to the House, we are not going to repeat the mistakes of the past. During the recessions of the ’80s and ’90s, hundreds of thousands were shuffled on to inactive benefits to keep the unemployment count down. They were trapped there without support, and abandoned. In contrast, we are investing an extra £1.3 billion in helping people to find work now, and we are bringing forward proposals to increase requirements on people the longer they are out of a job, to ensure that they do not fall out of touch with the world of work.
We believe that work is the best welfare, and we are committed to ensuring that everyone has the opportunity to improve their prospects and those of their families. The proposals in our White Paper are based on the simple ideas that no one should be left behind, and that virtually everyone should be required to take up the support that we know works, to help them to prepare for and look for work. But we recognise that, for those who are receiving benefits, we need to uprate the value of this safety net to reflect changes in the cost of living.
We propose, therefore, that most working-age income-related benefits will increase in line with the Rossi index, at 6.3 per cent. This means, for example, that the personal allowance for a single person over the age of 25 will increase from £60.50 a week to £64.30 a week. The amount for a couple will increase from £94.95 to £100.95. Child-related allowances that may be payable in the income-related benefits will be increased in parallel with child tax credit rates by almost 7 per cent., from £52.59 to £56.11. This is essential to ensure that families receiving these benefits see the full value of any increase in child tax credit. We have already announced in the pre-Budget report that we are bringing forward April’s increase in child benefit to January. This will be worth an additional £22, on average, to families. The standard rate of statutory maternity pay and maternity allowance will increase in line with prices by 5 per cent., from £117.18 to £123.06.
In April 2009, incapacity benefit will be uprated by the same index as the employment and support allowance—the Rossi index, instead of the retail prices index—in order to prevent rate differences widening over time. No incapacity benefit customers with age additions will, as we proposed in the welfare reform Green Paper, have their rates frozen. Instead, the cash increase in their overall benefit will be at least half of Rossi, until they are transferred to the employment and support allowance. The additions will therefore be phased out more gradually than previously planned. Incapacity benefit claimants with an age addition, including those formerly on invalidity benefit, will not receive less than £95.15 a week—the same as someone in the support group on contributory employment and support allowance.
In these difficult times, we must also continue our strategy of providing support for all, and more for those who need it most. This means that for older people, as my right hon. Friend the Chancellor announced recently, from April 2009, the basic state pension will increase to £95.25 per week, which is up by £4.55. For couples, the standard rate will rise to £152.30. These increases, against a backdrop of falling inflation, are in line with the highest level of inflation this year—5 per cent.—and represent a real-terms rise in the state pension of 7 per cent. since 1997. And for pensioners on the lowest incomes, from April 2009 we will see the biggest increase in the pension credit guarantee since its introduction in 2003. The standard minimum guarantee will rise from next April by £5.95 a week for single pensioners and £9.10 for couples. That means that from April next year, no single pensioner need live on less than £130 a week, and no couple on less than £198.45 a week. That is an increase of £31 for a single pensioner and £45 for couples since 1997.
This above-earnings increase in the guarantee credit underlines our ongoing determination to tackle pensioner poverty, with 900,000 pensioners lifted out of relatively low income since 1998, after housing costs, and £13 billion more will be spent on pensioners in 2008-09, compared with what would have been spent if we had continued the policies that we inherited in 1997, over half of which is going on the poorest third of pensioners. Tax and benefit changes will mean that the poorest one third of pensioner households will be on average £2,100 a year, or about £40 per week, better off in 2008-09 than under the 1997 system.
But of course, the Government recognise the difficulties that pensioners face when prices increase. That is why, alongside the winter fuel payment, which is worth £200 for those aged 60 to 79 and £300 for those aged 80 or over, this winter there will be additional payments of £50 for those aged 60 to 79 and £100 for households with someone aged 80 and over. This will take the total direct help with fuel costs for pensioners this year to £250 for those aged between 60 and 79 and £400 for those aged 80 or over.
The pre-Budget report also announced additional direct financial support in the form of a £60 payment that will benefit not just pensioners, but all the estimated 15 million people who receive the Christmas bonus. This will take the total value of the Christmas bonus this year to £70, and is equivalent to bringing forward the uprating of the state pension from April 2009 to January 2009.
All these measures demonstrate the Government’s commitment to supporting pensioners, just as we are also committed to increasing the support on offer for those of working age. Our new proposals for lone parents and disabled people, for partners and for those facing multiple barriers to work, build on the steps that we have taken over the past 10 years to bring the advantages of an active, responsive welfare state to all those who can benefit. Today’s uprating continues our progress towards a fair and inclusive society that offers opportunity and independence for all. It reinforces our commitments to tackle poverty and exclusion and to ensure security in retirement. I commend this statement to the House.
I begin by thanking the Minister for his usual courtesy in letting me have sight of his statement in advance.
The Conservatives support the uprating of benefits. Anything that will help hard-pressed individuals and families at this difficult time is welcome, especially as this Government’s own policies have contributed so much to the economic downturn and to its likely duration and severity. Every day brings new job losses, including the extremely bad news from Woolworths only yesterday. Will the Minister share with the House his projections for unemployment levels over the next 12 months? I also wonder whether he has an up-to-date figure for the amounts paid out by his Department due to fraud and error. On welfare reform, the Minister knows that he will have our support, if the Government are really serious about tackling these hugely important issues.
We welcome the increase in the state pension, which will then be worth, as we have heard, £95.25 a week and £152.30 for a couple. Perhaps the Minister will join me in pointing out to the leader of the Liberal Democrats that it is not £30 a week. Will the Minister tell us exactly when the Government intend to restore the link with earnings for the state pension?
We know that £5 billion of benefits go unclaimed by pensioners every year, so what are the Government doing to increase take-up? About 40 per cent. of those entitled to council tax benefit do not claim it, and 1.8 million are not claiming pension credit. Will the Minister restore the boosting of take-up as a departmental priority? The Government’s decision to reduce the period of backdating from 12 to three months for pension credit claims suggests that they are more interested in saving money than in increasing take-up. Will the Minister confirm that at least 110,000 pensioners will be adversely affected by that change, and that they will tend to be older pensioners?
There are already 2.5 million pensioners living in poverty in this country, so how are the Government going to tackle that disgraceful state of affairs? We naturally welcome the extra £60 and so forth, but does that really tackle the problems faced daily by our older citizens? Help the Aged describes the pre-Budget report as
“a truly skinflint package for the UK’s older citizens. The chilling message from the Chancellor is ‘keep struggling’”.
Age Concern said of the same report that it
“will still leave many of the oldest and poorest pensioners…paying the price for the economic downturn.”
Falling interest rates may be popular with some people—indeed, with many people—but there is one section of the population for whom they are really bad news. Does the Minister recognise that many pensioners are facing real hardship because their hard-won savings are now attracting very low interest? Now there is talk about interest rates reaching even zero. We are talking about people who have done the right thing, and what successive Governments told them to do: they saved during their working lives so that their savings could supplement their income in retirement. To add insult to injury, those with modest savings are assumed to earn 10 per cent. on their savings when it comes to eligibility for pension credit. In these times of falling interest rates, that is surely total nonsense. I am sure that pensioners would love to get 10 per cent. on their savings, but in Brown’s bankrupt Britain, that idea is pure fantasy. Will the Minister please undertake to approach the Treasury as a matter of urgency to right this wrong?
Will the Minister confirm that he is wholly confident that the new personal accounts system will begin on schedule in 2012, and that it will definitely come in at or below a 0.5 per cent. cost base? Is he confident that the crucial issue of the relationship with means-tested benefits will be addressed in good time so that we do not have hundreds of thousands of people who are no better off, or worse off, as a result of being auto-enrolled into personal accounts?
Will the right hon. Gentleman tell the House what the Government intend to do in respect of deregulatory measures to encourage defined-benefit provision? Is there an intention to add any such measures to the welfare reform Bill?
This Government have presided over the closure of more than 70,000 occupational pension schemes since 1997, yet we know such schemes are likely to provide a significantly more comfortable retirement than personal accounts ever will? Why have the Government given up on final salary schemes?
The Prime Minister may think that he is saving the world, but is it not high time he got round to repairing our broken society?
I will ignore the politicking in the hon. Gentleman’s comments, as I usually do—not least his last throwaway point about a broken society, which is, of course, absolute nonsense, but I do not have time to go into that now. I thank the hon. Gentleman for his usual courtesies, and for broadly supporting the uprating. Let me deal in turn with some of the points that he raised.
I have said, until I am—I was going to say “blue in the face”, and I shall stick to that, as I do not know what the Labour equivalent is. I have said until I am blue in the face that I am not Mystic Meg, and that it is not my job to forecast what unemployment may or may not be as the months progress. Rather, it is my job to ensure that Jobcentre Plus and all other aspects of the Department for Work and Pensions’ offer are there for people when they need them—sometimes before and sometimes after they lose their jobs. The hon. Gentleman will know that we look into what we can or cannot do on an almost monthly basis.
I take the hon. Gentleman’s point about Woolworths, but let us be clear that it is not closing down shops and losing jobs at the moment. There has been an apparent lack of success with the administrator. Since Woolworths first went into administration, we are, and have been, talking with Deloitte and we stand ready to help as much as we can on a regional and local basis if the worst prevails—but it has not, yet. As I said some weeks ago when the news was first announced, we should not discount the 27,000 jobs that are currently in the mix.
I also take very seriously the hon. Gentleman’s point about fraud and error. Notwithstanding the fact that losses due to those two have gone down by about £100 million over the last period, some £2.6 billion remains variously attributable to them. About one third is caused by customer error, one third by benefit error on the DWP side, and one third by fraud. I welcome all the help and support that the hon. Gentleman and local agencies of whatever persuasion can make to drive that down.
With the best will in the world, I am not going to get into the issues around the fixation of the right hon. Member for Sheffield, Hallam (Mr. Clegg) with the figure 30. That is not my business at all.
I do not think that the points made by the hon. Member for Eastbourne (Mr. Waterson) about the link between pensions and earnings stand up to much scrutiny. Current rates and increases are significantly better than they would be by simply establishing the link—but I think that the hon. Gentleman would concede that the link was broken by the last Conservative Government rather than by any other.
The hon. Gentleman’s points about take-up were well made. He may not have noticed, but we have made that absolutely central to what I am trying to achieve with colleagues on London child poverty. Take-up is part of that process, and boosting it is one of the quickest ways of dealing with poverty, whether at child or pensioner level: it helps to restore the balance and get people back on the path out of poverty. I welcome the hon. Gentleman’s support in that regard.
I also take seriously the broad point about pensioners and savings, and I will happily raise the issue with my right hon. Friend the Minister for Pensions and the Ageing Society, and report back with her to the Treasury about the House’s concerns. I would also say that pensioners in receipt of pension credit who find that their capital has decreased should report the changes to the Pension Service, which will be able to reassess their claim. That may be a shorter-term point, but the hon. Gentleman cannot get away with the notion that somehow, tariff income rules have only just been imposed by this Government. They have always been linked with income-related benefits, and pension credit disregard of savings of up to £6,000—and £10,000 for those in care homes—are still very real. The vast majority of pensioners who get pension credit—about 80 per cent.—have savings of £6,000 or less and do not have tariff income applied, but I am not belittling the point. I have said clearly that I will take the matter back to my right hon. Friend the Minister for Pensions and the Ageing Society and to the Treasury because we can and should look further into the current circumstances for savers—both for pensioners and more generally.
I, too, thank the Minister for sight of his statement. There are more than 500 people currently employed in the Woolworths office in Rochdale, which I understand from yesterday’s newspapers will be closing. What steps is the Minister’s Department taking to assist those people, with more than 70 losing their jobs last week in Castleton, for example?
We are pleased to see from the welfare reform White Paper that the Government are moving towards our policy of having a single working-age benefit in future. Although the Minister was unable to tell us the amount lost in fraud, we believe that the position will be improved by moving to such a benefit. I understand that more than £6 billion was lost last year.
The right hon. Gentleman mentioned the additional £1.3 billion for next year. How will that be spent by the Department? As he is not sure about rising unemployment, how does he think that that will pan out? If there is a need for additional resources, how will they be found?
We welcome and support increases in pension and benefits. However, we are disappointed that the right hon. Gentleman has again refused to link earnings to pensions. What will happen next year, when there may well be negative inflation, and the value of the pension will continue to be less than it was in 1950? Does he not think that now is the right time to restore that link?
The Minister should be aware that the carers allowance stops completely if anyone earns above £95 a week. Carers have the worst of all worlds. The allowance is not an income replacement, but it is an active barrier to carers being able to work. In the current economic circumstances, why has he not at least introduced a taper—but does he not accept that it would be better to have a meaningful increase of the carers allowance?
With regard to take-up, we remain concerned about the 1.8 million eligible pensioners who do not claim pension credit. The Minister must have some data now. Will he explain what has happened to the number of people claiming pension credit, in the light of the three-month backdating limit? Does he not accept that in the current economic climate, that is making life very difficult for pensioners who fall behind with their rent, for example?
Does the Minister have plans to extend the winter fuel payment to people who claim the higher rate mobility component of the disability living allowance? I am sure he would agree that that reflects the fact that their movement is limited and they have to spend more time indoors. What about people with severely disabled children, and the terminally ill?
On Woolworths, let me be clear that we have a rapid support service located in every region and district. Where there are large redundancies—defined as those involving more than 20 people—the service will engage directly and locally with Woolworths when the jobs are under threat. As I said, we are, and have been, talking to the administrator at a national level. As and when that follows through in each region and locality, the hon. Gentleman can be assured that Jobcentre Plus will work alongside the rapid response service. Where the problem is larger and has a more distinct impact on a region or area, we will grow the service response as well. He will know that we have quadrupled, from £3 million to £12 million, the central co-ordinating costs for the rapid support service.
On the hon. Gentleman’s point about the White Paper, I welcome what he says about the single benefit. We think that it is the right direction to take. However, given his genuine concern for carers, he may know that one thing buried in the White Paper is the fact that we are taking the carers allowance out of the path to a single benefit. There were concerns in the caring community that putting carers on a single benefit akin to jobseeker’s allowance would undermine what they saw as a strong job that well supported the members of their family who needed that care. We are looking at that whole notion again.
I thought that I had made it clear—I am sorry if I did not—that fraud accounts for about one third of the £2.6 billion currently lost through fraud and error. Customer error also accounts for about one third of that, as does DWP jobcentre error. We need to do all we can—I think that this will be a consensual point across the House—to eradicate that fraud and error. Much is being done. We are at least going in the right direction, but quite slowly.
The hon. Gentleman makes a perfectly valid point about the £1.3 billion. We will in due course announce how that is to be broken down, but a central part of it will be for Jobcentre Plus, given the circumstances, and some will be for employment services and intervention. We will make those announcements as soon as we can, and I will ensure that he knows when that happens. The only significant spend from that thus far has been in connection with the 60,000 additional jobs that we committed to Jobcentre Plus in the PBR.
To be fair, I do not think I said that I was not aware that unemployment might rise. Again, that is a point of consensus, whether we like it or not. It is not my job to make forecasts. The hon. Gentleman will know that forecasts are made on a daily basis, with various degrees of legitimacy and cogency, by any number of people, some of whom probably should set up a little tent and call themselves Mystic Meg. However, I shall not do that.
I take cognisance of the hon. Gentleman’s general point about welcoming the uprating. Given the time, I will happily get back to him on the smaller points of detail at another stage.
Perhaps I ought to declare an interest, in that I am a pensioner.
On behalf of my many constituents who are in receipt of benefits, I appreciate my right hon. Friend’s statement. Is he aware that in parts of Yorkshire, certainly in west Yorkshire where I live, we have had an awful winter—although I am not blaming him for that? The winter fuel allowance of £250 for those between 60 and 79 and £400 for those over 80 is much appreciated, but that money will quickly go if the weather of the past week or two continues into the new year. Will there be a supplement later if the severe weather continues in Scotland and the north of England?
The comments of the Secretary of State for Work and Pensions yesterday about single parents are related to those of my right hon. Friend the Minister. Most single parents are not single parents by choice. That situation is visited upon them by a husband—usually—who has left. I am sure that those single parents would prefer to be in work, training, or further or higher education, but especially if they have more than one child, they can do that, only if there is adequate provision of day nurseries. Will the Minister assure me that day nurseries will be provided in every area where they may be needed?
I am grateful to my hon. Friend for not blaming me for the weather. I am grateful, too, that she welcomes the uprating. I can no sooner forecast the weather, or the bitterness or otherwise of the winter in west Yorkshire, than I can the unemployment trends for forthcoming years—but I am sure that all services, not simply on the benefits side, will look at that problem as it affects vulnerable elderly people.
I take my hon. Friend’s point about lone parents. I am not in the business of demonising lone parents in the shameful way in which others have done and continue to do. However, we think it is right that, at the core of the welfare reform White Paper outlined yesterday, we afford them all the support and help they can possibly have. Notwithstanding what she says about barriers such as child care, as my right hon. Friend the Secretary of State for Work and Pensions said, no lone parent will be forced into a job, however appropriate, if child care is not available.
The hon. Member for Rochdale (Paul Rowen) asked about negative inflation. We enshrined a 2.5 per cent. floor in the Pensions Act 2008, so if inflation goes down to zero, as some anticipate, there will always be at least that 2.5 per cent. I am sorry I forgot to say that earlier.
As the Minister knows, I fully support in principle the welfare reforms that his right hon. Friend the Secretary of State announced yesterday to which he himself has referred today, but on the assumption that they would save money rather than cost money. Can he clarify that point? Outside the House, he and his colleagues have suggested that the reforms will, on balance, save the taxpayer money, but in the House yesterday the Secretary of State said that the reckless borrowing in the pre-Budget report—he was quoting a Conservative Member—was necessary because
“it allocated an extra £1 billion and this White Paper allocates still further money.”—[Official Report, 10 December 2008; Vol.485, c. 541.]
The Minister said today that that further money would amount to £1.3 billion. Will he tell us whether the programme will cost money and require extra borrowing, or save money and reduce the borrowing and the cost to the taxpayer?
I know that the right hon. Gentleman has been consistent in his support for welfare reform, albeit, as he has said, in the context of saving rather than otherwise. We believe that not only the welfare reform proposals but all that we are seeking to do will, on balance—his words, not mine—be cost-neutral. We have said, however, that at least during the interim period, when savings can be made we want to work closely with local authorities to come up with flexibilities that will enable them to respond to the requirements of their areas. Not all the savings will be brought into the centre in the first instance.
In the broader context of all that the Department is seeking to do, as I have announced and others have announced previously, there will be an additional £1.3 billion because of the economic downturn—and that is £1.3 billion that could not be counted on as an absolute if the policies of the right hon. Gentleman’s party were pursued. My right hon. Friend the Secretary of State made that point yesterday.
We are indeed experiencing difficult times when even the greatest financial institutions in the land are happy to take Government loans on very acceptable terms. Meanwhile, some of the very poorest people are taking money at the door at annual percentage rates of 100 per cent., or even several thousand per cent. Has the Minister reviewed the operation of the social fund in connection with both the money that is available and the stringent conditions that are applied?
I believe that an informal consultation paper reviewing the operation of the social fund was published yesterday along with the White Paper, but if it was not, it will be published very shortly. As my right hon. Friend the Secretary of State said yesterday, we want it to become much more community-focused and responsive, and, if possible—and eventually, we hope, on a national basis—to have credit unions at its core. I am aware of the hon. Gentleman’s interest in this topic, and I accept the broad sweep of his perspective on it. I invite him to read the consultation paper and present us with his comments.
I welcome the Minister’s statement. Unfortunately, there have been a series of redundancies in my constituency. When I met a group of people who had been made redundant this week, they reported that the local Jobcentre Plus simply could not cope and they were being referred to telephone numbers. While I welcome the uprating, I wonder what advice the Minister can give people who are finding it difficult to obtain benefits in certain parts of the country.
Obviously I do not know the details of the case, or cases, raised by the hon. Gentleman, but I can say that people who have been redundant and want to claim benefits are finding increasingly that the telephone is the first point of contact enabling them to establish their claims and get the process running, so I would not be so dismissive of telephone numbers.
I made it very clear the other week—on the Jeremy Vine show, no less—that if people did wish to complain about the service that they had received, I genuinely wished to know about it. I do not want to go around saying that this is a world-class service, although I believe that to be the case. It is certainly a far better service than that provided in the early 1980s, when I was unemployed; in those days people had to run around four or five different buildings before they knew for certain whether they could make a claim. What I want to do is provide a service at local level, because that is what is required.
As the hon. Gentleman will know, we are increasingly using Train to Gain funds and other interventions to work with companies to try to prevent redundancies from occurring in the first place, and, when that cannot be done, to ensure that people know exactly what support they will be offered long before they are faced with the cliff edge of redundancy. For that purpose we need, and are receiving—for which we are grateful—support and intelligence from, for instance, companies, the insolvency administrator—whatever that is—and trade unions on a region-by-region basis. The earlier the intervention, the earlier we can tailor the appropriate response from Jobcentre Plus.
Can the Minister answer the specific question asked by my hon. Friend the Member for Eastbourne (Mr. Waterson) about the Department’s decision to reduce the time limit for pensioners to backdate their pension credit, housing benefit and council tax benefit from 12 to three months? Does he accept that older pensioners are more likely to be affected by the proposed change, and can he explain why a decision was made which will cause endless extra poverty to people who are in difficult circumstances at this time of year?
I am sorry that I failed to deal with that question when it was first asked. The change is part of a wider package to increase take-up and make claiming simpler, and we believe that it will benefit thousands. It is not about saving money, but about targeting people in the most effective way possible. I do not doubt that the hon. Gentleman’s concerns and those of the hon. Member for Eastbourne (Mr. Waterson) are genuine, and I should be happy to pursue the matter with both of them outside the Chamber, but we genuinely believe that this measure is not about saving for the sake of it. As I have said, it is part of a wider package to increase take-up and make the claiming process simpler.
Points of Order
On a point of order, Mr. Deputy Speaker. I wonder whether you have received any indication that the Prime Minister intends to come to the House to correct the statement that he made on 3 December about the Government’s response to the report on Equitable Life. He was quite specific last week, when he said:
“There will be a statement before the House rises at Christmas. I can say to the hon. Gentleman that that will be done…There will be a statement before the House rises this Christmas.”—[Official Report, 3 December 2008; vol. 485, c. 38.]
We learnt this morning that the statement would not be made until January, but I and other Members have written to constituents telling them that there would be a statement before Christmas, on the back of what the Prime Minister said.
We have been misled by the Prime Minister’s statement, Mr. Deputy Speaker. Will the Prime Minister now come to the House to correct his statement, or ensure that the Chancellor comes to the House before Christmas and makes a statement on Equitable Life as promised?
Further to that point of order, Mr. Deputy Speaker. The right hon. Member for Maidenhead (Mrs. May) and I have raised this matter persistently. If neither the Prime Minister nor the Chancellor feels able to come to the House and respond to the specific question asked by the right hon. Lady, can we at least have an apology and an explanation? We have had neither today. All we have had is an announcement that a statement will not be made by the date by which we were told that one would be made. There may be a good reason for that, although it is difficult to understand how the Prime Minister could be confident last week but cannot be confident this week. However, surely the House and our constituents deserve at least some factual explanation of why a statement made last week has been undermined and contradicted by a ministerial statement made this afternoon.
Further to that point of order, Mr. Deputy Speaker. This is not the first occasion on which the Prime Minister has made a statement in the House which he has subsequently failed to correct. I hope you agree, Mr. Deputy Speaker, that in this Chamber the spoken word is of the utmost importance, and carries enormous integrity in the context of the respect from the outside community that we all command as parliamentarians. Will you advise me what can be done to ensure that the Prime Minister himself makes an effort to correct the record and to avoid such misrepresentations? If the Prime Minister does not do that, Mr. Deputy Speaker, the possibility will arise that other Members on both sides of the political divide will take the view that if the Prime Minister can make a misrepresentation and get away with it, so can they.
Order. I think that hon. Members should choose their words very carefully on this issue. I think that the use of words such as “misrepresentation”—which I ask the hon. Member for North-West Cambridgeshire (Mr. Vara) to withdraw—suggests that an hon. Member, whoever he or she may be, knows what he or she is saying to be wrong when he or she says it. We have no evidence that that is the case in this instance. Perhaps the hon. Gentleman would like to withdraw the word that he used.
I thank the hon. Gentleman.
The Leader of the House gave the House further information today about the proposed statement on Equitable Life. If hon. Members wish the Prime Minister formally to correct the statement that he made last week, I suggest that they table parliamentary questions. Let me add that I have no doubt that Ministers have heard the points of order raised today, and I also have no doubt that the Prime Minister will respond if he feels it appropriate.
On a point of order, Mr. Deputy Speaker. As you might have heard, there is bad news today for our armed forces and defence industry, with delays in major procurement programmes, including our aircraft carriers, the Navy tanker programme and future Army vehicles. There is, therefore, huge uncertainty about jobs at what is a very difficult economic time. When Ministers made previous announcements about these programmes, they were all too happy to do so by oral statement to the House, yet today, when it is bad news, we get a written statement with no opportunity for Members to ask the questions that matter. Have you, Mr. Deputy Speaker, had any requests for an oral statement on these very important and worrying matters? It is in stark contrast to the courage expected of our armed forces that the Ministers who represent them are too afraid to come to the Commons to explain and defend their own incompetence.
Further to that point of order, Mr. Deputy Speaker. At business questions, we witnessed the spectacle of the Leader of the House doing her level best to answer the substance of questions on the statement that was issued in the form of a written statement, but failing dismally to explain to the House why an oral statement was not being made. Can you, Mr. Deputy Speaker, tell us whether there is any reason, from the point of view of Mr. Speaker’s office, as to why that statement could not have been an oral statement?
Order. I think I understand the point that Members are seeking to make. Mr. Speaker has made it very clear that on all important issues on which the House will have a view, statements must be made to this House. Whether they are oral or written statements is entirely a matter for the Department and Ministers concerned. That is not a matter for the Chair, but I repeat that Government Front Benchers will have heard the comments, which are on the record.
I will not deal any further with the same point of order.
On a point of order, Mr. Deputy Speaker. I seek your guidance. When a Minister comes before the House to deliver an oral statement relating to a piece of procurement and gives the House an opportunity to question them on the announcement, if there is subsequently a delay in, or cancellation of, that procurement is there not a convention that the Minister should return to the House to give another oral statement? Otherwise, is that not unfair?