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Commons Chamber

Volume 485: debated on Tuesday 16 December 2008

House of Commons

Tuesday 16 December 2008

The House met at half-past Two o’clock

Prayers

[Mr. Speaker in the Chair]

Business before Questions

Manchester City Council Bill [Lords] and Bournemouth Borough Council Bill [Lords]

Motion made,

That the promoters of the Manchester City Council Bill [Lords] and Bournemouth Borough Council Bill [Lords], which were originally introduced in the House of Lords in Session 2006-07 on 21 January 2007, may have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).—(The Chairman of Ways and Means.)

Object.

Canterbury City Council Bill, Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill

Motion made,

That the promoters of the Canterbury City Council Bill, Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill, which were originally introduced in the House of Lords in Session 2007-08 on 22 January 2008, may have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).—(The Chairman of Ways and Means.)

Object.

National Curriculum Tests

Resolved,

That an humble Address be presented to Her Majesty, That she will be graciously pleased to give directions that there be laid before this House a Return of the Report, dated 16 December 2008, of the Sutherland Inquiry into the delivery of National Curriculum tests in 2008.—(Ms Diana R. Johnson.)

Oral Answers to Questions

Health

The Secretary of State was asked—

Smoking

Reducing smoking is a public health priority for the Government. We will bring forward legislation to remove the display of tobacco from retail environments and tighten requirements on vending machines. Both policies primarily aim to protect young people from smoking. Protecting young people will also be a key theme in our new tobacco control strategy.

I thank my right hon. Friend for that very positive response. Does he recall the private Member’s Bill that I introduced in October 2005, entitled the Age of Sale of Tobacco Bill, in which I proposed to raise the age for smoking from 16 to 18? That proposal was later incorporated into the Health Bill, I am glad to say. Is he also aware that, in Barnsley, one third of all smokers under 18 buy their cigarettes illegally from what are known—for want of a better expression—as the local fag houses? The problem is so acute that Barnsley council has set up a tobacco task group to look at the issue. What more can the Government do to stop the illegal sale of tobacco to young people?

I pay tribute to my hon. Friend for his sterling work over a long period of time to get the age of sale increased to 18. He asks what more we can do. From April next year, the “three strikes and you’re out” rule will come in. If any retailer is caught selling cigarettes to under-age children three times, they will not be allowed to continue retailing. Other measures to tackle illicit tobacco are important, particularly in the context of the famous Barnsley fag houses that we are now learning about. Micro-chipping illicit cigarettes is an important development from Her Majesty’s Revenue and Customs, for example. There is a whole range of steps that should be taken, but that should not detract from the public health initiatives that we are taking in removing tobacco from the point of sale and ensuring that we take action to regulate vending machines.

I welcome the Secretary of State’s proposed legislation, which offers the prospect of real and lasting progressive change for the better. Will he tell the House what steps he is taking to enlist the services of some of our sporting icons—the Olympic gold medallists spring readily to mind—in trying to persuade young people of the dangers of smoking and the benefits of abstinence?

I thank the hon. Gentleman for his welcome for our proposals. He has raised an important point. We know that there is an issue about young people smoking. On average, 10 per cent. of 11 to 15-year-olds smoke, but almost one in five 15-year-old girls smoke. They take up smoking—as most of us did in our youth—because they see role models and people whom they admire smoking. The message from Olympians and others, which we will ensure is strongly put forward, will help in that regard. The research evidence clearly shows that the only place where tobacco can now be advertised is on point-of-sale displays and that that gives young people the impression that smoking is normal. That is what we are seeking to address with these proposals.

Regardless of the merits or otherwise of the proposals, does my right hon. Friend accept that carrying out the proposed work will involve costs to small shopkeepers? Does he have an assessment of those costs, and does he have any plans to compensate retailers for them?

I accept that there are issues for small retailers, and of course there will be a cost. The Save Our Shop campaign is the brainchild of the Tobacco Retailers Association, which is an offshoot of the Tobacco Manufacturers Association, which represents Imperial Tobacco, Gallahers and others in the smoking industry. The campaign is estimating the cost at something like—

This might be totally irrelevant to the question that my hon. Friend asked, but the campaign has put the cost at something like £6,000. There is no evidence whatever for that. The evidence from the countries that have introduced these measures is that there is a maximum cost of £1,000. In Canada, it was £500. The cost of putting up the displays is met by the tobacco manufacturers—by the cigarette companies themselves. We will of course offer assistance to small businesses. That is why we are saying that this measure will not be introduced for small shops until 2013. That will give us plenty of time to have a full consultation and to ensure that this will not damage those businesses.

I also welcome the steps taken by the Government further to reduce the damage done by smoking-related diseases, but will the Secretary of State reflect on his decision not to make progress with one proposition that achieved 98 per cent. support in the consultation exercise—namely, the proposition that tobacco products should be sold in plain packaging? That seems to have been parked for the time being by the Government. Will the Secretary of State confirm that he is not ruling out considering that matter and that there remains a strong possibility of introducing it at some point?

The right hon. Gentleman has welcomed—indeed, two Opposition Members have welcomed—the proposals, unlike the Conservative Front-Bench team. I heard the argument from the Conservative Front Bench in last week’s Queen’s Speech debate that there was no evidence base for the proposals. I have to say, however, that despite the fact that the right hon. Gentleman is quite right about the huge response in favour of plain packaging, there is no evidence base that it actually reduces the number of young children smoking. We want to keep that under review, and when there is an evidence base for it, it could well be another important measure to meet our goal, which is to reduce the number of young people smoking.

As the chairman of the all-party group on smoking and health, I warmly welcome the proposals. There will not be evidence on plain packaging now, as we are the first country to suggest the measure, so it needs to be piloted in some way. May I say to the Secretary of State that I was disappointed in one aspect of the announcement—the failure to abolish vending machines, which are used as the medium of sale for fewer than 1 per cent. of all cigarettes? The suggestion that we can somehow tighten up to minimise the number of young people buying from vending machines is likely to prove a dead end. The sooner we introduce the abolition, the better.

I understand my hon. Friend’s argument. We will take a power in the proposed Bill to ban vending machines. We were persuaded during the consultation, however, that there are other measures to restrict young people’s access to vending machines without banning them. I do not think that Governments should move to banning things if there is another alternative. We were persuaded of the alternatives such as carrying out an age check before giving tokens to use in vending machines and other methods that have been used successfully to restrict access by young people. It is sane and rational to try those out first, to have the power to ban in the legislation if necessary and to move towards a ban if the other measures do not work.

The Secretary of State knows that we want to proceed on the basis of evidence and he has appealed to evidence. Last Thursday, he told the House:

“The number of young smokers in Canada… was reduced by 32 per cent. among 15 and 19-year-olds as a result of the implementation of the measure.”—[Official Report, 11 December 2008; Vol. 485, c. 724.]

Well, I asked the House of Commons Library to look at the statistics from Canada and it says that the tobacco display ban was not introduced in all provinces; that it was introduced only in Manitoba and Saskatchewan; and that since the tobacco display ban was introduced, there were no statistically significant results for any reduction in the number of young people smoking in either of those provinces. Will the Secretary of State simply apologise for giving the House an inaccurate presentation of the data on Canada and will he put a note in the Library explaining his basis for the proposition that there is a proven reduction in young people smoking?

That is an extraordinary position for the Opposition Front-Bench team to take, particularly when we have produced the research from the British Heart Foundation—

Well, if that is shredding—[Interruption.] The hon. Gentleman should hang on before he talks about shredding things.

What Cancer Research UK’s extensive evidence shows—and it was all produced during the consultation period—is this: young people are more receptive than adults to tobacco advertising; being exposed to tobacco advertising and/or promotion increases the likelihood that a young person will take up smoking; and large displays of tobacco convey the notion that smoking is common. In Canada, 12 out of 13 provinces have introduced this legislation—and they have introduced it because there is absolute evidence, as there is in Iceland and other countries that have introduced it, that it reduces the number of young people smoking.

Thailand and the British Virgin Islands, if the hon. Gentleman wants an exhaustive list, but as my hon. Friend the Member for North-West Leicestershire (David Taylor) said, the point is this: someone has to be in the vanguard, which is why Australia and New Zealand are preparing to introduce such legislation. It is hugely disappointing that there is not a political consensus across the three parties, because the evidence is clear, the evidence is there.

NHS Dentistry

5. What his most recent assessment is of levels of access to NHS dental treatment; and if he will make a statement. (243635)

In the 24 months to the end of June 2008, 26.9 million people saw an NHS dentist. Improving access is a top priority and we have increased dental funding to more than £2 billion. In addition, last week we announced that we have set up a review to advise how we can ensure that everyone who wants to see an NHS dentist can do so. The review will be led by Professor Jimmy Steele of Newcastle university.

Over the past two years, my constituents have constantly approached me to say that their dentist has stopped doing NHS work and that, contrary to what the primary care trust website says, they cannot find a dentist in Chesterfield or Staveley who will take new patients. Yesterday, a Chesterfield dentist of 32 years’ experience told me that the current contract is the most bizarre arrangement ever devised by man. Will the Minister finally admit that the Government got the contract completely wrong, that 1.2 million fewer patients are seeing NHS dentists and that the contract needs scrapping and rewriting as quickly as possible?

The British Dental Association is working very positively with us on the contract. The review that we have recently announced is to ask how we can improve access, but there is no question but that access has improved throughout the country.

There is a question whether access has improved throughout the country. I have been telling Ministers for some time that the majority of my constituents, me and my family cannot find an NHS dentist in Leicestershire. That is the fact. Access is not better. The review announced last week is an admission of the failure of the contract. Instead of a review, how about the Government saying what they are going to do about this now to improve access to NHS dentistry.

I suggest that the hon. Gentleman calm down a bit, for the sake of his own health. I am happy to advise him on how to do that. Access throughout the country and the oral health of patients throughout the country have improved. The review is assisting us to improve access. There are open lists in his constituency. That has been stated by the primary care trust.

The Minister will know that there are 24,000 fewer patients registered with NHS dentists in Stockport, compared with 1997. Stockport primary care trust has been offering extra sessions to try to fill the gap, but local dentists prefer to stay private, saying that the fee structure is not sufficient for them to provide a professional service under the NHS. Does she share my concern at the state of NHS dentistry in Stockport and will her review tackle the issue, whereby my patients are denied NHS treatment and, in a recession, are forced either to pay to go private or, worse still, to go without treatment altogether?

The review will be guided by the principles of the NHS next stage review, ensuring that services are responsive to the needs of individual patients, that there is a strong focus on prevention as well as treatment, and that there are continuous improvements in the quality of care, especially in relation to the inequalities at the moment.

The whole House should also recognise the work that dentists have done with the contract and the improvements that have been made, such as the new treatments and the new dentists who are coming out of newly opened dental schools. I look forward to discussing the Health Committee report later this evening.

My good friend the Minister has read the recent Health Committee report on dentistry, so she will be aware that there are parts of the country where very few people have any problems accessing an NHS dentist. That is true in my area, where I serve constituents from south Gloucestershire and Bristol. We found that where commissioning is taken seriously by PCTs and they collaborate with the local dentistry profession, excellent results can be produced. What will she do to ensure that PCTs take this matter seriously and work with their dentists to commission good services?

I thank my hon. Friend. The Health Committee report points out how bad things were in many parts of the country before the contract changed, and how good they are where proper commissioning takes place. That is without question. More work has to be done on commissioning and I know that Professor Steele will be looking at that matter seriously. I welcome the opportunity to share the report with the House soon.

I have a slight interest in this matter, as is well known. The Minister will be aware that there are 13,000 people with oral cancer at any one time in the UK. About 50 per cent. of those people will die, and the mortality rate is getting worse, not better. The key is access—and I believe, as do dentists, that the key to access is the contract. There has been an implementation group running for some time—I do not know its name because it has changed. What suggestions has it made to the Minister to change that contract to make it more desirable for dentists to work for the national health service?

The Health Committee’s suggestions on the hon. Gentleman’s point are taken very seriously by the Department. We want to work with Professor Steele to see how access to oral health can be improved, which the hon. Gentleman rightly raises as a concern; it is a concern to all of us. We want to make the contract work. So many people and PCTs are doing so, and this House should congratulate the dentists who have been working so hard through the new contract.

Availability of NHS dentists in Enfield is not our problem. In fact, there will be an 8 per cent. increase in the coming year, but there is a shortfall in uptake. It is a small shortfall, but none the less it is there. My PCT is going to run a major advertising campaign in the new year to deal with the matter, but constituents tell me that they are not entirely clear what they are entitled to and what it might cost them. Can I suggest that the way in which we communicate with constituents on such matters should be a major part of the review?

I thank my right hon. Friend for her comments on behalf of Enfield. We have to look to PCTs, so many of whom are very imaginative in their advertising and in their use of communication skills, to encourage the best to help the rest. I believe that world-class commissioning will help in that process.

Although health is a devolved matter in Northern Ireland, what steps can the Minister take in conjunction with other Health Ministers right across the UK to ensure that newly qualified dentists take on NHS patients, and that they do so in rural areas and in less populous areas, where the difficulty is more acute?

We are increasingly looking at how we can share best practice with the devolved Parliaments, because we can learn so much from each other. Our new students coming out of dental school are showing a great willingness to work throughout areas, particularly where health inequalities exist, which tends to be more in rural areas because of issues of access.

Telephone services have an effect on access to NHS dentistry and to GPs. What is the NHS doing to cut back on the very regrettable but widespread use of 084 telephone numbers, which cost patients extra money? It is a scandal throughout Government, with thousands of 084 numbers being used, including a lot in the NHS. What are the Government going to do about that?

I thank my hon. Friend for that topical point. We have announced and launched a public consultation today on this issue, which is due to run until 31 March 2009. It will inform the Government’s decisions on the future of such numbers in the NHS. I certainly share my hon. Friend’s concern about those actions, as do the ministerial team.

The British Dental Association will be fascinated by what the Minister said earlier about working with it. This contract was imposed on dentists even though the BDA warned that it would not be any good for British dentistry. Also, a Minister was invited to this year’s BDA national conference, but no Minister turned up, even though one was on the train going to Manchester when I was travelling to speak at the event. I know that we will debate this important issue later, and we have had an excellent report from the Health Committee, but can the Minister explain why she thinks things are going so well when 4,000 patients a day are not able to see an NHS dentist?

On the point about the conference and meetings with the BDA, the chief dental officer and I have regular meetings with the BDA, and the consensus around the table is to work together, which I suppose would be alien to the hon. Gentleman. Working together in partnership with professional organisations that represent health workers right across the board comes naturally to Labour Members, and it will always continue to do so.

Vioxx

3. Whether he plans to meet Merck, Sharpe and Dohme to discuss compensation for those affected by Vioxx. (243633)

I have no such plans. The then Under-Secretary of State for Health, my hon. Friend the Member for Bury, South (Mr. Lewis), met representatives of the company on 10 July 2008 and conveyed to them the concerns expressed by Members.

I thank the Minister for his answer. My constituent, Mr. David Jones of Elterwater, is just one of the many hundreds of innocent UK victims who have suffered severe health problems as a result of taking the anti-arthritis drug Vioxx. Following the landmark victory of Les Thomas in last week’s court case in Cambridge and the $4.85 billion settlement already paid to American victims by Merck and Co., will the Government now put pressure on Merck to ensure that all patients whose health has been damaged by Vioxx are given the compensation they deserve?

The hon. Gentleman knows that this is a very complex issue, and I have every sympathy with those UK patients—including his constituent whom he has mentioned—who believe that they have been adversely affected by Vioxx. As the hon. Gentleman knows, I cannot comment on individual cases, but I understand that the case he mentioned is not related to the matter concerning cardiovascular disease. It would be inappropriate for Ministers or Government officials to intervene in, or comment on, any current or potential claims for compensation from the company in question in this country, as they are properly for the legal system. However, patients who believe they have a case are not prevented from taking a test case to a court of law.

I wonder where the Minister draws the line on patient responsibility when they may know the potential dangers of a drug but still wish to take it because it is effective. I should declare an interest: I took Vioxx and I found it wonderful. It probably caused an ulcer, but I still agreed with my doctor to continue to take it because of its effectiveness, despite knowing of the risks. It was then withdrawn, so I could no longer do that. Vioxx is not the only such drug; there is also co-proxamol, for example, which has been withdrawn from use, too. It is difficult for people with arthritis or joint pain to find an effective analgesic, because the ones on which they have come to rely have been withdrawn. Nevertheless, many such patients would accept the risks involved in taking those drugs and still take them.

My hon. Friend speaks with great personal experience, and her question illustrates the complexity of these matters. It must, therefore, be right for it to be up to individual patients who believe that they may have been adversely affected in any such circumstance to make their own decisions about claiming for compensation and pursuing that through the legal system. It is certainly not appropriate for the Government to try to bring pressure to bear on an individual company in the circumstances my hon. Friend describes. These must be matters for clinicians and individual drug companies to decide, and it is for the National Institute for Health and Clinical Excellence to make recommendations as appropriate.

The Minister’s predecessor took a rather different view, and four years ago The Lancet concluded that:

“The licensing of Vioxx and its continued use in the face of unambiguous evidence of harm have been public health catastrophes.”

This year, a leading US American journal claimed that Merck had drafted “dozens of research studies” on Vioxx and then got prestigious doctors to put their names to them—there was ghost-writing, in other words—and had misrepresented data. Given that most of the 400-plus victims of Vioxx in this country were NHS patients, is it not incumbent on the Government to intervene in this scandal and demand that Merck treats British victims in exactly the same way as US victims have been treated in the $4.8 billion settlement from which they have benefited?

I understand the concerns of the hon. Gentleman and other hon. Members. My predecessor met a parliamentary delegation on the matter only this July, so representations have been made. I must emphasise to the hon. Gentleman that it is not appropriate for Ministers or for Government to intervene in, or comment on, a potential claim for compensation that might be carried out in this country and that is properly a matter for the legal system to address. I repeat to him that the Government do not have any ability to bring sanctions to bear on the company that he is describing. If patients believe that they have a case, they are not prevented from taking it forward in a court of law in this country.

Prescribing Costs

Annual growth in primary care prescribing costs in the year to March 2008 was 1 per cent. That is set against a 5 per cent. increase in the number of prescription items dispensed. Unfortunately, it is not possible to attribute a specific cash sum to more efficient prescribing, because variables, such as the cost of the drugs themselves, will affect the savings that are made by primary care trusts. I think that the hon. Gentleman can see that there has been some progression in efficient prescribing over the past year or so.

The Minister may recall that in its 2007 report, the Public Accounts Committee recommended, and the Government accepted, that more than £200 million a year could be saved for the NHS by prescribing generic drugs, rather than branded ones, without any adverse effect on patients. Has that target of £200 million been achieved? Which PCTs have made the most progress and which have made the least progress? If he does not have the information to hand, he may write to me.

The PAC report was very helpful, and I am grateful to the hon. Gentleman’s Committee for the work that it has done. The health service pays an £8 billion drug bill at the moment, so I am pleased to be able to tell him that PCTs are making considerable progress. Generic prescribing has increased from 51 per cent. in 1994 to 83 per cent. in 2008—that is the highest rate in Europe. He will know that PCTs are independent bodies and that they make their own decisions about these matters, but we have issued guidance to PCTs. Although it is ultimately for them to decide, the practice-based commissioning that we have seen and other guidance that we have issued is definitely driving the NHS forward in the right direction, towards the more efficient prescribing of drugs.

Five thousand of my constituents have written to the Minister, via me, asking that their general practitioners be allowed to continue dispensing. Will he take heed of this Bassetlaw common sense?

My hon. Friend has been at the forefront of the campaign on the issue of dispensing by doctors. We are analysing the responses to the consultation on pharmaceutical provision in England, and we will be making an announcement on these wider issues as soon as possible in the new year. I am aware of the strength of the responses we received on the various options for amending the criteria for dispensing by doctors. We have taken into account the views of those attending the listening events, the meetings and so on, and as a result I am pleased to announce to him that there will be no change to the current arrangements on GPs dispensing medicines to their patients.

Building on the remarks made by my hon. Friend the Member for Gainsborough (Mr. Leigh), does the Minister accept that if his June steering group report recommendation that there should be statutory regulation were implemented for complementary medicine, herbal medicine and acupuncture, that would create further downward pressure? That is because doctors would be prepared to refer to these practitioners, who charge a lot less, and, thus, the cost to the health service would be less.

I thank the hon. Gentleman for his question; I shall certainly consider the contribution that he is making and write to him on the particular point that he raises.

Has my hon. Friend considered the wastage of drugs through inefficient prescribing, especially in relation to free prescriptions? Many people accept the drug offered on the prescription, but do not use it. Even though the drug is unused and still in its original packaging, it cannot then be used and has to be destroyed. That loses the NHS a huge amount of money.

I understand my hon. Friend’s concerns and those of other hon. Members who have written to me about wastage. We are all concerned about wastage caused by unused medicines. The difficulty is that the recycling of medicines in the way that he and others have suggested is regarded as unethical and unsafe according to the code of ethics produced by the Royal Pharmaceutical Society. Indeed, some hon. Members have suggested that we could donate unused drugs to other countries, but the World Health Organisation guidelines state that no drugs should be donated that have been issued to patients and then returned to pharmacies. I understand the concerns about wastage, but we must take clinical matters into account when making decisions.

The Government have shown themselves willing to qualify the autonomy of primary care trusts when they feel it necessary to do so. Why then are they ignoring the huge disparity between the best and worst performing primary care trusts in the drug-prescribing habits of their practitioners and the related costs?

I referred to that matter when I answered the question asked by the hon. Member for Gainsborough (Mr. Leigh). We are drawing the attention of primary care trusts to the value of more efficient prescribing commissioning, and—as I said—generic prescribing has increased from 51 to 83 per cent. We are making excellent progress and I hope that PCTs, autonomous bodies as they are, will none the less take notice of the guidelines that the Government have issued, which will ensure that we have more efficient drug prescribing in future.

Accident and Emergency

6. Whether any of those accident and emergency departments redesignated as urgent care centres have subsequently been reinstated as blue light accident and emergency departments. (243636)

Not as far as we are aware. It is up to the local national health service to ensure that urgent and emergency care meets national performance requirements as well as reflecting local needs.

That is a disappointing reply. The transfer of blue light accident and emergency from Burnley to Blackburn has been a running sore for more than a year. Given the present capacity problems at the Royal Blackburn hospital, ambulances are again taking patients back to Burnley. Why cannot we reinstate our accident and emergency at Burnley general hospital, if necessary with a published protocol indicating where patients should be taken with their various injuries and conditions, whether it be to Burnley, Blackburn, Preston or even Manchester?

I am nervous about intruding on what I understand to be the historic but friendly rivalry between Blackburn and Burnley. Seriously, however, I understand the organisation of services there to be a result of what clinicians felt would be the best way to concentrate specialist accident and emergency care in Blackburn and elective planned surgery in Burnley, which would avoid some of the cancellation problems that his local hospital was experiencing because of the need to deal also with accident and emergency cases. My hon. friend will also be aware that the democratic check on those organisations—in his case, the Lancashire overview and scrutiny committee—strongly supported the proposals. The recent problems that he mentions happen in many accident and emergency services when there are particular, localised and sudden pressures, and they are not peculiar to the reorganisation to which he refers.

Could the Minister confirm that the urgent care centres are in addition to accident and emergency provision, and not in place of it? The care centres are a better use of the expensive professional staff—doctors and consultants—instead of a way to close accident and emergency services. People who would have automatically gone to accident and emergency are being transferred to a more appropriate form of treatment.

Yes, the hon. Gentleman is absolutely right. The decision at local level is made on a case-by-case basis, but he is right to draw attention to the benefits of urgent care centres in reducing the pressure on, and unnecessary referrals to, accident and emergency departments.

I hear what my hon. Friend says. One of the most difficult aspects of the way we now treat accident and emergency departments is how they must lock in carefully with the ambulance service. One of the continuing problems in Gloucestershire is the number of times that ambulances back up in the car parks of our two main acute centres. Is it not time to look at how the ambulance service operates in relation to accident and emergency, and consider ways we can improve that operation?

Let me say loud and clear to the trusts, through my hon. Friend and any other hon. Members who experience that problem, that it is totally unacceptable for ambulances to back up either because they are being forced to do so by the accident and emergency department or because the ambulance service has decided to do so. I am sure he is aware that the clock starts ticking on the four-hour maximum wait 15 minutes after the ambulance arrives. Any accident and emergency department that thinks it can fiddle its achievement of the four-hour figure by keeping ambulances stacked up outside the hospital is wrong. That message has gone out loud and clear many times from this Department and I am happy to repeat it in the House today.

Will the Minister confirm that when making decisions about the structure of emergency care in the years ahead, it will be increasingly important to take account of not only the evidence on how to achieve the best clinical outcomes but the resource implications of the different structures of emergency care? The Government have been signalling for some time that the rate of growth of cash available to the health services is going to slow down. In the pre-Budget report, the Chancellor made it clear that spending cuts were intrinsic to the Government’s plans. Against that background, is it not important to begin to manage expectations about the structure of emergency care that is likely to be delivered by the health service in the years ahead?

“Lower increases” would, I think, be a more accurate description of future spending projections. Of course, last week we announced annual increases of 5.5 per cent. and 5.5 per cent. for PCTs in each of the next two years. There will be lower increases from the Government, but there would be cuts from the Opposition, were they to get into government.

The right hon. Gentleman is absolutely right, and I commend the thoughtful remarks that he made at the King’s Fund discussion either today or yesterday, which I read. He is right to say that high-quality care is often the most cost-effective care. There is no doubt—this is the pattern not just in this country but in other countries around the world—that when it comes to accident and emergency services it is safer, better and more effective to concentrate care in a smaller number of specialist units. It is often better for in terms of survival rates and health outcomes people to travel a little bit further to those specialist units.

In view of the confusion that still exists among patients about whether they should go to accident and emergency, urgent care centres, minor injuries units or the out-of-hours GP centre, will the Minister tell us what progress he is making in establishing a single telephone number, less than 999, that would be relevant to each area and would direct every patient down the appropriate pathway for their area?

Very good progress, I am pleased to tell the hon. Gentleman. However, he will have to be a little more patient before we make a formal announcement.

Will the Minister find time before Christmas to go to Enfield and tell the people there why they do not need an accident and emergency department at Chase Farm hospital and why it will be replaced by a non-blue light service at the urgent care centre? The most recently published report by the experts, the College of Emergency Medicine, concluded:

“There is no evidence of the clinical or financial benefits”

of the urgent care centre model, and that the Government’s proposals are

“clinically unproven and against the principle of patient choice of access to proper emergency care.”

In the light of those statements, will the Minister and the Secretary of State reverse their decision to replace accident and emergency services at Chase Farm with an urgent care centre?

The hon. Gentleman is aware—or at least he should be—that there is a potential legal challenge, if not an active legal challenge, to that case. I shall therefore not comment on his specific point. He will be aware that the proposals in north-east London have been through the democratic check of both the overview and scrutiny panel and the independent reconfiguration panel. Everybody—including the four primary care trusts, most of which cover boroughs with Conservative majorities—is agreed that the proposals are the best solution for the north-east London health economy.

North Yorkshire and York PCT

7. What recent assessment he has made of the financial position of the North Yorkshire and York primary care trust; and if he will make a statement. (243637)

My right hon. Friend the Secretary of State was pleased to announce last week that North Yorkshire and York primary care trust will receive an 11.6 per cent. increase in funding over the next two years. That places my hon. Friend’s primary care trust in the top quarter of increases in allocations.

I have been arguing for years that the North Yorkshire and York PCT did not get enough money to meet the health needs of the large number of elderly people who live in what is a largely rural area, so I congratulate the Government on changing the funding formula to put that right. I am pleased that the PCT will get larger increases than the national average in future, but will the Minister do everything he can to ensure that it clears its deficit as soon as possible? That will ensure that this large amount of extra money will be used to provide new and better health services for patients, and not to clear historical debts.

Yes, and I am delighted that my hon. Friend’s persistent and effective lobbying on behalf of his local PCT has paid off. He will be aware that the PCT has gone through some difficult personnel issues, which are now being addressed. It is working very closely with his regional strategic health authority to ensure that the challenges to which he refers are overcome as quickly as possible.

Although I welcome the additional expenditure, will the Minister tell the House for how long the extra money will be available, and does he accept that the funding formula has to change? Per patient, the PCT and the individual hospital trusts have been receiving much less than the average, so will he review the patient formula? Will he reintroduce the factors that reflect the sparsity and rurality of the population because, as the hon. Member for City of York (Hugh Bayley) suggested, our ageing population lives in deeply rural areas? [Interruption.]

Exactly, we have just done that—the new formula has been changed to take into account elderly populations, and that is why the hon. Lady’s PCT has benefited so dramatically from the increase in funding. She asks how long the funding formula will apply, and I can tell her that it is for the next two years. At the end of that period, her PCT will still be 2.4 per cent. below target, but that is a good position for it to be in as it will then have more catching up to do. However, it is far less likely to catch up under a Conservative Government, as her party is committed to cutting spending on health.

Will the Minister review the role of patient referral units? They cajole patients to take up operations at the Capio private hospital in York, even though many would otherwise choose to have their operations in Scarborough.

It is interesting to hear a Conservative Member running down the use of the private or independent sector in health care. No one is being cajoled to go into the Capio centre, but people are being offered a choice. I thought that Conservatives were in favour of choice.

Topical Questions

The responsibilities of my Department embrace the whole range of NHS social care, mental health and public health service delivery, all of which are of equal importance.

May I congratulate the Department on its foresight in supporting the local campaign to reuse the Standish hospital site in my constituency? It would appear that in January we are to get the good news that the site will be transferred back to the PCT, and we look forward to the development of a fully integrated care setting there. There have been two obstacles to the campaign’s progress: my hon. Friend the Minister will know about the security issues with the site, but I am pleased to say that the listing of block C seems to have been sorted out. Will he ensure that this wonderful proposal sees the light of day, and will he give every support to the PCT so that it can see it through?

Yes, and let me commend my hon. Friend for his active interest in this matter. He is right to point out that the two remaining blockages to progress have been removed: the Department for Culture, Media and Sport has decided not to list block C—having visited the site with my hon. Friend, I believe that that is a very sensible decision. In addition, problems to do with security and vandalism have been sorted out, and I look forward to an announcement that he will be pleased with being made in January.

I recently chaired a seminar on Lyme disease in Westminster Hall, and two things became clear—that diagnoses of people suffering from Lyme disease are on the increase, and that sufferers are beginning to encounter the same scepticism that people with other chronic fatigue syndromes such as ME have been subject to. Will the Under-Secretary of State for Health, the hon. Member for Brentford and Isleworth (Ann Keen), address that matter? What instructions can she give to GPs to ensure that they treat more seriously the symptoms of long-term sufferers from Lyme disease?

May I congratulate the hon. Gentleman on the work that he is doing on Lyme disease, and indeed other hon. Members who have shown an interest in that relatively new disease? Guidance on the diagnosis and treatment of Lyme disease is provided to general practitioners and other clinicians by the Health Protection Agency and is published on its website.

T6. My right hon. Friend the Secretary of State will be aware that more than 90 million working days are lost in Britain every year through mental health issues such as stress, anxiety and depression. Many employers do not quite know what to do about mental health problems, so may I invite him to look at the innovative work being developed by the Cheshire and Wirral Partnership NHS Foundation Trust, together with local employers across Cheshire and the Wirral, which is having significant results? In particular, I point out the partnership between the trust and Airbus; their work has resulted in a 20 per cent. reduction in staff absences at Airbus. (243661)

I am very grateful to my hon. Friend for drawing to my attention, and the attention of the House, the excellent work done by Cheshire and the Wirral, and the scheme involving Airbus, which she identified as working very well. She is quite right; there are issues to do with mental health and employment that need to be addressed. She will know that we launched a consultation on the subject earlier this year, and a report on the issue is due in the spring. Dame Carol Black is chairing a steering group that is looking into how mental health provision can be better tailored and integrated to help people to find, stay in or return to work. I will certainly draw to the steering group’s attention the excellent work that my hon. Friend describes in her constituency.

T2. Will the Secretary of State agree to take an urgent look at the perverse effects of the NHS’s so-called choose and book system, which my constituents think should be renamed confuse and book? My local primary care trust is so fed up that it now routinely explains to my constituents that the system is nothing to do with it. It is certainly nothing to do with general practitioners, who often end up making the bookings on behalf of my bemused constituents, who cannot work their way through the system. Choose and book is certainly not helping my constituents, the overwhelming majority of whom would rather go to the local district hospital, Stepping Hill, than have what often turn out to be illusory offers of treatment elsewhere. Do Ministers accept that choose and book is putting at least three extra leaps between the consultant and the patient, and that the matter needs to be tackled urgently? (243657)

Order. If the hon. Gentleman ever wishes to apply for an Adjournment debate, I guarantee that he will get one, but I need questions to be brief.

No, we do not accept what the hon. Member for Hazel Grove (Andrew Stunell) says. I am afraid that it is the responsibility of his local primary care trust and GPs to manage the system efficiently and competently, as most primary care trusts and GPs across the country do, to the great benefit of their patients.

Will my right hon. Friend the Secretary of State confirm that the introduction of GP-led health centres will improve access to GP and primary care services, 12 hours a day, seven days a week, and that such health centres do not threaten well-run, easily accessible village surgeries?

I shall be very pleased to confirm that. Indeed, Bradford—not too far from my right hon. Friend’s constituency—had the very first GP-led health centre, which I opened on 28 November. There, we found that people can drop in at any time. They are guaranteed not to wait more than half an hour, even if they have not got an appointment. The contract was given to a fabulous social enterprise formed by GPs in the area who are doing excellent work throughout Yorkshire. Such health centres are about improving access and increasing the capacity of primary care, so it remains totally mystifying why the Conservative party opposes those new services.

T3. Is the Secretary of State aware that there has been a very serious outbreak of norovirus at the Queen Elizabeth hospital in King’s Lynn? Wards have been closed and all non-urgent operations have been cancelled. Obviously, the problem comes at a bad time for the hospital, as it is trying to pay off its historical debt. The problem could well have an impact on waiting lists and affect the hospital’s finances. What advice could and does the Secretary of State give to hospitals in that position? (243658)

Hospitals should know what to do in that position. This is not a new problem—as I am sure the hon. Gentleman is aware, it happens regularly at this time of year—and our latest understanding from the Health Protection Agency is that it is less bad this year than in previous years. However, it is important that hospitals take swift and immediate action and it is important, too, that people, not least hon. Members in the House, should not spread undue alarm by, for example, comparing this to health care-associated infections, the implications of which can be fatal.

T7. Will the Secretary of State confirm that the incidence of health care-acquired infections such as MRSA and C. difficile is down in 2008? Does he agree that at this time of welcome reductions it is all the more vital that all parts of the NHS remain focused on maintaining those clinical practices, standards of cleanliness and public education to drive out those infections completely? (243662)

My hon. Friend is absolutely right. We have halved MRSA bloodstream infections across England, hitting our target, and we are making excellent progress towards the 2010-11 target to reduce C. difficile infections by 30 per cent. However, we must continue to drive that forward and drive home the message, not just with health professionals but with the public at large, and I am extremely happy that all our people are working all the time to make sure that that happens.

T4. Will the Minister explain to my constituents in Romford and the London borough of Havering why the operating framework from the Department of Health for 2009-10 does not give priority to the health and well-being of our increasing ageing population? (243659)

The operating framework that we issued this year has been well received in the NHS. We have ensured that instead of trying to prioritise everything, and thus prioritising nothing, we have focused attention on health care acquired-infections, which are a huge issue for older people, particularly the over-65s; on dementia; and on greater patient involvement. Those priorities all apply to older people. The dementia strategy, which we will shortly publish, is of particular benefit to older people, as is the debate on the reform of adult social care which, although not restricted to the over-65s, is very much the focus of that report.

T5. It would be churlish to allow 2008 to close without thanking the Secretary of State for accepting in full the recommendations of the independent reconfiguration panel regarding Horton general hospital, and a lot of work has been done to try to balance accessibility issues and safety. May I trespass on the seasonal mood of good will to point out that the Leader of the Opposition, the shadow Secretary of State for Health and at least three members of the shadow health team all visited Horton general hospital in 2008? May I invite the Secretary of State or one of his team to come to visit the Horton general hospital in Banbury at some stage in 2009, so that when he considers these issues he can visualise the balance that we are trying to strike? (243660)

Order. Once again, in topical questions, questions should be brief, not long. Short and sharp—that is the idea.

I thank the hon. Gentleman for his comments. What happened with Horton hospital was verification of the process, and the independent reconfiguration panel made those decisions on the basis of the clinical argument. I should be glad to visit the hospital, but I do not believe that I have ever received an invitation. Usually, I depend on an invitation before I pop up, so it would be nice to receive one.

T8. Can the healthy schools programme be revised, so that medicine policies and support systems for children with diabetes and other long-term conditions are taken fully into account? (243663)

We are committed to improving diabetes care for children and young people, including the way in which the condition is managed in schools. The national clinical directors for children and for diabetes are working together to look at how to support the NHS to improve the way it cares for children with diabetes and other long-term conditions.

The Secretary of State will know that the NHS Information Centre provided to 10 Downing street information from hospitals about people presenting with knife wounds—data that were unpublished, not yet validated and incomplete. That was done on the basis that the information would not be used publicly in that form. Can the Secretary of State tell the House whether he knew about 10 Downing street’s intention to use those data and, whether he did or not, what steps he personally is taking to make sure that NHS data are not used for partisan purposes in that way?

I have nothing to add to the Home Secretary’s comments yesterday, particularly her apology for what happened. The hon. Gentleman has written to the Information Centre and made a number of points, all of which will be answered in due course.

T10. Are my right hon. and hon. Friends aware of the campaign by thalidomide survivors, who make the point that that increasingly elderly population who were victims of a great tragedy many years ago are now beginning to suffer the ill-health effects of ageing? How do the Government intend to respond to their aspiration for proper recognition of their plight? (243665)

There is, of course, huge sympathy across the House for individuals and families affected by thalidomide. My hon. Friend will know that a private compensation settlement was arranged many years ago—this is the 50th year, I think, since the tragedy occurred. In addition to the annual payments to victims, those affected by thalidomide will continue to benefit from ongoing improvements to health and social care in the circumstances that he describes, particularly the developments that we are introducing to help people with disabilities to get better social care. There have been substantial increases in the level of funding provided for health and social care services in recent years, and thalidomide survivors and their families will benefit from those services over the years ahead.

T9. Figures given to me by the Minister in a written answer show that alcohol-related finished admissions to hospital in Bexley have increased by more than 70 per cent. since 2002. Does that not show that Government policies on tackling the public health problems caused by alcohol are not working, and why we need our vital accident and emergency hospital department at Queen Mary’s in Sidcup? (243664)

On the hon. Gentleman’s final point, I understand that the independent reconfiguration panel is considering the matter. On alcohol issues, the hon. Gentleman makes a serious point. The number of admissions as a result of alcohol is increasing. If one looks at the reduction in premature deaths from heart disease, cancer and cardiovascular disease against the increasing trend in diseases caused by too much alcohol, one realises there is a very real public message to get across. That is one of the reasons why, the week before last, the Home Secretary announced that she was taking measures to ban the promotions that lead to a large consumption of alcohol in a very short time such as “women drink free” and happy hours on which there will be restrictions. We need to look much more closely at how we introduce other public health messages so that people are aware that consuming too much alcohol is a real and dangerous health risk.

Speaker’s Statement

Now that the House has concluded the debate on the Queen’s Speech, I wish at the start of the Session to make a brief statement about the duties and responsibilities of Members.

Our ancient privileges allow us to conduct our debate without fear of outside interference. In particular, we enjoy freedom of speech, both in Committee proceedings and in debates on the Floor of the House. Parliamentary privilege is essential for proper democratic debate and scrutiny, but it should be exercised responsibly.

It is up to each one of us to ensure that, as individuals and collectively, we do not misuse the rights that we have. They should be exercised in the public interest. We must ensure that we follow the letter and spirit of the code of conduct and related rules that we have approved to regulate our business.

Each Member is here to represent the views of his or her constituents and to participate in the process of democracy. We should ensure that every Member is heard courteously, regardless of the view that he or she is expressing. Every member of the public has the right to expect that his or her Member of Parliament will behave with civility, in the best traditions of fairness and with the highest level of probity and integrity.

I turn now to security, not only for Members of Parliament but for the staff of this House, who work so hard on our behalf, and for those who are pass holders. I expect every Member of the House to co-operate fully with those officials who are responsible for the security that ensures that our democratic process is not disturbed and that visitors to Parliament can continue to be made welcome. While the work of the Boundary Commission continues, hon. Members have a duty to look after the constituents who elected them. The boundaries do not change until the next election, so we must obey the convention of not involving ourselves with another Member’s constituency until after that time.

Royal Mail

I wish to repeat a statement made a little earlier by my noble Friend the Secretary of State for Business, Enterprise and Regulatory Reform about the Royal Mail. The Government are firmly committed to a universal postal service—that is, the ability of the 28 million homes and businesses across the country to receive mail six days a week with the promise that one price goes everywhere. The universal service helps to bind us together as a country. As well as having social importance, it is the means by which many companies build and operate their businesses. However, it does not come free.

Last December, my right hon. Friend the Member for Barrow and Furness (Mr. Hutton), the then Secretary of State for Business, Enterprise and Regulatory Reform, invited Richard Hooper to lead a full independent review of the postal services market. Its purpose was to look ahead to the future and recommend the steps needed to sustain the universal service in a world where technology, consumer behaviour and the communications market are all rapidly changing. The review did not cover the post office network. We have now received Richard Hooper’s final report. It is a serious, wide-ranging study and makes sober reading. We are publishing it this afternoon, and I am grateful to Richard Hooper, Dame Deidre Hutton and Ian Smith for their work on it.

Let me set out Hooper’s analysis of the challenges facing the Royal Mail. First, there has been a revolution in communications technology in the past decade as consumers have turned to e-mail, the internet and text messages. In this country, 60 billion text messages were sent last year, and we now send 5 million fewer letters per day than two years ago. Hooper is absolutely clear that the main challenge to the Royal Mail comes from the impact of changes in technology and consumer choices. His estimate is that last year the shift from mail to those new technologies cost the company £500 million in lost profits—that is five times the impact of business lost to other postal companies in our liberalised market. The message is therefore clear: making those other companies go away is not the answer to make the Royal Mail succeed. Royal Mail’s success matters because it is the only company capable of delivering mail to every address in the UK, six days a week. As Hooper makes clear, that will be the case for the foreseeable future, so a healthy Royal Mail is vital to sustaining the universal service.

The second challenge that Hooper describes is that of efficiency. Hooper reports that Royal Mail is less automated and less efficient than its western European counterparts. In modern European postal companies, 85 per cent. of mail is put in walk order by machine for delivery to the individual home or business. By contrast, in British local delivery offices, that is still done entirely by hand. The Royal Mail urgently needs to catch up and modernise.

The third challenge is the pension fund. Hooper warns that Royal Mail has a large, growing and volatile pension fund deficit. That is near impossible for the business to manage, and it is a huge demand on its revenues. Each year, on top of its regular £500 million contribution to the pension fund, the company is having to find an extra top-up of £280 million to plug the deficit. These payments look set to rise substantially when the fund is re-valued next year.

Fourthly, Hooper says that labour relations in the company need to improve. We know that levels of trust and co-operation are low and that industrial action takes place too often, and a fresh start in industrial relations is badly needed. Fifthly, there is regulation. Hooper reports a lack of trust in the relationship between the company and the regulator. There are disagreements about even basic information and those tensions divert energy from the chief challenge of modernising the business.

Overall, Hooper’s conclusions are crystal clear: the status quo is untenable, the universal service is under threat, and we face the choice of either downgrading the universal service as we manage decline, or acting now to turn things around and secure Royal Mail’s future.

At the heart of the Hooper report are three linked recommendations. First, Hooper recognises that the pension fund deficit represents a significant challenge for the company. The report recommends that as part of a package of changes, the Government should take over responsibility for substantially reducing the pension deficit. I stress that Hooper says that that would be justified only as part of a coherent package to secure Royal Mail’s long-term viability. Secondly—and closely related to that—to improve its performance, Royal Mail should forge a strategic minority partnership with a postal operator with a proven record in transforming its business, working closely with the work force. Hooper believes that that would give Royal Mail the confidence, the experience and the capital to make the changes needed to improve performance and to face the future—in other words, save the Royal Mail by investing in its future.

Finally, on regulation, Hooper proposes that Ofcom should take over responsibility from Postcomm for regulating the postal market. Its primary responsibility would be to maintain the universal service in the wider context of other changes taking place in the communication markets. My Department will study the report in detail and we intend to respond with a full statement of policy in the early part of next year. With backing from the Government, Royal Mail has been improving performance in recent years, but progress has been too slow, and Hooper makes it clear that, in the face of the challenges confronting the company, transformation must be faster and more far reaching.

The Government agree with Hooper’s analysis and recommendations. As he does, we reject cutting back the universal service; indeed, we share his ambition for a strong universal service and a strong Royal Mail. We intend to take forward the recommendations as a coherent package of measures. We will fulfil our manifesto commitment to

“a publicly owned Royal Mail fully restored to good health, providing customers with an excellent service and its employees with rewarding employment”.

Bringing in a partner through a minority stake in Royal Mail’s postal business will help us to deliver that goal. It will bring Royal Mail fresh investment and new opportunities to grow in Europe, and enable it to offer new services. It will provide a fresh new impetus to modernising the Royal Mail and to securing the universal service.

We and the Royal Mail have already received one expression of interest from the Dutch postal company, TNT, to build such a partnership. I very much welcome that approach from an experienced postal company, just as I will welcome other expressions of interest from credible partners should they come forward. My Department will pursue that in the coming weeks.

Finally, I should comment on the Post Office, which was not part of the review’s terms of reference. The network of local post offices combines a unique set of commercial, public and social roles. In recognition of that, a partnership would not include the post office network. However, a healthier Royal Mail letters business will be good for the Post Office, and today’s announcement will help underpin our existing commitment to the post office network. We are providing £1.7 billion until 2011 to support a network of around 11,500 branches. We will continue to support the non-commercial network beyond that time. The House will recall the recent announcement that the Post Office card account will stay with the Post Office. We will now build on that decision, to ensure a stable and sustainable network for the future. We are determined to have a post office network offering a broad range of services throughout the country, supporting both social and financial inclusion. I am delighted that the Select Committee on Business and Enterprise has agreed to undertake an inquiry into what further services the Post Office could offer.

I believe that Royal Mail and the postal market can thrive in the future, provided that decisive action is taken now. Without far-reaching change, the opportunities brought about by technology will become overwhelming threats. That need not be the case. I believe that there are benefits for everybody in the package of measures that we intend to take forward. It will protect the universal service for consumers and give Royal Mail new opportunities to modernise and develop; it offers Royal Mail’s staff a future in a modern, efficient postal operator, with more secure pension arrangements; and it offers the whole country a Royal Mail that we can be proud of. I commend this statement to the House.

May I thank the Minister for sight of his statement?

We welcome Richard Hooper’s report, which confirms what everyone has known for a long time. Royal Mail’s working practices are inefficient, competition is intensifying, industrial relations are poor and sorting machinery is outdated. The fixed price of a stamp and Royal Mail’s huge pension deficit seriously limit its room for manoeuvre. All that has been clear for a decade, but the Government have done little to curtail a precipitous decline in Royal Mail’s fortunes. Today we learn that the Government are trying to strike a deal to see them through the next election. They are trying to look like the saviour of Royal Mail, but are doing so in flagrant breach of their election manifesto and by raiding the pension fund to bail out Government borrowing.

Even though the Minister’s own party does not seem prepared to do so, we on the Conservative Benches broadly welcome his intention to introduce a new commercial partner. It is a step in the right direction, but the details remain unclear. Will the Minister confirm the status and details of the plans? What will private partners be offered in exchange for their investment? Will he demand a commitment from them to invest in new sorting technology? Can he confirm whether the opportunity to buy a stake in Royal Mail will be put out for competitive tender? By what commercial method might he sell a stake, believed to be about 30 per cent., and can he guarantee that all the revenues from any sale will go directly to Royal Mail and not to the Government?

The Government have had more than 10 years to deal with the problems that Hooper identifies, but they have completely failed to do so. In his first attempt as Business Secretary, Lord Mandelson said that the Government’s policies would

“lead to greater investment in and strengthening of the local post office network, resulting in improved services to ordinary people in every part of the country,”

adding:

“Everyone stands to be a winner”.—[Official Report, 7 December 1998; Vol. 322, c. 24-36.]

Since then, almost 40 per cent. of all post offices have closed. Rather than creating innovative solutions to the problems facing the business, the Government have concentrated on managing its decline.

During those 10 years, the Government could have cut costs, done deals, forged partnerships or even, as they are now doing, part-privatised the business. However, until now, they have done none of these things. They have not driven through efficiencies in Royal Mail management; they have not invested in new technology; and they have not dealt conclusively with the pensions deficit. So just as the Government have wasted 10 years mismanaging the country, they have also wasted 10 years mismanaging Royal Mail.

Now, disguised in today’s statement, is the truth. The Government intend to raid the pension fund in order to plug the black hole in the public finances, dumping the cost of a multi-billion pound liability on future generations. The seizure of £22 billion from Royal Mail’s pension fund would make the Government’s woeful borrowing figures look a little better, but it would saddle future generations with an almost open-ended bill. The whole process has been engineered to make a quick buck for the Prime Minister, kill the issue until after the next election and pass the biggest financial problem not only to the next Government, but probably to those who follow them. In order to asset-strip, the Government have decided that if there is not quite enough in the pot, they might as well swipe the whole pot.

Can the Minister tell us what he estimates the long-term annual pensions liability to the taxpayer to be? Will Royal Mail’s pensions liability be included in the Government’s borrowing figures? What exactly will happen to the £22 billion that is currently in the pension fund? Will the Minister keep the fund intact and top it up, or not? Has he been assured that such action would comply with European Union state aid rules?

The other issue is the unions. Royal Mail workers are already planning strikes. What does the Minister expect will be their reaction to today’s proposals? We believe that any restructured ownership package must include the full involvement and incentivisation of the staff. What will the pension terms and conditions be for future joiners and for agency workers? Thousands of post offices have already closed; large-scale sorting office closures would be a further blow. What is the Minister’s estimate of future job losses, and what is his assessment of the effect of a reconstituted Royal Mail on the income of post office branches?

Proposals for the serious reform of Royal Mail are welcome. Private capital to fund improvements in its services is welcome. We welcome, too, Mr. Hooper’s focus on preserving the universal service obligation, and the proposed amalgamation of Postcomm and Ofcom into a sensible, tidied-up single structure. But after a decade of missed opportunities, the Government’s last-ditch attempt to dangle the prospect of part-privatisation must not distract us from the real story: a bit of Enron accounting that will impose a huge bill on every family in the country for generations to come.

The Government are taking the funds that would have paid most of the pensions, and placing a new obligation on future generations to pay the bills that those funds would have covered. Yet again, the Government are stealing everyone’s tomorrow for their today. For future generations, the bill is in the post—and it has the Prime Minister’s stamp all over it.

As ever, the hyperbole of the hon. Member for Rutland and Melton (Alan Duncan) disguises the lack of any credible policy in his party.

The hon. Gentleman implied that nothing had been done about Royal Mail for the last 10 years. I remind the House that, in 2007, the Government made available £850 million in reserves on the balance sheet to support the pension fund, that they made available loan finance to help Royal Mail to modernise, and that, back in 2001, they made available £500 million in loans to purchase the companies comprising GLS, which is Royal Mail’s European logistics and parcels arm. Action has been taken and change has happened, but, as Hooper reports, that change has been too slow to meet the challenges confronted by the company in the face of changes in consumer habits and the burden presented by the pension fund deficit. I did not follow the hon. Gentleman’s logic in that regard. The pension fund does have assets, but it also has liabilities. The problem is that the liabilities are greater than the assets, and that represents a significant burden for the company when it comes to meeting the costs.

The hon. Gentleman asked about figures. As I said in my statement, last year the company had to find an extra £280 million—on top of the normal £500 million contribution to the pension fund—because of the pension fund deficit. To help the company to deal with the deficit, we released funds that could be spent on modernisation and meeting the challenges.

We have received one approach from a potential partner, and we invite other approaches from interested potential partners. We will try to reach an agreement that is in the best interests of Royal Mail and the British public.

The hon. Gentleman mentioned state aid. Of course we are aware that other companies in Europe have undergone similar transformations. We are certainly aware of the critical importance to post office branches of Royal Mail’s business. Having made the announcement on the Post Office card account just a month ago, we are looking forward to a more secure and sustainable future for those branches. There is nothing in the statement that I have announced today that will pose a threat to that.

Is the Minister aware that, in the real world, over the past nine months, the idea of privatisation and the halcyon days of 10 to 15 years ago have now disappeared? This Government have had to take steps to bail out some of the privatised companies so that they can carry on. The energy companies that were privatised are now ripping off the consumer, and the banking fraternity has had to be bailed out by the Government. Is it not strange to be talking about privatisation these days, when it has patently failed in so many areas? May I suggest that my right hon. Friend has a word with the Secretary of State and with this Mr. Hooper, whoever he is, and points out to them that things have changed in the past nine months? We are on a different set of rails now, and the sooner Mr. Hooper is told that—and that we should not invite in people like the Dutch TNT—the better this Labour Government will be.

I have the greatest respect for my hon. Friend, and I can assure him that this company will remain publicly owned in line with the manifesto on which we fought and won the last general election. Bringing in a partner on a minority basis will give three advantages. It will give the advantage of the experience of having gone through change in a major postal company, which Royal Mail has not yet gone through; it will bring the confidence to carry through the decisions necessary for such change; and it will bring access to the capital needed to fund the modernisation. That is why it is an important part of the package that we have proposed today.

I thank the Minister for giving me an advance copy of the statement and notice of the salient points. It is clear from a rapid reading of Mr. Hooper’s report that it is a serious body of work that sets out in clear terms the challenges facing Royal Mail, and that it offers significant and major proposals. Mr. Hooper and his team should be congratulated on their work; in broad terms, the report deserves a cautious welcome.

For our constituents who value their postal service and their postmen and women, the key issue was always the maintenance of the universal service obligation, involving collection and delivery six days a week. I welcome the fact that it was clearly stated in the report and in the Minister’s statement that the universal service obligation is to be maintained. However, as the statement makes clear, that objective requires a profitable Royal Mail, and that poses formidable challenges. I should like to ask the Minister some questions on these points.

Dealing with the pension deficit will clearly be critical. That burden must be dealt with and, unlike the Conservative spokesman, I believe that that proposal should, in broad terms, be welcomed. However, it raises two clear questions. First, will the Minister tell us which of the assets are to be transferred? Will it be all of them, or will some be left with the Post Office? Secondly, can he confirm that Royal Mail will continue to operate a pension scheme in the way that it has in the past, and that it will continue to be funded out of profits, as it has been in the past?

The report proposes a partnership, but leaves the detail to the Government. The statement, however, said that a private company would take a minority stake in the postal business. The former does not necessarily mean privatisation because it could be a joint venture into which both companies enter with no transfer of assets; the latter, however, requires a stake to be sold, which is part-privatisation, and requires a valuation. How will the Minister set about valuing that stake if that route is indeed chosen?

There is much in the statement that will need very careful scrutiny—for example, the regulatory changes look sensible broadly, but the manner in which they are conducted will have considerable impact on the future of the Royal Mail. Another example is the arrangements for the Post Office—arrangements that closely mirror the policies set out by the Liberal Democrats three years ago when we began to look at this problem. On the arrangements for postal competitors, it seems to me—I hope the Minister will accept this—that there is a requirement for a level playing field, and that we should look again into how to achieve that and into whether competitors should be required to pay in any way.

Those are details that must be gone into. The report is serious and needs to be taken seriously. As the Minister said and as the report makes clear, however, the status quo is no longer an option, as we recognised in our paper on the subject of three years ago. The devil will almost certainly be in the detail, as it is always so I end by asking the Minister for a clear commitment to a full debate on this subject at an early opportunity.

I thank the hon. Gentleman for his broad welcome of our proposed changes. He mentioned the maintenance of the universal service obligation and it remains at the heart of the statement I made today and at the heart of our policy intention. We legislated to enshrine the USO in law and we are pleased to see that Hooper rejected the downgrading of the USO as an answer to the company’s problems.

I also welcome the hon. Gentleman’s broad support for our pension changes. He is right, of course, that there is more detail to be worked through and more to be announced on this matter, but the principle is clear—that, as part of a wider package involving partnership and a change in regulation, we seek to lift the enormous burden that funding the current pension deficit poses to the company.

On the issue of the partner, I say to the hon. Gentleman the same as I said to my hon. Friend the Member for Bolsover (Mr. Skinner)—that the company will remain publicly owned in line with our manifesto commitments. Our objective will be to get the best deal for the company and for the public in respect of those three key factors that a partner can bring: experience, confidence and capital.

On the issue of competitors, Hooper considered and rejected the idea of a levy on them in order to fund the USO. He was also clear—this is important—that of the challenges facing the company, the shift from mail to other forms of technology is much more significant than other challenges and will have a much greater impact than in respect of other postal companies operating in the market.

Will my right hon. Friend confirm that legislation is needed to allow a private competitor to come in and take a stake? Does that not open the door to full-scale privatisation, which is against the wishes of our party and our Government? Will he also confirm that taking the pension fund on to the Government’s balance sheet effectively lifts a burden of perhaps £700 million off the Royal Mail’s balance sheet, so it either fattens the calf for a future privatisation or leaves the Royal Mail without that liability in a much more effective position to compete as a fully owned public sector organisation? Is not the real villain of the piece, notwithstanding the threat of electronic communication, the problem of unfair competition rigged against the Royal Mail in favour of private competitors, which undermines the universal service obligation and the ability of the Royal Mail to deliver it? Is not that the real problem that needs to be reformed?

My right hon. Friend is correct to say that legislation would be needed to take these changes forward, but he is not correct to say that that opens the door to privatisation of the company, because as I have said our manifesto commitment is clear and the company will remain publicly owned under the proposals I have outlined today.

My right hon. Friend talks of pension changes. Hooper is quite clear that those could be justified only in the context of wider reform of the company and wider change in it. That is why this should be viewed as a coherent package, not as a menu of items to be picked one by one.

I am afraid that I have to disagree with my right hon. Friend when he says that the main issue is other postal companies, not technology. Hooper concludes precisely the opposite and quantifies the effect of those two things on the company’s balance sheet. He concludes that the impact of technological change is five times greater than that of any competition with other postal companies. I am afraid that the main challenge is not other postal companies; it is the change in lifestyle that the technological revolution has brought about.

I am not sure how much I will help the Minister when I say that I think that the review team has done an excellent job and that the Government’s indication that they intend to accept the broad thrust of the recommendations is a sensible decision indeed. Post Office Ltd and Royal Mail Group both face huge challenges and the report recognises the scale of those challenges, but huge numbers of questions on the details remain to be answered. For example, what will be the relationship between Post Office Ltd and Royal Mail Group in this new world, with a part-owned subsidiary run by a current competitor of Royal Mail Group? The regulatory changes needed to bring Postcomm into Ofcom are clearly important as far as Richard Hooper is concerned, but again legislation will be required. Over what time scale can we expect that legislation?

The hon. Gentleman asks two questions. The first relates to Post Office Ltd. As I said, we are acutely aware of the importance of the relationship between Post Office Ltd and Royal Mail, and acutely aware that those arrangements enable the delivery of the universal service. It is our priority to keep the universal service, not to downgrade it. Therefore, we will be mindful of the importance of that to Post Office Ltd going forward.

On regulation and other details, as I said, we will make a fuller statement in the new year, but Hooper’s essential recommendation on this is clear: it is time for a change from the regulatory regime governed by Postcomm to a wider regulatory framework placing the Post Office in the context of the wider communications market and also ensuring that Ofcom’s primary responsibility in this field will be the maintenance of the universal service.

Does the Minister not recognise that most of the current financial difficulties facing Royal Mail stem from the postal regulator exposing it to unfair competition, allowing the vultures to pick clean the most profitable parts of the business? Does he not accept that the many years of contributions holidays taken by Royal Mail have played a major part in the build up of the pensions deficit that it now faces?

I know that my hon. Friend is a passionate campaigner for post offices and Royal Mail, but I have to point her to Hooper’s conclusion on the very point that she raises, which is that the principal challenge facing the company is not that from other postal companies, but the far greater challenge and the far greater impact on the company’s balance sheet caused by the shift from mail to other forms of technology. Making the other postal companies go away is not an answer to the challenges facing Royal Mail.

On the pension fund, regardless of what has happened in the past, we recognise that that is a major problem for the company. Therefore, as part of a package of wider changes, we are prepared to address the pension fund deficit.

While I welcome the Minister’s assurance on the universal service, will he give a further assurance that it will mean what it says and will not lead to variations in charges on a regional basis or in delivery times? Many people living in rural parts of the country do not have access to competitors and depend on Royal Mail. They are already finding a diminution of service. Does a universal service mean what it says?

Universal service means a one-price-goes-everywhere delivery, six days a week. That is enshrined in law, we are committed to it and it is at the heart of the reforms we have proposed today.

I look forward to reading the Hooper report, which should have come out last week, just before I visited my local delivery offices where people wanted to know about their future. This is a massive industry in which 30,000 to 40,000 people have already lost their jobs. I have some questions. What does it mean to say that the pension fund would be reduced substantially? If a burden is left that chokes up the new arrangement, the problem will not be solved. From my information as secretary of the Communication Workers Union in this House, I understand that TNT runs on a part-time basis. It brought in technology and paid off all its full-time workers, so that people get 22-hour contracts. Is that the future for post office workers?

The Minister says that it is a package. It is a curate’s egg, and the question is whether people will swallow it—

Order. I understand the hon. Gentleman’s deep concern, but Members have one supplementary question in these sessions because other hon. Members want to get in.

As I have said to other right hon. and hon. Members in response to questions on the pension fund, our concern is to reduce the liability posed for the company, but only in the context of the wider change that Hooper set out in his report. The company that my hon. Friend mentions has made an approach to the Government. There may be other approaches in the coming weeks and months, but our intention will be to find a partner who can provide the three key qualities that Hooper mentioned in his report: the experience of having gone through major change in a postal network, the confidence to carry through such change and access to the capital necessary to finance it.

When exactly do the Government expect to introduce legislation on their proposals, and will it be within a Bill additional to the Bills recently announced in the Queen’s Speech?

Legislation to carry these proposals forward would be in an additional Bill. I cannot say exactly when it would be introduced, but we will be working out detailed proposals on these matters in the weeks and months ahead.

I welcome the debate that will now ensue after my right hon. Friend’s statement, and I say to him that without radical reform and a substantial change to senior management, Royal Mail does not have a future at all. Can he tell the House whether the Government will engage directly with those who work for the Royal Mail? I have no confidence whatsoever that the present management will discuss the matter with them.

I am grateful to my right hon. Friend for acknowledging the urgency of change. He asks whether we will speak to the work force about the changes. Of course we will speak to them. As I said in my statement, it is time for a fresh start in industrial relations in the Royal Mail, and that fresh start is essential in the carrying forward of proper reform.

May I ask the Minister about access headroom? Many in the Royal Mail feel that that issue has constrained its competitiveness for a long time. Now that it is to be part-privatised, will the Government still be able to dictate matters such as access headroom to the Royal Mail?

I repeat that the company will remain publicly owned in line with the Government’s manifesto. The hon. Lady is right to say that access headroom has been controversial, and that people have raised a number of issues about it. It is a matter for the regulator, and in the context of the regulation change proposed by Hooper, it would be a matter for Ofcom in the future. It is important to remind the House that Hooper concludes firmly that the key challenge facing the company is not from other postal companies, but from other technologies. That is what lies behind a drop in the volume of mail of some 5 million items a day, and that drop is not just taking place in the UK, but in many other countries for precisely the same reason.

I recognise that my right hon. Friend has made this statement, but I am not convinced by Hooper’s recommendations. New technologies may have reduced letters by 5 million over two years, but the number of packages and parcels have substantially increased. Therefore, we ought to be getting into that business. Let me explain where we are really missing the point, however. It is not about selling off the silverware and looking for partners. We must charge private companies sufficiently high sums to ensure that Royal Mail makes a profit and is not subsidised by the taxpayer, because bulk mail is having a free ride at the expense of taxpayers. If we put that right, Royal Mail will begin to make a profit. Let us do it that way, not the privatisation way.

My hon. Friend is correct to point to a growth in packet volumes as a result of people ordering over the internet, but that is not enough to counteract the falling volumes of mail. Overall, mail has fallen by 5 million items a day. My hon. Friend takes us back to the issue that the hon. Member for Solihull (Lorely Burt) and other Members raised by contending that the principal problem facing the company is competition from other postal companies and the terms by which that competition is conducted. Hooper concludes that that is not the case, and that the impact of that is just one fifth of the impact of the shift from mail to other technologies. Therefore, changing the regime for upstream access or headroom pricing will not deal with the Royal Mail’s problems. That demands wider change and wider reform.

I bet the Minister is looking forward to taking this through the House!

On what date was the pension fund last valued, by how much has the stock exchange declined since, and will the Minister have another shot at defining “substantial”, as used in the statement he has just given?

The valuation takes place every three years. I think I am right in saying that the last valuation was in 2006, so we expect the next triennial valuation to take place early next year. We expect it to have grown substantially from the valuation in 2006 of a £3.4 billion deficit. That starkly shows the size of the burden imposed on the company, which is why, in the context of a package of wider reform, it makes absolute sense to relieve the company of that burden, so it can concentrate on the investment that is required to finance the transformation that the Royal Mail sorely needs.

How will the Minister—and, indeed, his Secretary of State—convince the public and many Members on the Labour Benches, and perhaps in all parts of the House, that this is not just the slippery slope to privatisation? We have seen this happen in the past: is it going to happen in the future? Will the Minister also tell us why on earth the Government feel they have to invite a foreign country’s private postal operator to come in, when they could in fact fully support this highly valued public service?

My hon. Friend asks how we can convince the public. The public want a strong USO, secure for the future. We do not have that at present, because the challenges I have outlined today—the transfer to different technologies, the pension deficit, the lack of efficiency in changing the company—mean the USO is now loss-making. We want to address that, put the company on a stronger footing, and make sure the USO is secure for the future.

On the slippery slope issue, I again remind my hon. Friend of our manifesto commitment for a publicly owned Royal Mail. We will have a publicly owned Royal Mail, and any partnership would be only on a minority basis.

The devil may very well be in the detail, but we are being offered very little detail today to find out where that devil lurks. The Hooper report states:

“Experience from other countries suggests that the company could provide the universal service with around half its current mail centres.”

Does the Minister accept that, and what is his estimate of the number of job losses as a result of this announcement?

The company is already going through a process of reducing the number of mail centres. Automation will mean fewer mail centres in future, as, I believe, both the company and the work force are aware. It is not for me to say exactly how many jobs would be involved, but automation will mean fewer mail centres. Many other western European postal organisations have gone through precisely that process.

May I quote from the statement? It mentions, “Bringing in a partner through a minority stake in the Royal Mail’s postal business”. That will be interpreted by almost every postal worker as privatisation, no matter how the Minister dresses it up, and it conflicts with a commitment to a wholly publicly owned service that we gave that work force. What role will the Government play in offering the work force a sense of security in respect of the threat of job losses and the security of long-term employment, because those workers have served this country well over generations of commitment to this public service?

I acknowledge the work force’s contribution. This package offers them a more secure future for their pensions than would otherwise be the case. The Government established the Hooper review to examine how the Royal Mail can succeed in a world in which electronic and other forms of communication provide increasingly attractive alternatives to the mail and in which there is more competition in postal markets. That is precisely what Hooper has done in his report, which has been published today. Its recommendations are a consequence of our fulfilling a manifesto commitment to carry out this review.

The importance of postal workers to the communities they serve cannot be underestimated, so under the new capital structure, which the Minister has outlined to the House today, will postal workers be able to acquire an equity stake in the new business? Do his proposals for the pension fund restructuring breach the state aid rules?

The intention in the Hooper report is for Royal Mail to partner another postal firm that has experience of going through this kind of change. It is not a share floatation that might be talked about in another context; this is a partnership with another postal firm. Of course, we will be mindful of the state aid rules in any reform package that we take forward.

We are not going to sub-contract our judgment to Richard Hooper, who is a former vice-chair of Ofcom. We want a wholly publicly owned Royal Mail, and I will not support any legislation that privatises it. Is it not the case that over a very long period Government policies have been designed to weaken the Royal Mail in order to encourage competition into the market? Is it not scandalous that new entrants have been allowed to undercut the Royal Mail? There has never been a level playing field in the provision of postal services, and it is completely disingenuous for the Minister to advance this argument—

I cannot accept that the Government have weakened the Royal Mail. We have lent the company money to make new acquisitions, and put up money to support the pension fund and to finance modernisation. But that process has not proceeded quickly enough in the face of the challenges that the company is facing. Today’s report concludes that new entrants are not the primary problem for the Royal Mail—new technology is.

One of my many failures in this place occurred 15 years ago, when, as Post Office Minister, I tried to privatise the Post Office. In the light of the Government’s acceptance of the importance of private capital, may I welcome new Labour to the Thatcherite wing of the Conservative party?

As I have made clear a number of times, we will maintain the Royal Mail as a publicly owned company, in line with our manifesto commitment to have a publicly owned Royal Mail.

The fact that the Hooper report has now been published is welcome, as it allows decisions to be taken and discussed in the context of the whole picture instead of the piecemeal way in which they have been announced thus far. The mail processing centre in my constituency is one of those under threat. Would the Minister agree to meet a delegation from that mail processing centre so that he can understand the context of the decisions that are being made for my constituents, including both those served by and those working in the centre?

I am always happy to meet hon. Members and any delegations they wish to bring, but Hooper is clear in his report that what the company needs is less political interference in its day-to-day decision making, not more. The future of mail centres must be for the company and the union to negotiate: it is not for Ministers to dictate operational matters such as where mail centres should be situated.

I welcome the commitment to the universal service obligation, but if Royal Mail is to be in a position to continue to deliver it, it must be adequately funded and have fair competition. Will the Minister consider a levy on companies that are not implementing the universal service obligation and are using the money to pay Royal Mail to do so? At present, too many private companies are cherry-picking the easy side of the business.

Hooper considered and rejected the idea of a levy, because the real challenge is to make the changes necessary in Royal Mail to enable it to deliver the USO while not running at a loss, as it is at the moment. That requires changes in automation, the changes that have been mentioned to the pension fund, and other regulatory changes that we have outlined today.

The Minister will be aware of the existing very low morale in Royal Mail, partly because the work force has to deliver for private sector competitors at a loss. He will also be aware of press reports today that up to 50,000 job losses could result from the proposals. Will he tell the House what implications the proposals have for jobs? Surely he must agree that the proposals go against the spirit of the manifesto commitment given by the Labour party?

I do not accept that the proposals are not consistent with our manifesto, as I have said several times, because the company will remain publicly owned. My hon. Friend talks of low morale, and it is true that there has been a history of industrial relations problems in Royal Mail. Ascribing blame serves no good purpose, and a fresh start in industrial relations is needed if change is to proceed at the pace and in the spirit necessary to get the company into the shape necessary for the future. We need a fresh start in industrial relations, and there is a lot in these proposals for the work force, not least security for the pension fund as part of a wider programme of change.

I congratulate the Minister on his courageous decision to part-privatise Royal Mail and assure him that when he introduces the legislation we will vote for it, so that—despite the clear number of Labour rebels that there will be—he will get it through.

I believe that the legislation to implement these proposals is in line with our manifesto and offers a good future for Royal Mail, its work force and the public.

May I offer the Minister an opportunity to deny specifically the allegation that the Opposition spokesman yelled from a sedentary position—that the Government are intent on stealing the assets of the pension fund? Will he confirm that what we will be discussing is the pension fund and its assets remaining in existence, and the terms on which taxpayers may contribute further to overcoming the deficit?

As I say, the hon. Member for Rutland and Melton (Alan Duncan) has a weird concept of stealing if he thinks that our proposals amount to stealing. The proposals take into account the fact that there are assets and liabilities in the pension fund. The problem for the company is that the liabilities are far greater than the assets. The Government will therefore try to address that problem to relieve the company of the burden of the additional payment that that deficit poses for it at the moment.

Let us be clear: decent, hard-working Royal Mail staff and their families are approaching this Christmas deeply worried. Can the Minister guarantee that there will be no forced redundancies as a result of his statement, and will he make it his policy to start to return public business to the Post Office?

As I said in my statement, the Hooper review did not cover the network of post office branches. Our intent was illustrated several weeks ago when we announced that the Post Office card account would go to the post office network. I am glad to say that the Select Committee on Business and Enterprise has agreed to undertake a further inquiry into what further work might go to the post office network. I know that that is valued on both sides of the House.

On the question of the staff, I return to what I said to my hon. Friend the Member for North Ayrshire and Arran (Ms Clark) when she said that morale was low. I accept that there has been a history of industrial relations problems in the Royal Mail. I believe that there is a need for a fresh start, and I do not believe that much can be gained by blaming anyone for the history of industrial relations problems. There is a lot in the statement for the staff at Royal Mail, who have worked hard and made a hugely important contribution. There is a lot in this for the staff, particularly when it comes to the pension fund proposals.

I thank my right hon. Friend for the commitment that he has given to the universal service obligation, which means so much to a rural constituency such as mine. I and a number of Labour colleagues met the regulator before he took up post and officially started to liberalise the service. We warned the then Secretary of State and Ministers with the relevant responsibilities that we were about to see a butchering of the service. What happened in such a short space of time should never have happened to the extent to which it did. It is not beyond the wit of the work force or the Royal Mail management team to deliver for this country what we require without the interference—I shall put it no more strongly at this point—of a third party to partner the business.

Hooper is clear that his recommendations are a package and that they stand or fall together. That is the view that the Government take. My hon. Friend mentioned the regulator and, as I have said, under the proposals the regulator will change from Postcomm to Ofcom. However, on the effect of the liberalised market on Royal Mail, I repeat that Hooper makes it very clear that the main impact on the company’s balance sheet comes not from other postal companies or the terms of that competition but from the shift from mail to other technologies. That is having by far the most major impact on the company’s balance sheet.

Many of us predicted the impact of what Hooper refers to as “asymmetric competition” at the time of liberalisation. I observe that paragraph 193 of the report states:

“Competition reduces Royal Mail’s revenue available to support the universal service. And some forms of competition may be inefficient if they simply exploit the constraint placed on Royal Mail to provide the universal service.”

Notwithstanding what he told my hon. Friend the Member for Argyll and Bute (Mr. Reid), will the Minister keep the door open on the possibility of a compensation fund at some future point? My constituents can tell him from their experience of the parcel post market that if liberalisation takes place without proper protection, a universal service might exist but it will exist in name only.

We are determined to ensure that the universal service does not exist in name only. We understand its value socially and in terms of the one price goes anywhere service, which I suspect is valued in the hon. Gentleman’s constituency. Let us be clear about Hooper and competition. He says that competition has had benefits. He does not accept the analysis that the Royal Mail’s problems were caused by opening the market to liberalisation. Instead, he paints a picture of much more deep-seated problems of a failure to modernise, a growing pension fund deficit and a transfer in consumer habits from mail to other technologies. That is why he proposes a far-reaching package of extensive reform.

Family Justice

With permission, Mr. Speaker, I shall make a statement about the opening up of the family courts. I have today laid before Parliament the document “Family Justice in View”, copies of which will be available in the Vote Office and on my Department’s website.

Family courts play a crucial role in our society. They make far-reaching decisions—for example about how to divide finance on divorce, or what protection to give victims of domestic violence—and they make life-changing decisions about the future of children: whether they should be given contact with their parents, whether they should be removed into the care of the state, and whether they should be placed for adoption. The decisions of family courts have profound and long-term effects on the lives of those involved and cumulatively on society as a whole.

Family cases can be conducted in the magistrates family proceedings courts, in county courts, and in the family division of the High Court. All those with responsibility for these proceedings are well trained and work to extremely high standards. It is vital that these courts, like any others, command the confidence of the public, if the public—including the parties involved—are to accept their decisions. That can best be achieved if justice in these courts is seen to be done.

For entirely legitimate reasons, the privacy of parties to family proceedings must be properly protected. That is of enormous importance to adults, and is an overwhelming imperative in cases involving children. At present, with some exceptions, neither the public nor the media are permitted to witness proceedings in these courts. However, many argue that the current provisions to safeguard privacy and confidentiality go too far, leaving family courts unfairly open to accusations of bias or even injustice.

In contrast, there is a greater degree of openness in the youth courts. For example, the media are allowed to witness and report proceedings in the youth courts, so long as they do not identify juvenile defendants, and youth courts have a wide discretion to allow others to attend. These rules have worked effectively, and both their spirit and their letter have been well respected by the media.

The debate about opening up the family courts has intensified in recent years, and two successive consultations have been carried out, in 2006 and again in 2007. The results of those exercises were inconclusive, with strong representations on the one hand in favour of improving transparency, and on the other in favour of maintaining the current position.

In the past few months, the Under-Secretary of State for Justice, my hon. Friend the hon. Member for Lewisham, East (Bridget Prentice), who has responsibility for access to justice, and I have been actively considering how we can shed more light on family courts while preserving the imperative of the welfare of the child. The Government have now reached their conclusion, and I am therefore announcing today that the rules of court will be changed to allow the media to attend family proceedings in all tiers of court.

Understandably, the media will be subject to reporting restrictions similar to those that apply in the youth courts. The courts will be able to relax or increase those restrictions in appropriate cases, and will have the power to exclude the media from specific proceedings altogether where the welfare of the child or the safety of the parties or witnesses requires it. The overall effect of these changes will be fundamentally to increase the openness of family courts, while protecting the privacy of children and vulnerable adults.

As well as allowing the media to attend family proceedings, there is a need to increase the amount and quality of information coming from the courts. At present, anonymised judgments of the Court of Appeal, and in some instances of the High Court, are made public, but that is not the situation for the county courts or the family proceedings courts, which deal with the bulk of family law cases.

We have therefore decided to pilot the provision of written judgments when a final order is made in certain family cases. The courts in the pilot areas—Leeds, Wolverhampton and Cardiff—will, for the first time, routinely produce a written record of the decision for the parties involved. In selected cases, where the court is making life-changing decisions for a child, it will publish an anonymised judgment online, so that it can be read by the wider public.

The consequences of family proceedings are so significant that the parties involved will sometimes need to seek advice or support from a range of people, including legal advisers, family members, medical practitioners and Members of Parliament or other elected representatives. To do so, they must be able to discuss and share information about their case. In 2005, we made changes to the rules of court to allow people to disclose certain information to specified individuals, but after two years it became clear that those rules remained unnecessarily restrictive and too complicated. Following a consultation last year, the Government have now decided to relax the rules on the disclosure of information in family proceedings.

Parties and legal representatives will be able to disclose more information for the purpose of advice and support, mediation, the investigation of a complaint, or—in an anonymised form—for training and research. In more cases, the person receiving the information will be able to disclose it to others, for the purposes for which it was originally disclosed to them, without seeking the permission of the court. To protect the anonymity of children after proceedings have concluded, the decision of the Court of Appeal in Clayton v. Clayton will be reversed. In principle, that decision removed the protection of the court once proceedings had been completed, although that protection could be reapplied in particular cases.

Most of the key changes that I have announced today can be made in the rules of court, without the need for primary legislation, but some will require legislation, including the reversal of the effect of the decision in Clayton v. Clayton and the potential opening-up of adoption proceedings. As regards the latter, we will consult on the most appropriate approach.

The Government are committed to improving the visibility of justice in this country—to lifting the veil that sometimes keeps justice from view. The measures that I have outlined today will help to build a transparent, accountable family justice system that inspires the confidence of the people whom it serves, while continuing to protect the privacy of the parties and children involved. I commend the statement to the House.

I thank the Justice Secretary for early sight of his statement. The UN convention on the rights of the child states that

“In all actions concerning children…the best interests of the child shall be a primary consideration.”

Some argue that privacy in family courts is essential to that end, but does the Justice Secretary agree with me that the privacy of the child and the interests of the child are not necessarily always the same thing? Secrecy can also mean a lack of accountability, which in turn leads to poor decision making. Does not the terrible case of baby P remind us that where the welfare of children is concerned, poor decisions can have catastrophic effects?

The Constitutional Affairs Committee concluded in 2005:

“A greater degree of transparency is required in the family courts.”

Speaking for the Conservatives in 2006, my hon. Friend the Member for North-East Hertfordshire (Mr. Heald) said that

“we need to open up the closed doors a bit more.”—[Official Report, Westminster Hall, 12 January 2006; Vol. 441, c. 164WH.]

Would the Justice Secretary concede, in the spirit of transparency, that the Government have been rather less sure about whether to open the door? In 2006, the previous Lord Chancellor, Lord Falconer, made firm proposals to allow the press in. By 2007 he had changed his mind, arguing that “the welfare of children” was “at stake.” Now the Government have changed their mind again. Within three years, the Department has changed its identity once, and its proposals twice. The Justice Secretary says that he has now reached a conclusion, but he also says that he is presenting proposals. Are they final?

We all recognise that this is a difficult issue, but is not the problem with secrecy that it ignores the issue of public confidence in the court process? The president of the family division, Sir Mark Potter, has spoken of

“an age of transparency...amidst largely misplaced criticisms of ‘secret justice’”.

Does not the experience of countries such as New Zealand and, closer to home, Scotland, demonstrate that properly regulated transparency is perfectly workable?

May I press the Justice Secretary on adoption proceedings, about which he is consulting further? Does he agree that, while there should be a presumption against openness in the final hearings, in which delicate and sensitive decisions are made, it is important to have scrutiny in the opening stages, in which the work of social workers, the Children and Family Court Advisory and Support Service and the National Youth Advocacy Service needs to be monitored?

Does the Justice Secretary recognise the increased stress on children that may result from the presence of the media in court, and the fact that many professionals such as the National Society for the Prevention of Cruelty to Children have serious concerns about that? Is he confident that the press will be as compliant with reporting restrictions as they are, for example, in New Zealand? Will all journalists be allowed into court, or only those who are accredited? Crucially, what sanctions for breaching reporting restrictions does he envisage? The Government previously proposed new legislation to ensure strong sanctions to protect anonymity. Does that proposal stand, and will third parties with a legitimate interest be permitted to attend, as they are in other countries?

A key concern for families is that they are unable to raise their cases with the media, but it appears that the Government’s proposed rules for disclosure will still prevent them from doing so. Will the Justice Secretary confirm that, and explain why he believes it is right to maintain that restriction? When the Government last proposed transparency in 2006, they recognised, in the regulatory impact assessment, that both they and the courts would face increased costs, including for additional security. Have the Government estimated these costs? At a time when the courts’ budget is being cut, how will those costs be absorbed? Is not the fact that the Government are piloting the provision of written judgments in only three courts evidence of concern that the resource implications could be considerable?

There are important questions about how transparency in family courts will operate, but does the Justice Secretary agree with me that child protection can no longer be a secret business? It is time to shine a bright light of public scrutiny to ensure that the most vulnerable in our society are protected. With proper safeguards, transparency is a force for good.

I thank the hon. Gentleman for his support for the proposals. He teased me about the fact that the Government had one view, then a slightly different view, and now they have a—

No, the original view—this is a binary choice.

The reservations that the hon. Gentleman went on to express, including about the sensitivity of adoption proceedings, and the concerns raised by some children’s representatives about having the media in court, show that this is a finely balanced judgment, but ultimately we have to say yes or no. He asked whether these were firm or final proposals, and answer is yes, they are. I hope to introduce measures that require rule changes, pressing on with this, in the spring, possibly in April. The changes in adoption require primary legislation—the Adoption and Children Act 2002 imposes a statutory bar on the attendance of the media or the public, and there is no current legislation available to make those changes—so we will have time to consult in more detail on that.

The hon. Gentleman asked me some specific questions about disclosure by families to the media. We have to put the detail of the changes to the rules committee, and I am actively considering that issue. The key issue, in my experience as a constituency Member of Parliament, is the assurance that if information is disclosed further, the identity and privacy of the child and, by extension, the family, is still protected. However, I thoroughly agree with his view, which is ours, too, that the quality of family justice is not served by proceedings that, to all intents and purposes, are secret and removed from the view of the media. I take his point that there is a clear distinction between a child’s best interests and the privacy, not of the child—no one is arguing about that—but of proceedings.

We have not estimated the cost of implementing the changes because we believe the costs will be marginal. For example, in respect of youth courts, which have to operate exactly the same restrictions but with the courts in many cases allowing individual members of the public and others in, I have never had any representations that that is a costly process.

Once there is a legislative opportunity, we will seek to rationalise the penalties and the regime. Meanwhile, a breach will be contempt of court, for which, in principle, imprisonment is the penalty. In respect of other proceedings in the youth courts and in Crown courts where juveniles and young people are being tried, and in respect of other reporting restrictions, the experience is that overwhelmingly the press respect restrictions.

I, too, broadly welcome the Secretary of State’s statement as a move in the right direction. There is a basic principle, as I hope he will agree, that justice should be seen to be done. Secret justice is often injustice. Privately heard witnesses who think they are less likely to be found out are more likely to be self-serving than witnesses in public, judges are more likely to go along with the cosy consensus that often develops between experts when there is no prospect of public comment on their judgments, and public authorities are more likely to act on insufficient evidence when their decisions are not subject to public scrutiny.

It is right that that principle should apply even in difficult cases, such as those in family proceedings. It is understandable that there will be some resistance from some professional groups, and clearly there is a balance to be struck between the public interest and the interests of individuals, especially of children, but as the hon. Member for Arundel and South Downs (Nick Herbert) said, I hope the Secretary of State agrees with Sir Mark Potter when he said in October that more openness would help to dispel myths about bias and inaccuracy in the family court, especially if there are enforceable rules about anonymity.

The Secretary of State spoke only about the media. He did not speak about access to the courts for the public. Obviously, different considerations apply, but what conclusions have the Government reached on admitting the public to some family proceedings?

On the publication of judgments, I am a little disappointed that the right hon. Gentleman has not gone further than a pilot. Publication of judgments, suitably anonymised, obviously, is vital to the scrutiny of what judges do. Their judgments must be open to comment and criticism; otherwise the law itself cannot develop. There have been cases where even professional law reporters were excluded from the courts. Surely the Secretary of State agrees that that should not happen.

I welcome what the right hon. Gentleman said about the disclosure of information by parents, but may we be clear about what that means? Will parents be able to discuss their case with their MP, which was one of the examples that he gave? What will be the position on the important issue of expert witnesses and second opinions? Will parents be able freely to approach experts who might help to challenge the views of the local authority expert in their case?

Will the Secretary of State be specific about what part of Clayton v. Clayton he proposes to overrule? There are two parts to that judgment. Is he saying that Parliament should overrule the part about the film that the father was going to make when the child had been abducted? Overruling that would make the situation worse for the child’s privacy, not better.

Finally, it is disappointing that the right hon. Gentleman has not taken the opportunity to make a wider announcement about family courts, especially about the increase in family court fees in public law cases from £150 to £5,000. Will he tell the House what effect on the volume of cases that change has had? What are his criteria for the success or failure of that policy? Is it just raising more money, or does he want there to be fewer cases?

I am grateful to the hon. Gentleman for his support for the proposals. He asked me a number of specific questions. Are we proposing that members of the general public be allowed into the courts? No—and to that extent, this regime is more restrictive than the one that applies in the youth courts. However, I think that that is appropriate, although we are open to representations, if necessary, on the issue. Will parents be able to discuss their cases with MPs? Yes, and in my experience they do already, although often in breach of some extraordinarily complicated and convoluted rules, which I discovered only very recently.

One of the issues is about the identity of expert witnesses being able to be made public. My default setting is that they should; I believe that in cases of this kind, the expertise of such witnesses should no more be allowed to go without scrutiny than the expertise of those in other cases, in which equally life-threatening or life-changing decisions are made and expert witnesses have to justify publicly their expertise and judgments.

We are seeking to overturn the part of Clayton v. Clayton that says that in principle the protection of the privacy of the child should fall away once the proceedings have finally been completed. We intend to reverse that, so that the presumption is the other way.

There was a huge consultation on the increase in family court fees. Local authorities had a transfer of £40 million from the Ministry of Justice budget—and a little more, I may say—to meet the full costs of that transfer of fees. I would have preferred the transfer to have been ring-fenced to the local authorities so that they could use it only for these purposes. The local authorities are themselves root and branch opposed to ring-fencing—but they have had the money. It therefore does not lie in their mouth to complain that they cannot afford the fees: they can.

Moreover, the fee is £4,000 on average; it ranges from £1,750 to £4,825, and the full fee applies only at the upper end. Local authorities have to base their decisions on the interests of the child. The fee, even at £4,000, is a very small proportion of the total costs of taking a case, which average £25,000. It is a still smaller proportion of the costs of taking a child into care, which are £40,000 on average and rise to £101,000 and more if the child is taken into secure accommodation for a year.

Order. I would appreciate some help. I realise that this subject does not necessarily lend itself to brevity, but I hope that hon. Members will try.

I welcome the statement, particularly the reference to the family courts in Leeds. A recent survey of children under 14 revealed, perhaps surprisingly, that their highest wish was an absolute ban on divorce. In view of that, may I ask my right hon. Friend to underline the fact that the purpose of family courts is to disentangle broken relationships, enable people to rebuild their lives positively and ensure the future flourishing of the children—not to expose individuals to damaging media destruction in the future?

Of course, I entirely support my right hon. Friend. Any of us here—and I include myself—who as a child saw the break-up of their parents’ relationship knows that what my right hon. Friend says is absolutely true.

Obviously, the devil lies in the detail and I very much hope that we will be allowed to debate the draft rules. Subject to that, I approve of what the right hon. Gentleman has said to the House. Transparency is good news as far as the quality of justice is concerned: it puts judges on their toes, which is jolly good news, and it puts expert witnesses on their toes, which is also good news. Furthermore, it enables us to know rather more about the welfare reports—and that, too, is good news. I hope that the right hon. Gentleman will be as ambitious as possible about transparency and let as many people as possible into the courts, subject to the protection of proper confidentiality.

I thank the right hon. and learned Gentleman; it is unusually good news that he is giving support to something that I have done. I welcome that in the spirit of Christmas and will consult the Whips about debating the rules.

I declare an interest as a member of the Magistrates Association. The statement referred to all those with responsibility for these proceedings being well trained and working to extremely high standards. That is especially true and important in relation to the staff. Will the Secretary of State say a word or two about the need for staff security and the confidentiality of staff names? We saw a recent example where Fathers 4 Justice attacked staff at NAPO offices last week. They deserve better than that. The later part of the statement referred to courts having the ability to relax or increase reporting restrictions in appropriate cases. Will guidelines for those appropriate cases emerge from the pilot, and how will they be disseminated nationally?

The pilots will produce guidelines on the publication of anonymised judgments. Those guidelines will not relate to the use of discretion to exclude the media—that will emerge principally through the practice of the family division. We are all concerned about the security of staff, but many people who make important decisions have no option but to have their identity made public. We cannot allow a situation to obtain whereby public officials who are paid by the taxpayer are able to make their decisions anonymously because of fears for their security. In practice, the number of cases where the security of staff is threatened is tiny.

The Justice Secretary has to understand that the increase in charges from hundreds to thousands of pounds has had the real effect of reducing the number of cases referred by social services to the family courts. The policy that he has announced this afternoon will simply not work if the cases are not taken to court in the first place. He must address the funding issue, which has led to a situation in which about a third of the casework is being funded that needs to be funded.

I do not accept what the hon. Gentleman says. The money—£40 million and more—is there and is being paid to the local authorities. Let me make it clear that it was local authorities who did not wish it to be ring-fenced. The number of cases started to fall before these changes were introduced, and because of major procedural changes—the introduction of the public law outline—they are now rising.

I welcome openness, but will my right hon. Friend confirm whether I am right in remembering that during the second consultation, what most caused Ministers to hesitate in making the decision announced today was that the great majority of children who responded to the consultation were opposed to letting the media into family courts? Is he saying that he must regretfully disregard their representations, or that the design of the scheme takes into account those representations?

Of course, I do not dismiss children’s concerns, but ultimately we have to make a choice. I believe—and experience has shown this—that the media will act responsibility. As the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) said from a sedentary position, in practice, there has not been a problem with the observance of reporting restrictions in the youth courts or elsewhere. Whatever else people may say about the British media, they are respectful of these restrictions, and the penalties on editors and journalists if they break the restrictions are very severe.

I go slightly against the flow in saying that I am yet to be convinced by these proposals, and I will watch the pilot schemes with interest. The Secretary of State drew on the experience of the youth court when he stated that these rules have worked effectively and their spirit has been well respected by the media. I must confess—I have written to him about this—that that has not necessarily been my experience, particularly as far as witnesses are concerned. Will he say what the situation will be with witnesses in the county court and the family court? Will the press be allowed to report their names?

No, the press would not be allowed to report witnesses’ names, because they are parties to the proceedings. The situation is different for expert witnesses, but with that exception, the identity of witnesses will be protected. I have yet to see the letter from the hon. Gentleman, but although there may be rare cases where there is concern about the operation of the family courts, such occasions are few and far between.

I welcome the Secretary of State’s statement. I have experience; a family came to see me who were concerned about the local authority’s involvement in their ongoing case. The case ended up in the family courts and the judge made a ruling that the family should not approach me again while it was in court. In my view, that was not really about protecting the child, which must be of the utmost importance, but about protecting the professionals involved in the case, because I was dubious about their judgment.

I accept what my hon. Friend says. We are changing the position so that in future a judge cannot make such a ruling in any case in which a party wishes to approach their Member of Parliament.

I welcome the proposals that the Justice Secretary has announced, although a lot of the details are still to be worked out and I could not quite understand why the previous good work had come to a grinding halt.

One of the biggest criticisms of the workings of the family courts has been the lack of accountability of social workers, Children and Family Court Advisory and Support Service workers and expert witnesses, particularly when errors are made that become part of the court record—a problem that is often compounded by the high turnover in those staff. As part of the review, will the Justice Secretary ensure that such errors are not given protection and that reporting will be possible in order to highlight those errors, to ensure that they are not made and to increase the accountability of those with key roles to play in the judgments that can be made?

The judgments in such cases are very difficult. Errors may sometimes be made, but I share the view, expressed not least by the hon. Member for Arundel and South Downs (Nick Herbert), that the greater the system’s openness, including through the scrutiny of public officials, the smaller the likelihood not only that egregious errors will be made, but that they will go unnoticed.

I welcome greater transparency. Wolverhampton, which I represent, will be a pilot area, in which full written judgments will routinely be made. It seems to me that that will have resource implications, because it will take up judicial time, as well as a certain amount of staff time. Will my right hon. Friend assure me that there will be extra resources for pilot areas, to ensure a full validation and to ensure that other cases are not adversely affected by resources being sucked into the pilot cases?

The notion of written judgments is an excellent idea, given adequate resources, of course. As a practitioner—I declare an interest as a member of the family Bar and I still occasionally practise—I am fearful that bringing in the media when parties to the action are giving evidence will undermine the quality of that evidence, given that it is often highly sensitive and intimate evidence. I am concerned that the proposal will suppress the truth, which is the last thing that anybody wants.

I understand the hon. Gentleman’s concern. There is a balance to be struck. My view, based not least on the experience of the youth courts, is that having the media there will produce a better overall quality of justice and, above all, a better perception of the justice that such courts provide.

Protecting the identity of the child and giving them the privacy that they rightly deserve in cases where it is often the failure of adults that has brought them before the courts is paramount. Will my right hon. Friend be holding meetings with the Press Complaints Commission and the Society of Editors to ensure that there are clear guidelines, particularly for local newspapers, whose reporting is more vulnerable to identifying who the child is and what the family circumstances are?

The statement has rightly focused on the protection and welfare of children, but the family courts also deal with divorce cases, not all of which involve children. Will cases that do not involve children be subject to the same media scrutiny when they concern what are in effect private matters between the parties?

I must declare an interest as co-ordinator of the Justice for Families campaign.

One of the critical things that we need to do in this country is improve decision making in respect of children in public law proceedings, especially in view of the number of serious case reviews. Scrutiny in the family courts is key to that, so I welcome much of the statement. I do not think that, in reversing the judgment in Clayton v. Clayton, the Government intend to cause a 17-year-old child to be unable to complain about his or her treatment, but I ask the Secretary of State to answer the question from my hon. Friend the Member for Cambridge (David Howarth) about second opinions. Will it now be possible for a party to obtain a second opinion without the permission of the judge?

I shall have to return to the hon. Gentleman, and to the hon. Member for Cambridge (David Howarth), on that discrete issue.