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Commons Chamber

Volume 489: debated on Wednesday 18 March 2009

House of Commons

Wednesday 18 March 2009

The House met at half-past Eleven o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions


The Secretary of State was asked—


I am in regular contact with Scottish banks and businesses on the economy. Since the start of the year, the Government have introduced a range of measures to help to increase liquidity and to ease credit conditions for business.

Following the announcement by RBS-NatWest on 5 February that it will make a further £250 million available for small and medium-sized enterprises in Scotland, the Secretary of State said:

“I shall be talking to other lenders in Scotland over the coming days to encourage them to follow the example being set today.”

How many has he persuaded and how much brass have they come up with?

I met the chief executive of the Lloyds group last week in Edinburgh, and the hon. Gentleman will be pleased to know that Lloyds has announced the availability of £2 billion under similar terms.

Does my right hon. Friend agree that the decision of two English local authorities to sue RBS in American courts is welcome? Will he encourage Scottish local authorities that have similar concerns to do the same? Will he assure me that the Government will be as accommodating, if necessary, to any future extradition application from America for RBS bankers as they were in the case of the NatWest three?

My hon. Friend will understand why I do not want to comment on any specific impending—or possibly impending—legal process. After centuries of success, the Scottish banks were moments from collapse. Without the intervention of the UK Government and, importantly, the UK taxpayer, the stability that we wish to return to the banks would not be possible. My hon. Friend will understand if I am not tempted to join him in speculating on the other matters that he raised.

The success of the private and public sectors is inextricably linked in the years ahead as we go through the downturn. What assessment have the Government made of their plans to take £1 billion out of the Scottish economy in cuts?

That is tired rhetoric from the Scottish National party. The Scottish Government have more money than ever and, from today onwards, they will have, over the next two years, more than £2.5 billion more. It is the first time in a spending review period that the Scottish Government have £100 billion.

The tiresome obsession with grudge is wearing thin with the people of Scotland. We are in the recession together and we will get out of it together. Scotland is stronger because of the United Kingdom, which is and will remain the most successful union of nations anywhere on the planet.

Does my right hon. Friend agree that banks are the main source of credit to business? That is why he is right to remind hon. Members of the important intervention that the Government made to stabilise the banking system. Does he agree that all the banks, not least RBS and Lloyds-HBOS, now have an obligation to do all they can to support Scottish business and business generally throughout the UK?

I agree with my right hon. Friend, and RBS and the Lloyds group have committed to lending more billions of pounds through the enterprise finance guarantee scheme. Legally binding—that is important—agreements have been made under the asset protection scheme for RBS to lend an additional £25 billion and for Lloyds to lend an additional £14 billion. As he said, it is important for the money to start to flow to Scottish businesses and Scottish mortgage holders so that we can have some return to stability. I think that he appreciates that it was important from October onwards to save the banks from collapse. Our action has helped to ensure that.

The Secretary of State knows that one of the jewels in the Scottish economy’s crown is the exports that have built up on the back of skills learned in the North sea. Does he understand that exploration in the North sea is drying up because of the banks’ failure to lend—the new model relies on bank lending? The Government could step in to ease cash flow by paying early the tax relief that they normally pay when production starts, so that the companies get better cash flow to allow them to continue to explore.

The hon. Gentleman makes an important point. My right hon. Friend the Secretary of State for Energy and Climate Change and I met representatives of Oil & Gas UK to discuss those specific matters and we will talk to them again. I am happy to raise the concerns of the oil and gas industry in Scotland with the banks—that dialogue will continue. I also agree that the export market is crucial for the Scottish economy as we try to recover. I have the honour next week of leading one of the largest ever business delegations from all sectors of the Scottish economy to China. That is also an important initiative.

Does my right hon. Friend agree that, although credit is important to business, so is the ability of Scottish business to get involved in emerging markets? For example, Aspen Solutions in Cumbernauld has won a Department for International Development contract to send IT to Sierra Leone to help to build that country’s infrastructure. What is he prepared to do to assist other such companies?

My hon. Friend is characteristically correct on that matter. I should declare an interest, because I think that Aspen Solutions provides the photocopier for my parliamentary office in East Renfrewshire. For the avoidance of doubt—[Interruption.] It is a very busy photocopier, or it certainly will be in the next few months. The point that my hon. Friend makes is entirely right. Small businesses in particular need to be able to access Government procurement and the contracts and portals that are available. In the past, small companies in particular have had to get through too much bureaucracy, which is why it is important that the UK Government and the Scottish Government find new opportunities to enable small businesses to compete for Government work.

Small Businesses

2. When he last met representatives of small businesses in Scotland to discuss their economic situation. (263299)

I have met the Federation of Small Businesses, the Scottish Chambers of Commerce, the Scottish Council for Development and Industry and the CBI Scotland to discuss the economic situation.

The feedback from many of the small businesses in my constituency, many of which are involved in tourism, shows that there is a lack of knowledge at the local bank branch level about accessing Government schemes. In his discussions with Scottish Ministers, will my right hon. Friend emphasise the importance of Scottish Business Gateway and its contractors, and ensure that people understand the Government-backed schemes that are in place and disseminate that information not just to businesses in Stirling, but to small businesses across Scotland?

My right hon. Friend raises a point about Stirling and tourism that is specific to her constituency, as she always has done in the House. She is right: we must ensure that the enormous investment in the schemes to support Scottish businesses is accessible and understood, particularly for small businesses. We are trying to encourage businesses to go to the “Real help now” website, where all the information is available. We also need to ensure that the advice through Scottish Enterprise’s networks and through UK Government and Scottish Government agencies is readily available, easily understood and deliverable, and we are working very hard on that.

Small businesses are indeed having to shoulder a big responsibility. According to excellent work by the Scottish Trades Union Congress, at the jobcentre in Stornoway in my constituency, 44 people are chasing each available vacancy, which is the highest rate in Scotland. Will the Secretary of State join the Scottish National party and the parties in Wales in the fight against Westminster’s forced £1 billion of cuts that are coming our way? Otherwise, more people will be chasing each vacancy in small businesses and other businesses all over Scotland.

In these difficult economic times, the SNP’s economic policies are indeed a fantasy; they are beyond all fiction. Scottish families in the hon. Gentleman’s constituency and mine—and, indeed, across the whole country—are finding additional ways to tighten their belts. There is only one organisation in Scotland that believes that it cannot make any efficiency savings, and that is the SNP Scottish Government. The Scottish Government have more money than ever before and they should get on with delivering it. Instead of this endless constitutional obsession, we should all be focusing on the economic recovery, not constitutional referendums.

My right hon. Friend will remember coming to a meeting with small businesses in Ayrshire at which the problems associated with the banks being able to make loans and the extra charges now being imposed were raised. With the Government owning 67 per cent. or thereabouts of some of the banks, surely the Government should be putting more pressure on those same institutions to lend the money and to reduce the charges that are now being faced, so that people can get on with their business and unemployment can be maintained at a low level in Ayrshire.

My hon. Friend makes an important point. I enjoyed my visit to Ayrshire with him and my hon. Friend the Member for Ayr, Carrick and Cumnock (Sandra Osborne). Points were made in that meeting with small businesses about the availability of credit, which is why we have taken the measures that we have. The Royal Bank of Scotland has announced that it will commit £25 billion of additional lending, while the Lloyds group has announced £14 billion of additional lending, as part of the asset protection scheme. That is legally binding, because we need to ensure that Scottish businesses—particularly small businesses, but also businesses across the whole of the UK, not just in Scotland—can access credit and trade again, as part of a future recovery. I look forward to coming to Ayr again to discuss those matters with him and his businesses.

I welcome the fact that the Secretary of State has met small business leaders and the First Minister to discuss the economic situation in Scotland. However, I am disappointed that once again post-meeting reports were characterised by the First Minister and the Secretary of State briefing against each other. When will we see the mature relationship between Westminster and Holyrood that we should expect in order to tackle an economic crisis of this scale? Perhaps the Secretary of State can make a start on this new relationship today by embracing the Chancellor’s call for humility and collective responsibility and apologising to the people of Scotland for the multitude of economic mistakes that his Government have made.

Like every Labour Member, I am always sorry when anyone loses their job, and today we are seeing some very difficult unemployment figures for Scotland and the whole of the UK. As we all know, behind those figures there are real people and real families. I am disappointed, as I am sure many Scottish families will be, that, rather than focusing on the real pressures that real families are experiencing, the hon. Gentleman again chooses to participate in the soap opera of the process of politics. People are interested in solutions, not in his soundbites. It is important that we make progress on this matter, and we will do whatever we can to support the newly unemployed, so that they do not become the long-term unemployed.

I am sure that the 1,000 additional people in the dole queues of Scotland this month, and their families, will very be interested to hear the Secretary of State’s solutions. In December, he announced that he was putting together a council of economic advisers, who would be named in January. Since then, we have heard nothing. What is the reason for that delay? Is he trying to avoid the mistakes of his predecessor, who used to vaunt the fact that Sir Fred Goodwin represented Scotland in the Chancellor’s high-level group on financial services? Does the Secretary of State think that his Government no longer need economic advice, or is it perhaps that nobody wants to be associated with his group?

I made no such announcement, then or since. The announcement that I made was about how to get those involved in academia and campaigning together with experts in poverty to ensure that the poorest could see a way through this recession, so that there would not be a generational legacy as a consequence of that, as there was after previous Tory recessions. We will not allow jobcentres to redirect people from unemployment benefit on to incapacity benefit, which is what happened in jobcentres during the previous Tory recession. That policy was wrong, immoral and unforgivable.

When the Treasury Committee visited Edinburgh two weeks ago, we found dismay among small businesses that banks were putting arrangement fees and other private charges on them, rather than interest rates. When the Secretary of State meets representatives of the banks, will he remind them that the Committee is undertaking an inquiry into the banking crisis, and that we will be monitoring their lending agreements, under which transparency and value for money for the taxpayer are going to be the key requirements?

On behalf of all hon. Members, I want to put on record the respect that exists across the country for the work that my right hon. Friend and his fellow members of the Treasury Committee do, and will continue to do, on this important issue. After seeing on television the hearings involving his Committee and the bankers, I do not think that the bankers will need me to remind them that he is determined to stay on top of this issue. Now that he has asked me to do so, however, I will of course raise the matter with the banks.


3. What recent discussions he has had with representatives of banks on the future of banking in Scotland; and if he will make a statement. (263300)

I am in regular discussions with bank representatives. I am determined that Scotland and the UK can remain world centres for financial services.

The Secretary of State has just confirmed that the Royal Bank of Scotland’s lending commitment is legally binding. Will he confirm that the astonishingly generous pension settlement of its former chief executive, Sir Fred Goodwin, is also legally binding? Will he therefore apologise for the soundbite from his Cabinet colleague who has postured on this issue but not been prepared to apologise for it?

These decisions were taken by the Royal Bank of Scotland’s board. I find it distasteful that one individual can be rewarded in such a remarkable way for failure and for the undoubted banking vandalism that has put at risk the well-being of so many families and business in Scotland and across the UK. It is important, as we try to re-stabilise the banking sector, that there should be no reward for failure. We find it extraordinarily distasteful that the Royal Bank of Scotland board made that decision.

Given the Government’s assistance to the banks and my right hon. Friend’s discussions with them, particularly those with a Scottish input, is he able to assure us that banks are indeed looking to develop a strategy to provide lending facilities for small businesses and home owners as the Government intended?

My right hon. Friend has raised this matter on a number of occasions and he will rightly continue to do so. I happily give him the commitment that we are doing everything we can in that respect. We are also trying to ensure that, where there are specific difficulties in certain business sectors or certain parts of the country, we take additional action. My right hon. Friend, as a Lanarkshire MP, will share my concern that Lanarkshire might be the epicentre of the recession in Scotland. That is why I shall shortly bring together business organisations, politicians, trade unions and others to see if we can find a way through the situation, particularly in Lanarkshire, where a proud and determined people who have come through previous recessions will need additional support now to get through the present recession.

Will the Secretary of State support the establishment of a post bank, publicly owned, operating in local communities and taking decisions about granting credit to small businesses based on local knowledge rather than a nationwide formula? I believe that that would give many viable small businesses throughout Scotland access to the credit that the larger banks are denying them.

The Government are always looking for additional ways to support small businesses in communities, and we particularly like to support the community and voluntary sectors and social enterprises. I would be happy to discuss that with the hon. Gentleman. It is important, however, to focus on some of the community facilities and support that are already in place, particularly for families rather than for businesses. I believe that we should all celebrate the remarkable success and important role of credit unions throughout Scotland. They will play an important part in the recession.

Thousands of my constituents work in the banks and financial services sector, and the vast majority certainly do not receive big bonuses and multi-million-pound pensions. Some are losing their jobs and many more are worried about their future. Does my right hon. Friend agree that Government at all levels—UK, Scottish and local—should work together to find a long-term strategy to get out of a common situation? What is he doing to get such a strategy agreed among all the players in the field?

My hon. Friend raises an important point, which I know is particularly relevant in his constituency, as it includes a large number of financial services sector workers. What has happened has, unfortunately, led to the portrayal of all those in the banking sector as greedy and in receipt of enormous bonuses. As he knows and as we all know, a large number of people working in banks in the back office or as bank tellers, for example, are on very average wages and they work very hard. Some of them may have had share options, which are now more difficult. It is important that we stop demonising all bank workers simply because of the irresponsible behaviour of a tiny minority of those who previously had leading and well paid positions in these organisations.

Does the Secretary of State agree that today’s publication of Adair Turner’s proposals for a new regulatory system for the banking sector is an illustration of the extent to which the previous regulatory system put in place by the Prime Minister failed? What does he say today to the thousands of Scots who face losing their jobs in the financial sector as a consequence of the Prime Minister’s previous failure?

The fact is that the international regulatory regime did not keep pace with a remarkable change in the global movement of finance—a fact now well acknowledged across the world. That is why we need, as part of the G20 process, a new architecture for regulation. Banking will never be and should never be the same again. As for the hon. Gentleman’s point on unemployment, we will do everything we possibly can to ameliorate the consequences of this international recession. Many Scottish families have people who have lost their jobs over the past few weeks, as has been confirmed today. As I say, we will do everything we possibly can to stop the newly unemployed becoming the long-term unemployed by giving people additional skills and retraining in order to retain their confidence and an attachment to the labour market. Of course things are more difficult. Not everyone can walk straight into a job, but we should not ignore anyone, and we should try to support people to keep their skills and confidence fresh.

Unemployment (East Lothian)

4. What assessment he has made of the level of support to long-term and recently unemployed people in East Lothian constituency. (263301)

We are giving people across Scotland real help now by offering greater support to help them to move back into employment. We have invested £1.3 billion in Jobcentre Plus services to ensure that those looking for work receive individual support, and an additional £0.5 billion to guarantee more help for people who are unemployed for six months or more.

I am sure that the whole House will now want to hear my supplementary question.

We currently have quite a good level of employment in East Lothian—over 80 per cent.—but I am concerned about the possibility that unemployment will rise both in East Lothian and in Scotland more widely. The position could be greatly improved if the banks adopted measures allowing them to enable small businesses to recover by lending them money. Constituent after constituent has said to me recently that they will have to make people unemployed because the banks will not lend to them. The arrogance of the banks beggars belief.

My hon. Friend has raised an important point to which the Secretary of State has already referred this morning: the need for banks to start lending in order to enable businesses to survive and to invest. We have introduced the necessary measures to make that possible. I am sure that she welcomed the recent announcement by the Royal Bank of Scotland of the provision of additional funds focused particularly on small and medium-sized enterprises, many of which are based in her constituency.

It is important to note that the United Kingdom still has the second lowest unemployment in the G7 area, but we are not complacent. That is why, from April, we will be providing additional help for those who are unemployed for more than six months, in the form of a £1,000 recruitment subsidy. [Interruption.]

My constituency is next to East Lothian, and it is in the same position. The problem is not just unemployment, but the fact that companies are reorganising themselves. Would my hon. Friend and my right hon. Friend the Secretary of State consider bringing the banks to Dover House, so that Members of Parliament can have a discussion with them, and put our cases to them? Why are the banks still not lending to companies that are reorganising themselves to try to get through their present difficulties?

I should be more than happy to speak to any of my colleagues about constituency issues, and about how we can help Members to ensure that local banks respond to the needs of companies in their areas. I welcome the fact that East Lothian council recently joined a local employment partnership, enabling us to work with employers in trying to deal with some of the problems.

Scottish Parliament (Financial Powers)

5. What recent discussions he has had with the Chancellor of the Exchequer on financial powers for the Scottish Parliament. (263302)

I have regular discussions with my right hon. Friend the Chancellor. Sir Kenneth Calman's commission on Scottish devolution is supported by business and trade union leaders, and by the Labour, Conservative and Liberal Democrat parties.

Does the Secretary of State agree that it is useful for Governments to be able to borrow at a time of recession—[Interruption.]

Does the Secretary of State agree that at a time of recession it is important for Governments to be able to borrow, and that the Scottish Government should have the power to borrow?

The Scottish Government have more money than ever before. The current Scottish Government have more than double the budget that the late Donald Dewar had when he was First Minister. I think it important for politicians in all parties in Scotland to find additional ways of working together through the recession. We are in it together, and we will get out of it together.

I appeal again to the Scottish National party to stop putting its obsession with the constitution before the priorities of our country, which are to do with economic recovery. Scotland will never forgive any political party that puts its interests before those of our country.

Is my right hon. Friend aware that although financial powers are important, they will take some time to produce any change, if change is coming? What we need now is action. Unemployment in Lanarkshire is higher than it is in any other region, and Lanarkshire also has the fewest job vacancies. I welcome all the initiatives that my right hon. Friend is taking there—unlike the one-trick pony who is First Minister in the SNP Administration in Scotland, who is interested only in division and in rubbing Scotland out of the United Kingdom.

My right hon. Friend campaigns tirelessly for the people and businesses of Lanarkshire, which has a proud industrial heritage, not least in mining and of course the steelworks. The people of Lanarkshire have shown their determination and resolution to rise from previous recessions. Working with him and other fellow Members, and businesses and trade unions, we are determined to do everything possible to make sure that Lanarkshire is not the epicentre of this recession in Scotland.

Prime Minister

The Prime Minister was asked—


Before listing my engagements, I am sure the whole House will wish to join me in expressing our deepest condolences to the family and friends of those killed on operations in Afghanistan over the last week. They were Corporal Dean John, Corporal Graeme Stiff and Lance Corporal Christopher Harkett. They, and all those who have lost their lives in conflict, deserve our profound gratitude for their service not just to our country, but to the peace of the world. Their courage and sacrifice will never be forgotten.

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

I am sure that everyone in the House will wish to associate themselves with the Prime Minister’s comments.

Today’s unemployment figures are extremely disappointing and, as a former shipyard worker who experienced the indignity of three years’ unemployment in the early 1980s, I can well understand the frustration and anger that unemployment brings. May I ask my right hon. Friend not to abandon the unemployed and to make sure that the Government continue to invest in the skills and training needed to help us through these difficult times?

I am grateful to my hon. Friend. Any person who loses their job or is in fear of losing their job is a matter of personal regret for me and the whole Government. I do not regard unemployment as a statistic; I regard it as one person, a second person and a third person who needs our help. That is why we will do everything we can to help people get back into work: that is why we have announced more apprentices; that is why we have announced more help with training; that is why we have announced that from April there will be help for those who have been unemployed for six months; and that is why we have put £1.3 billion into the jobcentres—money that is necessary, so that we can help hundreds of thousands of people in the next few months get back into work.

I join the Prime Minister in paying tribute to Corporal Dean John, Corporal Graeme Stiff and Lance Corporal Christopher Harkett. The fact that more than 150 of our servicemen and women have been killed in Afghanistan is a reminder, once again, of the huge sacrifices our armed forces are making on our behalf. We praise their bravery, we honour their memory and we must look after their families.

Today, as has been said, unemployment has risen to more than 2 million people. The increase in the claimant count is the sharpest since records began. Does this not reveal that the claims repeatedly made by the Prime Minister that Britain is one of the best-placed countries in the world to withstand recession were simply nonsense?

I came into politics, and I stood for Parliament, because I wanted to help tackle unemployment and poverty, and that is why we are announcing the most comprehensive programme to help the unemployed. But I have to tell the right hon. Gentleman that unemployment is higher in France, in Germany, in Japan and in America. It is higher in most of the other countries we deal with, but we are taking urgent action to help those people in Britain who are unemployed. We are spending £1.3 billion helping our jobcentres and helping people into work. The Conservatives would not spend that money. I ask him why he would not help us deal with the problem of unemployment.

I have to say to the Prime Minister that Members in every part of this House will contrast what he said with the fact that 144 of our further education colleges—the exact organisations we need to retrain people who are unemployed—are having their building projects halted. There is this enormous gulf between what he says every week and what his Government are actually doing. Let me return to the question. People will simply not understand why the Prime Minister is so incapable of ever admitting that he got anything wrong. It is not just the unemployment figures today; the International Monetary Fund has said that the recession will be deeper and longer in Britain than in many other countries, and that Britain will be the only major economy in the world that will be in recession next year. So let me ask him again: was it not wrong to claim that Britain was one of the best-placed countries in the world to withstand recession? Admit it.

No, because the fact is that America entered recession more than a year and three months ago and the euro area entered recession in April last year, whereas we entered recession in July. We stopped ourselves going into recession for months after what had happened in America, and the action that we are taking now is designed to get us through it as quickly as possible.

Let me correct the right hon. Gentleman on FE colleges—we are going to spend £110 million this year investing in them. Let me correct him on public expenditure— we are investing £44 billion this year, in health, in education and in other capital investment projects to help us through this downturn. Let me correct him again on unemployment. Unemployment is far higher in America, in France, in Germany and in the euro area. I know that is of little comfort to people in this country, which is why we are doing everything we can to help them.

Let me correct—[Hon. Members: “More.”] Yes, there is plenty more. Let me correct the Prime Minister on the figures that he has just given to the House of Commons. He says that the recession started in July, but the economy stopped growing in April last year; we have been in recession for almost a year. [Interruption.] Yes, let me correct him on the further education colleges. He should come to my constituency of Witney, where people are in temporary classrooms because the whole building project has had to be abandoned because of his incompetent Government.

The entire country will see that the Prime Minister is in denial about the length and the depth of the recession. He likes to talk about the schemes that he has announced, so let us have a look at them. Can he confirm that not a single unemployed person has been helped by the recruitment subsidies that we called for in November and that he announced in January? Can he confirm that not a single home owner has been helped by the home owners mortgage support scheme that he announced in December? Is it not the case that those two specific schemes simply are not operating?

First of all, the right hon. Gentleman is wrong about the start date of the recession. Secondly, he is wrong about further education, because £110 million will be spent on it this year. Thirdly, he says that we are not doing anything, so I should tell him that in the last recession there was no help available for the unemployed, but we are spending £1.3 billion to help people get into work. Let us just go through the things that we are doing: 300,000 people used to be helped under Train to Gain and that will rise to 1 million; we have raised the levels of mortgage support, so that people can stay in their homes even when they lose their jobs; and, as the Secretary of State for Work and Pensions announced, in April—next month—programmes will come in that will help people who have been unemployed for six months. That was the date we set. The problem is that the right hon. Gentleman asks us to do more, but he is the only Opposition leader in history who is asking us to do more when saying he will spend less—it just does not add up.

We have just had the view from the bunker, where all these schemes are operating and where everything has been implemented, but the fact is that, on the ground, these things are not happening. We get a lecture in competence from a Government who are so incompetent that they could not even stop Fred Goodwin, or, sorry, I should say Sir Fred Goodwin—the Prime Minister knighted him for his services to the banking industry—walking off with a pension that is worth £60,000 a month. The lack of action applies not just to the housing scheme and the job scheme, because the asset-backed securities scheme is not up and running, and the working capital scheme is not working properly. Is that not why the CBI said that this Government have a total lack of a “coherent strategy”? Is that not why Shelter says that people facing repossession have been given “false hope”? Does the Prime Minister regret giving those people false hope?

That is not what we have done. We have negotiated with the building societies and banks a six-month moratorium for people who are faced with mortgage repossession. We have sent new orders to our courts that lenders cannot, as a first resort, go for repossession; they have to go through all the proper processes before they even consider that. We are helping unemployed people with their mortgages at a level that has not been done before, and next month we will bring in the protection scheme, under which we are insuring the banks and building societies against loss so that people can phase their mortgages over a longer period of time. The problem that the right hon. Gentleman has got is that everything he proposes, he will not fund. On Monday, he said there would be more cuts in public expenditure—already he has refused to support the £1.3 billion that we are spending to help the jobcentres and to help people who are unemployed. It is simply not credible to come to this House and say that he is urging us to do something when he would pay for absolutely nothing.

I do not know why the Prime Minister does not listen to his Employment Minister, who had the courage to leave the bunker for a moment this morning and say that

“there is a frustration about these schemes and the money and the credit getting through.”

If the Prime Minister had listened to us, he would have introduced a national loan guarantee scheme back in November, and it would have been operating for five months. Should not he also listen to the German Chancellor, Angela Merkel, who stood with him in Downing street and said—[Interruption.] The hon. Member for Bolsover (Mr. Skinner) should be quiet. I know that he wanted miners to join the Government: well, now he has got one—Lord Myners—[Interruption.]

Order. Miss Snelgrove, I have told you before. It is not the done thing to shout in the Chamber. You should not be doing that. Perhaps you need a wee tablet from the doctor.

They all want Lord Myners to negotiate their retirement packages: call an election and we can arrange that.

Back to the German Chancellor, who said that

“if we want to make real impact, you really must implement the package first before you talk about the next step”.

Is not that right? Are not this Government just running round, like headless chickens, with initiative after initiative that never gets implemented? Is not that combination of ineffectiveness and hyperactivity the worst combination of all?

The right hon. Gentleman opposed the German fiscal expansion. He has opposed every fiscal expansion—in the US, in Germany and in France. He is out on a limb in opposing public expenditure rising in the downturn: he wants to cut it, and he wants to cut it now.

On the right hon. Gentleman’s great £50 billion scheme, the shadow Chancellor said that it

“does not add to public expenditure.”—[Official Report, 18 December 2008; Vol. 485, c. 1228.]

However, the shadow shadow Chancellor has said that

“the taxpayer will take some of the hit.”

The Conservatives do not know whether the scheme that they are proposing will cost money or not cost money: that is how bereft they are of ideas for the economy.

The Leader of the Opposition does not understand that this is an unprecedented global banking crisis. Unprecedented means without precedent. Global means that it affects the whole of the world. The sooner that he wakes up to the fact that we need global action to deal with it, the better for our country.

I am glad that the Prime Minister is back to reading out quotations, because we now know how long a pledge from him lasts. Yesterday, he said in The Guardian:

“I personally have always said that modern politics, with its focus on who said what, when, how and why, is far too divisive for the problems that a country’s got to meet”.

What a complete phoney! [Interruption.]

Order. Let me chair the proceedings. That remark should be withdrawn—[Interruption.] Order. I will do the talking. It should be properly withdrawn.

I am happy to withdraw that remark.

The Prime Minister mentioned the Germans. Of course, they went into the recession with a surplus, not a deficit. That is why the German Finance Minister said that the VAT cut, which we opposed, will build up debt that will take a generation to pay off.

Let us be clear about what has happened today. This Government have announced the biggest rise in the dole queue since records began. That is a rise faster than under any Conservative Government or any previous Labour Government. Is it not the case that the Prime Minister has led us to this point without a hint of an apology, and the British people will never forget it?

First of all, quoting German Finance Ministers in the week when the Conservatives are walking away from the mainstream of European politics is absolutely absurd. Secondly, we are prepared to spend money to help the unemployed; we are not going to walk by on the other side, we are going to help them. However, when it comes to the Conservatives’ main proposal for spending money, let us be absolutely clear that we are spending money to help the unemployed whereas the Conservatives’ first priority is an inheritance tax cut for the 3,000 top estates in the country.

What further indication do we need of Conservative priorities than the fact that the motion for today’s debate on the economy does not even mention the word “unemployment”? That is how they feel. They are the party of the few; we are the party of the many.

Six months ago today, a constituent of mine, Claire Walker, died of cervical cancer. She was 23 years of age. Will the Prime Minister join me and Claire’s family, friends and supporters who are campaigning in London today in wholeheartedly welcoming last Friday’s announcement that there will be a full, independent and comprehensive review to consider the urgent case for the reintroduction of cervical cancer screening for young women under 25?

I appreciate everything that my hon. Friend said. Any family that is suffering because of cervical cancer—or, indeed, because of any form of cancer—has all our sympathies. We want to do everything we can to help, which is why we have introduced the vaccinations for teenagers—we have extended that programme and are ready to extend it further—and why the independent review that he mentioned will consider the case for making cervical cancer screening available to women under 25. It is our responsibility to look at all the available medical evidence about the risks as well as about the advantages of such screening. That will be done and I assure him that we take seriously the needs of anyone who is facing cancer at this time.

I would like to add my own expressions of sympathy and condolence to the family and friends of the three soldiers who tragically lost their lives in Afghanistan in the last week. With the death toll among our brave servicemen and women now at more than 150, it is right that we should pause to reflect on the immense sacrifice that they and their families have had to endure in serving this country and, of course, the people of Afghanistan.

Does the Prime Minister believe that the culture of frenzied target setting that has been introduced into the NHS by his Government had any role to play whatsoever in the horrific events that occurred at Stafford general hospital?

May I and the Health Secretary first say that we apologise to those people who have suffered as a result of the mistakes that have been made at Stafford hospital? Everybody who uses the national health service has a right, if they put their faith in the NHS at that hospital, to expect the highest standards of treatment. These were not the highest standards of treatment. They have now been investigated, and they fell far short of the standards that people expect. The first thing that we have to do is to assure the families of those who have suffered and relatives who are grieving and who want answers to their questions that there will be independent reviews, if they seek them, of their families’ case notes so that they can be assured of what has happened. That is the first thing that we will do.

The second thing that we have to look at is whether this is a generic problem or a problem at a specific hospital. I am assured by the Healthcare Commission—the chief executive has made a statement today—that there is no equivalent case in all the other NHS hospitals across the country. We should therefore focus on the individual mistakes that were made by management and deal with them. A further inquiry is going on to look at what happened between 2003 and 2005. At the same time, the Care Quality Commission is looking into what lessons we can learn in general from what happened.

When doctors at that hospital have confirmed that they were instructed by their managers to abandon seriously ill patients and to treat people with minor ailments instead in order to meet the Prime Minister’s targets, it is not enough to talk of reviews, inquiries and to blame other people. Will he scrap the mad targets that make hospitals tick boxes rather than look after the desperately ill?

Whatever happened in that hospital is unacceptable and should never be allowed to happen again. I too have looked at all the detail of the evidence in this report, which also says that nursing care standards were poor but that they were never discussed or identified as being poor, that results of patient surveys were available but were never reported to the board of management, and that, at the time of the C. difficile infection, nobody on the board or among the general public ever knew that the rate of infection had doubled. Those low standards of management in the hospital, therefore, must be dealt with by our review.

I take seriously everything that has come out of this case, but I think that it is not unreasonable in the modern age to expect a hospital to have the highest standards of care and at the same time ensure that every cancer patient is seen within two weeks. It is not unreasonable to say that hospitals should have the highest standards of care and ensure that there is a wait of only 18 weeks between a person seeing a doctor and getting an operation. It is not unreasonable to say that the highest standards of care should be pursued in accident and emergency departments and that people should not have to wait for hours before they get treatment.

We will look at all the evidence that is available. The Care Quality Commission will look at it too, but I think that we have to deal with the individual management failures in the hospital and then learn whatever lessons we can for the future of the national health service.

After these damaging revelations about Stafford hospital, there are relatives today in turmoil, wanting to know whether their loved ones’ deaths could have been prevented. I want to press the Prime Minister on what he has just said about reviews. I say that those relatives are entitled to an independent assessment to answer that question for them. Does he agree with that?

There are no excuses for what happened in Stafford hospital—no excuses at all. That is why every single relative who asks for it has a right to have the case notes reviewed independently, and to see the notes themselves. That is what will happen. Relatives will have a right, therefore, to take whatever action is necessary as a result of seeing the papers before them.

At the same time, Mr. George Alberti, who is recognised as being a very pre-eminent surgeon, is going to go to the hospital to look at the progress that has been made, and which has been reported by the Healthcare Commission already. He will ensure that, in future, patients at Stafford hospital have the assurance of the highest standards. The chief executive and the chairman of the trust have been removed. There is a new chief executive who will look at disciplinary procedures wherever they are necessary. We have got to do everything to assure people that they can have the trust that we know that everybody wants to have in the national health service and in every hospital in the country.

Q2. Is the Prime Minister still committed to robustly protecting the green belt? If so, will the Government scrap the south-west regional spatial strategy and allow local communities to develop plans to address local housing need and protect precious open spaces? (264128)

If the hon. Lady wants to talk about the future of the regions, I hope that she will join the regional Committees in the House of Commons to debate that. As for the green belt, I think that we are doing more than any Government to protect it, and that is what we will continue to do.

The proposed Mersey gateway bridge will help ease traffic congestion in my constituency and in the constituency of my hon. Friend the Member for Weaver Vale (Mr. Hall). The previous Tory Government turned down the project, which will also create more than 4,000 jobs in Cheshire and Merseyside. Will my right hon. Friend do all he can to ensure that there is no delay in the final decision approval, as this is exactly the sort of infrastructure project that will help economic recovery?

Yes. My hon. Friend has been working very hard and representing the case of his constituents on this matter, and I can assure him that we will look very carefully at what he says. I can tell him that we plan to advance public spending in the year that is coming. We plan to spend £44 billion in the year from April, and that will add to the number of jobs in every constituency.

Q3. It was announced today that another 800 jobs have been lost in the south Devon area. That will put more pressure on South Devon college, which helps to train people and get them back into work. Will the Prime Minister look urgently at the funding blockages that are preventing that outstanding college from expanding and helping some of the people who are losing their jobs? (264129)

I am grateful to the hon. Gentleman for that question, and I will look at the matter. I repeat that the investment that is to take place in further education colleges—it is a capital programme—will be £110 million this year. I can also say to him that the Train to Gain programme, in which colleges are often involved, is expanding from 300,000 people to 700,000 and then a million people, so more people will be able to take courses that will give them the necessary skills. Of course I will look at the specific issue in his constituency that he has raised.

Q4. As my right hon. Friend is aware, a prisoner recently released from Guantanamo Bay has been making very serious allegations about torture. Can he assure me and the rest of the House that the claims will be fully investigated? (264130)

I have placed a written ministerial statement in the Library this morning, and I want to update the House about what the Government are doing, so that we can deal unequivocally with the issue of our condemnation of the use of torture. We will now publish, after consultation with the Intelligence and Security Committee, the guidance to intelligence officers and service personnel on detention, and on interviews of detainees overseas. We will invite Sir Peter Gibson, who is a former Lord Justice and the current intelligence services commissioner, to monitor complaints to do with the guidance, and to report to me annually. In order to have systems that are robust, we will ask—

In order to ensure that our systems are robust, we will ask the Intelligence and Security Committee to consider any developments and relevant information since its last report. [Hon. Members: “This is a statement.”] I have faith in our security services. We must ensure that the public also have all the faith that is necessary in our security services, and we condemn absolutely the use of torture.

Order. I hear shouting. If anyone feels that there should be a statement, they should ask for an urgent question; that is the way to do it.

What the Prime Minister just said about the hospital in Stafford simply is not enough. We do need a review of the case notes, but we do not just want a Care Quality Commission review. What we need is a full public inquiry to get to the bottom of the matter. It is not enough simply to deal with the issue in the way he described. We need to know whether compensation will be payable to the victims, and we need to ensure that the people responsible who are still on the board are sacked, and not simply suspended on pay.

I know that the hon. Gentleman’s constituency is covered by the hospital as well, so let me reply to him in some detail. All disciplinary matters are being dealt with at the moment by the new chief executive, who is looking at what has happened in the hospital over these last few years in the light of the Healthcare Commission report. A Healthcare Commission report will be followed up by a review into what happened between 2003 and 2006, and an inquiry by George Alberti about whether the standards that have been raised are actually satisfactory for people in the area. At the same time, the Care Quality Commission will look at the standards of health care overall, and look at whether there is an early warning system that could be better in future for dealing with such problems. Individuals, of course, can bring what cases they wish, but I think that they will welcome the fact that the individual case notes are to be made available to them, and are to be reviewed independently.

Q5. May I add my condolences to the families of all the servicemen who have died recently in Afghanistan, including Corporal Dean John of Port Talbot in my constituency? Dean was a member of a well-respected service family. Many of our 6 million carers in this country have benefited significantly from the Government’s new national carers strategy, and we should welcome that. However, the carer’s allowance has not been improved. Will my right hon. Friend the Prime Minister agree to meet carers’ organisations, and the all-party carers group, to discuss ways of improving carers’ benefits, as recommended by the Work and Pensions Committee report last year? (264131)

The 6 million carers in our society are at the heart of the help that is necessary for people who are in need of assistance and care, and we want to do everything that we possibly can to help them. I will happily meet the delegation that my hon. Friend suggests I meet. As he knows, the national carers strategy made proposals about respite care, about training for carers, and about pensions for carers. We are also looking at the allowances that are available for carers. We want to do whatever we can to help that group of people who give their lives to help people who are in difficulty and in need. I look forward to meeting the carers’ organisations.

Q6. On Saturday my right hon. Friend the Member for North-West Hampshire (Sir George Young), my hon. Friend the Member for Basingstoke (Mrs. Miller) and I visited Basingstoke and North Hampshire hospital to see an out-of-hours medical service provided by local GPs. It is a fantastic success story called Hantsdoc. It has been rated the best health provider in Hampshire, it has nearly 100 per cent. customer satisfaction, and it is locally run and locally devised. Is this not a better model than the top-down, target-driven, Whitehall-imposed approach that seems to be, sadly, less successful elsewhere in the NHS? (264132)

It does not seem to me incompatible to have locally run health services that are of the high standard that the right hon. Gentleman has asked for and seen in his constituency, and which I have seen in many hospitals and GP-led centres in the country, and to have minimum targets which are objectives that are set and can be met for the country as a whole. I come back to this: do we want to get rid of the objective and, indeed, the guarantee that within two weeks someone suffering from cancer can be seen by a clinician? Do we really want to go backwards on that? Surely that must be a national objective which all people can support.

Q8. Many British children on the island of St. Helena are living with only one parent or without both parents, as adults of working age have to leave the island to find work elsewhere. The decision this week to put off a decision on the airport has dismayed them. Will my right hon. Friend commit to an early decision and give those families some hope that they can live together again? (264134)

I know that my hon. Friend held a debate on the matter in Westminster Hall. It is important to say that we have set up a consultation on options for access to St. Helena. That consultation will report, and then we will make the right decision.

Mid Staffordshire NHS Foundation Trust

With permission, Mr. Speaker, I wish to make a statement about Stafford hospital, following the Healthcare Commission’s investigation published yesterday.

The report details astonishing failures at every level, and shows that for patients admitted for emergency care at Stafford, there were deficiencies at every stage. The Healthcare Commission found disorganisation, delays in assessment and pain relief, poor recording of important information, symptoms and requests for help ignored, poor communication with families and patients, and severe failings in the way the trust board conducted its business. While the management was obsessed with achieving foundation trust status, the wards were understaffed and patient care seriously compromised.

The report cites incidents of patients left without food or drink for days because operations were delayed, of nurses who had not been properly trained to use basic, lifesaving equipment, and of patients admitted to A and E being triaged by receptionists. It notes that there was a dangerous lack of experienced staff, observation and monitoring of patients was poor, essential equipment often was not working, and there were no systems in place to spot where things were going wrong in order to make improvements. In short, it is a catalogue of individual and systemic failings that have no place in any NHS hospital, but which were allowed to happen by a board that steadfastly refused to acknowledge the serious concerns about the poor standard of care raised by patients and staff.

I apologise on behalf of the Government and the NHS for the pain and anguish caused to so many patients and their families by the appalling standards of care at Stafford hospital, and for the failures highlighted in the report.

In the course of my statement I will set out the actions that we will take in response to the report, but I want to begin by summarising the events that led to the Healthcare Commission’s investigation. The Commission became aware of high mortality rates for specific conditions or operations at the trust during the summer of 2007 through its routine analysis and a statistic known as hospital standardised mortality ratios, more commonly called SMRs, produced by the Dr. Foster research unit, based at Imperial college.

Whenever the Healthcare Commission is alerted to unusually high mortality rates, it initially asks the trust to provide further information to explain such anomalies. High standardised mortality ratios are not necessarily an indicator of poor clinical performance and nor do they signify that there have been avoidable deaths, but they do act as a screening tool to identify the need for investigation. Further analysis showed that there were consistently high mortality rates for patients admitted as emergencies going back over several years.

The trust repeatedly dismissed the significance of these statistics, saying that they could be explained by the problem it was having with the recording of data. The accuracy of information coding—that is, the system for cataloguing types of surgical and other interventions—had historically been poor in the trust, and the internal group that the trust itself had set up to consider high mortality rates assumed that they could be explained by coding errors.

The Healthcare Commission refused to accept this explanation and launched a full-scale investigation in March 2008. In May of that year, following its first visit, the commission asked to see the chief executive and set out its immediate concerns about the poor patient care and inadequate staffing levels that it had observed. Since then, there has been gradual improvement. The Healthcare Commission states in its report that

“the Trust deserves credit for progress on infection control and for responding positively to the concerns of the Commission.”

On an unannounced visit in February to the accident and emergency department, the Healthcare Commission noted significant improvements. Its visit raised no immediate concerns about the safety of patients admitted to the accident and emergency department.

However, the failures are stark and they occurred over a substantial period of time. Patients will want to be absolutely certain that the quality of care at Stafford hospital has been radically transformed and, in particular, that the urgent and emergency care is administered safely. I have today, jointly with Monitor, asked Professor George Alberti, the eminent physician and national clinical director for urgent and emergency care, to lead an independent review of the trust’s procedures for emergency admissions and treatment and its progress against the recommendations in the report. He will report in five weeks’ time and his findings will be published to the House.

The Healthcare Commission has told me that it is confident that Stafford hospital is an isolated case, and that having looked at other trusts with similarly high standardised mortality ratios, it is reassured that a similar succession of serious lapses in care has not occurred elsewhere.

The National Quality Board has been set up to look at how organisations work effectively together in patients’ best interests. It is composed of representatives of the royal colleges, patient groups, regulatory bodies and clinical experts. I have asked the board to look at how we can ensure that any early signs that something is going wrong are picked up immediately, that the right organisations are alerted and that action is taken quickly.

The public and the House will want to know how the problems at Mid Staffordshire could have remained undetected for so long. One of the reasons the Healthcare Commission began its investigation was that after having been initially alerted to the problem in the trust, it became clear that there had been serious failings for some time. The Healthcare Commission’s report raises serious concerns about why the primary care trusts and the strategic health authority either failed to spot the problems at the trust or, having spotted them, failed to act.

I have asked Dr David Colin-Thomé, the national clinical director for primary care, to review the circumstances surrounding the Mid Staffordshire NHS Foundation Trust prior to the Healthcare Commission’s investigation to learn lessons about how the primary care trusts and the strategic health authority, within the commissioning and performance management systems that they operate, failed to expose what was happening in this hospital. His recommendations will focus on what commissioners across England—GPs and PCTs—can learn from this case to be sure they are advocating effectively on patients’ behalf.

Our principal concern today must be to reassure the families and friends of patients who have died at Stafford hospital that they will be able to ascertain whether any of the failings detailed in the Healthcare Commission’s report contributed in any way to the death of their loved ones. As the Healthcare Commission has said, it is not possible to determine conclusively from any set of statistics whether there were any avoidable deaths owing to poor standards of care—that can be done only through a case notes review. I can confirm that the new leadership of the trust will respond to every request from those relatives and carry out an independent review of case notes to determine whether or not the care that they or their loved ones received was appropriate.

The failings at Stafford hospital are inexcusable. I hope that we can close this chapter in the hospital’s history by acknowledging and addressing past failings and by ensuring that lessons are learned by government and the NHS at all levels to make sure that these terrible failures are never allowed to happen again.

The House will be grateful to the Secretary of State for his statement and will share with him the apology that he expressed on behalf of the Government and the NHS to all the families and patients adversely affected by the events at Stafford hospital.

We were all shocked and appalled at the failings in patient care at the hospital. There was a systematic failure in respect of patients receiving emergency care. Triage was done by unqualified receptionists; treatment was carried out by too few, too poorly trained doctors and nurses; there was inadequate staffing in the emergency department and on wards; nurses were poorly trained; patients were pushed out to the wrong wards, where the care that they needed was not available; patients were left in pain; patients were left without food and drink; basic hygiene needs were not met; nil by mouth patients were left for days waiting for operations; cardiac monitors were switched off because the nurses were not trained to use them; there were too few critical care beds; and there was a failure to prevent blood clots that went on to kill patients.

A number of things were lacking in the Secretary of State’s statement. I say first that it would have been better for him to have acknowledged the role played by Julie Bailey and the Cure the NHS campaign in Staffordshire in calling attention to what had happened at Stafford hospital. As the Healthcare Commission said in its report, when it launched its investigation there was an unprecedented level of response from patients and relatives who wanted to tell its representatives what was happening. That, frankly, is illustrative of the abject failure of the NHS to listen to what patients and relatives were telling it about what was happening at the hospital.

We do not know how many patients died needlessly, but we do know that the board of the trust did not listen to complaints from patients and their families, or even to the doctors and nurses on the front line at the hospital. The board did not devote its efforts to the quality of care for patients but was obsessed with financial results, organisational change and targets—not with the care and safety of patients.

Our job is to find out not just what happened, but why it happened—and, by doing so, to ensure that it does not happen again. Clearly, the board of the trust was appointed to this task, but it should not have been simply left to get on with it. What was the primary care trust, which was responsible for commissioning services from the hospital, doing about the situation? The Healthcare Commission report says:

“Staff from the PCT involved in commissioning told us that they inherited a chaotic situation”—

following the merger of primary care trusts—

“with no detailed handover from the previous PCTs…The minutes of the PCT’s performance…committee did not reveal any evidence that the PCT was aware of any problems in the quality of service being provided by the acute trust”.

The PCT was concerned with cost and volume, not with quality. I urge the Secretary of State to ensure that a powerful lesson is learned about how commissioning is undertaken across the country.

The strategic health authority was, until February 2008, responsible for the performance management of the trust. It saw the mortality data at the same time as the Healthcare Commission, asked what was happening, sent the university of Birmingham to do an academic inquiry and came away, apparently reassured, that it was a matter of coding. Why did it not get to the truth of what was happening? Why was it that a year ago, the chief executive of the trust, who was responsible for what was going on, said:

“We worked with the Strategic Health Authority and investigated this apparently high mortality rate and concluded that it was due to problems in the way we were recording and coding information about patients. We have, over the last year, employed more clinical coding experts”?

He employed not doctors or nurses, but clinical coding experts. Why did the strategic health authority have the wool pulled over its eyes? Given that the then chief executive of that SHA, Cynthia Bower, has since been appointed by the Secretary of State to be chief executive of the Care Quality Commission, which will take over the Healthcare Commission’s responsibilities in two weeks’ time, is the Secretary of State confident that the CQC will intervene where necessary in future, and that it will be effective when it does so?

When the Secretary of State passed to Monitor the application for this trust to be a foundation trust in the summer of 2007, one of his jobs was to assure himself that there was a good quality of care. Did he simply tick a box called “They’ve met the four-hour target in A and E” or was there any additional evidence? It should have been his job to know that the Healthcare Commission had initiated an investigation into the trust. Even if the Healthcare Commission did not tell Monitor, it was his job to do so, and there is an admission in the Department of Health documents that that should be part of the process.

When the Healthcare Commission carried out its investigation, and wrote on 23 May 2008 requiring urgent action by the chief executive at the Stafford hospital, what did the Secretary of State and Monitor do about it? Why did they not intervene at that moment to remove the board and put in new management? It has taken us 10 months to arrive at that point. It was not simply the case that the events in question were historical, and that everything had been solved by then. The report of the Healthcare Commission says:

“As late as September 2008, we found unacceptable examples of assessment and management of patients.”

The problems persisted and the board carried on. It is still in denial, and when Mr. Martin Yeates, the chief executive resigned, he said, among other things:

“I am very proud of what we have achieved so far.”

The public in Staffordshire had a right to know what was going on, and the chief executive of their trust never told them what was happening.

After Maidstone and Tunbridge Wells, the Secretary of State came to the House on 15 October 2007 and said:

“we should be spotting these issues much earlier and getting rid of incompetent chief executives or chairpersons who, fortunately, are in the minority, rather than waiting for a report such as this, by which time, frankly, most of the damage has been done.”—[Official Report, 15 October 2007; Vol. 464, c. 571.]

Where is there any evidence of early and effective intervention by the Secretary of State, his Department, the strategic health authority, which acts on his behalf, or the primary care trust, which also acts on his behalf? Why did that not happen?

Will the Secretary of State acknowledge that constant organisational change, loss of financial control and an obsession with narrow process targets also contributed to the failure of this hospital, as they have in so many other places before, such as Maidstone and Tunbridge Wells and Stoke Mandeville? There is a systematic problem here. Will he ask the National Quality Board to look at the structure of targets so that it delivers on performance management and continuous improvement without the distortion of clinical priorities and clinical decision making, which has followed on from the application of the four-hour A and E target?

Moving from targets to outcomes, devolving decisions to the front line, giving real information and choice to patients, listening to patients, and holding hospitals to account for their performance through competition are not just the policy changes needed; they are the essence of an NHS that does not just respond to tick-box, top-down targets, but responds to the real need of patients. Learning from what has gone wrong is the essence of understanding how to improve it in the future. When will the Government learn that lesson?

The hon. Gentleman makes a number of valid points, and one that I do not consider valid, which I will come on to.

The hon. Gentleman’s point about Julie Bailey and the Cure the NHS campaign was absolutely right. Indeed, I said in my statement that patients and staff raised concerns over a long period, and we can look at the number of complaints that went through the process. Let us remember that before the early part of this century, there was no independent regulator and no proper complaints procedure. A complaint would only have ended up in the trust—there was nowhere for it to go after that, and there were no statistics. Accident and emergency was a data-free zone. We can go back only about as far as 2001 to get any real indication of what happened.

What we know is that in the three years 2005-06 to 2008-09, there were 43 complaints by patients at the hospital. That is not unusual, incidentally. What is unusual is that 32 of those complaints were upheld at the level of the Healthcare Commission, which is where complaints now go beyond the local trust. [Interruption.] The hon. Member for Eddisbury (Mr. O'Brien) says that we have just stopped that. We can debate those issues, but it is very important to talk about what happened at Stafford. The hon. Member for South Cambridgeshire (Mr. Lansley) said that we have to know how this happened. He made a valid point about patient organisations, including Cure the NHS.

As for why it happened, the hon. Gentleman made a valid point about the primary care trust. Actually, we have to put that in the plural—it was primary care trusts at the beginning. I believe that there were two or three before the reorganisation. Now there is one, but previously there were a number. The reason I am asking David Colin-Thomé to look at that as far back as 2002 is precisely that we need to know what the primary care trusts were doing. We need to know why the strategic health authority, too, was not picking up on the problem on behalf of its patients. That is a central feature of what the SHA and PCTs are meant to do as commissioners.

All that we know—the hon. Gentleman will have seen this in the Healthcare Commission’s report—is that there is a turgid argument about coding errors. It was pointed out by the Commission for Health Improvement in 2002, when it examined Stafford as part of a rolling programme of looking at every hospital in the country, that the system of collecting data was poor. That then seems to have become the major reason no one would examine what was actually happening to patients and patient care. The SHA commissioned Birmingham university to produce a report, which once again seemed to suggest that the problem was all about coding errors. We should pay tribute to the Healthcare Commission, which, having listened to that over and over again, refused to accept it and actually went in to see what was happening in the hospital.

I do have confidence in the Care Quality Commission, not least because this House has given it greater powers than the Healthcare Commission has. Looking at what happened at Stafford, although no one knew it when we were debating the matter, there is no better argument for why those registration and other powers are so important.

The hon. Gentleman asked when the information was passed to Ministers, and he made a point about how the Healthcare Commission could have tackled the problem much earlier. This was approved in the Department before I arrived—[Interruption.] Well, he asked me when I approved it, so I am just answering that I did not approve it; it happened before.

The simple fact is that the approval was for a system that looked to the future. The consideration was whether the board had a strategy for the future—the hospital had a three-star rating from the Commission for Health Improvement—and whether it was capable of carrying it out. At that time, in June 2007, there was no indication of a Healthcare Commission inquiry. Indeed, the commission itself was alerted by the Dr. Foster figures in the summer and autumn of 2007.

As far as the question about what the commission did is concerned, when it went in in May 2008 it had the ability, which Parliament had given it, to put that hospital into special measures immediately. That is the commission’s decision, not ours. It is an independent regulator’s decision to do that. What the commission did—I think it was the right thing to do—was not wait for 18 months until it had produced a report but immediately call the chief executive to a meeting and say, “There are serious concerns.” Obviously it had to produce a report with recommendations, but it said that those concerns had to be tackled immediately. It states in its report that the trust did start to tackle those issues, although the hon. Gentleman is absolutely right to say that we have to be confident that there is not still a state of denial in the trust. I am still not confident about that, for some of the reasons that he gave. That is why I have asked George Alberti to go immediately and produce a report in five weeks.

Where I take issue with the hon. Gentleman—I hope that Members of all parties will not use this turgid argument—is the idea that somehow this is to do with targets.

The hon. Gentleman says from a sedentary position that that is in the report. No, the report says that staff—

Order. The hon. Gentleman should not be saying anything from a sedentary position. A Minister is answering a case that has been put by the Opposition Front-Bench spokesman, and other hon. Members should listen.

Thank you, Mr. Speaker. This is an important point. Staff said in the Healthcare Commission report that their managers were pushing them on this issue, on the basis that they had to meet the target. However, I have just explained that A and E was a data-free zone. Horrendous things were going on there, including 12-hour trolley waits, that needed to be tackled. The argument made by the College of Emergency Medicine and the Royal College of Nursing is not that we should do away with targets. Indeed, the hon. Member for South Cambridgeshire himself said yesterday, in a very measured statement, that he has no problem with time limits—he did not use the word “targets”—but that they must never be used as an excuse to damage patient care.

We must not let the management of Stafford off the hook through some suggestion that patients cannot be treated reasonably and quickly unless we do away with standards for patient care. There is no excuse for getting untrained receptionists to triage nurse, and there is no excuse, least of all targets, for leaving someone with a broken thigh bleeding in A and E for six hours without any attention. There is no excuse for the chronic understaffing that took place at Stafford. I therefore believe that although there may be an attempt to score a few political points here, to the people of Stafford targets are not responsible for what happened in that hospital. The problem was poor management and inadequate staffing.

The report makes it very clear that the care failings ran deep and wide. It is less clear why that performance attracted the highest, three-star rating and foundation trust status just last year. I put it to the Secretary of State that the big challenge now is to get that hospital performing to the right standard every day for every patient while totally reconstituting the trust. May I ask him to lead from the front and come to Stafford to meet people in the hospital and talk to the patients groups that he praised in his statement? Will he explain to us how he is going to stay involved as we make those changes?

My hon. Friend has written on several occasions about the situation at Stafford, as have other hon. Members of all parties over the years. I will be very pleased to come and meet the patients and the representative patients groups at Stafford, and I am keen to go through with them the various measures that I have set out today so that I can be assured that there is nothing else that we can do to put their minds at rest.

I thank the Secretary of State for early sight of the statement.

We all recognise the full horror of what has been uncovered in the report—the gross neglect of patients and many dreadful and inhumane examples of poor treatment. Conditions were described by one relative as being reminiscent of the workhouse, which is a shocking comparison to make. There has clearly been an absolute dereliction of the duty of care, which should shock us all. Stafford is not a private hospital, for which we can all blame uncaring shareholders. This is the NHS, and that is what makes it so utterly shocking.

I, too, pay tribute to the relatives who refused to be fobbed off and kept battling away, trying to get justice for their loved ones. It is the Government’s absolute responsibility to ensure that we eradicate that sort of experience from the NHS. It must never happen again. In saying that, I am conscious that it was not that long ago that we considered the abject neglect that was found in Maidstone hospital. There are therefore repeated examples of those concerns.

I hope that the Secretary of State will not only focus—rightly—on the culpability of those at the hospital, but face up to the possible wider causes and failures that led to the shocking scandal. So far, we have received an apology from him and the Government only for the failure of others. It is a strictly limited apology and further investigation is required.

The Secretary of State has announced several specific steps that he wants to take, but will he agree to relatives’ demands for a full, independent public inquiry into all the possible causes of the scandal and the vital lessons to be learned? Such an inquiry should consider the following matters. First, it should examine the need for justice for patients and relatives who have suffered so much. Secondly, it should consider the rigid operation of the four-hour target and the bullying that too often surrounds it—when one goes to hospitals and talks to emergency care practitioners, one hears that that plays a part. Doctors are told to divert from important care to treat people who are close to the four-hour target, and nurses have been threatened with the sack if the four-hour target is breached. It is extraordinary that the statement did not mention the four-hour target, given that the report refers to it.

It beggars belief that the hospital was a three-star hospital, which secured foundation trust status despite all that we have heard was going on. Is that not reminiscent of Haringey council, with its three-star status as the baby P tragedy unfolded? Surely we need a review of the way in which hospitals are assessed in the light of the events. Although managers are rightly in the firing line, what about the clinicians working in emergency care? Clearly, there was appalling understaffing, but did anyone speak out? Should any clinicians be held accountable for what happened? Has anyone left the trust? Has anyone gone through internal procedures? Those questions need answers.

We should also consider the role of the coroner, who failed to provide information about inquests, which would have been helpful. Surely that obstructed the investigation. What about the crucial role of the primary care trust and the strategic health authority? How on earth did matters go on for so long? The high mortality rate dates back to 2003—five full years—before anything was investigated.

What of the role of Cynthia Bower? She was chief executive of the strategic health authority and she is becoming head of the Care Quality Commission. What about her predecessor, who is now chief executive of the NHS? Is there a conflict of interest—

Order. Obviously, Front-Bench spokesmen get an allocation, but the hon. Gentleman has spoken for four minutes and I must consider Back Benchers and the fact that there is an Opposition day debate today. If the hon. Gentleman is about to wind up, that is fine, but he is taking liberties at the moment.

I am grateful for that guidance and I will wind up my remarks.

The chair of the Healthcare Commission has talked of appalling standards of care and chaotic systems, which are intolerable. Will the Secretary of State instigate a public inquiry? Will he apologise if the conclusion of an independent inquiry shows that the culture of top-down bullying in enforcing rigid targets has played a part in the scandal?

I think that the hon. Gentleman is wrong to call for a public inquiry. We have a very good Healthcare Commission report, which underlines the difference between what has happened and the Bristol royal infirmary inquiry, which considered the position between 1984 and 1995, when there was no commissioner or independent regulator. There was no one to go in and examine the matter and no information. Now, the Healthcare Commission has provided an excellent report. We need to do more—that is why I said that events from 2002 to 2005 need to be examined. We need to be reassured that things are happening now. There needs to be an independent review of case notes and the National Quality Board needs to examine the alerts.

The next stage review, which Lord Ara Darzi leads, appears esoteric in many ways, because it refers to each board having to produce a quality account as well as a financial account and it mentions quality metrics. It is not the stuff that gets people excited, but it is right. When we consider what happened at Stafford, we must move even further. Bruce Keogh, the medical director of the NHS and an eminent cardio-thoracic surgeon, said that there is a

“moral, professional and social responsibility”

on everyone in the NHS to know

“what they are doing and how well they are doing it”.

That did not exist previously. The hon. Gentleman spoke about Maidstone, but there was no ability to have such reports previously. The Healthcare Commission’s approach has done us proud, and I therefore do not believe that there is a need for a public inquiry.

On what is happening in the trust and whether there is an issue about people on the board or clinicians, I stress that the board, which is now led by a new chair and a new chief executive and has a new clinical director, received the report officially only today. They must now go through due process. I want people to be treated fairly, with due process. The board will consider the report today and decide whether it needs to use internal procedures in the way the hon. Gentleman suggests.

I thank my right hon. Friend for his apology on behalf of himself and the Government for what can be seen only as a tragic let-down for patients in the trust. The report often states that the trust board could—and did—ignore individual concerns. What will my right hon. Friend do about creating a mechanism that forces the board to answer individual concerns? Not only that, the concerns should be printed locally—that would reinforce the resolve of people who may want to formalise a complaint—so that we can see the scale of problem and bring pressure to bear locally. When can we, as individual citizens and patients, exert pressure on the trust boards?

My hon. Friend is right. The Healthcare Commission makes recommendations about what the trust must do, especially about the extraordinary fact that the board, when it met, dealt with only high-level stuff. It never received any complaints. To revert to an earlier point, the staff complained regularly. There was only one consultant in A and E when there should have been around four. There were three matrons in a hospital that now has 12 and should have had that number all along. Patients and staff made those complaints regularly, but they never reached the board.

Of course, some high-level stuff needs to be examined, but the Healthcare Commission has also made some basic “how you manage a hospital properly” recommendations, which must be implemented. I am confident that the new management will do that.

The Secretary of State was good enough to have a word with me yesterday about the appalling situation, which many hon. Members and the national press have thoroughly described. However, I revert to the question that I put to the Prime Minister about an inadequacy in the way in which the Government are handling the matter. I am surprised and appalled by it. So far, I have counted five separate reviews that they propose: a review of case notes—of course, that is important to establish culpability; the Alberti review, which deals only with A and E; the Care Quality Commission review, which raises questions about a conflict of interest, in that its inquiry will include an analysis of the role of the strategic health authority, in which the person who is now in charge of the CQC was involved; the PCT review; and that of the SHA.

As the Secretary of State knows, I wrote to the Healthcare Commission many months ago. I pay tribute to Julia Bailey, Debbie Heseldine and Ken Lownds, who worked on the report—

Order. The hon. Gentleman must ask a question. I have given him a bit of leeway; I got him in at Prime Minister’s questions—he has done well today—but he cannot make a speech.

I understand that, Mr. Speaker, but these are hugely important questions. Bringing all those matters together in one public inquiry, as we did in different circumstances back in 1984, with legionnaires’ disease in the same hospital, should be very carefully considered. I strongly urge that we do that; otherwise we may miss the wood for the trees. May I say finally that—

The hon. Gentleman has vociferously and persistently raised the case of concerned constituents. Indeed, he represented Stafford until 1997, so I listen with more than usual respect to what he says. The point about the case notes review is that no public inquiry or anything else can determine whether a patient died unnecessarily other than by having clinicians go through the case notes, so offering that to the loved ones of people who have died is absolutely right.

The hon. Gentleman said that Alberti would deal only with A and E, but A and E is the problem. The Healthcare Commission has made the point that the issue was to do with one third of the patients coming into A and E and the emergency assessment unit. With the greatest respect, I do not think that a public inquiry will take us any further forward. Yes, there was a public inquiry into legionnaires’ disease at the same hospital in ’84, but there was no independent Healthcare Commission at that time. The Healthcare Commission has provided the report. To have a public inquiry on top of that would just delay moving forward on the issue, so with the greatest respect, I disagree with the hon. Gentleman.

Does the Secretary of State agree that having no reconfiguration of primary care, no change in the status of a hospital and no targets would take away the responsibilities that health professionals have to patients? Would he also be prepared to allow the findings of the case notes review to be reported to the regulatory bodies, if that is applicable?

I agree with my right hon. Friend on all those points. One reason standards have improved so dramatically is that we have proper measuring and independent regulation and we have set standards. The targets become standards as soon as they are achieved, and they have indeed been achieved. I also agree with the point about drawing to the attention of the regulator any information that emerges from the case notes review.

These issues precede 2002. It is to my great regret that I was told by Staffordshire paramedics in 1999 that people would be far better off going to Burton than to Stafford. When I made inquiries about that, I was just fobbed off. What can the Secretary of State do now to reassure my constituents that Burton, Good Hope and other hospitals, as well as Stafford, are safe places to go to?

People have to look at what the Healthcare Commission says. The Healthcare Commission has looked at all the so-called outliers—hospitals that had a very high standardised mortality ratio—and it is assured that the problems are not the same as at Stafford. The Healthcare Commission has its own alert system, leaving aside the Dr. Foster system, in which five red lights, as it were, went off about care at Stafford hospital. That has not happened in Burton or other hospitals around the country.

I find it inconceivable that what happened could have happened over such a long period, and the hon. Gentleman is absolutely right: it probably went on for much longer. The hon. Member for Stone (Mr. Cash) made the same point to me yesterday. However, we now have the procedures in place and we have the Healthcare Commission, and people can rest assured. Hon. Members in all parts of the House have to ensure that there is no hiding place for poor patient care.

Last week Bill Moyes of Monitor told me in the Select Committee on Health that the Mid Staffordshire NHS Foundation Trust met its criteria

“in February 2008, after…a lengthy assessment.”

Does that not undermine the credibility of the foundation trust assessment process? Could the Secretary of State also give me an assurance that the proper patient care priorities of other hospitals, including the University hospital of North Staffordshire, will not be compromised by its determination to secure foundation trust status?

My hon. Friend raises an important point, which is central to the issue that we are discussing. I do not think that Bill Moyes or Monitor could have made any other decision. Let us not forget that the decision on Stafford was made before the Healthcare Commission decided that it needed to investigate. Yes, there were issues to do with the high standardised mortality ratio, but there are such issues in many hospitals. Once the Healthcare Commission decided formally to investigate on 18 March 2008, the hospital already had foundation trust status. Why did Monitor do that? It did so because the system looks at whether there is a proper strategy to implement.

There are lessons for everyone to learn, but I will tell the House what Bill Moyes said last night:

“we have certainly learned since our assessment of Mid Staffordshire that we need to look wider than we did at the time. At the time we tended to rely on other bodies to bring us information, whereas now we look at a whole range of issues about quality, including things like complaints”.

Apparently that was not previously in the system. We all need to learn from what has happened. I am not saying that Monitor or anyone else—and certainly not the Government—does not have lessons to learn, but the 115 foundation trust hospitals that have managed to achieve that status, to which many others aspire, are a world away from the awful events that were happening in Stafford.

May I offer the Secretary of State a simple and constructive suggestion? Will he ask the chairman of every hospital’s trust how much time its board has spent in the last year considering each of the following three topics: meeting Government targets; the status of the trust; and improving patient care? Would the answers to that question not help the Secretary of State as he tries to ensure that nothing similar ever happens again?

They would not, in the sense that the primary duty is to concentrate on patient care. That is the primary duty of all clinicians. [Interruption.] Well, look, the worst mistake that we could make in this House would be to besmirch the whole of the NHS with what happened at Stafford, which was an absolute exception. I hope that the right hon. and learned Gentleman accepts that, because that is what the Healthcare Commission says. Anyone who has seen any NHS worker anywhere in the country who looks at what happened would be appalled. The chief executive of the NHS has today written to every trust board, drawing their attention to what happened at Stafford and asking them urgently to review the situation to ensure that they are doing the things that the Healthcare Commission has recommended Mid Staffordshire trust must do, which includes ensuring that patient complaints reach the board.

This is a shocking and shaming report, as my right hon. Friend has said, but it is not a surprising one. My files are full of cases describing a lack of basic care at the trust. That is why I wrote to the Healthcare Commission asking it to look at the pattern of complaints and saying that I thought that they “highlighted systemic care issues”. Now we know from this extraordinary sentence in the report that

“the board did not routinely discuss the quality of care”.

We are talking about a trust that had sky-high mortality rates and sky-high levels of upheld complaints that did not even routinely discuss the quality of care at board level. That is beyond belief. The Government have now rightly put the quality of care at the top of the NHS agenda, but how can we be sure that that really happens everywhere in the country?

My hon. Friend’s constituency covers Stafford hospital—he will shake his head if I am wrong—and once again I pay tribute to the work that he has done. The National Quality Board, among other things, will ensure that quality is central to everything that happens in the NHS—again, that came from the Darzi review. The process will involve presidents of royal societies and, crucially, patient representatives, as well as the regulators. They will be focused completely on ensuring the introduction across the country of quality metrics, CQUIN—commissioning for quality and innovation—and all the other terminology that is important to clinicians, so that quality becomes the organising principle of the NHS. It is their job to ensure that that takes place everywhere across the country. With that drive and commitment by clinicians, who were paramount in shaping Darzi’s review, my hon. Friend can be assured that quality will indeed be the guiding principle and that, as I said earlier, there will be no hiding place for poor patient care.

During the years of deficit, strict vacancy freezes were put in place in all trusts. Will the Secretary of State reassure us that the vacancy freezes in Mid Staffordshire were not followed by a permanent reduction in nursing posts?

I can reassure the hon. Gentleman that there are no vacancy freezes. The Healthcare Commission has said that the hospital was drastically understaffed, and had been so for years. He is absolutely right to say that it had to move from deficit to surplus; it is quite right that extra money going into the NHS must be matched by trusts handling their finances properly, but that must never, ever be at the expense of patient care. It is obvious that this hospital was understaffed for many years, particularly in A and E.

Doctors and nurses are in the first line of whistleblowers. I want to hear my friend say loud and clear that clinicians have a professional obligation to speak out loudly when things go wrong, and to take any concerns to their professional bodies. Why on earth did that not happen in this case?

My hon. Friend is absolutely right. It is one of the great mysteries of Stafford that, as far as we are aware, that did not happen. The Healthcare Commission has said that clinicians and staff gave up registering complaints at the hospital because they felt that they were wasting their time, but I cannot answer the question of why those complaints did not come up through a different route. My hon. Friend is right to raise it, but there is no answer to it in the Healthcare Commission’s report. Perhaps one will emerge from the other reviews.

I apologise to the Secretary of State for interrupting him earlier. I put it down to the fact that I was horrified by the tale that he was telling us. Will he tell us who was responsible for the appointment of the non-executive directors of the trust, who was responsible for the system of appointment for the non-executive directors, and what qualifications the non-executive directors had that gave them the skills to be non-executive directors?

It was the chair and chief executive of the trust, before it became a foundation trust, and now it is the governors of the trust who are responsible for appointing the board and for ensuring that the people whom they appoint as non-executive directors have the skills to do the job.

Although I accept that the Government should always keep targets under review, does my right hon. Friend agree that it is utter nonsense to suggest that targets were at the heart of this problem, and that that is a reason for health professionals to neglect people who are in urgent clinical need? Does he think that replacing the word “targets” with the word “outcomes” would somehow alter the fact that we were measuring the performance in our NHS hospitals? Is it not right that we need to learn—

Order. Hon. Members are supposed to ask only one supplementary question. There were three in there somewhere.

My hon. Friend is absolutely right—[Hon. Members: “Page 49.”] Members are saying, “Page 49”. I have read every page of the report that the Healthcare Commission has conducted and written. It says that targets cannot be used as an excuse for basic failures in management. Hospitals all over the country are getting waiting times down—the Conservatives had a target of 18 months in their patients charter—and it would be bizarre and perverse to say that, because this one hospital, Stafford, has been so appallingly managed and so understaffed, we will now take away the assurance that patients across the country have that they will be seen by a specialist within two weeks if they are suspected of having cancer, that they will wait no longer than 18 weeks for their operation, and that they will wait no longer than four hours in A and E. That would be ridiculous. It is a bizarre argument and I do not understand it. On the point about outcomes, I suggest that my hon. Friend read the leader in The Times on Monday, which made the same point as eloquently as he did.

Does the Secretary of State agree that there has clearly been gross incompetence by management and staff in this case? That raises the question of what happens in the public sector when gross incompetence occurs. Surely he will agree that it is important that disciplinary procedures should be commenced as rapidly as possible, that due process must be observed, and that those responsible should be disciplined—and, if necessary, sacked—and paid the minimum that the law requires.

The right hon. and learned Gentleman is absolutely right, but, as he said, this must be done through due process. I would expect that due process to be speedy and to come to a conclusion quickly, and neither I nor anyone else in the House wants to see any rewards for failure.

The NHS overall does a great job. Stafford hospital is just a few miles from my constituency, and I am outraged at what has happened. The Secretary of State said in his statement today that “the management were obsessed with achieving foundation trust status”. There have been far too many reorganisations of the NHS, both under this Government and under previous Governments. We have too many non-executive directors who are accountants, we have trust boards that are unbalanced, and we have too many senior managers in the NHS who are incompetent and not being fired. Will my right hon. Friend assure me that he and his Department will abandon the distraction of foundation trust status, which Wolverhampton is about to go through, and that he will try to ensure a better balance on trust boards so that we have fewer—

Order. I must remind hon. Members of the practice of putting only one supplementary question to the House.

My hon. Friend has strong views about foundation hospitals, which I do not agree with. He was right, however, in his first comment. The NHS, which deals with 1 million people every 36 hours, does a terrific job up and down the country. He is falling into the trap of equating Stafford with everywhere else. There are 115 foundation trust hospitals that do a terrific job and whose standards are very high. They are part of the NHS, but it is quite right that they should have that extra freedom if they prove worthy of it. The important thing is that it should not only be financial competence that determines whether they are worthy of that status; it should also be their very important focus on patient care.

Seven years ago I warned the Secretary of State’s predecessors and the hon. Member for Woodspring (Dr. Fox) that these political targets would result in clinical distortions. Does the right hon. Gentleman accept that this hospital was a three-star trust and a foundation hospital under his Government’s target metrics? Surely he cannot simply blame the managers, when they were told that they would lose their jobs unless they met the Government’s priorities. According to the managers, these were P45 targets, and the Secretary of State cannot simply blame them for what has happened.

What the hon. Gentleman says about targets is stuff and nonsense. There is a debate about this issue. The Royal College of Emergency Medicine and the Royal College of Nursing think that targets are right. They think that the tolerance levels involved should be 95 or 96 per cent., rather than 98 per cent, but to turn Stafford into a technical argument about three percentage points is perverse, and it is unworthy of the report that the Healthcare Commission has produced.

There you go: there’s an admission! If the model is used properly, and if governors are empowered, it offers by far the best method of accountability, despite political differences. Is it not about time that we had faith in this model and empowered the governors, so that we can prevent the Staffords of this world from happening again?

I believe that my hon. Friend might have shared the view of my hon. Friend the Member for Wolverhampton, South-West (Rob Marris) at the time when we were having the debate about foundation trusts. However, he now speaks very eloquently from his experience of the trusts, and I think that he is absolutely right.

Will the Secretary of State take this opportunity to assure the House that there are no systemic failures in the NHS system, and that his Department’s regulations are not taking every ounce of initiative and flexibility away from the health professionals? For instance, if a patient is not eating at meal times, families are not allowed to visit in order to feed the patient. Is not that nonsensical? Can we not reintroduce a degree of flexibility into the arrangements, and trust the health professionals to allow what is best for the patients in their care?

I think that the hon. Lady has a particular incident that she wishes to speak to me about, and I would be very pleased to talk to her about it. I can reassure her that there is no systemic failure in the NHS, on any model. Of course, we now judge this independently; we have independent statistics. We have the Dr. Foster statistics, which are used only in this country, Canada and the United States. They are not hard and fast—there is a debate in the British Medical Journal this morning about them—but they are a very good indicator of when there is a problem in a hospital. These things never occurred before. Anyone who reads the report of what was happening at Bristol royal infirmary—in a data-free zone and without resort to independent regulation—will see that we have moved on a great deal since those dark days.

Young People Leaving Care (Accommodation)

Motion for leave to introduce a Bill (Standing Order No. 23)

I beg to move,

That leave be given to bring in a Bill to make provision for minimum standards in respect of accommodation for young people leaving care; to impose a duty on local authorities to ensure that such standards are met; and for connected purposes.

This Government have made massive progress in bringing in legislation to protect children and they have given a special focus to identifying and supporting children who are at risk of harm. The Children and Young Persons Act 2008 includes radical measures to improve the experience of young people in care, to deliver high-quality corporate parenting, to listen and respond to young people, to bring stability and continuity into every aspect of child care and, perhaps most of all, to create an uncompromising culture of high aspirations.

The Bill supports the high aspirations of the Children and Young Persons Act 2008. When a young person’s accommodation is changed from a placement in a regulated setting—that is, a children’s home or foster placement—to one that the Act refers to as “other arrangements” that are not regulated under the Care Standards Act 2000, the Bill will ensure that statutory minimum standards are in place to determine whether such accommodation is suitable.

It has been suggested that this Bill is not necessary because the regulations and guidance relating to the Children (Leaving Care) Act 2000 already place a general duty on local authorities to ensure that they provide suitable accommodation to care leavers. Certainly, a number of local authorities have developed exemplary good practice in supporting care leavers, including minimum standards to determine suitability, which they apply locally. The current framework should ensure that all care leavers are being placed in suitable accommodation that adequately meets their needs. In fact, however, the evidence from care leavers themselves and their care workers shows that in far too many cases it is not working. If the guidance from 2001 is not yet working and vulnerable young people are being placed at risk, we must conclude that a step change is needed—and it is needed now.

The National Care Advisory Service reports that 10 per cent. of care leavers feel unsafe and 44 per cent. worry about their safety. The Rainer “Home Alone” report gives case studies of the actual experience of young care leavers, so I shall cite some. For example, it states:

“There are serious problems with drug use amongst the other tenants. It’s hard for Dan as he’s struggled with that in the past and is trying to move away from it”.

In another case, it is stated:

“The room was on the very top floor, up a few flights of steps. It’s really difficult to manage every day with a young daughter and a buggy. There were no cooking facilities, no food allowed in the room.”

In another case:

“There were large amounts of rubbish and discarded food, with flies everywhere.”

In another:

“He felt uncomfortable even using the bathroom to wash. An older resident made inappropriate sexual advances to him and he still received no support. Eventually he was moved after being found unconscious in his room.”


“There was frequent harassment and discrimination from other tenants. The worst example saw her burgled and her pets were killed”—

and this relates to a girl who left care aged 16 after six and a half years as a looked-after child.

These are further cases:

“She’s 25 miles away from all of her support networks, including the leaving care team and her social worker. She doesn’t know anyone in the local area so she feels very isolated”;

“He couldn’t sustain the training placement that he’d won because of where he moved to and the distance involved”;

“The local housing department wouldn’t let Paul bid on a property until he reached 18 but he had to move out of his ‘moving on flat’ before his 18th birthday. So he had to move into temporary accommodation—a hostel—while they sorted things out. This was a major backwards step for someone who was doing well at living independently. The hostel was also in a different town which jeopardised his employment”.

In his 2006 report on young people’s views on leaving care, the children’s rights director says:

“Young people spoke of having to wait months or longer, in local bed and breakfast accommodation, before the promised flat became available. A number of young people raised concerns about whether accommodation arrangements for care leavers are always sufficient to keep them safe from harm. Young people reported that they are given flats that are unclean and situated in bad areas”.

He also said:

“Many were keen to make the point that their accommodation was filthy and that they did not feel particularly safe or secure. Other young people expressed concern at what they described as being forced to share residence with adults and other young people who they said they would never have been allowed to mix with whilst in care”.

More recently, the experiences described to the associate parliamentary group on looked-after children and care leavers confirm that far too many young people are still being moved from care into unsuitable accommodation.

Part of the problem seems to be that what constitutes “suitable accommodation” in relation to care leavers is not described in any detail. By comparison, the “fitness of premises” requirements for children’s homes under the Children’s Homes Regulations 2001, issued under the Care Standards Act 2000, give detailed specifications that accommodation must be the following: adequately lit, heated and ventilated; secure from unauthorised access; of sound construction and kept in good order; equipped with what is reasonably necessary and adapted as necessary in order to meet the needs arising from the disability of any disabled child.

Under those regulations, there must also be conditions of appropriate privacy and sufficient washing and toilet facilities; sufficient and suitable kitchen equipment; adequate facilities for the preparation and storage of food; adequate facilities for laundering linen and clothing; space for sitting, recreation and dining and for private study; sleeping accommodation that is suitable for needs, including for privacy; and appropriate furniture, storage facilities, lighting, bedding and other furnishings, including suitable window and floor coverings. Furthermore, premises may not be used for the purpose of a children’s home unless they are in a location and of a physical design and layout suitable for the purpose of achieving the aims and objectives set out in the homes statement of purpose. Children’s homes are also inspected to ensure they meet these and other standards. Once a young person leaves a home or foster care to live in other accommodation, however, the guidance of suitability becomes extremely broad-brush, and there is no independent inspection.

The purpose of the Bill is to sort out those problems by providing clear, simple minimum guidance—nothing bureaucratic or over-sophisticated, just the sort of simple guidelines that any decent responsible parent would ensure were in place for their child if they were looking for suitable accommodation. A lot of the work to identify standards has already been done—for example, with student accommodation where national codes of practice have been agreed, covering transparency of charges, responsibility for repairs, health and safety requirements, security, environmental standards and tenant relations. All should be specified in detail and there should be a requirement that contracts for tenancies are fair.

Foyers, which supports more than 10,000 young people each year—16 to 25-year-olds in housing need—has a lot of experience in this area. The Foyer Federation has developed an accreditation process with quality standards to ensure that accommodation is affordable accessible, safe, well maintained and appropriate to needs, and meets the needs for independence, privacy and dignity, security and health and safety.

The majority of young people choose when to leave home—perhaps to go to college or university, to take up a job or to move in with friends or a partner. Most of them decide when they want to leave and have a support network to back them up, and family to help them out and a home to go back to if they want. The average age at which people leave home is 24, but young people leaving care are more likely to be vulnerable and without access to family support. They are more likely to leave at a much earlier age. Last year, 24 per cent. of care leavers left care at 16, and 15 per cent. left at 17. They often have to face a huge number of changes all at once, and all too often have to deal with them without any support or help from a family, and they have nowhere to go back to if things do not work out for them.

With just a small effort from this House—it is a corporate parent and has a duty of care to these young people—we could make a huge difference to outcomes. We have to make sure these young people have accommodation and support that is suitable for them and meets their needs. We need this Bill, so I ask the House to take it forward.

Question put and agreed to.


That Helen Southworth, Ann Coffey, Dan Norris, Mr. Barry Sheerman, Mr. David Kidney, Rosemary McKenna, Mr. Kevin Barron, Derek Twigg, Hilary Armstrong, Mr. Mike Hall, John Bercow and Annette Brooke present the Bill.

Helen Southworth accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 19 June and to be printed (Bill 77).

On a point of order, Madam Deputy Speaker. We are about to have a major debate on the economy. At 12 noon today, the Treasury published Lord Turner’s report on the causes of the current problems in the economy. As of three minutes ago, the report is not available in the Vote Office. It strikes me as outrageous that the Treasury has not made arrangements to let us know what is going on in its policy formulation.

The right hon. Gentleman’s point will have been heard by Members on the Treasury Bench, and no doubt arrangements to make the report available are now in hand.

Opposition Day

[8th Allotted Day]

The Economy

I beg to move,

That this House condemns the fact that, nine months into a recession, Government policy is failing to tackle the deepening economic crisis; notes that the measures announced months ago, including the Working Capital Scheme, the National Internships Scheme, the Asset-Backed Securities Guarantee Scheme, the Homeowners Mortgage Support Scheme, the car manufacturers’ finance guarantee and the Recruitment Subsidies Scheme, have not yet been implemented; questions whether there is any evidence at all that the temporary cut in value added tax has succeeded; notes with concern that the value added tax cut has added to a rapidly deteriorating fiscal position, and that Government debt is likely to double by 2013; calls on the Government once again to implement what was promised, to get credit moving by introducing a National Loan Guarantee Scheme, to take tax measures in order to help savers and to take other measures to help small businesses; and further calls on the Government to start addressing the long-term causes of the current crisis, including a build-up of government, corporate and personal debt which has left the UK more exposed than other countries, and to develop the required long-term reforms of the tax system, the failed tripartite system of regulation, and the public sector, so that in future Britain lives within its means.

As we heard during Prime Minister’s Question Time today, we have just seen the fastest monthly rise in unemployment on record, worse than any monthly figure during the 1980s or the 1990s. Vacancies are at a record low—which used to be the Government’s excuse on days such as this—while 2 million people are out of work, and of course the numbers climb steadily. We have also learnt today that the International Monetary Fund has produced new growth forecasts for the world, which show that Britain is set to be in recession for longer than any other major economic area. Indeed, the IMF predicts that the British economy will be the only major economy to contract next year, 2010, when the economies of America, the eurozone and Japan are all forecast to be growing again.

As my right hon. Friend the Member for Haltemprice and Howden (David Davis) has just said, Lord Turner has published his report—[Interruption.] I was sent a copy in advance, so I did not need to go to the Vote Office. However, it says something about co-ordination in the tripartite committee that the committee could not convey the report to other Members.

I will give way in a while, but may I be allowed to say something about the report first? It offers a pretty devastating critique not just of the regulatory system created by the Prime Minister in 1997 but—this is in the first half of the report—of a model of economic growth that was based on unsustainable debt, over-leveraged banks and a huge macro-economic imbalance.

One would have thought that the Chancellor of the Exchequer, who commissioned the report and whose policies are deepening the recession, would be here to debate the economy and defend his approach, but apparently not. We have not had a debate on the economy in Government time since December, and the Government have known about this debate for two weeks. When we suggested it, we were told that there was no pressing international summit or unbreakable commitment that would require the Chancellor’s absence. There is only one conclusion to be reached: the Chancellor of the Exchequer is running away from the debate because he knows that he is losing the debate. A confident Government, and a Prime Minister who meant what he said about restoring the primacy of Parliament, would have relished the chance for the Chancellor to appear before us today.

I note that the shadow shadow Chancellor is not here either.

The hon. Gentleman opened his speech with a reference to unemployment. Why is there no mention of unemployment in his motion? Is it because, as I suspect, the Tory view is still that unemployment is a price worth paying?

First, our motion refers to the various unemployment and employment schemes that are not operational. Instead of simply taking the Whips’ handout, the hon. Gentleman might actually read the Order Paper. Secondly, may I give him some advice? I know that he has been in Parliament since 1997, and he has been taking these handout questions since then. He is still not on the ministerial rung, and he only has a year to go. Why does he not change tack, and be a bit more critical of the Government?

Does the hon. Gentleman agree that the big difference between this recession and the last one, which took place under the Conservatives, is that under the Tories interest rates were at 15 per cent., whereas in the present recession they are at only 1 per cent.?

The difference between this recession and the last one is that we have just seen the highest rise in unemployment on record, and it happened today.

Would not the hon. Member for High Peak (Tom Levitt)—and indeed the Prime Minister, earlier today—have been well advised to read the Government amendment before making the point that they made, as the amendment also contains no reference to unemployment?

As ever, my right hon. and learned Friend’s razor-sharp attention to detail has enabled him to make a telling point.

So we do not have the Chancellor of the Exchequer. Instead, we have the Chief Secretary to the Treasury. I know that she is not exactly busy these days. I am not sure what the role of a Chief Secretary is in a Treasury that has completely given up any attempt to control public expenditure.

Yesterday, the Prime Minister announced in an interview in The Guardian—not to the House of Commons, of course—that there would be no spending review at all this year. The whole panoply of comprehensive spending reviews and three-year plans that we have had from the Prime Minister over the last 15 years has been junked without a word of explanation to Parliament or the public. If somebody does not review spending when they have the biggest budget deficit in the country’s history, they really must have abandoned all the basic responsibilities of government. On the plus side, however, this means that the Chief Secretary has more time on her hands—more time to plan her budding leadership campaign, of which we read in the newspapers, and more time to join us here. We welcome her to her place.

The case that we make today is simple. First, the Government’s policies to tackle the recession are simply not working—literally so, in the case of the many schemes that still exist only in the form of a press release. Secondly, the Government have not yet faced up to the fundamental failure of the debt-fuelled model of economic growth which their Prime Minister pursued for a decade, and which has led us into the longest recession in the world and the deepest recession in our recent history. Or as the right hon. Member for Norwich, South (Mr. Clarke)—always a friend of the Prime Minister—put it just this lunchtime on television:

“There are many aspects of our economy that put us in a worse position”.

It is for the hon. Gentleman to answer for his party.

According to the hon. Gentleman’s motion, we are

“nine months into a recession”.

That means that the recession started last July. During Prime Minister’s Question Time, however, the leader of the hon. Gentleman’s party said that it had started in April—12 months ago. Could the hon. Gentleman help to resolve the apparent confusion in the Conservative party?

That was a staggeringly poor intervention. First, the Leader of the Opposition said that the economy had not been growing for a year, and I think the hon. Gentleman will find that there was zero growth in the second quarter of last year. Secondly, if he wishes to trade quotations of what was said during Prime Minister’s Question Time, I point out that the Prime Minister said that America had entered the recession before the United Kingdom, and it experienced positive growth in the second quarter of last year. No doubt the hon. Gentleman will be writing to his right hon. Friend to correct him as well.

The case we will make today is simple: the schemes are not working and the Government have not faced up to the fundamental flaws in their model of economic growth.

If the hon. Gentleman will allow me to make a little progress, I shall give way to him later—and, perhaps, hear whether he supports what Ken Livingstone has been saying about the Prime Minister today. I will give the hon. Gentleman some time to think about that. We might also hear about what the Member sitting next to him, the hon. Member for Dagenham (Jon Cruddas), has written in The Guardian today about how new Labour has lost its spirit of generosity and lost touch with the people of this country. While the hon. Member for Eltham (Clive Efford) reflects on that, let me say this—[Interruption.] May I just add that we support the campaign of the hon. Member for Dagenham for the leadership of the Labour party?

A lot of attention has been given in recent weeks in this House, and especially in the media, to the repeated bail-out of the banks and the forthcoming G20 meeting, and I will discuss those on a later occasion, but what I want to draw to the House’s attention today is the failure of the policies that, in the Government’s words, are supposed to be providing “real help now” to families and businesses struggling with the recession. That slogan of “real help now” is a cruel joke to thousands of people who have lost their jobs, and continue to lose their jobs, while this Government dither and delay.

The hon. Gentleman has talked about what works and what does not work. Can he explain how cutting inheritance tax for the richest 3,000 people, at a time when we are in one of the deepest recessions in the last 100 years, will help ordinary families who are struggling to survive through this recession?

My memory of the autumn of 2007 was that I proposed some changes to inheritance tax that the hon. Gentleman’s Government then copied about a week later. In commemoration of that occasion, I was sent a cartoon by a Labour MP showing the Chancellor and the Prime Minister climbing through a window to steal my policies from my office. Therefore, if the hon. Gentleman has a complaint, please will he take it up with those on his own Front Bench?

Setting aside the political rhetoric—[Interruption.] I think we have heard a lot of that today. Setting aside the political rhetoric, does the Conservative party accept that as part of any fiscal stimulus internationally, it is inevitable in this country, as in other G20 countries that both debt and borrowing will be a higher percentage of GDP, rising in every advanced country above the 3 per cent.? If the Conservatives do accept that, what is their strategy for tackling Britain’s position?

Well, I can actually. The answer to the question is as follows. Of course, in a recession Government debt increases—and, by the way, when we go into a recession with a 3 per cent. Budget deficit, it is likely to increase above that in the recession, because tax receipts fall off and welfare payments increase. Those are the fiscal stabilisers, and that provides a fiscal stimulus. That was a debate that was had in this country and many others over many decades since the 1930s. We have not proposed in any way to tamper with the fiscal stabilisers. What we opposed was the debt-funded discretionary cut in VAT. The question that Labour Members have to ask themselves is this: have they got any evidence that that has in any way stimulated the economy or encouraged anyone to spend any more money? Every single major retailer has come out and said that it was a waste of money and it has not worked. The one thing we can be sure of is that it has, in a discretionary way, added to a very significant borrowing problem, and the shocking figure we will get on Budget day will be the size of the fiscal deficit that this Government are saddling this country with for many years to come. It will be the highest in our history, and the Labour party’s reputation for economic incompetence is not only apparent for all to see today, but it will be hung around their neck for a decade to come.

The Institute for Fiscal Studies commended the VAT cut in its “green Budget” as bringing expenditure forward. I want to ask the hon. Gentleman a question on economic competence, however. Is it competent in the midst of a recession to be talking about public sector cuts?

Again, the hon. Gentleman would do well to look at what we have actually proposed. We have proposed reducing the real growth in spending from 3.4 per cent. to 2.6 per cent., which means that public expenditure will grow by £25 billion next year instead of £30 billion, and using that £5 billion to help the millions of savers and pensioners who have been penalised in this recession—who did the right thing for the last 10 years and have been punished for it. That is a perfectly sensible allocation of resources.

I shall give way to my right hon. Friend the Member for Wokingham (Mr. Redwood) and my hon. Friend the Member for Bournemouth, East (Mr. Ellwood), and then I shall make some progress.

My hon. Friend is making an extremely powerful case. Does he agree that another big hazard for us is that, because the Government have clumsily blundered into giving too much money to banks, taxpayers are now at massive risk and are standing behind grotesquely large remuneration packages and pensions for some who have failed, and that the Government should have been a lot tougher in their support and much more careful in what they did?

Of course I agree with my right hon. Friend, and the tale of Lord Myners and Sir Fred Goodwin’s pension should ring around the country as an example of how this Government are completely incapable of looking after taxpayers’ money. It is a miracle that Lord Myners survives in the Government, and it says something about the judgment of the Prime Minister that he put him there in the first place.

My hon. Friend talked about the importance of helping businesses. The one initiative that has made its way to Bournemouth is a seminar called “Employing People from Overseas Countries”, which has been paid for and run by the Home Office. At the seminar, people can learn about step-by-step visa applications, biometrics and the new points system. This is the only initiative that has got to Bournemouth. Is this really the way for us to tackle unemployment in this country?

Well, it does sound a little inconsistent with the Prime Minister’s slogan of “British jobs for British workers”.

My hon. Friend brings me on to the subject of Government schemes, which I want to touch upon now that I have taken those interventions. Four months ago, we argued from this Dispatch Box that the urgent priority was to get credit flowing again to businesses large and small, so that they stayed afloat and people were kept in work. We proposed a national loan guarantee scheme as a big, simple and bold answer to the problem that everyone, from the Governor of the Bank of England to the head of the CBI to the trade unions, had identified as the most important problem facing British business. We also said that to help with the cash flow of smaller businesses while they wait for that credit, we should allow them to defer their VAT bills and we should reverse the rise in their small companies tax rate. To help the unemployed get back to work, we suggested a national insurance rebate for any employer who took them on. At the time, the Government—particularly the Prime Minister—of course dismissed every single initiative out of hand. Now, four months later, they are struggling to introduce them.

I will give way after I have got through this section of my speech. [Interruption.] This is about the hon. Gentleman’s constituents—it is about the many thousands of people in all our constituencies who are losing their jobs. Businesses are going bust because Government schemes that were promised have not been implemented.

Let us look at the working capital scheme—no doubt the hon. Gentleman was among the loudest cheerers when it was announced from the Dispatch Box. It was proposed on 14 January and launched in a blaze of publicity. The Business Secretary said at the time:

“There will be real results from the schemes that go live today.”

Two months later, that scheme does not exist. The date when it was supposed to be up and running came and went weeks ago. The negotiations with the banks are still continuing, and in the meantime good businesses are going bust and good people are losing their jobs.

That is not an isolated example of the incompetence of this Government. The automotive assistance programme is supposed to help the car industry. Two months after it was launched, there is no evidence yet that a single car manufacturer has been helped. Earlier this week, the Department for Business, Enterprise and Regulatory Reform floated the idea of a car scrappage scheme. Today, the Treasury is briefing the media that it is not in favour of the scheme—That one did not even last a week. My hon. Friends will recall that the home owners mortgage support scheme was announced by the Prime Minister in the Queen’s Speech debate, yet we are now in March and that scheme does not exist; the number of repossessions is rising, thousands are losing their homes and not a single home owner has received support. What about the national internship scheme, which was announced three months ago? I can find no record of that scheme anywhere—it has completely disappeared without trace. Perhaps the Chief Secretary to the Treasury could tell us what has happened. Ministers cannot distinguish between getting a headline on the “Today” programme and actually making sure that the schemes they promise are implemented and are working, but the public can and this is causing widespread disillusion and despair.

My hon. Friend is making such a strong case. Does he agree that one of the real dangers of delay is that rising unemployment will simply overcome all these efforts, as consumer confidence falls and the chances of rescuing these businesses and saving jobs are lost?

I completely agree with my hon. Friend; we are facing a very severe rise in unemployment. The tragedy is that if some of these schemes, particularly the credit and guarantee schemes, had been in place months earlier, some businesses could have been saved and some of those people could have been kept in work.

The hon. Gentleman is discussing a long list of Labour’s, and in particular the Prime Minister’s, broken promises—the Prime Minister is going to introduce £1 billion of cuts in Scotland, in addition to everything else that is happening there and in Northern Ireland. May I remind the hon. Gentleman about last week’s Prime Minister’s questions? The Prime Minister told the hon. Member for Macclesfield (Sir Nicholas Winterton) that he would be

“happy to debate the economy at any time in this House”.—[Official Report, 11 March 2009; Vol. 489, c. 292.]

Could it be that the Prime Minister is somewhat less happy this week?

For once, I agree with the Scottish nationalists—perhaps there will be many other such occasions in the future. The hon. Gentleman rightly says that the Prime Minister said that he wanted to debate the economy, yet he will not even send the Chancellor of the Exchequer to debate it today.

I know that many hon. Members will raise constituency cases in this debate, but I just want to read a letter that I have received from a constituent of mine, because I think it touches on a wider national issue. The letter states:

“Dear Mr Osborne

I am writing concerning an article which was published in The Times…The article was entitled ‘White-collar workers to get special help as jobless hits 2m’…I have recently become unemployed and am keen to undertake some training to extend my skills so this”—


“would be ideal. Unfortunately, no one at the local JobCentre (including their management team) has been told about either scheme and they were…totally unaware of the article. This lack of information reflects badly on the JobCentre staff which is unfair as, for the most part, they are doing a good job under very difficult circumstances.”

Again, the hon. Gentleman is making light of the fact that thousands of people are losing their jobs. He is making light of the fact that someone who has lost their job went to the jobcentre clutching an article that they had read in The Times about a Government scheme that had been launched only to find that the jobcentre knows absolutely nothing about it. That is why in a year’s time the hon. Gentleman will be the one losing his job. [Interruption.]

rose— The very end of the Opposition motion refers to the country living “within its means”, and that has an impact in terms of savings. At the moment, there is a 10 per cent. return from the capital rule for savers who are pensioners in terms of benefits. Many of us think that that 10 per cent. is unrealistic now. If the shadow Chancellor agrees, would he indicate the level to which he thinks that percentage ought to come down?

I agree with the hon. Gentleman that the way in which many of the benefits and the pensions operate makes assumptions about returns from capital that are totally unrealistic in the modern environment, with its near zero interest rates. I think that we will find many examples like the one that he raises. He makes his point very seriously, and I shall go away and give it full consideration and come back to him on it. He will find as we go through this year that there are many examples of how the prospect of deflation interacts in a very odd way with the benefits system to which we have got used.

This morning, I received a reply from the Minister with responsibility for higher education saying that, since 2007, career development loans provided by banks are down by a third. These are the career loans for people, mostly young people, who have suddenly found a halt to their careers. Does my hon. Friend agree that this is yet another example where the Government’s policies simply are not working and the money is not trickling through to the public?

My hon. Friend is right; there are numerous such examples, some of which I have raised. One has only to listen to what the Minister for Employment and Welfare Reform was saying just a couple of hours ago in order to realise this. He acknowledged that

“there is a frustration about these”—


“schemes and the money and the credit getting through.”

That is the Government’s Employment Minister acknowledging frustration about the Government schemes that were promised and not delivered. That brings me to the second point that I wish to make.

Does my hon. Friend agree that it is very worrying that one of Bournemouth’s leading construction and engineering companies has written to me saying that it has tried to get one of these guaranteed loans, but the banks will accede to that only if the directors give a personal guarantee? That negates the whole objective of guaranteed loans, does it not?

My hon. Friend is absolutely right. The whole purpose of these guarantees is to try to get the money out of the banks and into businesses. We were told that the recapitalisation in October would achieve that, but it failed. That is why we needed a national loan guarantee scheme. The examples that we are hearing about today—there are countless other such examples around the country—are examples of how the Government are failing to deliver on the promises that they have made to the public and are failing to deliver on their basic duty to help people in this recession.

If both distinguished former Treasury Ministers—to varying degrees of distinction—will allow me, I shall make a little progress. I know that lots of hon. Members wish to speak, given that we have not had a debate on the economy since December. I am sure that the hon. Member for Coventry, North-West (Mr. Robinson) will wish to tell us all about how successful the Government schemes for the car industry are proving at the moment.

Let me deal with the second major question: do the Government understand that the model of debt-fuelled growth that they pursued for 10 years is fundamentally broken and needs to be fixed? Judging from the Prime Minister’s increasingly contorted answers to the questions of blame, the answer is no—indeed, his answer seems to amount to, “I’m sorry I didn’t get other leaders to agree with me earlier.” That is not much of an apology. He, alone in the country, still maintains that there was nothing wrong with the British economy and with the way in which he regulated financial services in the country, and that we are simply the unwitting victims of a recession that came from America. That is his argument, although I note that he left it out of his speech to the American Congress—I guess that speech will not be appearing in the next edition of “Courage”.

The problem with the argument that the recession came from America is that it does not explain some basic facts. Of course there has been turmoil in the world financial system and huge problems in America, but was it America that caused British families to become more indebted than American families or that caused British house prices to rise twice as fast as US house prices? Was it America that caused British banks to lever up 37 times their capital—almost double the leverage of their US counterparts? Was it America that gave Britain the largest budget deficit in the developed world? Was it an American politician who said with the hubris of “peace in our time” that he had “abolished boom and bust”? No, it was a British politician. The Turner report, which was published at midday, blows apart the Prime Minister’s claim that all was well with the British economy until we were hit by a transatlantic storm. It supports the Conservative argument that the problems in the British economy are deep-seated and that the model of growth pursued over the past decade is fundamentally broken.