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Commons Chamber

Volume 488: debated on Thursday 26 February 2009

House of Commons

Thursday 26 February 2009

The House met at half-past Ten o’clock


[Mr. Speaker in the Chair]

Business Before Questions

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

Motion made, and Question (15 January) again proposed,

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).


The debate stood adjourned; to be resumed on Thursday 5 March.

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

Motion made, and Question (15 January) again proposed,

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 this House 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).

Oral Answers to Questions

Environment, Food and Rural Affairs

The Secretary of State was asked—

EU Floods Directive

1. What recent discussions he has had with the Environment Agency on the implementation of the EU floods directive. (258775)

DEFRA officials hold regular discussions with the Environment Agency on a range of matters associated with the draft floods and water Bill, which will include the implementation of the EU floods directive.

The EU floods directive is due to be implemented this September. What reassurances can the Secretary of State give to the many people who have suffered flood damage in the past couple of years in particular, including my constituents, who have suffered flood damage three or four times in that short period? What reassurance is there that the Environment Agency will be able to implement the directive on time, when there were some 200 flood risk-based vacancies in the agency only last summer?

I am well aware of the flooding that the hon. Gentleman’s constituents have suffered, and the greatest reassurance that I can offer him is that since the floods of 2007, 49 schemes have been put in place, protecting 37,000 homes across the country, as I have reported to the House previously. Frankly, that is the best protection. We are putting more money into flood defence; indeed, we are bringing forward some of that investment in order to provide the protection earlier. We will be consulting on the draft floods and water Bill, which will look at how we implement the EU floods directive. Part of the work that that will require is already in train. The Bill will cover the further steps that we need to take to implement it.

My right hon. Friend was very helpful at the time of the floods in July 2007, but we were also promised some EU funding for some of the measures that we need to put in place. It would be useful to know what money we have received from the EU and how it can be taken forward in respect of the floods and water Bill. The sooner we get that Bill in place, the better.

The question of EU funding to support the recovery effort was dealt with by my right hon. Friend the Secretary of State for Communities and Local Government. As I indicated in answer to the first question, we are significantly increasing the investment in providing defence. It is important that we do that, because it gives us the opportunity to provide more flood protection. Each scheme has to be assessed against criteria. Not all of them can go ahead, but the best thing that we can do is ensure that more money is available.

Almost every weekend since December I have been visiting people who were affected by floods in my constituency. Is not the clear message that there needs to be a step change in our approach to flooding? We need much more emphasis on the maintenance of watercourses and drainage and much more concentration on resilience. We need to empower local communities to help themselves and we need to manage whole river catchment areas more effectively. May I invite the Secretary of State again to visit Somerset and to see for himself the problems that we face there and, perhaps, some of the solutions that have been developed locally, with which he might help?

If the hon. Gentleman will bear with me, I will do my level best to accept his invitation. Indeed, I know that he was personally caught up in the recent flooding. The truth is that the answer is all the things that he mentioned. They were all laid out clearly in Sir Michael Pitt’s excellent report, as the hon. Gentleman will be aware. We have accepted all the recommendations and we are getting on with implementing them, because there is not just one solution, and local responsibility is included in that. Indeed, I am absolutely up for looking at steps that can be taken locally, both because that engenders a greater sense of responsibility in local communities about what they can do to help and because, frankly, this is a task for all of us.

Two weeks ago, many villages in and around Braintree and Witham were once again hit by substantial flooding, which closed roads and left people stranded. Does the Secretary of State agree or at least recognise that my constituency urgently needs further investment for flood prevention, and will he commit to that investment today?

I recognise that the hon. Gentleman’s constituents were affected by the flooding and I know that he wrote to my right hon. Friend the Minister of State on that question. Mercifully, the number of properties flooded across the country was relatively small and a number of the flood defence schemes that have been put in place acted to protect people in those circumstances. On investment, the Government’s position is crystal clear. It would be quite helpful if the hon. Gentleman encouraged his party’s new shadow spokesperson to give an equally clear commitment that it supports the investment that we are going to make up to 2010-11.

Domestic Waste Collection

It is for local authorities to decide on the best way to collect waste in their area. They are, after all, best placed to make decisions based on local circumstances. Our role is to give them the tools to do that. It is for that reason that we fund the Waste and Resources Action Programme, among others, to provide guidance and share best practice.

I hear what my right hon. Friend says, but in the case of Tory-controlled Plymouth city council, it took the combined efforts of myself, the shadow leader and the local councillor to get some rubbish removed for Mr. Pickford in Vauxhall street. It took more than a week, and even when he reported rat infestation, he received a flippant response. Will the Minister take an interest in ensuring that the quality of service, which was designed to be improved last November, does in fact improve?

I am interested to hear about my hon. Friend’s example. As she will know, 99 per cent. of households in Plymouth city council have a kerbside recycling collection of mixed materials, but the circumstances that she describes would be very much worse if the proposed Tory cuts to public spending were introduced. There would be a very bleak prospect indeed for all the available support—not just through WRAP, but through the recycling and organic technology advisory team and others—if the Conservatives were to come to power.

The National Audit Office has warned the Government that they are set to miss their targets for reducing waste going into landfill and therefore face massive fines for failing to achieve good practice. Is it not madness that more of the funds raised by the landfill tax are not going into increasing good practice in waste collection, but are being swallowed up by the Treasury black hole? Will the Minister agree to reallocate funds from the landfill tax and further funds to local councils so that they can step down landfill and step up recycling?

The rate of recycling in England in 1997 was 7.5 per cent.; it is now 34.5 per cent., and it is continuing to improve. The landfill tax has been a singular success and it has focused the minds of local authorities on precisely that threat of failing to reach the targets. Local authorities are working hard, and in very many cases they have got the message. I think that they should be congratulated on the progress they have made.

As my right hon. Friend knows, best practice in waste management is recycling. As she mentioned, the Government have a good record on that, but we could improve it even more. Local authorities’ recycling targets are measured not by product but by weight; if we had material-specific targets, recycling could be improved, as it could if we also removed the distinction between the collection of domestic and commercial waste in some circumstances. Will the Minister revisit those issues?

My hon. Friend will know that the waste strategy was published in 2007, and that the new economic climate in which we are operating requires us to keep all such matters under review. He has made his point in writing and at meetings. He raises an interesting point, which I will want to study further, but it is worth knowing that a lot of good work is already going on. Just this week, I visited a business in the centre of London, in Great Titchfield street. The business is called i-level; it is a digital media agency that is working with Alupro, the Aluminium Packaging Recycling Organisation, on the “Every Can Counts” initiative, which is all about the recycling of just aluminium and steel cans in a highly specific way. As I said, a lot of good work is going on, but there is always more that we can do.

I am concerned about the service that local authorities give to residents. Increasingly, under councils of every political colour, there is anger and criticism about how local authorities are operating refuse collection, not least regarding the move from a once-a-week to a fortnightly collection. In many cases, the size of wheelie bins has been reduced. When will local authorities take account of the interests of those paying them their wages rather than seek to meet—I say this although I do support recycling—some unacceptable regulations, many of which come from Europe?

It is obviously a matter for local authorities to determine how local household waste is managed, how it is collected and how much recycling is undertaken. I have already described the improvements across England in respect of the proportion of household waste recycled. The hon. Gentleman’s local authority may be behaving in a way that he disapproves of, but let me tell him that in my experience, because of the importance to every household of dealing with waste, this is one of the most highly political issues. It is therefore very important for local authorities to be aware of what their communities are saying.

As a busy person who manages to compost my food waste, including small bones and the mouldy stuff that we find at the back of the fridge, may I ask my right hon. Friend what incentives the Government are providing to encourage the roll-out of composting systems such as Bokashi and Green Cone, so that more domestic food waste is kept out of the waste stream and so that gardens flourish?

It is a long time since I looked at the back of my fridge, and I dread to think what is lurking there. The recycling and organics technical advisory team is available to all local authorities in England; it provides advice on the separate collection of dry recyclables, and in particular the organic wastes that my hon. Friend describes. It is doing extremely good work. We also encourage the take-up of anaerobic digestion as an alternative means of dealing with organic waste. Again, good progress is being made by some of the big retailers, who are working with local authorities to bring organic waste into anaerobic digesters and produce some really useful products as a result.

Kettering borough council has increased its domestic waste recycling rate from 4 per cent. to more than 45 per cent. in the past six years, but following on from the question asked by the hon. Member for Birmingham, Selly Oak (Lynne Jones), to get the figure up to 55 or 60 per cent, we need to tackle the recycling of cooked food waste, which is not allowed into the compostable waste stream. That is proving problematic. Is the Department considering any financial or other incentives to enable local authorities to deal with that particularly tricky problem, so that we can reach the sort of recycling rates to which we aspire?

On the other hand, health advice would be to eat only what we need to eat. The hon. Member for Kettering (Mr. Hollobone) presses a very good point. He is right that local authorities need to engage much more with the issue of what we do with organic waste, precisely as my hon. Friend the Member for Birmingham, Selly Oak (Lynne Jones) said. There are projects in place, and there is funding, but it needs to be bidded for, and it needs to be based on local circumstances and local need. Good projects should be brought forward; they would then be considered by the regional development agencies, the Department for Environment, Food and Rural Affairs or a local government department.

National Waste Management Strategy

We published the 2007 waste strategy for England on 24 May. Progress remains very much on course, as is shown by continued reductions in levels of household waste—a subject that we have just discussed—and an increase in levels of household recycling.

I thank my right hon. Friend for that answer. The emphasis in my question is on the word “national”. I think that everybody agrees that recycling, composting and making waste into energy are good things, but on numerous occasions—and twice in very recent history—massive local campaigns have been mounted against a composting plant or gasification unit. The decision has to be taken by the local authority, which will also take the hit for it. Is there some way in which decisions about where such units go could be made nationally, so that we could all take a part in that recycling, composting and gasification?

Some aspects of waste recycling are controversial. Often, the controversy is based on misunderstood information and fears that are not well founded. The Waste and Resources Action Programme offers advice and help, and DEFRA is developing programmes of support for local authorities. The Local Government Association is asking for further detail and guidance on how local campaigns can be clear and reassuring, and can provide good, solid, well-founded information to local communities who might have concerns about a particular technology. There is no doubt that there have been massive improvements in the type of gasification technology that my hon. Friend describes, for example, which causes alarm. People can be reassured that it is good, clean, technology.

The Minister told me this week that in all but two English regions, landfill capacity would run out in less than seven years’ time. We urgently need a better strategy to increase recycling rates further and develop markets to use waste as a resource for materials and energy in particular. Last month, however, the National Audit Office said that DEFRA had responded too slowly to the landfill directive, with the result that waste infrastructure projects were being delayed. Can the Minister explain why a Department that is meant to be leading on environmental protection takes years to act?

As I said earlier, the recycling rate in England was 7.5 per cent. in 1997 and is now 34.5 per cent. A huge amount of work has been done. We expect the combined impact of our policies in the waste strategy that I described earlier to be a reduction in global greenhouse gas emissions of at least 9.3 million tonnes of carbon dioxide equivalent per year by 2020 as a result of waste management. What would be the impact on targets of that nature of the cuts that the hon. Gentleman would be forced to make in any departmental programme of this kind? When in government one makes decisions that have a big impact, and the decisions that we have made have brought about a sea change in household attitudes to recycling.

Is it not the case that the heart of a national waste management strategy should be the principle that the polluter pays? Does the Minister share my concern about the fact that more local authorities have not shown interest in differential charging for domestic waste? Is it not common sense that the filthiest households should pay more, and what further steps can the Government take to increase local authorities’ understanding of the importance of the “polluter pays” principle?

I do not necessarily agree with my hon. Friend. Some of the poorest households find waste management the most difficult, often because the circumstances in which they live are so difficult. I think that we should work harder to understand how we can help households in such circumstances to do better. One possibility is a punitive approach, but I want to study the situation with some of those local authorities, which may be struggling. We know that it is particularly hard to deal with houses in multiple occupation containing lots of families. I want to understand what the barriers are, and how we can reduce them to help local authorities perform better and improve the environments of some of the poorest people in the country by enabling better recycling techniques to be used.

Common Agricultural Policy (EU Review)

4. What progress has been made in the EU review of the common agricultural policy; and if he will make a statement. (258779)

The CAP health check was, on balance, a step towards our long-term view of the CAP. In particular, it removed about half the remaining production-coupled payments. We will continue to press for further reform for the benefit of farmers, consumers, taxpayers and the environment in the forthcoming European Union budget review.

The hill farmers in my constituency are in an extremely precarious economic situation. Many are being forced to reduce the size of their flocks and herds, or even to contemplate getting out of farming altogether. Does the Secretary of State recognise that those farmers are vital to the well-being of their local communities and the management of our environment? If so, will he ensure that in the next fundamental review of the CAP we retain enough flexibility for the different parts of the United Kingdom to give long-term support to hill farmers?

I agree with everything that the hon. Gentleman has said about the importance of hill farming, and join him in paying tribute to the work that hill farmers do. It is tough farming, undertaken by some of the toughest farmers whom I have met.

I note the hon. Gentleman’s point about future negotiations, but we have already taken one significant step, which we announced not long ago, in replacing the hill farm allowance with the upland entry level scheme. The fact that that has been so widely welcomed reflects both a recognition of the Government’s commitment to supporting hill farmers, and our hard work in listening to feedback about what would help them when we were drawing up the scheme.

Does not the CAP cost the taxpayers of the European Union far too much and benefit far too few people? Agriculture represents about 1.5 per cent. of the aggregate EU GDP and about 5 per cent. of people in the EU work in agriculture, but almost half the EU budget is consumed by it. That cannot be allowed to continue for much longer, can it?

As my hon. Friend and the House will know, it has been a long-standing aim of the UK Government to reform the CAP in order to address some of the difficulties to which he has drawn attention, and as I said, the health check was, on balance, a further step along the way—although there were some steps forward and also one or two steps back. In the end, the Government’s objective is to support farmers for the public goods that the market will not reward them for, which is why we have argued long and hard for a shift of resources from pillar one to pillar two. Agri-environment schemes are extremely important; we celebrated their 21st anniversary last year, but the truth is that this is a long, hard slog, because different EU member states take a different view about the need for reform.

Farmers are often hampered in producing food by regulation associated with the common agricultural policy. Given that only one animal out of all those tested in England and Wales last year under the fallen stock scheme proved positive for BSE, is it not now time to review the ban of on-farm burial and lighten the burdensome and costly regulation that farmers have to endure?

I take the hon. Gentleman’s more general point about the cost of regulation, which is why we have been vigorous in, for example, trying to get the best deal we can on electronic identification of sheep. We have made some progress, but as he will be aware, not enough member states are worried about the matter to change the nature of the regulation itself. On his specific point, what is most important is that we act on the basis of the veterinary advice that we have about risk. I undertake to come back to him with a further response to the matter he has raised, but managing the risk and making sure there is no risk to the public has to be the overriding consideration in dealing with BSE.

Did not the Secretary of State put his finger on it when he said that reform is opposed by a large number of other countries? There is broad consensus across the House and, I think, the nation on the need for CAP reform in this country, but we have to persuade Dublin and France and Madrid to think differently. To that end, will the Secretary of State bring in some of the Church charities that campaign on opening up trade for the third world, and ask them to talk to the Churches and equivalent charities in Ireland, France, Spain about fighting for a real alteration, because there is no use in our agreeing to this in Britain if we cannot persuade our partners elsewhere in Europe?

My right hon. Friend, who has great experience in these matters, of course, is absolutely right: in the end, we have to get agreement across Europe to make the change. The agricultural policies that are pursued in Europe do have an impact on some of the poorest farmers in the developing world. That is relevant to the question of food security, because an urgent task that we face is to support a growth in agricultural production, particularly in the developing world, to feed a rising population, and that is harder for a farmer to do if they do not have a market and cannot see an incentive. I welcome my right hon. Friend’s suggestion that we should encourage this debate, looking at all aspects of the importance of agricultural production and at making sure Europe has the right policy, but in the end we have to get consensus.

I am pleased to hear the Secretary of State endorse the point about reducing the burden of regulation, and he will know of his own Department’s target to reduce the burden by 25 per cent. by next year, but is he aware of the research by Open Europe showing that, far from reducing, the burden is actually increasing dramatically? It estimates that the cost of the regulations that derive from the EU but are interpreted and implemented here is now £1.2 billion, an increase of a massive 47 per cent., and even more seriously, that home-grown regulation—regulation that originates in this country, and largely in his Department—has increased by 275 per cent. since DEFRA was established in 2001. Therefore, rather than waiting for any review of the CAP, when is the Secretary of State going to get a grip on what his own Department is doing and start to lift the burden on our farmers?

If the hon. Gentleman would like to draw attention to the specifics of the home-grown regulation to which he is opposed, it would be interesting to hear what he does not want us to do. As he knows, the vast bulk of the regulation comes from Europe and the nitrates directive, for example, was agreed not by a Labour Government but by his party in 1991, so it would have to answer for the form that that took. We worked very hard last year to implement the changes that were required under that legislation in such a way as to minimise the impact on farmers.

I have already indicated what our position is in relation to electronic identification for sheep. As the hon. Gentleman will know, we have been fighting the pesticides regulation because we do not think that the case has been made, particularly given that there has been no proper impact assessment in Europe. A message that could be sent from both sides of the House to Europe—both in current circumstances, when times are tough, and more generally—is that we should do the things we need to do to deal with problems, but we should not add to farmers’ responsibilities if it is not strictly necessary.

Pitt Report

5. When he last met Sir Michael Pitt to discuss the recommendations in his report, “Learning Lessons from the 2007 Floods”. (258780)

I last met Sir Michael Pitt to discuss our response to his report in November. I and DEFRA officials will continue to consult him on progress in implementing his recommendations. The Government will report further every six months, beginning in June this year.

When they next meet, will the Secretary of State discuss with Sir Michael the concern, raised repeatedly at public consultations on the Pitt recommendations—particularly by drainage boards such as that in my constituency, which represents the Great Ouse and River Ivel valley areas—that the Environment Agency’s policy of minimal dredging as part of its maintenance is continually increasing the risk of flooding, particularly in low-lying, slow-moving watercourses? When is this policy going to be changed?

I will gladly raise the issue that the hon. Gentleman has drawn to my attention, of which I am very aware. The Environment Agency spends about £34 million a year on dredging, clearance of debris, polling trees and removal of weeds. The issue is that in some cases, it makes sense to do that to enable the water to pass more quickly to reduce the impact of flooding; but in others, dredging, by the act of speeding up the movement of water, merely makes it arrive faster somewhere else and adds to the problem of flooding. The decision therefore needs to rest on local knowledge about the watercourses and what the consequence of action in one place will be for another place. The Environment Agency takes that responsibility very seriously. The issue is the subject of continuing debate and I have raised it with the agency previously.

DEFRA has a great little scheme that funds some pilots through which farmers and land managers manage their land in ways that hold back flood waters. I have been to see a scheme at Seighford, near Stafford, with Matt Jones from Staffordshire Wildlife Trust, who is the project manager. Some really low-tech solutions are successfully keeping back flood waters at times of pressure. Will my right hon. Friend be talking to Sir Michael about the assessment of those pilots, with a view to seeing whether they could be rolled out more widely? If he does, can he report back to MPs who have pilots in their area?

I would be very happy to take up the last of my hon. Friend’s suggestions. He makes a very good point, which shows why we are doing the pilots—in order to see what contribution proper management of the flow of water can make to reducing the impact of flooding. As the whole House recognises and as we discussed a moment ago, we need all these means to try to deal with the problem. As I have told the House previously, I am up for considering everything that will be effective in trying to minimise the impact of flooding on communities and people’s lives.

Sir Michael Pitt has warned that local authorities need legislation to give his recommendations the priority that they deserve. It will soon be a year since the Prime Minister announced a draft floods Bill. As we head towards the second anniversary of the 2007 floods, with more than 1,000 families still in temporary accommodation, why have we not seen even a draft of this Bill? Is it not true that there is now no possibility of this legislation being on the statute book before the election, and that, yet again, DEFRA is living up to its reputation as the Department of delays?

I take this opportunity to welcome the hon. Gentleman to his Front-Bench position. I know that he has a very strong personal commitment to the issues that he will now be dealing with as the Opposition spokesperson. I wish him a long and very successful career as the shadow Secretary of State.

We will be producing the draft floods and water Bill for scrutiny in the not-too-distant future—in the spring. Clearly, it takes time to work out what changes in legislation are required. I reject the hon. Gentleman’s accusation that DEFRA is a Department responsible for delay. The figure I gave earlier of the number of flood defence schemes that we have got on with and implemented in the year and a half since the great floods of 2007 shows that this is not a Department that is delaying things, but one that is committed to getting on with things and providing greater protection to people.

Secondly, it is not as though we have waited for legislation. Although in some respects there is a lack of legal powers to make things happen, we have already indicated to local authorities that the upper tiers will have responsibility for dealing with surface water flooding. We have also got on with funding and, as I announced to the House in December, the first group will start preparing the plans. We are not waiting for the Bill to get on with the work, but if we do need powers to ensure that we can protect people as fully as possible from flooding, that is what the Bill will achieve.

My right hon. Friend will be aware that Sir Michael Pitt’s report mentioned the importance of co-ordination between different organisations in terms of flood defence and flood relief. However, although the Environment Agency is looking at new river catchment flood defence plans, I still speak to local authorities, internal drainage boards, landowners and the National Farmers Union who all think that they are not being involved enough in the formulation of those plans. Where several catchment area plans meet, such as in areas of Goole, Snaith and the Isle of Axeholme, not enough thought has been given to the combined effect of the plans. Will my right hon. Friend speak to the agency to ensure more joined-up thinking in that regard?

Not only will I do that, but I have already done so. My hon. Friend raises an important point. The Environment Agency has responsibility for drawing up the plans, but this is everybody’s problem—including local councillors, MPs, the agency and others. I know that Chris Smith, the chair of the Environment Agency, is seized of the need to improve co-ordination. It works well in some areas, but has some progress to make in others. For communities affected by these problems and given the increased funding, we really want the chance to say, “This is the range of options to deal with the problem.” Local communities have to play a part in deciding the priorities, because the choices they make will have consequences. I am determined that we should try to improve co-ordination, but it does mean that everybody must take responsibility for dealing with a problem that faces all of us.

Topical Questions

DEFRA’s responsibility is to enable us all to live within our environmental means. At its meeting last week, the United Nations Environment Programme governing council agreed to negotiate new international controls on the use of mercury. That will be an important step forward in protecting human and environmental health and has been widely welcomed by Governments and NGOs. This agreement clearly demonstrates the value of the United Nations.

May I bring Ministers back to matters more domestic, and to the surface water drainage scheme, which is causing enormous consternation not only to church groups, but to flat dwellers who feel that they have been very unfairly treated as their bills have shot up—especially in comparison with commercial properties? Will the Government look at this again and see whether Ofwat has allowed the profiteering water companies to get away with something that they should not have been allowed to get away with?

I thank my hon. Friend for raising what is a very important issue that has been addressed in the House before. He will be aware that the focus has been on the charges imposed by one individual water company, United Utilities. There is a strong regulatory regime, and back in 2003 the Secretary of State made clear his guidance on the need to be proportionate and fair in the introduction of those charges. We have worked with the regulator and the utilities company, and we are pleased to say that some progress has been made—not least United Utilities’ commitment to roll back its charges to the 2007-08 regime, which is in effect the pre-surface water drainage charges, and to take the next 12 months to work with the regulator to ensure that the charges next year will be fair and proportionate, as well as recognise the impact on churches, scout groups, sports clubs and others.

Recreational sea anglers have virtually no impact on the marine environment. In fact, they can be a great help in terms of our knowledge of fish stocks. Some 1.1 million sea anglers will welcome the EU Commissioner’s row-back on plans to include the recreational catch in national quotas. Does the Minister accept that this issue will not go away until the Commissioner defines “recreational sea angler”, and will he tell us what efforts he is making to bring closure on this ludicrous proposal?

I thank the hon. Gentleman for that question and, although we have met on other occasions in Committee, I welcome him to his first DEFRA questions as an Opposition spokesman. He is right to say that this is an important issue. The angling fraternity in the UK is huge: it has an important function socially as well as economically, and its members are known for their environmental concerns. We share the concern about the need for an adequate definition of “recreational angling”, as the definition applied in other EU member nations is not the same as the one that affects us here. We are actively engaged in work on this with the Commission, and I join the hon. Gentleman in welcoming the comments by Commissioner Jo Borg. We shall continue our work, and I welcome the hon. Gentleman’s support in highlighting those concerns.

T4. Recycled cooking oil is used increasingly commonly in the production of biodiesel, but it can also be used for power generation. Last year, the Court of Appeal made an important ruling about the use of recycled lubricating oil that should set a precedent for the use of cooking oil in the generation of electricity, but the Environment Agency has not yet made its ruling on that. Will the Minister talk to the agency to seek an early ruling about the use of recycled cooking oil? (258798)

Order. May I remind the House that we are on topical questions? We need short, sharp questions and short, sharp answers.

I will take your guidance, Mr. Speaker. The Environment Agency has been in touch with the company Living Fuels about the use of cooking oil as a fuel. The process has been thorough and has taken some time, but I am pleased to say that the agency’s chief executive has written to the firm’s managing director to accept the offer of a meeting to discuss the matter further and take it forward.

T2. Is the Minister aware that proper flood warnings are a vital part of flood protection? In Norfolk, we have a highly effective battery of flood sirens along the coast and the lower reaches of the Ouse. This tried and tested system has worked very well for generations, and does he agree that it would be most short-sighted to replace it with a new system of text messages and radio announcements? (258796)

I am aware of the issue that the hon. Gentleman has raised. The information that I have is that the sirens are owned by Norfolk county council rather than the Environment Agency, although some people have been under the misapprehension that they were owned by the agency. Their future use and refurbishment are therefore matters for Norfolk county council, and no doubt the hon. Gentleman is raising those matters with that council. However, I am also advised that the police have stated publicly that, in their view, the sirens are no longer required because there are other systems for making sure that people are warned. I think that the hon. Gentleman reinforces once again the need for people who are not already on the Environment Agency’s flood warning system to get themselves on it because, frankly, the more ways that people can be advised of a problem, the better.

T6. Earlier, I asked my right hon. Friend the Minister of State about incentives to reduce the amount of waste going into the waste scheme, but I am not sure that she addressed that question. Will she look at the perverse incentives in the system that do not encourage waste minimisation and the best quality of recycling? For example, waste glass collected from doorsteps in Birmingham goes to aggregate but, compared to recycling it back into glass, that is not a very environmentally sound way to cope with it. Will she look at how the targets are disincentivising the best kinds of waste minimisation and recycling? (258801)

I am aware that there are some rubbings in the system. Clearly, we need to keep the whole panoply of work that we are doing under review. If my hon. Friend checks Hansard, I think that she will see that I dealt with the incentives that my hon. Friend the Member for Bury, North (Mr. Chaytor) raised, but I will look into the specific case that she raises of how glass is being used.

T3. This is the first time I have done this. First, I want to thank the Secretary of State for meeting Devon farmers to discuss the effects of bovine TB. They were extremely grateful for the time he gave to them. He also suggested that there would be some vaccine available for the eradication, hopefully, of bovine TB and that Devon would be probably the first area, or at least one area, that he would consider for that trial. Will he tell the House whether the intention is to vaccinate the cattle, in which case, in the supermarket, will the meat of the cattle have marks to show that they have been vaccinated against TB? Or is the plan to chase the badgers all around Devon? Is the Secretary of State going to employ more officials to chase the badgers and inject them with the TB vaccine? (258797)

The first vaccine that we hope to have available next year is an injectable vaccine for badgers. As I said when I met his constituents, it would make a lot of sense to have a demonstration project in an area that is particularly badly affected by bovine TB. An oral vaccine for badgers will take some more time, as will an injectable vaccine for cattle. I have put an increasing amount of money into this because we need to explore all the avenues to try to provide help. I was grateful for his constituents’ positive response, which showed their willingness to take part in the injectable vaccine demonstration project when we can get it going.

T7. I will be as quick as I can, Mr. Speaker. Will the Minister elaborate on an answer to an earlier question? How will the Department quantify the help that it will give to local authorities to develop green technology? (258802)

A number of incentives are already in place in the system, not least for renewable energy, and it is one area in which local authorities can do more. That is why there are incentives under the renewables obligation, why the Government will introduce feed-in tariffs for microgeneration and why the work that my right hon. Friend the Minister of State is doing on anaerobic digestion is important. That all links to a number of the questions that have been asked today. Instead of sticking food waste in landfill where it produces methane, we should generate some energy from it.

T5. I will be brief, but it is a hard question. What is the Minister doing about the tendency of some retailers and waste authorities to stockpile electrical waste simply to sell it at premium and inflated rates to the producers’ organisation, the Recycling Electrical Producers’ Industry Consortium? That makes the waste electrical and electronic equipment directive more costly and makes producers’ responsibilities harder to discharge. (258799)

I am aware that there is some concern about certain operations, and, indeed, that has been some recent media interest. I will look into the case that the hon. Gentleman raises.

Can the Secretary of State explain why his Department has cancelled its 2005 commitment to pay 55 per cent. of the redevelopment costs of the vital Pirbright laboratories? What steps will he take to ensure that the redevelopment of Pirbright takes place?

As we have made very clear, we had some concerns about the cost-effectiveness of the redevelopment proposal, not least because the cost of meeting the capital charges of that development would also impact on our ability to fund the world-class research. The Biotechnology and Biological Sciences Research Council is now reviewing how that scheme will be taken forward. In the short term, DEFRA will contribute to the cost of an interim building to help the further redevelopment of the site. As the right hon. Gentleman will be aware, a considerable amount of money has gone into it already, and we need to find a cost-effective solution to ensure that we continue to benefit from the world-class science that is undertaken at the Institute for Animal Health.


The Solicitor-General was asked—

Torture (Legal Proceedings)

1. What factors the Attorney-General takes into account in determining where the public interest lies in the context of legal proceedings relating to allegations of torture in interrogation. (258803)

Any decision on whether to bring criminal proceedings for an offence depends first on the sufficiency of evidence and then on whether prosecution is needed in the public interest. The normal principle is that a prosecution will usually take place unless there are public interest factors tending against prosecution that clearly outweigh those in favour.

In the current circumstances of the Attorney-General’s investigation, it is odd that she is deciding not whether there should be prosecution but whether there should be investigation. In those circumstances, does the Solicitor-General agree that the evidential hurdle should be very low, that if there is credible evidence of torture it should be investigated by the police and that the public interest must always lie in favour of prosecution and factors such as embarrassment to the Government or the interests of foreign powers should never be taken into account?

I am sure the hon. Gentleman is right that there is no suggestion that that will happen. He did not start where the question suggested I thought he would, which was at the wrong end of it. Indeed, the court approved the Home Secretary sending to the Attorney-General the job of deciding whether there should be an investigation, and that is ongoing. If in due course there is one and there are offences to be considered, almost certainly—unless it is a decision that the House has said the Attorney-General must take—any decision to prosecute will be taken by the independent Director of Public Prosecutions in any event. I hope the hon. Gentleman feels that answer is clear and that it satisfies him.

As my hon. and learned Friend knows, the Joint Committee on Human Rights is looking into these allegations. We are particularly concerned about section 7 of the Intelligence Services Act 1994, which provides for the Secretary of State to waive the liability of intelligence service personnel for legal acts committed abroad in certain circumstances—the so-called James Bond clause. Will my hon. and learned Friend confirm that it would not be in the public interest for any such certification to be provided in any case involving torture, and will she confirm that in the cases being looked at by the Attorney-General no such certificate has been issued?

I can neither confirm nor deny any such thing. It is not our intention to give a running commentary about the details of the ongoing deliberation process. The Attorney-General has written to the hon. Gentleman, as he knows, and a copy of the letter is in the Library. It indicates the stage that we are at—whether there should be an investigation is ongoing—and the Attorney-General will report to Parliament when she has made a decision.

Does the Solicitor-General agree that the public interest really lies in identifying whether or not torture was used and whether British officials were party to it? The public interest does not necessarily require identifying what information was extracted.

Once again, I have no doubt that the right hon. and learned Gentleman is right in the factors he puts forward that must play a role in considering the public interest. Let me simply reiterate what the Attorney-General has been asked to do, and the court wishes her to do: it is to see whether there should be an investigation, so please let us not put the cart before the horse. There will obviously be opportunities to look further at the matter. The Attorney-General has made it very clear that she will report to Parliament when she has completed her assessment.

But does the Solicitor-General think that the Attorney-General should have accepted this task in the first place, given the fact that Crown servants, senior officials and even Ministers might be involved? Is this not a situation where the investigation, and indeed the decision to prosecute, must be entirely independent of politicians?

They obviously will be. I do not know how many times one has to explain that to the Liberal Democrats. The decision whether to prosecute will not be taken by the Attorney-General or by me unless it is one of the offences on which Parliament has said the decision must be taken by the Attorney-General or the Solicitor-General so they cannot avoid it. In all other situations, the decisions will be taken by the independent Crown Prosecution Service and the investigation that precedes any such decision taken obviously by the police.

Does the Solicitor-General accept that most people see this as a cover-up of state-sponsored torture by a Government who supposedly introduced the Human Rights Act?

The hon. Gentleman lashes out like a man trying to get a fly out of his beard—[Interruption.] I am sure he is old enough to grow one. As I am sure he appreciates, the Foreign Secretary has made it very clear that the documents that are the cause of concern, which the court worried about and consequently passed on to the Attorney-General, were disclosed to Mr. Mohamed’s lawyers only because the British Government negotiated the United States into that position. It is not the British Government who have any reservation about their disclosure. The hon. Gentleman tries really hard to be wide of the mark and he scored a very wide one today.

Careless Driving (Prosecutions)

2. How many prosecutions for the offence of causing death by careless or inconsiderate driving have been brought; how many convictions have been obtained; and what the average length of custodial sentences handed down has been to date. (258804)

Causing death by careless or inconsiderate driving under section 20 of the Road Safety Act 2006 came into force on 18 August 2008. Court proceedings data, including prosecutions and so on for 2008, will not be available until autumn 2009.

I am grateful to the Solicitor-General for the answer. The lorry driver who killed six people on the M6 was convicted of causing death by careless driving and is serving three years. Of course, if that offence had not been introduced, he would have only received penalty points on his licence and a fine. The judge in the case said:

“This was one of the most serious offences of its kind.”

Is the Solicitor-General therefore surprised that the sentence was three years—nowhere near the maximum of five years?

The hon. Gentleman is exactly right in his analysis of what would have happened if we had not introduced this offence: it would have been possible only to charge the driver with careless driving, which is summary only and only involves a fine. So by introducing the offence, we have allowed for the right level of culpability to be applied to people who do such things, with appropriate penalties. The case is not one that the Attorney-General can refer as an unduly lenient sentence case, although causing death by dangerous driving, which the jury did not find, would have been such a case. I cannot comment on individual cases, but the hon. Gentleman may get some sense of what we think about it by my making that observation.

While not in any way disagreeing with what my hon. Friend the Member for Wellingborough (Mr. Bone) has said about the case and accepting that the Solicitor-General does not want to expand on it, does she accept that many people who cause death by careless or inconsiderate driving are not of the criminal fraternity and that, although they should be certainly very severely punished, a community sentence, rather than a custodial one, is very often a better way to punish them?

We leave sentencing to the judges, within the parameters that are set down by Parliament. It is a very serious matter to drive a vehicle carelessly. For instance, in a number of cases recently, people have been texting while driving cars. Such rashness, carelessness and dangerousness does require condign punishment and ought to be met with imprisonment in my view, although I am not a sentencer.

Criminal Justice System (Vulnerable Women)

4. What steps she is taking with ministerial colleagues to assist vulnerable women in the criminal justice system. (258806)

In common with other witnesses who are vulnerable or, indeed, intimidated, women in that category are entitled to special measures to help them to give evidence, such as giving it from behind a screen or by video link. In rape and domestic violence cases, which have high women victimisation rates, they can now have the help of an independent domestic violence adviser or independent sexual violence adviser, who will befriend and help the victim through the proceedings.

I thank the Solicitor-General for that response. I am sure that she will be aware of the recent case where a judge called a halt to a case of robbery on the grounds that the victim was too convincing in her identification evidence. My concern is that, in cases, particularly rape cases, that hinge on the victim’s words, that may discourage women from coming forward, because they are damned if they are not convincing enough and they are damned if they are too convincing. What reassurances can my hon. and learned Friend give me that women will not be discouraged by the precedent that has been set?

As my hon. Friend said, it was not a rape case at all; it was a case, I think, about dishonest offence and identification. I am not very close to the case, but it appears as though the identification involved only a fleeting glimpse, which is a very dangerous thing to allow to go before a jury. If a person believes that they have recognised someone, they are very convinced of it and they sound strong, but the experience of the courts is that a fleeting glimpse can often mislead. I think that the case was withdrawn from the jury in that context, but I could not agree more with my hon. Friend that the turn of phrase used by the judge was most unfortunate and should not be taken seriously by any woman who is thinking of coming to court. The stronger she is in her evidence, by and large, the better, and we want to fortify all witnesses and victims to be able to feel that they can come to court and make complaints when justice requires it.

In view of recent cases referred to the Court of Appeal for leniency, will my hon. and learned Friend consider reviewing the sentencing guidelines for rape?

The sentencing guidelines are kept under review primarily by the Sentencing Advisory Panel, which has strong links with public consultation, and then by the Sentencing Guidelines Council; between their reviews, the Court of Appeal keeps its eyes on such sentences. There have been a number of referrals because of undue leniency. When it has seen fit, the Court of Appeal has put those cases right and thereby sent out strong messages to future sentencing judges, with which for the time being we are very content.

Disabled People (Court Proceedings)

5. What recent discussions she has had with the Secretary of State for Justice on steps to assist disabled people taking part in court proceedings. (258807)

I have not had any recent discussion on that specific topic with the Secretary of State for Justice himself, but through the Crown Prosecution Service we have been working closely with our other criminal justice partners to improve support for disabled victims and witnesses. The CPS is carrying out a consultation on a new policy for prosecuting cases involving witnesses or victims who have learning disabilities or mental health issues.

People with mental ill health are probably the single largest disabled group in the context of this question. Will the Solicitor-General have discussions with the Secretary of State for Justice, particularly in relation to the answer that I was given when I raised my concerns about those involved with mental health tribunals? I feel that they are not getting a fair crack of the whip. If the Solicitor-General reviewed the scale of the problem and suggested proposals through which we could tackle those difficulties, I would be most grateful.

My hon. Friend makes a strong point. He is a well-known supporter of disabled rights, and I compliment him on the perseverance with which he pursues those interests. I can answer only for the prosecution authorities; the mental health tribunals do not fit into my responsibility. I suggest that my hon. Friend raises the issue with the Secretary of State for Justice, from whom I am sure he will get a sympathetic response.

Is the Solicitor-General aware that part of the concern is that prosecutors are too often unwilling to regard people with mental health problems as potentially credible witnesses? Does she have any ideas about how that attitude can be changed?

The right hon. Gentleman has put his finger on what has been a historic problem; it surfaced recently in a case, for which the CPS apologised straight away. The CPS has invited Mari Taber, a director of Mind, to carry out an internal review of that case with a view to learning lessons more broadly. The consultation to which I have already referred is about putting forward a strong policy about how decisions concerning those with learning difficulties or mental health problems should be made in a sensible way so that those people are empowered, not disempowered.

Fraud Act

I answer only for the prosecutors whom the Law Officers superintend—not for the Department for Work and Pensions or the Department for Business, Enterprise and Regulatory Reform, for instance.

The number of offences under the 2006 Act are as follows: there were 9,221 in 2007 and 22,687 in 2008. This year, until 20 February, there have been 4,148. Small and very large frauds are included; it is difficult to make much of the figures.

We supported the 2006 Act because the Government suggested that the consolidation of fraud legislation would dramatically increase prosecutions for fraud. Is the Solicitor-General satisfied that that is happening and that the Act is being used properly, correctly and to successful effect by our prosecutors?

On the face of those figures, it appears that the Act is being used substantially—there was a great increase between 2007, when it was very new, and 2008, by which time everybody had had full training about it and appreciated its simplicity and utility. On the face of it, it looks as if the Act is being used extensively. As I said, it is hard to make very much of such bald figures.

Banking (Asset Protection Scheme)

With your permission, Mr. Speaker, I shall make a statement on the bank asset protection scheme and today’s agreement with the RBS Group. I hope that the House will understand, again, that it was necessary for the Treasury and RBS to issue market notices this morning, in the usual way.

In my statement to the House last month, I set out the principles behind the Government’s proposals to put the banks on a stronger footing, insure their balance sheets, and boost bank lending. I can now tell the House that those measures are being implemented: at the end of January, the Bank of England’s temporary special liquidity scheme was replaced with a permanent facility; last week, the Bank of England began purchasing assets to free up markets for commercial lending; and on Monday, Northern Rock announced that it would provide up to £14 billion of new mortgage lending.

Banks are at the core of all modern economies—they allow people and companies to make payments, and to save and invest for the future. Indeed, if we and other countries do not fix the banking system, we will not fix the rest of the economy. The basic problem that we are facing is a crisis of confidence about bank assets, which is preventing the UK banking system from providing loans for businesses, and mortgages for those who want to buy a home. The critical barrier to improving confidence and expanding lending is the uncertainty about the value of banks’ balance sheets. We must now enable banks to clean up their balance sheets so that they can become stronger and rebuild for the future, making them more able to lend to people and business all over the country. That will not happen overnight, but it is the essential starting point; it must go hand in hand with a broader reform of supervision and regulation of the banking sector; and that action must be taken not only here but by Governments right across the world, because the alternative is a failure of the banking system, here and elsewhere, which will make the recession longer and more painful, putting more jobs at risk.

The challenge today is to provide certainty against a background of a sharply deteriorating global economy. The IMF, which in October was forecasting world growth this year of 3 per cent., is now forecasting growth this year of close to zero. In the last quarter of last year, the world economy shrank for the first time since 1945, with Japan, America, Germany and Europe, as well as the UK, all now in recession. All that followed from the sudden collapse in confidence when Lehman Brothers—the world’s fourth biggest investment bank—went bankrupt in the autumn. That has meant even weaker banks, which are lending less, and in turn leading to further economic weakness. So getting the banks to lend again is essential to our economic recovery and to our fight against the global economic—financial—recession.

In October, we injected additional capital into the banking system to prevent the collapse of banks and to maintain their ability to lend to companies and home buyers. We had to act quickly—in a matter of hours, not months. We made available then up to £50 billion initially, of which £37 billion was taken up. I have always said that we stand ready to do whatever it takes to maintain financial stability. So, as well as additional contingent capital, today I am making a further allocation of £13 billion for RBS in return for non-voting shares. These shares will be purchased at a similar price to those purchased in October, and they in turn will pay a preference coupon.

The Government are currently set to own up to 70 per cent. of RBS, for which the taxpayer will benefit when the bank recovers and strengthens in value. We believe it is important that there remains some private ownership in RBS—by pension funds and individual investors, for example. We have therefore decided that in injecting this capital, we will do so by purchasing non-voting shares, in line with practice in other countries. That means that the Government could now own up to 84 per cent. of RBS in economic terms, but the institution will remain as a privately quoted company. That will provide potential gains in the long term for the taxpayer and an easier return to full commercial ownership when the shares are sold and the proceeds come back to the taxpayer.

In January, we announced the creation of a scheme to identify losses and clean up the banks’ balance sheets, giving them the confidence to lend again. A range of different mechanisms have been suggested to do that, but in the end they all require the same basic approach: first, a thorough analysis of the banks’ balance sheets to establish what their assets and loans are worth and whether they are likely to be fully repaid; and secondly, a comprehensive stress test of whether the banks are strong enough to survive bad economic scenarios and establish what further losses the banks can bear, to satisfy us that the banks have enough capital to get through the recession and to keep lending going. Thirdly, it enables the Government to judge the necessary scale of their intervention, either by buying up the assets or insuring them, in return for a fee or a share of future gains.

That is the approach that we will follow in the asset protection scheme that I announced in January. In arriving at the design of the scheme, we have taken account of the experience of other countries which in recent months have announced similar action: including the Swiss, with UBS; the Dutch, with ING; and the United States, with Citigroup and Bank of America. The scheme is open to all eligible banks and building societies, and I expect a number of them to apply to use it according to this approach. Lloyds Banking Group has today confirmed that it is in discussions with the Treasury regarding participation in the scheme.

In relation to RBS, which has announced its results today, let me set out how the asset protection scheme will be applied. When the Government purchased their stake in December, a new management team was put in place, and it has been going through the books, identifying potential losses. As the House will understand, that cannot be done quickly, because the assets are both complex and numerous. As we have seen only recently in the case of the United States, the valuation of these balance sheets takes considerable time, and all the more so if it is done against a background of sharply deteriorating global conditions.

Today, the chief executive of RBS announced a plan to restructure and rebuild the bank, including an agreement to extend its lending in the UK. To complement that, RBS will include £325 billion-worth of assets in the asset protection scheme. That will include a range of assets in the UK and abroad, most of them including mortgages and business loans that are currently hard to value. The Treasury, with the help of external advisers, has assessed the assets held by RBS and subjected its balance sheet to a series of different stress tests overseen by the Financial Services Authority and the Bank of England—a practice that the United States Government yesterday announced they will apply to institutions seeking support.

To protect the taxpayer, RBS will have to bear the first portion of any additional losses over the coming years, up to a total loss of 6 per cent., or some £20 billion, on top of the £22 billion of impairment and write-downs that it has already taken. As in any insurance scheme, RBS will have to bear the first losses. After that, the Government will cover up to 90 per cent. of any further losses. RBS will also pay a fee of 2 per cent. of the value of the assets insured—some £6.5 billion—again, as in any insurance scheme. It has also agreed for a number of years not to claim certain UK tax losses and allowances, meaning that when it does return to profitability it will not be able to benefit from the losses accrued in the intervening period.

In return for this, RBS has agreed to maintain and increase its lending for mortgages and businesses in 2009 by an additional £25 billion, with a further £25 billion in 2010 depending on market conditions. That is at the heart of the deal that we are striking with RBS. That new lending will be on top of maintaining lending on mortgages and other loans of just under £300 billion in the UK. These lending commitments with be legally enforceable and externally audited, and the Treasury will report annually on RBS’s delivery of its lending agreement. RBS has agreed to continue treating its customers fairly, including by participating in the Government’s home owner mortgage support scheme. That will go hand in hand with the tough conditions on RBS bonuses that we announced last week.

Together, these measures will help restructure and rebuild RBS, making one of the UK’s biggest banks also a stronger bank, better able to serve the people and businesses of this country, returning to tried and tested principles of banking. Other participating banks that join the scheme will have to agree to make more lending available, and banks will also have to review their policies on pay and bonuses to come up with long-term strategies that prevent excessive risk taking and reward successes, in line with the FSA’s new code of remuneration practice.

As with previous measures, the capital support for the banks is an investment that will eventually be sold to the benefit of taxpayers. With the insurance scheme, the eventual cost to the taxpayer over the lifetime of the scheme will depend on economic conditions and how the assets are managed. That means taking that risk on to the taxpayer for a fee, but in a way that ensures that the banks remain able to lend. That strategy for tackling the bad assets has worked elsewhere in the past. So while the taxpayer does face risks as a result, the cost of doing nothing is far greater. In the long term, the taxpayer will benefit from returning our stake in these banks to full commercial operation because, as I have said before, I am clear that British banks are best owned and managed commercially, and not by the Government.

The future of the UK as a financial centre, and the future of our economy and thousands of jobs, depend on being able to run banks commercially. All countries are having to deal with the same problem: how to isolate assets that are damaging confidence in the banking sector and preventing banks from lending more. Over the coming weeks, we will continue to discuss with other countries, including the new US Administration and with the European Union, how best to co-ordinate our approach to the common challenges we face. As part of our presidency of the G20, I have written to Finance Ministers setting out a set of principles for dealing with asset protection and insurance.

It is essential to restore confidence in the banks to allow them to clean up and rebuild, and get lending going again. The economic recovery, and thousands of jobs, depend on it, and I commend this statement to the House.

I thank the Chancellor for his statement, but to be blunt, we have heard all these claims before. Back in October, just like today, he told us that a huge taxpayer bail-out of the banks would “get lending started again”. He stood there waving a piece of paper, just as he has again today, and claimed that he had binding legal agreements with RBS, yet of course business lending has fallen by £5 billion since October and, as the inflation report shows, continues to fall.

Back in October, just like today, the Chancellor said that his first bail-out was a good deal for the taxpayer. Indeed, the Prime Minister claimed that we would soon be making money on the shares that we had bought. But now we all know that the taxpayer has lost £16 billion to date on the deal that was done in October. Back in October, just like today, the Chancellor said that a key condition of the bail-out would be an end to excessive bonuses and rewards for failure, yet today we discover that the chief executive who helped to bring RBS to its knees is getting a £650,000 a year pension for life, negotiated with the Government. While a second bail-out seems inevitable, we will therefore treat the Chancellor’s claims about his latest plans with a healthy degree of scepticism.

Let me ask the Chancellor these specific questions. First, on lending, he says that RBS has committed to lend £25 billion a year. Will he confirm that that represents just 3.4 per cent. of total RBS lending to non-bank customers? He said once again, as he often has, that he has a legally binding agreement, but the new chief executive of RBS said on the radio this morning that that agreement is subject to its continuing to price on arm’s length terms. Given that that price is currently prohibitive to many businesses large and small, why does he expect this legally binding agreement to be any more binding than the last one? Indeed, he says that the lending agreement is legally enforceable. How exactly is he going to enforce it? Will he give RBS the money to pay the fine when he enforces the agreement?

My second set of questions ask the Chancellor to be absolutely straight with people about how much the taxpayer could lose. Of course, this is a sweet deal for the banks, their management, the remaining shareholders and above all their creditors. The first loss to be borne by the bank is just 6 per cent. That is much lower than the 10 per cent. that the Treasury was initially briefing and the 10 per cent. that the Dutch authorities have imposed on ING. The fee is just 2 per cent.—half the level that the Treasury set out to try to negotiate—and it is being paid only in non-voting shares. Will the Chancellor confirm that that is because otherwise, according to stock exchange rules, RBS would stop being listed altogether? What is more, we are giving the bank billions of pounds to pay the fee to ourselves. That is like saying, “Lend me a tenner and I’ll buy you a pint.”

Will the Chancellor now say exactly what the potential exposure of the taxpayer is under this deal? He did not answer that question on the radio, so will he answer it today? Will he now impose the full independent, asset by asset audit of the British banks that the Governor of the Bank of England has just called for in the Treasury Committee and that I called for at the Dispatch Box last month?

Finally, on excessive bonuses and rewards for failure, once again the Chancellor has promised there will be none. Yet this morning he said in his radio interview that he learned only a very short time ago that Sir Fred Goodwin was paid off with a £650,000 a year pension funded by the taxpayer. However, the new chief executive, who was on the same radio programme, said that the deal was negotiated with the Government. Who exactly in the Government knew about that deal? Will the Chancellor answer the claims that Fred Goodwin’s departure was delayed so that he could secure that pension? Whichever way one looks at it, that obscene pension is unacceptable and the Government are on the hook. Either they did know and failed to act or they did not know and failed to ask the right questions. It is a totally irresponsible use of taxpayers’ money. There is, of course, now only one person who can correct that huge error of judgment by the Chancellor, and that is Fred Goodwin himself, who should in all decency renounce his pension.

The Government have no option but to undertake a second enormous taxpayer bail-out of the banks, because the first enormous taxpayer bail-out has failed. Let us hear no more nonsense about what a good deal has been struck. The British taxpayer is insuring the car after it has crashed. The sad truth is that families throughout the country pay the price, while those responsible try to walk away from the wreck—so far, unscathed.

The Prime Minister who presided over the fiasco is off trotting on the world stage while the man he knighted, Fred Goodwin, is walking off with a £650,000 a year pension. That is why the Government have lost the confidence of the British people in their ability to deal with the recession that they helped create and the banking crisis that they failed to prevent. [Interruption.]

The Chief Secretary should just concentrate on her leadership campaign and stop barracking the Opposition.

The Government have announced so many different schemes, executed so many about-turns, made so many false claims and broken so many promises that no one believes a word they say any more. They are running around like headless chickens, trying to save their own necks. Once again, the British taxpayer will pay a huge bill for the mistakes of Labour’s age of irresponsibility.

First, once again, it is clear that, although the hon. Gentleman could not quite bring himself to say it, he agrees with what we are doing. Although he now tries to criticise what we did last October, at the time he expressed full agreement with it, because he recognised that our banks, along with those in other parts of the world, faced collapse, and that we had to step in to recapitalise them. We had to do it quickly—in a very short time. We did not have the luxury of months to go through the books and make decisions about what might happen further down the track; we had to take action quickly. At that time, the Opposition supported our actions, although they subsequently found it convenient to change their mind and walk away from that support.

On the agreement that we reached in October, we said that the banks in which we took major shareholdings—RBS and Lloyds TSB—would undertake to maintain the same level of lending as in the previous year. They have been able to do that, but against a background of a marked reduction of lending in this country, especially from foreign banks, which have either withdrawn to their own countries, or in the case of the Icelandic banks, for example, have got into such great difficulties that they cannot lend. In the last quarter of last year, there has also been a sharply deteriorating position in the economy.

We want—it is important—to get lending going again because, as I said earlier, if we do not fix the banking system, it will be difficult to fix the wider economy. It is a problem that we face, the Americans face, the Germans face, the Japanese face—it is a problem right across the world. That is why I said in January that we would have to do something about the problem of assets on bank balance sheets that people either could not value or had deteriorated in value because of what is happening in the economy. As a result of what we have been able to do, RBS will increase its lending by £25 billion this year and next year, on top of the £300 billion that it currently lends in this country.

I believe that the insurance rates are appropriate. It is also right to put in the additional capital to help the bank get through the recession. Nobody wants to be in that position—no Government wants to be in that position—but, throughout the world, we must all face up to the fact that banks need additional capital and that we need to ensure that they have a proper insurance scheme to enable them to continue lending.

The hon. Gentleman asked about audit. I said in my statement that there needs to be a thorough audit of banks that come into the scheme. I am aware of what the Governor of the Bank of England said this morning—I have heard him say it on previous occasions. I agree that, especially when insurance is involved, there needs to be a rigorous audit, not only so that banks understand the position, but so that we do, too.

The hon. Gentleman mentioned the remuneration of Fred Goodwin. It is beyond doubt that most people find it hard to understand, given what has happened to RBS, that such an enormous pension can be paid from the age of 50. Let me explain the position. First, the agreement was not negotiated by the Government; nor was it approved by the Government. Nor would it have been—[Interruption.]

The agreement on remuneration—the pension arrangements—of employees of a bank is a matter between the employee and the board of directors. Last autumn, we were told that there was a contractual agreement between the bank’s board and Sir Fred. We previously understood that his pension arrangements were an unavoidable commitment, but we did not know—we became aware of it only very recently—that the decision of the previous board of RBS to allow Sir Fred to take early retirement had the effect of increasing his pension entitlement, and that that might have been a discretionary choice. We did not know that and, on finding out—[Hon. Members: “When?”] Last week, actually. It became clear that the matter may have been a discretionary choice. When we found out, I asked United Kingdom Financial Investments, which holds the shares, to discuss with the new board of the bank whether there was any scope for clawing back some or all the pension entitlement, and whether the board made the decision in full knowledge of the facts. That investigation is going on at the moment. As I said, and I agree with the hon. Gentleman, the matter could be concluded swiftly, because Sir Fred Goodwin could decide not to take the pension—that has been put to him—but the ball remains in his court.

I believe that the measures that we have taken on RBS and the asset protection scheme are necessary and unavoidable. It is an essential part of what we must do and what other countries must do if we are not only to fix the banking system but, more importantly, to ensure that we can rebuild our economy and help people and businesses in this country.

In October, we broadly supported the Government because we thought that that was the right patriotic response in an emergency and because their proposals for bank recapitalisation were sensible. However, I am afraid that they have now almost completely lost the plot. The proposal for asset protection is a disgrace and a betrayal of the taxpayer’s interests. It is a classic case of privatising profits and socialising loss.

We know from American experience that valuing bad assets is hideously difficult. We also know that the banks know more about their bad assets than the Government, so there is now an open invitation to the banks to dump their worst assets on the Treasury, for a fixed fee, knowing that the taxpayer will pick up 90 per cent. of the losses. That is a fraud at the taxpayer’s expense.

There is a much better approach—the way in which the Government started dealing with the problem. It is to acquire shares in the banks—ordinary shares with full voting rights. That guarantees that any upside in recovery—if there is one—and any eventual sale fully accrues to the taxpayer. It also gives the Government full effective control over banks’ lending strategy and remuneration, instead of the current feeble agreements, which the banks have treated with contempt.

We know what the Government are afraid of: being accused of nationalisation. Let me quote what the Government’s old friend—the Prime Minister’s hero—Mr. Alan Greenspan said about that only last week. That American Republican free-market ideologue stated:

“It may be necessary to temporarily nationalise some banks in order to facilitate a swift and orderly restructuring”


“allow the Government to transfer toxic assets to a bad bank without the problem of how to price them”—

the problem we have today.


he said to the Government,

“should not get caught up on a word”—

that is, nationalisation. He continued:

“It doesn’t matter what you call it, but we can’t keep on funding these zombie banks without gaining public control.”

The problem is that we have not only zombie banks, but a zombie Government: the walking dead, controlled by people who have a strong vested interest in protecting their bonus arrangements and covering up large-scale tax avoidance scams.

The Government claim credit for being tough and stamping on the generous bonus arrangements of RBS and NatWest. I totally agree with the Conservative shadow spokesman about Sir Fred Goodwin.

He was absolutely right. He could also have asked—I will ask—how much in addition the Government have given in tax relief to Sir Fred Goodwin and people in his position.

However, there is a wider point about bonuses: they are public expenditure. These bonuses are a massive spending increase on public wages for which there is no justification whatever. What response will the Chancellor give this morning to Barclays, which has said that it will not deal with the Government unless all its bonus arrangements are fully protected? That is blackmail and he should make it absolutely clear that he will stand up to it.

I have one final question about what the Prime Minister said in the paper on Sunday about the proposal, which a growing number of people on all sides accept, that in the long term the low-risk high street lending activities of the banks have to be separated from the high-risk casino-type activities with which they have been associated. The Prime Minister seems to have capitulated to pressure to abandon that proposal altogether. I can understand why the banks want to hang on to the operations that generate their bonuses, but why on earth should the Government be giving a long-term guarantee for gambling activities on a global scale? It is incomprehensible and completely without justification.

I feel rather sad about this response, because I normally try to be constructive, but the Government’s proposal is absolutely dire.

On the last point that the hon. Gentleman made, there has been a lot of debate about whether banks should be separated, so that they organise themselves along the lines of what that they had in America for many years, with what he calls low-risk retail banks and, on the other hand, investment banks. I would just remind him that the first bank that got into trouble in this country was not an investment bank but Northern Rock, which is a retail bank. The problems have been experienced both by banks with complex models, and by investment banks pure and simple—indeed, many have now collapsed—and retail banks. The regulatory system should distinguish between the two. Perhaps on another occasion there will be an opportunity to discuss what we need to do on supervision and regulation.

In relation to the hon. Gentleman’s broader point, about nationalisation—the one on which he takes fundamental issue with the Government—I just disagree with him. We have, as it happens, nationalised a bank already: Northern Rock. However, I have always made it clear that our long-term objective is to get that bank and the banks in which we have shareholdings operating back into the private sector. That is something with which the Liberal party and he agree. I therefore do not believe that it is in our interests to completely squeeze out the remaining part of the private shareholdings in RBS, which is what nationalisation would entail. Also, as we have 70 per cent. of the votes there, it is beyond doubt that we control the bank. It is not as though it could block a decision that we really insisted upon.

It is important to strike the right balance. Even in these times, we need to look at the long-term destination of those banks. It is right that we should strike that balance, as I said earlier this morning. I just think that the hon. Gentleman is plain wrong in what he said about that.

Is the Chancellor aware that we all recognise that the reason why today’s measure has been announced, as well as the previous one, is to ensure the bank deposits of the vast majority of people in Britain? However, it is becoming increasingly apparent with every statement that those in the banking fraternity have, by and large, been on a winner for a long time. They are no different, really, from Nick Leeson, and that fellow Madoff in America who made off with the money. I have a novel suggestion for the enemy within. Instead of paying out vast executive bonuses and Freddie Goodwin’s massive £650,000 pension, why not tell them that those of us on the Labour Benches will gladly walk through the Lobby to ensure that all those executive bonuses and that pension fund for Freddie Goodwin and his mate will be paid for out of the toxic debt when it has been repaid, which will be never? That is the proposal that we ought to put to those bankers and we should treat them with the contempt that they deserve.

I agree with my hon. Friend that it is essential that we change the culture that has been prevalent in so many financial institutions and that bonuses be tied to the long-term performance of a company and paid for some special effort or as part of a reward for working hard to ensure the long-term health of the bank. I also agree with him that the reason for the action that we have taken is to protect depositors and ensure that we do everything that we can do to get lending going again in this country.

Will the Chancellor confirm that the full details of Sir Fred Goodwin’s pension were set out in RBS’s 2007 annual report? If he is really telling the House that he spent £20 billion of our money four months ago and has only just checked out the details of the chief executive’s entitlements, he is even more hopeless and hapless than we thought he was.

Bank lending in Erewash is, as it is everywhere else, pretty variable and constrained by the current climate of uncertainty. The freeing up to lend initiative that was announced this morning has the prospect of helping some of the businesses and the families in my constituency, but can my right hon. Friend give some more detail about how it will be monitored locally, so that RBS does what we are asking it to do?

As I have said, we will be publishing an annual report. Into how much detail and how local it can go remains to be seen but, in addition, it is important that we regularly monitor lending to ensure that it starts flowing through to individuals and businesses.

Can the Chancellor tell the House what assumptions about the state of the economy and the performance of the assets at RBS were used in arriving at the level of the fee, or did he just pluck it out of the air?

No, the fee was calculated taking into account RBS’s position and the assets that were put forward. We will approach the other banks in exactly the same way.

I welcome my right hon. Friend’s statement. It is clear that large public holdings in the banks are beginning to drive major and essential structural change. However, as banking is a global business, does he agree that the restructuring that is starting to take place and the redrafting of the regulatory system need to be globally co-ordinated and if so, how will we help to achieve that?

I agree with my hon. Friend on that. We need to do what is necessary in both restructuring and financing, but we also need to ensure that the regulatory and supervisory framework is effective. However, that only gets us so far, because most banks trade across borders throughout world. It is also necessary to ensure the same approach in different countries, which is why I said in my statement that we need to work with the Americans and in Europe. That will be very much part of the focus of the meeting of the G20 Finance Ministers in a couple of weeks here in London.

If the amount that the Chancellor has said that RBS must lose before his guarantee kicks in is correct, then, if I were still doing the job that I was doing 12 years ago in group risk management in RBS—[Hon. Members: “Ah!”] It would not have happened on my watch. On the basis of traditional banking practices, I would be urging the bank to build up reserves rather than engage in additional lending. Why would I be wrong?

First, I will happily pass on the hon. Gentleman’s name to the new chief executive of the bank and see whether he can re-employ him. Secondly, and rather more seriously—[Interruption.] I am glad that the right hon. Member for West Derbyshire (Mr. McLoughlin) is thinking of the health of RBS. In relation to the hon. Gentleman’s general point, the Government have to intervene and make it possible for there to be more lending precisely because, if left to their own devices, banks stop lending to individuals and businesses, and that would simply make the present difficult situation far more difficult. That is why my argument is that doing nothing not only does not work, but is damaging to our future prospects.

I share concerns about socialising losses and privatising gains, but whatever means are used to back the banks and private financial institutions with public money, I think everybody is agreed that it is necessary. Given that situation, my question is: why are the Government still relying on commercial loans to secure investment in public-sector infrastructure projects and public services such as the Royal Mail? Should we not cut out the middle man?

On PFI projects, I hope that we will shortly be able to publish proposals that will take account of the difficulties about funding that my hon. Friend referred to. On her more general point, I believe that a combination of the public and private sectors working together, whether it be for the provision of finance or elsewhere, is a good thing. That applies to the Royal Mail, too, as it needs more money to help it modernise and improve. That is why I think that bringing in private capital to work alongside the public sector is a good thing.

I guess that the banking crisis and the recession are the most important issues facing the country and Parliament today. I do not know whether the Chancellor noticed while he was making his statement that there were only about a dozen Government Back Benchers behind him and three times that number on these Opposition Benches for a party half the size. To what does he ascribe that? Does he think that it is because Government supporters are not interested or are idle, or does he think that Government Back Benchers have, like the rest of the country, lost confidence in him and his Government?

The hon. Gentleman is right to say that the banking problem is the most important that we face at the moment, so I am surprised that he did not want to ask a question about it.

I welcome my right hon. Friend’s statement. In addition to the commercial and residential property loans that are among the eligible assets for the scheme, the Treasury statement of this morning also mentioned structured credit assets, which are the ones that have proved very difficult for the banks. Who exactly in the Treasury or among the Chancellor’s advisers will be doing the due diligence on this and roughly what proportion of those assets does he expect to make up the scheme?

The diligence examination of the assets was carried out by the same people in respect of all the assets. It was not done by the Treasury alone, as we brought in outside advisers so that we could be satisfied as to what was being offered for insurance and then take a view on what price would be appropriate.

I agree with the Chancellor that fear of the toxic assets was the main inhibitor to securing confidence in lending and I give a cautious welcome to the asset protection scheme. As to RBS, however, it will fund its insurance by taking the first losses, 10 per cent. of subsequent losses, a 2 per cent. fee and, most significantly, deferred tax assets. If any other eligible banks wish to take part in this, will they be subject to the same payment terms, the same deferred tax assets and the same attachment point, and will it be done on a bank-by-bank basis?

The answer is that we will look at each bank on its merits. We do so because what is offered for insurance will vary from bank to bank and we will have to make an assessment of the position of the individual bank. In the meantime, I welcome the hon. Gentleman’s general support for our proposals and his agreement that this is the right thing to do.

Does the Chancellor understand that many ordinary people are bewildered and dismayed that, across the Atlantic, there are obligations to fiduciary duties, compliance and due diligence, which are backed up by the sanction of the criminal law, yet there is an absence here of such obligations. Unless or until financial institutions, managers and directors know that they could face the law, we will continue to see this recklessness and selfishness enduring. Will my right hon. Friend tell the House that Lloyds TSB and the RBS group are fully co-operating with the United States Justice Department in respect of the documents that were doctored in London in order to get round US sanctions on money for Iran, as the conduits were the RBS group, Amro and Lloyds TSB?

I hope that any institution in this country would co-operate with the relevant authorities, whether it be in the United States or anywhere else. On my hon. Friend’s more general point, it is important that people obey the law, irrespective of their area of work, and that has to be enforced by authorities that are independent of the Government.

I am deeply concerned about the hundreds of thousands and perhaps millions of people in this country and abroad who have lost or are losing their jobs. We have to get the banks lending again to ensure that our economy can grow so that unemployment will not be as high as we perhaps fear. Does the Chancellor believe that the money put aside for Sir Fred Goodwin to enable him at the age of 50 to have an annual pension of £650,000 will give people the confidence—it is confidence that is lacking in this country and elsewhere at the moment—that we can come out of the recession? Will he give an assurance that that pension will be stopped because it is being funded by taxpayers’ money?

I said earlier that the board and UKFI on behalf of the Government are pursuing that matter. On the hon. Gentleman’s first point, like him, I have the greatest concern for people at risk of losing their jobs; that is why we have put in place measures to help people back to work. For many years I listened to the hon. Gentleman when he sat on the Government side, so I know that he was consistent—unlike some of those sitting around him—throughout the ’80s and ’90s in expressing his concern. I share it and I welcome his support for the measures that we are taking to help people back to work.

Staying with Sir Fred’s grotesque pension, why does the Chancellor think that the new chief executive of RBS stated clearly on the “Today” programme this morning that his predecessor’s leaving arrangements were fixed between the old board and the Government? Was he deliberately misleading listeners or was he pointing out that the Chancellor was responsible for this grotesque pension and knew about it more than a week ago?

As I said, the pension arrangements were agreed between the previous board and Sir Fred Goodwin. That remains the position.

The long-term effectiveness of the Chancellor’s measures is predicated on growth resuming in the British economy, but his statement referred to the International Monetary Fund’s dire assessment of when growth is likely to return. Will the Chancellor confirm whether he still stands by his pre-Budget report, which said that growth would resume in the British economy in three months’ time?

I said at the time of the pre-Budget report that we would set out our next set of forecasts at the time of the Budget. We will do that. The IMF figure that I mentioned related to its forecasts for the world economy. Since October, when I published my forecasts—they were broadly in line with those prevailing at that time—there has of course been a very sharp downturn in economies here and across the world. The latest IMF world forecast reflects that.

We have just heard announced today, so far as I am aware, the largest commitment by any Government of this country at any time in history to an individual entity. The material provided with this information, as so often with this Government, is woefully short of detail. Will the Chancellor confirm two individual aspects of the statement? First, what level of certainty has he reached with the Royal Bank of Scotland that its assets—the £325 billion-worth of assets that will go into this scheme—have been agreed with the Government? RBS has just concluded a conference call with investors, confirming that in its perspective the total quantum of assets of individual assets included in the scheme has not yet been finalised with the Government. Secondly, will he confirm whether any of those assets include non-performing assets? When will he provide detail on the level of the non-performing assets that the Government are prepared to take into this scheme?

I can perhaps help the hon. Gentleman on that: I hope very shortly to make further details available, and I will place them in the Libraries of both Houses. Inevitably, it will take time to finalise the detail and to hold some of the discussions that have to take place before an absolute, final agreement is reached, but I think that I was right to come to the House to indicate the general scheme that we are proposing, and the amounts involved.

Will RBS be able to throw back the losses that it announced today and reclaim previously paid corporation tax, which would result in billions of additional pounds of taxpayers’ money being invested in RBS?

Having announced this dismal package—a one-way bet that rewards failure on the part of individuals—will the Chancellor accept that this is the sort of pusillanimous leadership, shown in many countries in the 1930s, that led to the rise of extremism?

Even by the hon. Gentleman’s standards, that is a particularly silly remark. We are taking this action because it is necessary to do so. Indeed, even his own party’s Front Benchers have grudgingly admitted that. It simply is not possible to walk away from the problem—to wish it were not there and pretend that it had not happened. There is a problem, not just here but in other countries, and not just with RBS but with banks across the world. We need to do something about it; otherwise we will not get lending going again. If we do not get lending going again, the recession will be longer and more painful than would otherwise be the case. That is what the hon. Gentleman ought to reflect on.

Further to the Chancellor’s answer to my hon. Friend the Member for Ludlow (Mr. Dunne), is the Chancellor clear and satisfied that he has been made aware by RBS, sector by sector, of the scale of the loans advanced by RBS that are now underwater?

As I said in my statement and in answers to questions on it, the Treasury and its outside advisers have looked in some detail at the assets that RBS has offered and has asked to have insured. As I said to the House earlier, one of our difficulties is in trying to value such assets at a time when conditions are deteriorating. We are taking action against a background that is not static; it is moving all the time. We have made every effort to ensure that those assets have been properly looked at and properly valued.

Business of the House

12.22 pm

With permission, I should like to make a statement about the business for next week:

Monday 2 March—Conclusion of remaining stages of the Political Parties and Elections Bill.

Tuesday 3 March—Motion to approve the draft Prevention of Terrorism Act 2005 (Continuance in force of Sections 1 to 9) Order 2009, followed by remaining stages of the Corporation Tax Bill, followed by motions to nominate Members of regional Select Committees, followed by motions relating to the Committee on Members’ Allowances.

Wednesday 4 March—Consideration of an allocation of time motion, followed by all stages of the Northern Ireland Bill.

Thursday 5 March—General debate on supporting women and families through the downturn and building a strong and fair economy for the future.

Friday 6 March—Private Members’ Bills.

The provisional business for the week commencing 9 March will include:

Monday 9 March—Estimates (2nd allocated day). There will be a debate on the work of the Department for Business, Enterprise and Regulatory Reform in the current economic situation, followed by a debate on railways. Details will be given in the Official Report.

[The details are as follows: Delivering a sustainable railway: a 30-year strategy for the railways? (10th Report of Session 2007-08 from the Transport Committee, HC 219; Government response—eighth special report, HC 1105); and Departmental Annual Report and scrutiny of the Department for Business Enterprise and Regulatory Reform (14th report from the Business and Enterprise Committee, HC 1116; and Government response Cm 7559) and further Oral Evidence of 16 December, 14 January and 23 February.]

At 10 pm the House will be asked to agree all outstanding estimates.

Tuesday 10 March—Opposition Day (7th allocated day). There will be a debate on an Opposition motion, subject to be announced, followed by proceedings on the Consolidated Fund (Appropriation) Bill.

Wednesday 11 March—Remaining stages of the Business Rate Supplements Bill, followed by a motion to consider the Penalties for Disorderly Behaviour (Amount of Penalty) (Amendment) Order 2009.

Thursday 12 March—If necessary, consideration of Lords amendments, followed by a motion to take account of the outstanding reports of the Public Accounts Committee to which the Government have replied. Details will be given in the Official Report.

[The details are as follows: the 30th, the 36th, the 39th to the 41st, the 43rd to the 49th and the 51st and the 57th Reports of the Committee of Public Accounts of Session 2007-08, and of the Treasury Minutes on these Reports (Cm 7493, 7522 and 7545).]

Friday 13 March—Private Members’ Bills.

I thank the Leader of the House for giving us the forthcoming business. May I, through her, thank the Prime Minister, and indeed all Members of the House, for their sympathy and the generosity of spirit that they showed yesterday to my right hon. Friend the Leader of the Opposition, following the death of his son? In that spirit, I hope that the right hon. and learned Lady will today allow me to suspend the usual differences that we express each week across the Dispatch Box. This week, we will keep it very straightforward.

We welcome the debate that is to take place on Monday 9 March, which will allow us to discuss the accountability of Ministers in the Lords to this House. I have raised the issue before, and I am grateful to the Select Committee that is giving over its estimates day so that we can discuss that very important issue.

Yesterday, it was reported that Alma Harding, a 65-year-old retired postmistress, had been given a criminal record for clipping an offensive and rowdy teenager round the head with the papers from her parish council meeting. Many people have first-hand experience of the random, passing abuse that can be dished out by unruly children, and the corrosive impact that it can have on communities, and they will be angry and astonished that the case made it to court at all. May we have a debate on fairness in the policing and legal system, so that the House has an opportunity to make its own judgment on what we think its priorities should be—and then make proper law that fits our view?

May we also have a debate on teenage pregnancy? Today’s statistics are a depressing reminder that the case of 13-year-old Alfie Patten, whose example should concern us all, is not an isolated incident. We are obviously failing our children when they are raising children themselves. Is it not right that people should be taught about right and wrong, and that bringing up a child carries with it enormous responsibilities?

Earlier this week, there were rather confusing briefings in the press about whether the Government were about to tear up their commitments on equalities legislation and on expanding maternity leave. I know that the right hon. and learned Lady takes a keen interest in those matters, so may I invite her to offer the House a statement to clarify the Government’s position, and to announce any imminent changes that are intended?

May we also have a debate on the plight of businesses in our British ports and harbours? Hon. Members will be aware of the Valuation Office Agency’s plans to levy retrospective charges for business rates on about 700 companies operating in British ports, and the devastating impact that that will have at a time of deep recession. That is a cross-party issue, and many Labour Members have been particularly active in trying to prevent the widespread redundancies that will inevitably follow from that punitive tax. It is surely in everyone’s interests to debate the issue properly, and to make the point that imposing such retrospective detriment is unfair and unprincipled.

Finally, and particularly in light of the statement that we have just heard, may I once again call for a full and thorough debate on the economy in Government time? It has been yet another week of dire economic news. The scale of the problem is beginning to beggar belief. There has been a change of policy on Northern Rock, without any explanation of where the £12 billion-worth of new lending will come from. There are reports that the taxpayer will be underwriting debts to the tune of over a quarter of a trillion pounds; we have just heard some further details of that. There was also an announcement by RBS of the biggest losses in corporate history in this country. In the week when we learned that the Government are once again printing money, is it not apparent that there is a real national need to debate the crisis properly on the Floor of the House?

I agree with the hon. Gentleman’s comments on the way in which Prime Minister’s Question Time was handled yesterday and the suspension of questions. I think that all Members appreciated the opportunity to show their sympathy and support for the Leader of the Opposition and his family.

The hon. Gentleman asked about the case of Alma Harding. We have all seen press reports. I remind the hon. Gentleman that although we set the law in this House, our constitution requires the law to be applied by the courts and prosecutions to be undertaken independently by the Crown Prosecution Service. I am sure that neither the hon. Gentleman nor the Opposition as a whole would want us, as elected Members, to substitute our judgment—[Interruption.] Would hon. Members allow me to finish the point? We must not substitute our judgment for the independent decision-making process in the Crown Prosecution Service.

Although the court saw fit to give Mrs. Harding an absolute discharge, according to press reports, it did not take the option that it could have taken and require the CPS to pay her costs. Let me simply say that it is important that we all recognise that we cannot substitute our judgment for that of magistrates and justices of the peace. They hear the evidence, they must decide on the penalty, and they must decide the question of guilt or innocence. That is the appropriate position, and I do not think that the hon. Gentleman should try to make this House a substitute for a court of law.

We are all anxious to ensure that unwanted, unplanned teenage pregnancies are reduced to as low a level as possible. That is why, in 1999, we introduced a reduction target. Over the 10 years that the strategy has been in effect, there has been a 10 per cent. drop in the rate of teenage pregnancy. I think that, given that no progress was made in the preceding two decades, this has been a decade of welcome progress. However, as the hon. Gentleman rightly recognised, that progress has been uneven around the country. According to a report published today by the Office for National Statistics, local authorities that employ a focused strategy involving everyone working together have made considerable progress, while others have lagged behind. That is why the rate of progress has dipped and now requires further momentum.

Let me give two examples, from the hon. Gentleman’s constituency and mine. In Rutland, there has been a 7 per cent. increase in the teenage pregnancy rate over the past 10 years. I suggest that the hon. Gentleman works with all the authorities in his constituency—health authorities, local authorities and schools—to back up the strategy that he clearly supports. In the London borough of Southwark, which I represent, there has been a 12 per cent. reduction in the—yes, much too high—rate of teenage pregnancy. We must do what we can in all parts of the country, which means giving information to parents on how to talk to their children about these issues, ensuring that there is good sex education in schools, and ensuring that there is good advice on, and accessibility to, contraception.

The hon. Gentleman asked about the equality legislation, and about maternity pay and leave. As I have said, there will be a debate next week on supporting women and families through the downturn, which will give Members an opportunity to speak and hear more about the role of equality legislation in ensuring fairness and equality for women in the world of work. We will press forward with that legislation.

I remind the hon. Gentleman that, since 1997, we have increased maternity leave from 40 to 52 weeks. We do not regard that as a burden on business; we regard it as support for families. We have doubled maternity pay from £55 to £117 a week. We do not regard that as a drain on the public purse or a burden on the taxpayer; we regard it as good support for families. Any further measures will be a subject for the Budget, which will be announced on 22 April.

The hon. Gentleman asked for a further debate on the economy. He will have heard me announce that there would be an estimates day debate on the Department for Business, Enterprise and Regulatory Reform in the current economic situation, which will give Members an opportunity to raise issues of concern such as lending to small businesses, securing jobs, helping those who do face redundancy, and ensuring that we do all that we can to support the housing market.

The hon. Gentleman asked about port rates. As he will know, a statutory instrument allows businesses more time to pay backdated obligations.

I have been contacted by about 25 constituents over the past few weeks about the Autism Bill, and have met a number of them to discuss the Bill and the problems of autism. I have heard some heartrending stories about the difficulties experienced, by adults in particular, in gaining access to services and support. My constituents want those services and support, along with proper planning of services, to meet the needs of children and especially adults with autism.

A report on the website of the National Autistic Society, which I looked at this morning, states that the society is celebrating a “victory” and that the measures announced by the Government this week

“directly respond to the Bill”.

A spokesman for the society says

“we have achieved our major political goals.”

I am not entirely sure what the Bill will achieve that has not already been achieved. Will my right hon. and learned Friend confirm the Government’s absolute commitment to delivering those improvements and to seeing them through to the end?

I can confirm that the measures taken in the autism strategy go further than those proposed in the Bill. I pay tribute to the National Autistic Society for its proposals. We are developing the strategy and consulting on it. We undertake to go as far as we possibly can and to work closely with the society.

In response to the comments of the hon. Member for Rutland and Melton (Alan Duncan) about yesterday’s events, let me simply say that I felt that the Prime Minister, the right hon. Member for Richmond, Yorks (Mr. Hague) and my hon. Friend the Member for Twickenham (Dr. Cable) expressed the House’s sentiments very well. Any further words on the subject from me would be superfluous.

We have just heard a very important statement by the Chancellor of the Exchequer on economic affairs. At the same time, the Treasury Committee was hearing evidence from the Governor of the Bank of England. May I suggest to the Leader of the House that that was not good timing and not the best use of the House’s time? Of course the statement was important and of course it needed to be made today, but the order of statements prevented Members—including the Chairman of the Treasury Committee—from being present in the Chamber to hear the statement. That strikes me as unfortunate; perhaps the Leader of the House will look into it.

While I am talking about financial affairs, I note that 9 March is to be an estimates day. Of course, the one subject that we will not debate on that day is that of the estimates that we will be asked to agree at the end of the session. On 10 March, we are to have what are misleadingly described as “proceedings on the Consolidated Fund (Appropriation) Bill”. Precisely what we will not have are proceedings on that Bill, because under Standing Order No. 56 we cannot debate, amend or even vote on it. That, in my view, underlines the failure of the House to undertake properly its scrutiny role in relation to expenditure. We have escalating spending, escalating debt and an escalating contingent liability. Never has so much been spent by a Government with so little scrutiny. There is an urgent need for us to reform our scrutiny of expenditure, as well as the tax arrangements, in the current Parliament.

Experience shows that sadly, during a recession there is normally a concomitant increase in crimes such as burglary and theft. May we have a debate on police numbers? The Home Secretary has said that the overall number of police in the country has risen marginally, and she is correct. However, earlier this week, the chief constable of Gloucestershire said that in 19 police forces officer numbers had fallen. My own force area, Avon and Somerset, has lost 73 officers in the past year.

When I was chairman of Avon and Somerset police authority, under a Conservative Home Secretary, I asked for more officers every year and was told that we could not have them. Since then we have seen an increase, but now we are seeing a decrease at exactly the time when we need officers on the beat.

Lastly, may we have a debate on whether it can ever be justified to have a pension of £650,000 a year—three and a half times the Prime Minister’s annual salary, 30 times the salary of the people in the call centres and the telling staff who are being sacked this week from the same organisation, and 140 times the basic state pension? When a public company is involved, can that level of expenditure ever be justified—or is it, as I suspect, corporate theft?

We had to bring the statement to the House as soon as we could. The Treasury Committee was undertaking an important inquiry at the same time, so its members could not be present in the Chamber. That is unfortunate, but it was not readily avoidable. However, I take this opportunity to say that that Treasury Committee inquiry shows the Select Committee system at its best, doing a very important job on behalf of the public interest, and I pay tribute to its Chairman and all its members. We await their report with interest. They are performing an important public and parliamentary service.

The hon. Gentleman thinks that we could scrutinise the spending of Departments better. Perhaps he, the shadow Leader of the House and I should meet to discuss whether we can find agreement on a way to improve the processes. I think that he has a point, but I am not quite sure what the solution to it is.

There has been, on average, a 16 per cent. increase in resources to police authorities, so I am unclear how there could be a cut in police numbers in the hon. Gentleman’s area. There has been a debate on law and order this week, in which I know those issues were widely aired.

Finally, the hon. Gentleman asked whether the pension he mentioned can be justified. I can answer that by saying no, it cannot be justified to have a pension from the age of 50 of £650,000 a year, especially if there is any question of its being financed at public expense.

May we have an opportunity to debate the location of the medical examination centres for benefit claimants used by the Department for Work and Pensions? From a written answer from the Department, I have learned that more than 3,300 individuals from the Milton Keynes postcodes were asked to go for medical examinations in 2008, and forced to travel to either Aylesbury or Luton, both of which are extremely difficult to get to from Milton Keynes by public transport. Obviously, such people often do not have their own transport, or cannot use it. May we have an urgent re-examination of the arrangements and relocation of medical centres, so they are near where the claimants are, instead of in some bizarre, historical, random location?

I shall draw this matter to the attention of my right hon. Friend the Secretary of State for Work and Pensions, and if my hon. Friend finds that the response is not satisfactory in relation to her constituents, she might think of seeking a Westminster Hall debate on the subject.

A great deal of consideration is given to how we deal with this matter. At the last business questions, I set out the approach in principle that I think that we should take. The solution I would propose involves the role of the Speaker, perhaps joining as a party to encourage the court to recognise that it needs to strike out its original judgment. I feel that we have a duty of care to our constituents: that is a duty in our code of conduct. We are accountable: we are accountable to our electors at general elections. We are not accountable to the courts, except in respect of the criminal law, contract law and employment law. The judgment on how we have responded to our constituents is not for the judiciary; it is for every single elector and our constituents.

May I echo the call of the hon. Member for Rutland and Melton (Alan Duncan) for a debate on fairness in policing, because we now have a situation in London where if someone happens to be a friend or associate of Boris Johnson, the chairman of our Metropolitan Police Authority, they are likely to get a phone call from him to discuss private conversations he has had, in his capacity as chairman of the authority, with chief officers who are involved in important investigations? That is an unsatisfactory situation. The Mayor has been admonished this week by an inquiry into that question, and the MPA will now have to consider setting up protocols to control the behaviour of the Mayor of London. The matter is worthy of debate on the Floor of the House, so may we have such a debate in the near future?

That is a subject on which my hon. Friend might seek a debate in Westminster Hall or on the Adjournment, because it could involve a number of other London Members. It is a very important constitutional principle that elected members leave the police to get on with their job. We provide the resources and the legal framework, but it is not for elected members to decide who or what the police should be investigating or to seek to interfere with the conduct of police inquiries. That is totally wrong.

May we have a debate on political correctness in the light of the excellent remarks made by the Secretary of State for Communities and Local Government earlier this week, and particularly in relation to schools? Despite the right hon. Lady’s speech, they are currently enjoying a lesbian, gay, bisexual, trans-history month, with schools performing “Romeo and Julian”. Does the Leader of the House agree that it is better for pupils to learn about “Romeo and Juliet” and Shakespeare than the politically correct “Romeo and Julian”, and does she also agree with her right hon. Friend on these matters?

I do not regard myself as a Shakespeare expert, but, as far as I can remember, in Shakespearean times boys would play girls and girls would play boys, and the whole point was trying to work out which was which. As to pressing forward on equality, there will be a debate next Thursday on new equality legislation, so that we can ensure that everybody in this country is treated with fairness and respect and is not subject to prejudice and discrimination—or, indeed, cheap shots from the hon. Gentleman.

Will the Leader of the House join me in welcoming the decision of Amazon, the online sales company, to withdraw the video game “Rapelay”, which, as she knows, allows players to simulate the stalking and raping of women? However, does she share my concern that it is still possible to offer for sale these kinds of degrading and deplorable video games? Also, when can we expect to have a debate on the aftermath of the Byron review, which the Prime Minister set up? Could we have that debate as soon as possible?

There are two issues on which I know the Home Affairs Committee, which my right hon. Friend chairs, has been doing important work: such video games and the violent and pornographic material they contain, and the accessibility of such material on the internet. I am aware that there is an early-day motion in my right hon. Friend’s name, which has attracted a number of signatures. We will be keeping the matter carefully under review and working closely with those in the industry, as well as the Internet Watch Foundation.

Will the Leader of the House say whether the Government plan to let the Autism Bill go into Committee—or do they plan to block it tomorrow?

The procedure will be dealt with in the usual way, but what autistic adults and families with autistic children are concerned about is the substance of the services they get and what financial support they can get. As far as the process is concerned, we are going ahead with the strategy and the consultation. We will just have to wait and see what happens when the Bill comes before the House.

Has the Leader of the House had an opportunity to look at my early-day motion 872?

[That this House does not approve of the Government's proposed authorisation of a contingent liability in excess of £250,000 associated with the Defence Training Review set out in the Departmental Minute laid before Parliament on 17 February 2009, for which there is no specific authority; notes that only two copies of the Minute have been provided to the House; further notes that the Minute and the reference to it in the Votes and Proceedings for 23 February 2009 provides no information on which the House can come to a considered view on the proposed liability; and requests the Government to refrain from incurring the liability until approval has been given by a resolution of the House consequent on a thorough examination by the Committee of Public Accounts and the relevant departmental select committee.]

Although it is headed “Contingent Liability on Defence Review Training Costs”, the EDM relates to the point raised by the hon. Member for Somerton and Frome (Mr. Heath) regarding how we deal with the authorisation of expenditure.

I discovered this week that there are things called unnumbered Command Papers, only two copies of which are supplied by the relevant Government Department to the House of Commons. One goes to the Library and the other goes to the Clerks Department; notionally, the latter is laid on the Table of the House. It seems that, in our ignorance, we nod through not just thousands but millions of pounds of authorised expenditure—a blank cheque for Departments—without any Member rumbling it. Apparently, it appears subsequently in the Journal of the House.

Will the Leader of the House consider how we can scrutinise this massive expenditure—it occurs some 30 or 40 times a year—so that Members of Parliament and the appropriate Committees can examine, probe and call to account the Ministers and Departments that bounce the expenditure through on a rubber-stamp basis?

There is no intention that anything involving public spending should be rubber-stamped. There is scrutiny by Select Committees and the Public Accounts Committee, and there is the scrutiny that follows the Budget. If my hon. Friend has any suggestions as to how we can more effectively scrutinise public expenditure—the point raised by the hon. Member for Somerton and Frome—we would certainly be prepared to discuss them. In the first instance, perhaps my hon. Friend the deputy Leader of the House could conduct a discussion, and if anybody wants to contribute to it, they can talk to him. None of us has any interest in anything other than making sure that every pound of taxpayers’ money is properly and effectively spent.

My constituency is home to the largest clinical unit dealing with anorexics and bulimics in the whole of the north of England, yet the supply of places there is still outstripped by demand. Given the answer that I recently received to a parliamentary question about the increase in the number of young women under the age of 16 suffering from eating disorders—the number has increased by 80 per cent. in the past 10 years—does the Leader of the House not feel that the time has come to have a debate on why there has been such a drastic increase in these figures and what more can be done to help?

I will draw the hon. Gentleman’s comments to the attention of my right hon. Friend the Secretary of State for Health, but it might also be appropriate for the hon. Gentleman to seek a debate in Westminster Hall on this issue. A number of other Members might like to join in that debate and to hear what the relevant Minister has to say.

David Taylor (North-West Leicestershire) (Lab/Co-op): The business statement has been going for 30 minutes, and in that time six or seven of our fellow citizens in the UK have suffered a stroke. Each year, some 150,000 people die from stroke, which is the third largest killer and the largest single reason for major disability in this country. At a conference in Leicester that I addressed on Monday, it was clear that the people there wanted the Government to return to a focus on the national stroke strategy, particularly in relation to so-called mini-strokes or transient ischaemic attacks. If treatment is provided within 24 hours for those at high risk, or within seven days for those at lower risk, it can reduce the risk of a recurrent, more major stroke by 80 per cent. or more, saving many thousands of lives. May we have a debate, perhaps in Westminster Hall, on this topic, which is sometimes not given the priority that it deserves?

That would be a good topic for debate. I very much welcome the national campaign to raise awareness of the need for fast action when a stroke occurs. The Government have kept a continued focus on the national stroke strategy—not least on the prevention measures that can be taken but also, importantly, on ensuring that in all areas the hospital response is as good as in the very best instances. Massive progress has been made recently and we want to ensure that everyone can get the very best care.

Will the Leader of the House ask the Justice Secretary or the Lord Chancellor’s Department to make a written statement on the working of the Legal Services Commission contract payments protocol? Obviously, no one expects a legal aid firm to get every minor variation paid each month, but where the standard monthly payment falls to about one quarter of the money outstanding to a legal aid firm, there ought to be a way of making sure that that payment is made. If the LSC consults the Law Society and the experts in my constituency, Jane Macdougall and Christine Campbell, it will probably find ways to make sure that the rules allow justice to be done. The Government want to make sure that debts are paid. Money is outstanding to good legal firms.

I will draw the hon. Gentleman’s comments to the attention of my right hon. Friend the Justice Secretary. I do not know whether the hon. Gentleman has tabled a written question, but the detailed points might be well made in such a question before he seeks a written ministerial statement.

The Leader of the House paid a generous tribute to the Treasury Committee. May I urge her to let us debate the Committee’s findings on the port rating crisis, to which my hon. Friend the Member for Rutland and Melton (Alan Duncan) referred? Is she aware that, just in the last fortnight, a written answer has confirmed that the advice to Ministers from the Insolvency Service is that the statutory instrument she mentioned does not in any way affect the requirement of businesses to enter all rates outstanding in their balance sheet? Ministers are also reminded that directors who continue to trade can face direct personal sanctions for doing so.

The hon. Gentleman will know that the Liaison Committee, consisting of the Chairmen of all the Select Committees, discusses and agrees which Select Committee reports are to be chosen for debate on the Floor of the House, and then makes a recommendation to the House.

May we have a full day’s debate—in Government time, not just on the Adjournment of the House on a Thursday—on future strategy in Afghanistan encompassing the present military effort, the lack of air power, the success or otherwise of reconstruction projects and other related matters, so that Members of this House can have a real opportunity to debate the future and the possible political successes or otherwise?

We had a debate on Thursday 5 February on Afghanistan and Pakistan, a subject that the Government chose. Regular statements are made by the Secretary of State for Defence, and the topic is regularly raised in Foreign Office questions and, indeed, Prime Minister’s questions. I assure the hon. Lady that I continue to look for opportunities to debate these important matters in the House.

The Leader of the House will be aware of the evidence given to the Treasury Committee yesterday by Lord Turner, chairman of the Financial Services Authority, to the effect that the regulatory regime pursued by the FSA was based on poor instructions, that it was a bad model and that it was too light. He went on to say that that was because of pressure from the Treasury—in other words, from the present Prime Minister. May we have a statement from the Prime Minister next week on his response to those grievous allegations and, in particular, on how he can go on saying that our financial crisis was caused by problems abroad, given that it is wholly plain that he contributed very significantly to them?

As I said, the Treasury Committee is doing very important work in its inquiry. We look forward to the evidence that continues to be given to the Committee and the report that will follow, which the Government will consider carefully. As far as statements are concerned, I would like to hear a statement from the right hon. and learned Gentleman himself and the Opposition on how it is that, after baying year in, year out for less regulation, deregulation and total deregulation, they appear suddenly to be in favour of more regulation.

May we have an urgent debate on the disparity between what the Government say they are doing to help small business and the reality on the ground? On 10 December, I wrote to the Secretary of State for Business, Enterprise and Regulatory Reform, copying a simple inquiry from a constituent company in Sharnbrook, Bedfordshire about information on grants that had been announced. Having received no reply, I wrote again on 29 January, and this month I followed that up with two phone calls to the Department. After 10 weeks, there has been no reply to an inquiry about information that the company needs. What is business to make of that failure to deliver? In its own small way, is not that failure as fraudulent as what the high rollers of finance have perpetrated on the British people?

It is important that initiatives designed to provide substantive support to our vital small business sector at a time of global economic challenge work in practice for every small business that needs help. About 66,000 small businesses have had their tax deferred and all small businesses benefit in one way or another from the VAT cut and the extra money that has gone into the economy from tax rebates. The need to ensure that loan guarantees are available for reasonable borrowing is one of the reasons we produced the booklet “Real Help now for People, for Business”. We have divided that up so that businesses in each region can see what help is available. If the system is not working as intended, that is very significant for the individual who needs help. I will ask the Deputy Leader of the House to take up the case and report back to me and the Secretary of State for Business, Enterprise and Regulatory Reform, so that if an individual case has hit a problem it can be sorted out, or if it illustrates a wider problem, we can deal with it.

My hon. Friend the Member for Congleton (Ann Winterton) rightly referred to the urgent need for a debate on the situation in Afghanistan, but will the Leader of the House allow a full day’s debate on foreign affairs in Government time on the Floor of the House? She has previously indicated that she would attempt to schedule such a debate. Given that there are simmering crises in Zimbabwe, Darfur in western Sudan and Burma—to name but three—with egregious human rights abuses being committed in each case, is it not time that this House debated the British and multilateral policy response to those crises?

The hon. Gentleman adverts to the fact that we have recently had several debates on important foreign affairs issues, including not only Afghanistan and Pakistan but Sri Lanka. The hon. Member for Macclesfield (Sir Nicholas Winterton) and my hon. Friend the Member for Vauxhall (Kate Hoey) regularly raise in business questions the need for a debate on Zimbabwe, and we all agree that that is pressing. Although I have not been able to announce such a debate in the business for the next two weeks, I can say that we will have a debate on Zimbabwe next month. I know that the House wants the opportunity to debate that issue.

On the wider point of a general debate on foreign affairs, there are routine general debates, and I shall have to look at that question.

(Macclesfield): Does the Leader of the House believe that it is appropriate to proceed with the appointment of Members to regional Select Committees at a time of dire financial crisis? That proposal will cost the House of Commons—in other words, the taxpayer—£2 million. I ask her to reconsider the appropriateness of proceeding with that proposition at this time.

May I also thank the Leader of the House publicly for saying that we will have a debate on Zimbabwe? I think that I have heard the date on the grapevine, and we are very grateful to her for finding time for a debate on that critical subject.

Bearing in mind the enormous investment in regions—through the highways authorities, the learning and skills councils, Building Schools for the Future and new hospitals and health centres, not to mention the regional development agencies—which can have a profound effect on a region and its people, this is precisely the time when regional agencies should be more accountable for how they spend the money in their region, especially as there is even greater concern now that every pound of public money should be spent properly. I want those regional masters of the universe—the directors of those agencies that have a massive impact at local level—to be accountable to hon. Members for what they do. Therefore, the regional Committees should get to work on looking at the capital investment and the regional strategies of agencies.

Far be it from me to suggest what any regional Committee should do, but one of the things that the Committees could do is ask these regional masters of the universe for the details of their bonuses and pension packages. That would be an increase in accountability that might have a good effect on public spending.

Will the Leader of the House convey my thanks to the Justice Minister for the help I have received from his officials in defining both the content and form of my amendment that, if Mr. Speaker selects it on Monday, will allow Members to decide whether candidates should be forced to reveal their home addresses during elections? When she is thanking the Justice Minister, will she ask for a statement from a Minister or a Law Officer about whether the law on treason still applies? I ask that in the light of yesterday’s serious reports that British passport holders are operating in war zones and attacking British service personnel. It needs to be made clear to anyone who seeks or holds a British passport that such activity is not only criminal, but treasonable.

I will ask the Attorney-General to write to the hon. Gentleman about the enforceability of different aspects of our domestic law in respect of overseas actions. She can set out the full position for him.

I will convey the hon. Gentleman’s comments to the Justice Secretary, but I wish to thank the hon. Gentleman for his work. He has tabled a good amendment that, if selected and accepted, will make it clear to electors in which constituency candidates live without forcing candidates to reveal their addresses if they do not want to do so. That is a very sensible amendment, and I understand that Labour Members will have a free vote on it. If it is selected, I shall certainly vote for it.

May we have a statement on the pernicious effects on local economies of the abolition of empty property relief for business rates? My constituent, Mr. Chris Brigstock, runs a local property development company and next week he will have to dismantle one of his warehousing facilities because he simply cannot afford to pay the business rates on it and he does not qualify for the temporary relief scheme that the Government have introduced. Economies such as Kettering cannot afford the loss of local infrastructure, and it is entirely due to Government legislation.

I know that the Treasury is keeping this issue under review and I suggest that the hon. Gentleman write to the Chancellor of the Exchequer with details of the company concerned to see whether any wider lessons can be drawn from its experience.

Records of Detention (Review Conclusions)

Before I begin my statement, I should like to pay tribute to the three soldiers from 1st Battalion The Rifles who died on operations in Afghanistan yesterday, and to the Royal Marine from 45 Commando who died yesterday from wounds received earlier this month. Today is a sad day for our armed forces and a reminder of the exceptional challenge that our personnel meet with such extraordinary resolve every day. We owe our security to these brave servicemen and women, and I am sure that the whole House will join me in sending condolences to the families and friends of those whom we lost yesterday.

I wish to make a statement on the results of a recent Ministry of Defence review of records of detention resulting from security operations carried out by UK armed forces in Iraq and Afghanistan. It is, I believe, essential that our armed forces are able to detain people who pose a real threat to our troops, our allies or the local population whom we are seeking to protect. These operations are conducted by our forces with courage, integrity and professionalism. In undertaking them, we take fully into account our obligations under international law.

In February last year, allegations were made that persons captured by UK forces in Iraq were transferred to US detention facilities and were mistreated and removed unlawfully from Iraq. My predecessor, my right hon. Friend the Member for Kilmarnock and Loudoun (Des Browne), rightly launched a review, and much of the work was led personally by a very senior British Army general. My right hon. Friend was right to satisfy himself that appropriate procedures were in place to ensure that persons captured by UK forces and transferred to US detention in Iraq were treated in accordance with UK policy and legal requirements. Separately, he also set in hand work to examine all available documentary material relating to detention operations in Iraq and Afghanistan, and to review the parliamentary record.

The Ministry of Defence has now completed a detailed review of records of detention in Iraq and Afghanistan since the start of each campaign. I am today placing in the Library details of all detentions in southern Iraq in each year since 2003.

In Iraq, we have reviewed the record of detainee numbers listing all individuals held in UK detention facilities, first at the Shaibah logistics base and subsequently at the contingency operating base at Basra. In December 2003, when the facility at Shaibah was first opened, records show that 105 internees captured by UK forces were transferred into it from US custody at Camp Bucca. A further 19 were released at that stage. After December 2003, an additional 546 individuals were interned in these facilities. The majority, 491, were released once it was judged that they no longer represented an imperative threat to security, while 141 were transferred to the Iraqi authorities. A further 12 escaped, six were transferred to US detention facilities and, as hon. Members will know, one sadly died in custody.

In conducting this review, it became apparent that, in three parliamentary answers since February 2007, Ministers had overstated by approximately 1,000 the numbers of detainees held by UK forces in the period since January 2004. Nine further answers contained minor inaccuracies. I have written separately today to hon. Members setting the record straight, and I have also placed copies of the letters in the Library of the House. I want to apologise unreservedly for these inaccuracies.

We have also reviewed our records of detentions in the period from March to December 2003, when large numbers of individuals were captured by UK forces during the initial, high-intensity combat phase of the operation. Many of them were held for very short periods or were transferred to the US facility at Umm Qasr and then released. This facility was run by the UK from late March to mid-April 2003, at which point it was transferred to US control.

Given the circumstances in which the database was compiled, we cannot be confident that the data that we hold today are entirely complete. On a small number of occasions, answers or statements provided by my Department have included figures relating to the position in 2003 that indicated that we initially held up to 5,000 Iraqi prisoners during that period. However, a significant number of these were held on behalf of other coalition forces. We now believe that UK forces transferred around 3,000 individuals to the detention facility at Umm Qasr between March and December 2003, but I would ask the House to treat this figure as a best estimate.

In areas outside multinational division south east, UK forces have undertaken operations to capture individuals who were subsequently detained by the United States. These individuals do not feature in the data that I have set out today, but I want to reassure the House that the review has concluded that UK forces have exercised appropriately their responsibilities towards all captured personnel handed to US custody, whether in Multi-national Division (South-East) or elsewhere, and that it has uncovered no evidence of mistreatment.

During the final stages of the review of records of detentions, we found information about one case relating to a security operation conducted in February 2004. I am sure that hon. Members will recall that that period saw an increased level of insurgent activity as the transfer to Iraqi sovereignty drew closer. During the operation, two individuals were captured by UK forces in and around Baghdad. They were transferred to US detention, in accordance with normal practice, and subsequently moved to a US detention facility in Afghanistan.

This information was brought to my attention on 1 December 2008, and I instructed officials to investigate the case thoroughly and quickly so that I could bring a full account to Parliament. Following consultations with US authorities, we confirmed that they transferred the two individuals from Iraq to Afghanistan in 2004 and they remain in custody there today.

I regret that it is now clear that inaccurate information on this particular issue has been given to the House by my Department. However, I want to stress that that was based upon the information available to Ministers and those who were briefing them at that time. My predecessors as Secretaries of State for Defence have confirmed to me that they had no knowledge of these events. I have written to the hon. Members concerned correcting the record, and am placing a copy of these letters also in the Library of the House. Again, I want to apologise to the House for these errors.

The individuals transferred to Afghanistan are members of Lashkar-e-Taiba, a proscribed organisation with links to al-Qaeda. The US Government have explained to us that those individuals were moved to Afghanistan because of a lack of relevant linguists to interrogate them effectively in Iraq. The US has categorised them as unlawful enemy combatants and continues to review their status on a regular basis. We have been assured that the detainees are held in a humane, safe and secure environment that meets international standards that are consistent with cultural and religious norms. The International Committee of the Red Cross has had regular access to the detainees.

A due diligence search by US officials of the list of all those individuals captured by UK forces and transferred to US detention facilities in Iraq has confirmed that this was the only case in which individuals were subsequently transferred outside Iraq. This review has established that officials were aware of the transfer in early 2004. It has also shown that brief references to this case were included in lengthy papers that went to the then Foreign Secretary and the Home Secretary in April 2006. It is clear that the context provided did not highlight its significance at that point to my right hon. Friends.

In retrospect, it is clear to me that the transfer to Afghanistan of these two individuals should have been questioned at the time. We have discussed the issues surrounding this case with the US Government. They have reassured us about their treatment but confirmed that, as the individuals continue to represent significant security concerns, it is neither possible nor desirable to transfer them to either their country of detention or their country of origin. The UK no longer has power to detain suspects in Iraq, and only limited powers of detention in Afghanistan.

For Afghanistan, robust checks have confirmed that we have detailed and precise numbers of all those detained by UK forces since we deployed Task Force Helmand in July 2006. As of 31 December 2008, our database holds the capture details of 479 individuals, including 254 who were subsequently transferred to the authority of the Government of Afghanistan, 217 who were released, and eight who died as a result of injuries sustained on the battlefield.

We hold capture details relating to a total of a further seven individuals detained by UK forces between 2001 and April 2006, and I believe that this represents a complete record. I am also placing the complete details of the detainee numbers for Afghanistan in the Library of the House.

Our detention operations in Iraq and Afghanistan are underpinned by arrangements with our international partners. We have a memorandum of understanding in place with the Government of Afghanistan, signed on 23 April 2006, covering the treatment of individuals detained by UK forces and transferred to Afghan custody. We also have a memorandum of understanding with Iraq, agreed on 8 November 2004, on the treatment of detainees transferred to Iraqi custody. Iraqi Interior, Justice and Defence Ministers have confirmed to us that Iraqi detention procedures remain consistent with the principles set out in that memorandum of understanding.

For the initial stages of the campaign in Iraq, we also had in place a memorandum of understanding with the US and Australian Governments covering arrangements for the treatment and transfer of detainees. We worked on the mutual understanding that the key provisions of the memorandum of understanding continued to apply until it was replaced last year by a further memorandum of understanding with the US. We have also confirmed with the US that the provisions on arrangements for the treatment and transfer of captured prisoners remain under the new legal framework in Iraq and that no person captured with assistance from UK forces will be removed from the territory of Iraq without prior consultation with the UK.

Let me make a final observation. We ask our armed forces to operate in highly dangerous environments, where there is often a limit to the capacity of local agencies to enforce security and the rule of law. In those circumstances, it is essential that we provide our forces with the authority and capabilities to deal effectively with individuals who represent a serious threat to our troops or those they are there to protect; the two detainees to whom I referred earlier fall into that category. We recognise the sensitivity of detention operations. We have put in place rigorous safeguards to ensure that detainees are treated properly. We will continue to carry out detention operations in accordance with our legal and policy obligations, in concert with the US and other allies. This is, and will remain, absolutely central to the way our armed forces conduct these vital operations.

May I fully associate the Conservative party with the Secretary of State’s comments about the deaths of the four soldiers yesterday? It was a black day for the armed forces, and it was particularly sobering for me as my old regiment is shortly to go to Afghanistan. I entirely associate the Conservative party with the comments made by the Secretary of State at the end of his statement, when he made clear the challenge faced by the armed forces on operations overseas in very difficult circumstances.

I thank the Secretary of State for giving me early sight of the statement and I note that it follows the undertaking in his letter of 17 November to the Chairman of the Defence Committee to answer the questions put to him by the Chairman and my right hon. Friend the Member for Wells (Mr. Heathcoat-Amory) in the sitting that he had three weeks earlier with the joint committees. It is a serious concern that there is an underlying charge of complicity with serious abuse of people detained by British forces on operations overseas. Properly, I presume that it is to address that charge that the Secretary of State has decided to come to the Chamber to make an oral statement, and we thank him for treating the issue with the seriousness that it deserves.

Much of the Secretary of State’s statement dealt with the transfer of two members of Lashkar-e-Taiba to Afghanistan in 2004 following their capture by British forces and their being handed over to the American forces. I am grateful for his candour on the details uncovered by the review. It is clear—I know that he has had a conversation with the shadow Secretary of State, who is abroad, about this—that this is a specific rather than systemic failure. I also accept that there appears to be no legal or practical alternative to their continued detention, where they have access to the International Committee of the Red Cross and appear to be detained in proper circumstances.

Will the Secretary of State confirm that his account contradicts the specific assurances given by the then Foreign Secretary to my right hon. Friend the shadow Foreign Secretary on 6 February 2006? It is at the very least unfortunate that both officials and Ministers overlooked the significance of the cases, not least since the issue of rendition was already highly controversial. My hon. Friend the Member for Chichester (Mr. Tyrie) had already formed his all-party group on the issue. The Secretary of State says that in retrospect it is clear to him that the transfer to Afghanistan of the two individuals should have been questioned at the time. What is his explanation for that not being done at any level and not being rediscovered until 1 December 2008?

I acknowledge the Secretary of State’s unreserved apology for overstating by about 1,000 the number of British detainees since 2004. Again, will he provide the House with an explanation for that? I visited the prison facilities in our area of operations with the Defence Committee in early 2004 and I acknowledge that they had been much improved since serious concerns surfaced about operations there in 2003, but in those circumstances I am astonished at the inaccuracy arising from conditions in 2004 and afterwards. Equally, my experience would lead me to accept that the figures for 2003 could only be an estimate.

Let me turn to our current operations in Afghanistan. What confidence does the Secretary of State have that some of the 254 detainees handed over to the Afghan authorities have not been mistreated or tortured? On what basis does he claim in his letter to the Chairman of the Defence Committee of 17 November 2008 that there is no legal obligation to detainees once they are transferred to another state? Does he acknowledge that a moral obligation exists? Was that not implicit in the memorandum of understanding between the USA, Australia and the UK of March 2003? Why would not that wider obligation also apply between the UK, Iraq and Afghanistan?

The statement avoids the principal public issue, which is the charge about complicity by UK forces operating in Iraq outside the Multi-national Division (South-East). That is a glaring hole and it must be addressed. I suspect that as Secretary of State he might not be inclined to thank my hon. Friend the Member for Chichester for his dogged persistence on the issue. However, I rather suspect that, as a parliamentarian, the Secretary of State will admire my hon. Friend’s achievement in ensuring that the issue remains at the front of parliamentary concern. I hope that the Secretary of State will confirm that for all the difficulty that the statement brings the Government and the embarrassment at procedures that apparently undermine and sometimes disgrace our values my hon. Friend has done Parliament and our wider values proud by holding the Government to account.

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