House of Commons
Thursday 19 March 2009
The House met at half-past Ten o’clock
Prayers
[Mr. Speaker in the Chair]
Business Before Questions
Manchester City Council Bill [Lords] and Bournemouth Borough Council Bill [Lords]
Resumption of adjourned debate on Question (15 January),
That the promoters of the Manchester City Council Bill [Lords] and Bournemouth Borough Council Bill [Lords], which were originally introduced in the House of Lords in Session 2006-07 on 22 January 2007, should have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).
Object.
The debate stood adjourned; to be resumed on Thursday 26 March.
Canterbury City Council Bill, Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill
Resumption of adjourned debate on Question (15 January),
That the promoters of the Canterbury City Council Bill, Leeds City Council Bill, Nottingham City Council Bill and Reading Borough Council Bill, which were originally introduced in this House in Session 2007-08 on 22 January 2008, should have leave to proceed with the Bills in the current Session according to the provisions of Standing Order 188B (Revival of bills).
Object.
The debate stood adjourned; to be resumed on Thursday 26 March.
Oral Answers to Questions
Business, Enterprise and Regulatory Reform
The Minister of State was asked—
Royal Mail Pension Scheme
We estimate that the Government will assume total liabilities of £29.5 billion and assets of £23.5 billion. That would mean the Government absorbing a deficit of £6 billion. This assessment of the liabilities in the scheme and the funding position is based on the most recent trustee valuation, from March 2008. However, we anticipate that the funding position of the scheme could well have worsened since that date, so when we have updated figures from the new valuation, beginning this month, we will finalise our assessment of the funding position of the scheme.
Clause 20 of the Postal Services Bill will allow the Government to take the existing assets from the pension fund into the consolidated fund and spend it that very same year. Is it wise as part of addressing the pension funding crisis to take the existing inadequate assets and use them to rescue the Government’s current deficit, making the problem worse in the longer term?
Our motivation is not about the public sector accounting impact. Our motivation is to give greater security to the hard-working men and women who work for Royal Mail, because the pension fund is an increasing burden for Royal Mail. At the same time, however, if we are to ask the taxpayer to take on those liabilities—I have set out what the scale of those liabilities is—it is equally right that we also give the taxpayer some confidence that the company can be transformed and modernised in the future. It is precisely those two things that are set out in the Postal Services Bill, which was published recently.
Postal workers in my constituency will be greatly reassured by the Government’s commitment to rescuing the pension scheme, but could the Minister tell the House to what extent the deficit of £6 billion is due to contributions holidays by previous employers?
The scheme was in surplus as recently as 2001, so I am not sure that the deficit can be ascribed to contributions holidays. Another factor that right hon. and hon. Members should consider is that the Government have not taken a dividend from Royal Mail for some years, so the most important thing is to concentrate on what we do now. As things stand, with a combination of the pension fund deficit and falling mail volumes, the company is in a very serious position. That is precisely why we have brought forward plans to deal both with the pension fund and with the transformation of the company in the future.
The Minister has just said that the Government proposals would provide greater security for postal workers’ pensions, but can he confirm that clause 19(6)(b) of the Postal Services Bill provides that this or a future Government could waive the pension guarantee and vary the terms of the postal workers’ pensions without the approval of the trustees, who will lose their power to protect the pensions under the provisions of the Bill?
The changes that we propose to the pension scheme will mean that the deficit is handled on the same basis as the pension schemes serving teachers, nurses and civil servants. That will indeed give Royal Mail staff far greater pension security than they get at the moment, when the deficit appears to be increasing year on year.
Can my right hon. Friend say whether the income from the selling of equity and shares in Royal Mail will be used either to reduce the pension deficit or to modernise Royal Mail?
Our intention, through a partnership, is to bring in new investment into the company. We intend to bring in not just investment in Royal Mail, but experience from another European postal or network company that has been through a transformation of the kind that Royal Mail needs, but has not yet gone through. The harsh fact is that if we do not get that investment and experience, the decline in mail volumes will decide the issue for us. As things stand, without the transformation of the company, for each decline in mail volumes of 1 per cent., Royal Mail loses around £70 million. There is therefore an urgent need not only to deal with the pension fund, but to modernise Royal Mail.
Financial Assistance (Businesses)
Banks participating in the Government’s recently announced asset protection scheme have committed to making available £27 billion of additional lending to businesses over the coming 12 months. The value of eligible cases for the enterprise finance guarantee has increased tenfold, from £3 million in the first week of operation to more than £31 million last week.
If the Minister were to join me in my meetings with small businesses in Southgate tomorrow, would he be able to tell them how long the crippling effect of credit insurance withdrawal along the supply chain will continue, and when the planned increase in the flow of credit from the Government’s schemes will actually reach the high streets of Southgate?
The hon. Gentleman is perfectly right to point out the severe problems that many companies are facing as a result of the global credit crunch. Our priority as a Government has been to fix the power failure in the banking system, and we have been taking action to do that through the recapitalisation of the banks last October, and through the actions that we took through the asset protection scheme. That will stimulate extra spending in the economy as well. I can tell his firms that the Government are providing real help to businesses through the enterprise finance guarantee, which will cover over 95 per cent. of all companies, and through the asset protection scheme and the measures that we have taken to get lending going again.
My hon. Friend is absolutely right to say that the Government have taken significant steps to open the process up, but does he agree that the banks and other lenders have not yet properly started to play ball? Barclays are asking a company in my constituency for 9.9 per cent. above the base rate for an overdraft, for example, and the car finance corporation is charging a 30 per cent. annual percentage rate on loans. Those rates are not going to get businesses and customers back to where we want them to be, which is buying and selling.
There is certainly a variable picture out there in terms of lending and of the rates being offered on overdrafts and other credit facilities. The most recent Bank of England lending panel report demonstrated that margins were coming down, however, and that lending was now cheaper than in 2007. There has been some progress, with the reduction in the LIBOR rate, although there is probably more to be done. The Government remain committed to ensuring that we have competitive lending available to UK companies and mortgage holders, and we are focused on delivering that.
Money is not getting through. We have said that again and again, but the Government seem not to be listening. In recognising that there is a management element to the Government’s job, will the Minister tell me what the Department is doing to ensure that he is getting out there, monitoring the process and ensuring that the thing works? It is not working at the moment.
There are two points here. The first is about overall lending, and what the Government are trying to do to stimulate lending in the economy through the actions that we are taking with the banks. I hope that the hon. Gentleman realises that, about 12 months ago, 50 per cent. of the lending to the commercial sector in the UK came from foreign banks. Those banks have not gone bust, but they have gone home. That proportion of lending has therefore disappeared from the UK economy, and our banks are having to work even harder to replace some of that lending. That is why we have taken action through the asset protection scheme and other measures.
On the question of specific Government programmes, I have already set out the progress that we are making through the enterprise finance guarantee. This was the old small firms loan guarantee scheme. We have now upped the qualifying limit from £5.6 million to £25 million, which covers the vast majority of companies in the United Kingdom, and we have upped the limit of loans from £250,000 to £1 million. The guarantee stands at 75 per cent., and more than 1,100 companies that are eligible for the scheme are already having their applications assessed. We are monitoring the scheme weekly through the banks and through Capital for Enterprise. It is up and running, and we believe that it is on target to meet its commitment to supporting £1.3 billion of lending to the UK economy.
The “Real help now” package that the Government have put in place shows their determination to help small businesses, but the banks remain stubbornly resistant to co-operating with what has been put in place. Businesses in my area describe interest rates being held stubbornly high or increased, bank charges being imposed without warning and a requirement for 100 per cent. security despite the fact that loans are covered by the guarantee scheme. Is it not time that we had an independent ombudsman or arbiter that businesses could go to when the banks are not carrying out what they should be doing on their behalf?
We are certainly already monitoring the actions and activities of the banks through the lending panel, so there is a level of scrutiny there. Obviously, we cannot stand in the shoes of the banks that have to make commercial lending decisions on the basis of their assessment and pricing of risk. That is what would be expected of any functioning economy. What we can do, however, and here I agree with my hon. Friend, is rigorously monitor the situation. It is right to say that we need to keep a close eye on the banks; we are doing just that.
What are the Government doing about credit guarantee—in other words, what happens when a firm delivers goods to another firm that subsequently becomes insolvent? The Prime Minister assured me during the Gracious Speech debates that something was being done, so will the Minister tell me exactly what is being done to assist small and medium-sized companies?
We are taking a range of measures to support small and medium-sized companies, which we recognise as the backbone of the economy, so we need to help them get through the recession in the best possible shape. I have already mentioned the enterprise finance guarantee scheme. We are also taking actions through the working capital scheme to shore up credit lines. I know that there have been criticisms from Conservative Members that we have not made further announcements on the working capital scheme, but what we are doing there is guaranteeing portfolios of working capital facilities. These are deals that we are doing with the banks rather than individual companies, but they run into hundreds of millions of pounds. As the right hon. and learned Member for Rushcliffe (Mr. Clarke), who speaks for the shadow Chancellor of the Exchequer knows, these deals are not done in five minutes or even days and weeks, as they are the result of complex negotiations, but they are important to shoring up working capital for companies, and they are in addition to the actions that we are already taking.
The actions taken by the Government so far have been largely defined by, and perhaps constrained by, sections 7 and 8 of the Industrial Development Act 1982, which include the provision to expand or sustain the productive capacity of any industry. Is the Minister happy that those provisions are sufficiently broad and flexible because the construction industry, and particularly the buildings material industry in my area that feeds it, is yet to see the real fruits of the Government’s initiatives? Do we not need some more imaginative action; might not some emergency legislation be appropriate?
Yes, I am happy that sections 7 and 8 of the Industrial Development Act remain fit for purpose: section 7 covers regional assistance and section 8 covers industrial support more generally. In the Second Reading debate on the Industry and Exports (Financial Support) Bill on Monday, we explained why we were increasing the limits relating to section 8 expenditure, which are going to go up to £12 billion if the legislation is passed and with a possibility of their going up to £16 billion. That reflects the fact that the more modern way in which we are providing support is through loan guarantees that have to be scored as expenditure even though they are really a contingent liability. We can provide support under that legislation, and the schemes that we have announced will have as their legal vires that industrial development legislation.
At the last DBERR questions, the Minister told me that he expected that lending figures for companies participating in the enterprise finance guarantee scheme
“will quickly start to build strongly”.—[Official Report, 5 February 2009; Vol. 487, c. 957.]
That has simply not happened and, given the scale of the problem, the numbers the Minister has quoted this morning are a pittance. Is he aware that applicants still face considerable difficulty in assessing the scheme, that the banks are still extremely reluctant to grant moneys under it and that the small and medium-sized enterprises that have been clinging on by their fingertips for months now want substantive help and not platitudes? When will the Government get a grip, stop monitoring and actually manage the situation?
We are both managing and monitoring the situation. The hon. Gentleman has made a number of assertions; let me explain the facts to him. More than 1,100 companies have shown themselves to be eligible to participate in the enterprise financial guarantee scheme, and £115 million worth of loans can potentially be made to them. It will be up to the banks to assess the applications. About 70 per cent. of cases are going through at present, which is quite normal. There is obviously a difference between the number of eligible cases, the number of loans offered, and the drawdown of those loans.
This is still a new scheme, but it is growing. I have already said that in the first week there were £3 million of eligible cases, and last week the figure was £30 million. A big increase is taking place. As I have said, we will continue to manage the process as well as monitoring it, to ensure that it delivers for small businesses.
Three weeks ago, the Government proudly announced what they claimed was a unique agreement with Royal Bank of Scotland and Lloyds, which apparently guarantees that those banks will lend business a total of £27 billion this year. Given the evident and continuing problems for businesses, how will Ministers guarantee that sum this year and, given that they are part-owners of the banks, what penalties could they actually apply if the banks proceeded to default?
The hon. Gentleman has repeated the figures that I announced in my reply to the hon. Member for Enfield, Southgate (Mr. Burrowes). He is right about the commitment of £27 billion of additional lending—£16 billion from RBS and £11 billion from Lloyds Banking Group. We will monitor their delivery of that commitment, just as we are monitoring their progress in terms of lending under the enterprise finance guarantee.
I would like to think that the Conservative party welcomes the fact that we are introducing legally binding commitments as part of the asset protection scheme. We expect RBS and Lloyds Banking Group, as responsible companies, to deliver on those commitments, and I have no reason to doubt their genuineness in wanting to deliver for small businesses. Rather than carping and moaning, Conservative Members should welcome the fact that we have an active Government who are making commitments and ensuring that they are delivered.
Hooper Report
The Secretary of State announced in December that the Government accepted the analysis set out in Richard Hooper’s review of postal services and that, to maintain the universal postal service, the Government intended to implement his recommendations. I repeated that statement in the House of Commons on the same day.
The Postal Services Bill has since been introduced into the House of Lords, and received its Second Reading on 10 March. The Bill proposes a new regulatory framework for postal services, enables the Government to tackle Royal Mail’s pension deficit, and ensures that Royal Mail remains in public ownership, while supporting modernisation through a strategic partnership.
Are the comparisons in the report made on a like-for-like basis in terms of prices and the services provided? Does the report not fail to identify either the cause of the pensions deficit or the devastating effect that unfair competition has had on Royal Mail?
The report covers all the issues relating to pensions, pricing and regulation. It is entitled “Modernise or decline”, which is an accurate description of the choice that we face. If we do not act to turn Royal Mail around, the decline in mail volumes will decide the issue for us. For every 1 per cent. decline, the company loses £70 million. There has already been a decline of 7 per cent., and a further 7 per cent. decline is forecast. That demonstrates the urgent need to transform and modernise the company. If we do not take that action, Royal Mail will end up cutting services, which is not a solution that we want it to apply to its current problems.
In 2007, 637,000 days were lost at Royal Mail as a result of industrial action. That is 60 per cent. of the number of days lost to strikes in the entire United Kingdom. Does the Minister accept that the Communication Workers Union must become far more realistic about modernisation if industrial relations at Royal Mail are to improve?
Richard Hooper identified industrial relations as a significant problem for the company, and it is not just the industrial action and the strikes that have taken place, but the regular threat of industrial action—such as, in recent months, over changes to the pension scheme and the closure of a number of mail centres. A fresh start for industrial relations is, therefore, needed in Royal Mail, and I would say to the CWU that the current relationship is not what it should be and that bringing in a new partner may present a possibility of improving industrial relations, given their current very poor state.
Will the Minister confirm that the argument in previous answers to questions has been that the Government will privatise Royal Mail and a foreign firm will come in? Can he explain to me how it is that now that we have an economic tsunami lapping on every shore, in Holland, let us say, Dutch TNT can find money that nobody else can find? If the economic recession is hitting everybody, where is the magic wand in Holland to find the money that we cannot find here?
I have great respect for my hon. Friend, but he is not right to say that we are privatising the Royal Mail. The Bill clearly says that we will keep Royal Mail in public ownership, so it is simply not true to say that we are privatising it. He questions why the Dutch postal service may be in a better position than Royal Mail; that is precisely because it has carried through the transformation and modernisation that Royal Mail has not yet managed to achieve. I cannot comment on any particular potential partner, because there has to be a proper process to get the best agreement for Royal Mail and the taxpayer, but if there is a partnership with another European postal company, I remind the House that liberalisation of postal services will be introduced in 15 members of the European Union by the end of next year. That will also give Royal Mail the opportunity to be a major European player, and that is not an opportunity that we should shy away from.
I welcome the clauses in the Postal Services Bill that allow a levy to be placed on the large private mail operators that are not fulfilling the universal service obligation to compensate Royal Mail, which is fulfilling the USO. There is an urgent need for those clauses to be implemented, because Royal Mail is facing unfair competition at present. Will the Minister give a commitment to a rapid introduction of those clauses?
Those clauses, like all the other clauses in the Bill, will be implemented if the Bill is passed by Parliament, but the hon. Gentleman raises a very legitimate point with regard to regulation. That has been a subject of considerable controversy in this House and more widely, and we propose in the Bill to put at the heart of the regulatory system the maintenance of the universal service—of the one price goes anywhere, six-days-a-week universal postal service. That is the foundation of our postal system. We want to legislate to maintain that, not to leave Royal Mail alone to have its finances eaten away by the fall in mail volumes, which is costing it £70 million for every 1 per cent. of decline. That is no future for Royal Mail, but the Bill that we have presented is.
The Government seem to have accepted the Hooper review in total. The official Opposition have accepted, and are supporting, the sale of some shares. Are they also supporting other measures in the review, including regulation—
Order. That is not a responsibility for the Minister. He has more to worry him.
Broadband Providers
Wholesale broadband is closely regulated, and the market is regularly reviewed by Ofcom. That ensures that the UK broadband market remains competitive at the retail level. I can tell the House that there are more than 400 suppliers of broadband services.
I note the Minister’s reference to retail. Given that people up and down the land are facing great and real financial hardship, is it not time that the broadband telecoms market was opened up to true competition—not fake competition—so that the current pretty poor service levels can be driven up and customer prices can be driven down?
The hon. Gentleman may know that a number of companies offer wholesale broadband products and a series of other companies that are in a position to do so are choosing not to do so for commercial reasons. That is one of the reasons why we have made sure that the industry is closely regulated. In those parts of the country where there is considerable competition some of the price controls that have been in place have been relaxed. In other areas, where competition is not as strong as we might like, we have kept that regulation in place. He will know from the work of Lord Carter that this issue is being closely examined in government, with industry and with a range of other players. An interim report has been published and further work is in hand. The hon. Gentleman will be able to judge, with the rest of the House, the fruits of that further work towards the summer.
Surely my hon. Friend will agree that the problem is not the number of competitors in the market, but the uptake. Surely we should be examining what is happening in cities such as Glasgow, which has the lowest uptake of broadband in the country, rather than the number of people who are in the market.
With respect to my hon. Friend, I think we need to look at both issues: the level of competition in the market; and how we can ensure universal access to broadband services and speed up broadband access. He raises an important point, which deals with one of the issues reflected on in the interim report that was recently published by Lord Carter. The issue is part of the further work that is being done, and my hon. Friend, along with other Members of the House, will be able to judge our progress in that work towards the summer.
Does the Minister agree that whether in telecommunications or, indeed, the banking world, the best form of regulation is open competition?
With due respect to the hon. Gentleman, I think that competition is a good thing but that, as he knows, or ought to know, only too well as a result of the economic difficulties that our country faces, there is, on occasion, a strong role for regulation to play too. On the particular issue that we are discussing, I should say that where there is real competition, we have been able to relax price controls, but where there is not strong competition, we have kept those controls in place.
In his discussions with Ofcom and the providers, will the Minister ensure that the needs of businesses working in rural areas are met? High-quality broadband is essential in rural areas and sparsely populated areas, because people need to compete on a level playing field.
I accept that there is an issue about ensuring broadband access in rural areas, as in the rest of the country. As I have said, the question of universal access is one on which the Government are very much focused in discussions with Ofcom, the industry and other stakeholders. An interim report was published by Lord Carter, further work is under way and the House will be able to judge our progress in that sense towards the summer.
Automotive Industry
I talk to people in the automotive industry on a regular basis—indeed I have received three texts from companies in the past 30 minutes. The industry-led, BERR-facilitated new automotive innovation and growth team’s report on the future of the UK automotive industry is expected in early May.
People have not stopped driving cars; they have just stopped buying them, because it is difficult to access finance for buying or, indeed, leasing them. Way back, on 27 January, the Secretary of State said that he was setting up a taskforce, to be led by the new trade Minister, Lord Davies. It was supposedly going to work out how consumers could access finance again to buy all these cars and get the car purchase market going. Nothing has been heard of that taskforce, so when are we going to hear the outcome of the work supposedly being done by Lord Davies on this car financing taskforce?
People have not stopped buying cars, but car sales have fallen. February sales were down 22 per cent. in the UK, 48 per cent. in Spain and 24 per cent. in Italy. There is a problem in the automotive sector, and that is one of the reasons why we announced the automotive assistance programme. We are still in discussions with the Bank of England and the Treasury on how car finance arms might be able to access some of the support that is available through Government programmes, but every day newspapers contain good deals on cars, including 0 per cent. finance and cashback in many cases, so finance deals are available. Clearly, we want to ensure that we support a strategically important industry such as the car industry, which is going through a very difficult time. We are doing that and we will continue to look at what further support we might be able to make available.
The Minister must realise that for tens of thousands of people in the automobile industry, the Department is all talk and spin, but no action. He says that Lord Davies is still studying the proposals on car finance that we put forward as a policy suggestion months ago, but when will we get a result? As Lord Mandelson has indicated his sympathy for that policy, is it being blocked by the Bank of England or the Treasury? When will a decision be taken on this important matter?
We all agree about the importance of ensuring that the car industry has support in these difficult times. Along with the construction sector, the automotive sector has borne the brunt of the recession, in addition to what has happened in the banking system. It is difficult to point to other sectors that have seen quite such dramatic falls, but a car is a big discretionary purchase.
The right hon. and learned Gentleman should not pretend that car finance assistance would be a panacea and that if funding is made available through the banks to car finance arms, everyone will go out and buy cars. We will continue to have discussions about whether we can do something that represents value for money for the UK taxpayer that will assist car finance arms. Some of those finance arms are already providing good deals, however, and he knows that.
Topical Questions
The focus of our Department is on working with business and employees during these difficult economic times, and on ensuring that British business is as well placed as possible for the future.
This week, the Federation of Small Businesses, the Communication Workers Union and Unite came together to launch the manifesto for a post bank. At a time when the main commercial banks, with the honourable exception of the Co-operative bank, are held in increasing contempt by their customers, and at a time when the Post Office remains one of the most popular and trusted institutions in the country, is not this an idea whose time has come, and will the Minister support it?
I attended the launch of that pamphlet a few days ago. It is right that if the Post Office is to survive and prosper, it needs to look to new areas of business. It cannot survive on nostalgia or by ignoring the changes in people’s lifestyles, such as using the internet and direct debits. The Post Office is already expanding its banking services: it is the leading supplier of foreign exchange in the country and it supplies credit cards, insurance and savings products. I agree with my hon. Friend that an expansion in banking and financial services is a very important part of the Post Office’s future.
In relation to the European Investment Bank loan scheme, will the Minister take action to ensure that funds coming from the EIB to banks with a presence both in Northern Ireland and the Republic of Ireland will be made available to businesses in Northern Ireland? As he will know, two of the main banks are owned by the Republic, so this is a particular problem for the Province. That money needs to be made available to businesses in Northern Ireland.
The hon. Gentleman is right to point out the action that the Government have taken to get EIB support through the banks for further loans to small and medium-sized enterprises. It is right that those loans should be available throughout the United Kingdom and my understanding is that that will be the case. Of course, EIB loans are at advantageous rates and it is right that they should be available in Northern Ireland, just as they are in the rest of the UK.
My hon. Friend is absolutely right to draw attention to that danger. The recession must not be an excuse to deny employment rights to some of the most vulnerable workers in the country. That is why we have changed the law, bringing in tougher penalties for employers who do not pay the minimum wage and better arrears for employees who are denied the minimum wage. We are also putting in extra resources, including a £1 million campaign that was recently launched to inform agency workers of their basic employment rights, including wages, paid leave and so on. It is very important that we come through this recession not only by helping business but by ensuring that the most vulnerable workers do not pay the price.
Last week, the Minister held a seminar in his Department for businesses in the car industry and for banks to begin to explain how to apply for EIB loans that were first announced by the Government last September. Can he now tell us how many applications have been received and how many more weeks or months it will be before anybody receives any of that support?
Just to correct the right hon. and learned Gentleman, let me say that the purpose of the seminar was to explain the Government’s automotive assistance programme, which covers loan guarantees to companies that are accessing the EIB clean transport facility as well as the Government’s scheme more generally. He knows that, but he is just trying to make a debating point. DBERR has been supporting applications to the EIB. My understanding is that a number of companies are at an advanced stage in discussions with the EIB. I do not think that it would be appropriate for me to name those individual companies, because the negotiations are commercial in confidence, but he will be aware of reports that companies have been making those applications. We hope that next month the EIB will approve applications from a number of companies.
It is true that that is an issue. Many young people want to be famous and there has been a pattern of exploitation, with people setting up in hotels and launching one-day casting sessions. Last year we brought in a new cooling-off period to try to protect people against such activities. We said at the time that if that provision needed to be reviewed we would review it. We have continued to receive complaints, so today we are publishing a consultation document on banning the taking of up-front fees so that young people and their families are not exploited. We do not want to tread on anyone’s dreams and hopes, but we also do not want to see people exploited because of them. That is why we are taking this action today.
It is true that the issue has been raised with us, and of course we will consider anything that we think can help people who are unemployed or in economic difficulty. There is a significant contrast between how this Government will respond to this recession and how the previous Government abandoned the unemployed. The previous Government left the unemployed with only a benefit cheque to keep body and soul together, and gave them no real help to get a second chance. In contrast, this Government will stand by people who are losing their jobs.
I have received a number of complaints recently about mobile phone companies and cashback offers. Is the Minister aware of the problem? If so, is he planning on taking any action?
I can tell my hon. Friend that we are aware, anecdotally, of concerns about the behaviour of some mobile phone companies in that regard. Those concerns have been expressed in letters sent directly to Ministers and in questions raised by Members of Parliament. This is one of the matters that I have discussed with Consumer Focus, the new consumer body, which is doing some work on the problem in tandem with Ofcom. I look forward to discussing with Consumer Focus the results of that work, which we are expecting shortly. We will then consider what else we can do to help.
Are Ministers aware of just how angry businesses are at the Department’s failure to convey information to them? On 12 November, I wrote to the Secretary of State on behalf of a constituent company, asking for information about business loans. It is now 19 March and there has been no answer, despite three further letters, six phone calls to the Department, and a letter to Lord Mandelson last week saying that, if he did not answer, I would raise the issue in the House of Commons. This is the second time in three weeks that I have raised a similar matter. On one occasion, staff at DBERR were not even picking up the phone to answer inquiries because they were in such chaos.
When will something be done? If the Government cannot get information to companies out there, it is no wonder that absolutely nothing is being done. All we are getting is just a lot of talk, and no initiatives are working at all.
With the greatest respect to the hon. Gentleman, I shall look into the specific case that he mentions and come back to him. However, I do not accept his broader point about help not getting through to businesses, and I shall use the region in which his constituency is based, the east of England, as an example. More than 8,000 businesses in that region have been able to defer their business taxes in the past four months, while across the UK as a whole almost 93,000 businesses have been able to have business taxes totalling some £1.6 billion deferred. That is just one example of the real help being given to businesses at the moment, but as I said, I shall look into the specific case that he has raised and come back to him.
Can the Minister update the House on the Doha talks?
My hon. Friend will be aware that we got very close to an agreement. In the words of Pascal Lamy, some 75 per cent. of the conclusions were reached last July, but we have been waiting for a new US Administration to get their new trade negotiators in place. Similarly, we have been waiting for elections to be held in India and elsewhere. We hope to use the G20 summit in three weeks’ time to begin discussions again about how we can finish the negotiations on the Doha round. One thing about which the Prime Minister is absolutely and quite rightly clear is that any descent into protectionism, as happened in the 1930s, will cause further problems for our economy and for the global economy. That is why we are devoting so much attention to trying to make progress in the Doha round. That will be an issue for the G20 and for the G8 too.
Electoral Commission Committee
The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—
Voting Age
The Electoral Commission’s 2004 report entitled “The Age of Electoral Majority” concluded that there was insufficient justification for reducing the voting age to 16. The commission has since refocused its activities on the objectives of, first, regulating party and electoral finance and, secondly, delivering well-run elections. It believes that issues such as the extent of the franchise are matters for Government and Parliament to decide.
I am grateful to the hon. Gentleman for that answer. He will be aware that the Electoral Commission said that it would look at the matter again within five to seven years, so does he agree that it is time for the commission, independent of political influence, to look at the subject? Now that we have managed to allow young people to use this Chamber, although many Opposition Members wanted that not to happen, is it not time to consider young people a bit more than we have in the past?
It is indeed true that in 2004 the Electoral Commission said that it would revisit within five to seven years the case for lowering the voting age, but as I have just explained, the commission has since refocused its efforts. The refocusing is not in any sense an abrogation of its responsibility, but follows a review of the commission’s activities by the Committee on Standards in Public Life. The refocusing has been welcomed by the Government and the Committee.
Does my hon. Friend accept that the Electoral Commission is right to refocus in that way? Like most Members, I regularly visit schools in my constituency and hold question-and-answer sessions with fifth and sixth formers. They are very interested in a number of subjects, but none of them is the slightest bit interested in having the vote at 16.
I am grateful to my right hon. Friend. Most of the responses to the consultation held in 2004 supported lowering the voting age. However, the commission found that more general opinion polling suggested strong support for keeping the current minimum, and that young people seemed divided on the issue.
Church Commissioners
The hon. Member for Middlesbrough, representing the Church Commissioners, was asked—
Churches Conservation Trust
In 2009-10, the Churches Conservation Trust will receive just over £4.5 million grant in aid from its co-sponsors, the Department for Culture, Media and Sport and the Church Commissioners.
I am grateful to the hon. Gentleman for that reply. Will he join me in paying tribute to the Churches Conservation Trust, in particular for its work in Shropshire looking after nine churches and also Longford chapel in my constituency, near Newport? While I note the grant, will he also join me in recognising that there are real financial pressures on many churches? Churches help tourism and promote culture and heritage in counties throughout the country, and in Shropshire in particular, so will he speak to the Secretary of State to see whether that grant is sufficient to keep these churches running?
I am grateful to the hon. Gentleman for mentioning the Longford chapel near Newport. He might have added Stirchley St. James and Adderley St. Peter, which are in his constituency, as I understand that they, too, benefit from the trust. His point is perfectly right. The Churches Conservation Trust is 30 per cent. Church and 70 per cent. Government funded, and it is working hard to secure its financial future by widening its funding base. I take his point that the Department for Culture, Media and Sport grant was frozen in 2001 until 2008. There has recently been a small cash increase of 1.8 per cent., but it continues to be reduced in real terms. We welcome that contribution from the state, but it is not sufficient.
Given the continuing cut in DCMS support for heritage, especially for cathedrals and churches, will the hon. Gentleman take great care to ensure that the Church Commissioners maintain their financial aid? The Churches Conservation Trust is an excellent organisation. Does he share my enthusiasm for its 40th anniversary celebrations and its “Birthday bells” appeal, in which more than 70 churches across the country rang their bells to celebrate those 40 years? Does he also agree that people who do not like church bells should not buy a house near a church? “Ring out, wild bells”, Mr. Speaker.
I am grateful to the hon. Gentleman for those comments, and I celebrate with him the 40th anniversary to which he referred. On the Church Commissioners’ involvement, the present financial difficulties do not affect churches’ expenditure plans for the next few years, so the Churches Conservation Trust’s grant from the Church Commissioners is safe in our hands.
Church Repairs
Church representatives have been in regular contact with the Treasury on that matter. The latest development is the agreement reached by the European Council of Finance Ministers on 10 March that all member states will have the option to apply permanently reduced VAT rates to a number of goods and services. I very much regret that the repair of places of worship is not on that list of goods and services.
Is it not a pity that the Council found the opportunity to discuss VAT reductions for some toll bridges and restaurants, but not for church buildings, which provide so much emotional, spiritual and cultural well-being? What is the next step?
I agree entirely with my hon. Friend. One has to bear in mind that the former Chancellor of the Exchequer, now Prime Minister, agreed effectively to reduce VAT on church repairs to 5 per cent. until 2011. The campaign by Members in this House will be to maintain that derogation well after that date. I am sure that right hon. and hon. Members will add their weight to it. In particular, may I thank the hon. Members for Vale of York (Miss McIntosh) and for The Wrekin (Mark Pritchard), my hon. Friend the Member for Wirral, South (Ben Chapman) and others who are present who have contributed to and supported the campaign? I also thank those in the Church of England who have campaigned so arduously. I invite parishes up and down the land to make use of the derogation scheme already in operation.
I thank the hon. Gentleman for his kind words, and for raising the profile of parish churches in rural areas. Now that we have established the derogation, and the broader principle of lower VAT on other goods and services, can we not all unite behind the campaign to persuade the Prime Minister and the Chancellor of the Exchequer to take the argument to Europe, so that they can ensure that the derogation affects churches across the European Union? We must unite behind that worthwhile cause.
I am grateful to the hon. Lady for her comments, and I would certainly support any campaign that the Prime Minister and the Chancellor might wish to take to Europe, bearing in mind that it took six years to get this far, and that the process was extraordinarily complicated. As my hon. Friend the Member for Wirral, South (Ben Chapman) said, at the last moment, it was decided in Lisbon to throw in toll bridges; they are to be covered, but not VAT on church repairs, which is quite remarkable. I hope that that is not a reflection of how the European Union looks upon the Christian community throughout the Union.
Does the hon. Gentleman accept that many of us are extremely angry at the attitude recently taken in Europe? Does he also accept that at a time of unemployment, it is crucial that church buildings can be repaired, not only because that is intrinsically important, but because that work offers employment to craftsmen and others?
The hon. Gentleman makes a fine point, because the work is artisanal—if that is a word that we can put in Hansard—and helpful for local communities. The essential message that this House should give the parishes is to encourage them to undertake those church repairs, and to collect the VAT reduction. It is important that the scheme is taken up before 2011, so that, with the grace of this House, it can be continued after that date.
Church of England (Disestablishment)
In July 2007, the Church welcomed the Government’s reaffirmation of their commitment to the position of the Church of England, which is by law established with the sovereign as its supreme governor. No assessment of the kind that my hon. Friend mentions has been made.
Archbishop Rowan recently said that it would not be the end of the world if the Church of England was disestablished, although disestablishment should not be on the agenda at the moment. Notwithstanding those wise remarks, would my hon. Friend agree that if an assessment of financial implications were undertaken, it would be highly likely to find that the Church’s inherited financial commitments greatly exceed its inherited financial resources?
I am grateful to my hon. Friend, who raises a pertinent point on the disestablishment of the Church. He referred to the comments made by the Archbishop of Canterbury. I welcome the Archbishop of Canterbury’s intervention on the financial crisis; he added a moral dimension to the debate on the economy, along with the Archbishop of York. Although his comments on disestablishment have been given wide credence, he also said that he would be concerned if there was to be disestablishment.
On the specific point made by my hon. Friend, the financial implications of disestablishment would be a matter of discussion between the Government of the day and the Church of England during the preparation of the necessary legislation. The question of the financing of the Church and its financial outcome would have to be fully debated by the Government of the day, Parliament and the Church of England.
As a supporter of disestablishment, may I ask the hon. Gentleman if he would at least ask the Church Commissioners to undertake the financial assessment to which the hon. Member for North-West Leicestershire (David Taylor) referred, and look at the Churches in Wales and Ireland, which disestablished but which do not appear to have been disadvantaged financially as a result?
I am grateful for the hon. Gentleman’s comments and for his statement that he believes in a disestablished Church. The question that my hon. Friend the Member for North-West Leicestershire (David Taylor) asked related to financial commitments, which far outweigh the total inherited resources of the Church of England. In response to the question about whether we ought to undertake a study, we should not put the cart before the horse. We should await any decisions that the Synod may make before we debate the matter and its financial implications. However, disestablishing the Church would affect every parish in the country, and its allegiance to the Crown and to the Church, and is a step that would be taken only after many years of consideration.
Electoral Commission Committee
The hon. Member for Gosport, representing the Speaker's Committee on the Electoral Commission, was asked—
Electoral Fraud
The Electoral Commission informs me that it does not expect new measures to be in place by the last possible date for the next general election.
I thank my hon. Friend for that reply. I am rather disappointed, because I am sure that he is as concerned as I am, and as everyone else in the House who worries about democracy is, about the comments made a few years ago by a judge who said that our standards were those of a banana republic. In particular, will my hon. Friend raise again with the Electoral Commission and with the Government the need for individual registration, rather than household registration, which would go some way towards solving the problem of electoral fraud? In addition, will he raise the fact that postal voting on demand has been shown—this has been commented on on many occasions—to be an easy route to fraud in elections?
Occurrences of electoral malpractice are rare, but it takes only a small number for confidence in the voting system to be seriously damaged. The Electoral Commission takes the view that postal voting should be made more secure, rather than withdrawn, and it very much welcomes the commitment by the Government to introduce provisions to introduce a system of individual electoral registration in Great Britain. The commission has argued for that since 2003, and it believes that the system should be modernised and strengthened by introducing individual electoral registration.
I am sure that the hon. Gentleman will be aware that in certain community groups, there is considerable confusion as to whether people are entitled to vote, particularly because some of them are entitled to vote in local elections, but not in general elections. Is it on the commission’s agenda to do more to educate people about the circumstances, particularly in relation to their immigration status, in which they are allowed to vote?
The hon. Lady makes a fair point. The rules are, in fact, a little complicated, and this is exactly the area in which the Electoral Commission feels a sense of commitment to make people aware of their rights.
Business of the House
May I invite the Leader of the House to tell us the future business?
The business for next week will be as follows:
Monday 23 March—Remaining stages of the Coroners and Justice Bill (Day 1).
Tuesday 24 March—Conclusion of remaining stages of the Coroners and Justice Bill.
Wednesday 25 March—Opposition Day (9th Allotted Day). There will be a debate entitled “The Need for an Inquiry on Iraq”, followed by a debate entitled “The Impact of Business Rates and how Businesses can be Helped Through the Recession”. Both debates will arise on an Opposition motion.
Thursday 26 March—A general debate on defence in the UK.
Friday 27 March—Private Members’ Bills.
The provisional business for the week commencing 30 March will include:
Monday 30 March—A general debate on Africa.
Tuesday 31 March—A general debate on the economy.
Wednesday 1 April—Second Reading of the Geneva Conventions and United Nations Personnel (Protocols) Bill [Lords], followed by a motion relating to the Non-domestic Rating (Collection and Enforcement) (Local Lists) (Amendment) (England) Regulations 2009.
Thursday 2 April—Motion on the Easter recess Adjournment.
I should also like to inform the House that the business in Westminster Hall for 2 April will be a debate on the report from the Science and Technology Committee entitled “Investigating the Oceans”.
I thank the Leader of the House for giving us the forthcoming business. Her response to me last week about the encampment and the harassment by protesters in Parliament square was, I am sorry to say, painfully inadequate. When will she undertake to give a full report to the House so that we can cut through the bureaucratic nonsense governing the issue and remove what has become a permanent embarrassment to British democracy?
May we have an urgent debate on the NHS? Yesterday we heard from the Health Secretary the miserable tale of Stafford hospital. Will the right hon. and learned Lady confirm to the House that the same senior management who were so devastatingly criticised by the Healthcare Commission on Tuesday saw their salaries doubled in 2008, and that one has been appointed to a Government watchdog? Is it not the clearest possible demonstration of Labour’s priorities towards the health service that while they spent their time lining the pockets of a failed management team, there were patients lining the walls of a filthy accident and emergency ward who were dying of neglect?
Lying behind this is, I sense, a growing problem with how health trusts and other public bodies treat correspondence from Members of Parliament. Too often, Members’ letters about a constituent are fobbed off by being sidelined into a complaints procedure designed for another purpose, and also by hiding behind data protection. Can the right hon. and learned Lady confirm that when an MP writes to a chief executive they should receive a letter back from that chief executive, that getting a letter from an MP should be regarded as a priority, and that any failure to treat an MP’s letter properly should be a disciplinary offence, even resulting in dismissal?
We are still waiting for the Government’s long-delayed strategic review of reserve forces. We all have reservists in our constituencies. When will we get an announcement, and can the Leader of the House confirm that it will be a full oral statement?
Today 144 further education colleges have their building programmes frozen, and this morning the Under-Secretary of State for Innovation, Universities and Skills, the hon. Member for Birmingham, Erdington (Mr. Simon), the Minister responsible for further education—or should I say, the Minister requiring further education?—offered no reassurance that the Government would prevent those colleges from going bankrupt. May we have an urgent debate to discuss the future of those institutions, which offer vital training to the rapidly rising number of people facing unemployment?
For the umpteenth time, may we ask for a debate and action on Equitable Life? Today the Public Administration Committee has slammed the Government for their callous betrayal of Equitable Life policyholders. It says that the Government have denied them justice. This is a truly scandalous state of affairs in which an unprincipled Government would rather see them all dead than compensated. When will the Government act properly on what the ombudsman has recommended?
On a number of occasions I have raised the farce of Regional Select Committees. The North East Committee has five Labour members, four of whom are Parliamentary Private Secretaries, and the other a long-serving Back Bencher. I am advised that when they met, they picked one of the PPSs as Chairman, and that the only member not in hock to the Government has now decided to resign. Is this true, and may we have a further debate so that we can give the Leader of the House the opportunity to admit her mistake and abolish those Committees?
Yesterday the scarlet-haired Solicitor-General, who has no experience of economic affairs, claimed that we would soon see “green shoots” in the British economy. As a barrister she was known as the “towering inferno”; yesterday, it seems, she finally went up in flames. Is that not the most crass statement that any politician could have made, on the day when it was announced that more than 2 million people are unemployed?
May we have a statement on the Prime Minister’s recent visit to Washington? It seems that the DVDs that President Obama gave the Prime Minister—rather like the Prime Minister himself—do not work in the UK. We are told that one of them was “Psycho” and the other “Gone with the Wind”.
So those are our requests for debate: there is a rotting encampment outside Parliament; there are failed NHS managers with bloated pay packets; the fate of our reserve forces is left dangling; FE colleges are collapsing; Equitable Life pensioners are betrayed; dysfunctional Select Committees are set up; we have a dysfunctional Government; and the Solicitor-General insults the unemployed. How can the Leader of the House defend any of that, without hanging her head in shame and apologising?
At last week’s business questions, I answered the hon. Gentleman’s question about the encampment of protesters in Parliament square by saying that he or other colleagues could raise the issue at Justice questions. I added that we had said that as part of the legislative programme, there would be consideration of a Bill on constitutional reform that could address the issue. That is very much under consideration, so I endeavoured to answer him fully on the issue.
On the question of the national health service, there was a statement yesterday about the regrettable situation in Stafford hospital. There will be questions next week. The hon. Gentleman asked about our priorities for the NHS. They are simple and straightforward: that there should be more doctors, nurses and other staff in the NHS—and that is what has happened—that those staff should be better paid, because when we came into government they were extremely badly paid; that there should be tough targets, so that nobody should have to wait in accident and emergency or for a referral for cancer treatment; and that there should be tough inspections. We have pressed forward with our NHS priorities, which people who need treatment can expect and deserve.
The hon. Gentleman raised a serious point about responses to Members who write on behalf of their constituents, or of organisations in their constituencies, to NHS authorities—the chief executives of trusts or PCTs. He has raised an important point on behalf of the House. He had mentioned it to me already, so I have spoken to the Minister of State, Department of Health, my hon. Friend the Member for Exeter (Mr. Bradshaw), who has raised it with Sir David Nicholson, the chief executive of the NHS. They have said that they completely agree with the shadow Leader of the House and that if a Member writes to someone in authority in the NHS, that letter should require personal consideration by the chief executive, and a personal response. There is no guidance to that effect at the moment, but my hon. Friend and Sir David are absolutely clear about their view. They are considering whether they should issue guidance, although the matter should have been self-evident. That is the absolutely clear position. If hon. Members have any concerns about the issue, they can take them to the shadow Leader of the House and he can raise them with me, or go directly to my hon. Friend the Health Minister. We do not expect Members’ letters to go into a complaints system that is designed for individual patients, not for accountability, which is what the House’s job is about.
The hon. Gentleman asked about reserve forces, and I should say that next week there will be a full day’s debate on defence. He also made comments about the Solicitor-General, with whom I work closely and with whom I will be taking the equality Bill through the House. In her role as Solicitor-General, she is a great champion of victims of crime. She is also a great champion of her constituents and her region in the north-east. She is a fine Member of Parliament who cares about these issues and is a valued member of the Government. I will not hear a word said against her—I hope that I have made myself clear on that one.
The hon. Member for Rutland and Melton (Alan Duncan) also asked about Regional Select Committees. When we passed the resolution to set those up, we determined that they would last just for this Parliament, and be reviewed thereafter, so they have that consideration of review built in. I appreciate that I am not making progress with Opposition Members, but I still take the view that there are important agencies working at regional level, investing hundreds of millions of pounds of taxpayers’ money, and it is a shame if Opposition Members cannot be bothered to hold them to account on behalf of their regions. I hope that they will have a conversion with regard to Regional Committees, although I do not set much store by that expectation. That is a pity, but in the meantime Members who are prepared to hold agencies to account in their regions—Labour Members—are getting on with the job. Until other Members join the Committees, they should not be complaining about them.
As for Equitable Life, when the Chief Secretary to the Treasury made her statement in response to the ombudsman’s report she said that the failures that have affected a large number of people were rooted in the original mismanagement of Equitable Life, which goes back to the ’80s. That was compounded by regulatory failure, for which she has apologised. We have acknowledged that regulatory failure and exceptionally, although there is no legal obligation so to do, we are determined to make ex gratia payments, for which a judge has been asked to set up a scheme. Of course, as one would expect, those in the greatest need will be dealt with first. That is how we are proceeding, and we believe that we have made the position clear to the House. The work is under way, and if the Opposition want to hear about it further or debate it, they can choose it as the subject of an Opposition day debate.
The hon. Gentleman mentioned unemployment. We are very concerned indeed for every person who loses their job, whether they are a man working in the car industry or banking industry, a woman working part time or an older person who is heading towards retirement but whose job is still important to them and to their household budget. Employment in the economy is important for the economy as a whole. That is why we are ensuring that we will not be cutting capital spending, as Opposition Members propose, which would make unemployment even worse. It is why we are providing a fiscal boost and putting more money into the economy to help get it going and help staunch the problem of job loss. That has led to an increase in debt as a percentage of GDP. Hon. Members complain about that, but if they are concerned about unemployment, why do they argue that we should not do all the things that we are doing to try to protect the unemployed and prevent even more people from becoming unemployed?
Of course, one thing that the Opposition simply refuse to acknowledge is that there is an unemployment problem across the country as a whole—[Hon. Members: “Too long!”] I have not taken as long answering as the hon. Member for Rutland and Melton took asking his questions—[Interruption.] All right, I apologise. I shall therefore finish by mentioning FE colleges.
I remind the House that when we came into government in 1997, the capital budget for FE colleges—[Interruption.] I would just like to ask hon. Members whether they can remember what the capital budget for FE colleges was then. It was £0—there was no capital budget. Since then we have invested massively in further education, and rightly so. I reassure hon. Members that there are 261 colleges for which final approval has been given, or at which there is already work on site, and that the capital investments in those 261 colleges will go ahead as planned. Sir Andrew Foster will examine how preliminary approval has been given beyond the programme budget. We acknowledge that that is a problem, and it is being looked into. However, as the Prime Minister said yesterday, we will go ahead with the £2.3 billion in this comprehensive spending review period that we have allocated to further education colleges—and I think that £2.3 billion contrasts favourably with £0.
It was reported yesterday that the disgraced former chairman of RBS was seeking re-election to the board of BP and, surprisingly, was supported in his request by the chairman of BP, who had been a director of RBS. Until we break into the magic circle and old boys’ club, in which the same directors appoint each other to boards, remuneration committees and so on, we will never sort out accountability and the problems that have arisen in the banks and elsewhere. May we have a debate on corporate governance, to ascertain how to address the issue fundamentally, so as to stop problems occurring not only in the banks but in other sectors of our economy?
The question of corporate governance—and of remuneration, which is intrinsic to it—has been part of the Turner review, which was published yesterday. It will be the subject of a Government response, with national action to gear up financial regulation, which will also be taken forward to the G20 international summit to ensure not only that we have good national action but that it is reinforced by international co-operation on regulation and remuneration.
May we have a debate on communications between the Prime Minister’s office and the outside world? A few years ago, I was in Turkmenistan when the Turkmenbashi was the president. I was told that the Karakum canal was leaking disastrously, but that none of his Ministers dared tell the Turkmenbashi, because they were afraid of the consequences. I wonder whether something similar is happening with the Turkmenbashi of No. 10. The hon. Member for Rutland and Melton (Alan Duncan) gave one example—the further education colleges. It is no good talking about what happened 12 years ago; we need to consider what is happening now. Colleges throughout the country are having their capital schemes frozen.
Another example is the mortgage relief scheme, which I raised directly with the Prime Minister a month or so ago, and which others, including the right hon. Member for Witney (Mr. Cameron), have subsequently taken up. It is no good saying that it will happen when I—I am sure that I am not alone in this—have people in my advice surgery in tears because they are going to court next week, when their house will be repossessed, and the mortgage relief scheme is still not in place. May we therefore have a debate to bring the Prime Minister into the real world loop? He is giving orders, which are not being carried out.
Many students will be alarmed this week by universities’ proposals to double fees. Before a further generation is put into deeper debt, may we have a debate on the matter so that we know the Government’s position? They know that many of us will oppose any such proposals bitterly.
We had the sad statement about Stafford hospital, and many of us recall earlier events at Maidstone. I wonder whether it would be appropriate to have a debate on professionals’ duty of care. I understand that administrators appear to have taken an extraordinary view of targets and abused the system at that hospital, but clinicians, doctors and nurses have a duty of care to individual patients and they should be reminded of that. It is not part of their role simply to accept whatever orders they are given, if they are detrimental to patients. May we therefore have a debate on that?
Yesterday, the Prime Minister made a statement about allegations of collusion with torture. That written statement raised more questions than it answered, not least because, as I read it, it confers on the Attorney-General a wider role, which I believe to be entirely unconstitutional, whereby a Minister of the Crown determines—not only in the case referred by the High Court, but in others—not whether Government agents are prosecuted, but whether they are even investigated. That cannot possibly be right constitutionally or legally. May we have a serious, sober debate about that matter, about which hon. Members of all parties will be concerned?
I shall not add anything further to my answer to the shadow Leader of the House about FE colleges, except to say that 261 colleges will go ahead with their capital improvement, and that over three years, £2.3 billion will be invested. An inquiry is being set up under Sir Andrew Foster about the preliminary approvals that were given, but should not have been. It will report shortly.
The mortgage scheme—the help for people to defer their interest payments—was announced in January, but it was made clear when it was announced that because the scheme involved the major mortgage lenders, it would have to be worked up with them. It was not just a Government scheme, like the Her Majesty’s Revenue and Customs scheme, which could be announced and then implemented straight away. It had to be worked up in partnership with the mortgage lenders—and that is happening. In the meantime, we have given more help to those who become unemployed by shortening the amount of time for which they have to be unemployed before they get help with their mortgage payments, and increasing the amount for which they can get help with their payments. We have issued guidance to the county courts to ensure that they enforce the position that repossession is a last resort. We also have a moratorium with the mortgage lenders on moving to repossession. That work is under way, and some has already come on stream.
On higher education fees, the Minister of State, Department for Innovation, Universities and Skills, my right hon. Friend the Member for Tottenham (Mr. Lammy) has said that there will be a review. However, even before the review we know that admissions to further and higher education have increased across the board.
The hon. Member for Somerton and Frome (Mr. Heath) mentioned the duty of care of professionals at Stafford hospital. There will be Health questions next week, and he could raise the matter then.
The hon. Gentleman talked about the Attorney-General and the Prime Minister’s written ministerial statement on detainees. At Prime Minister’s questions, my right hon. Friend spoke of our absolute abhorrence of torture and rendition, and our rejection of anything to do with that. To reinforce that, and to reassure people so that they know that our important security services are not contaminated by such abhorrent malpractice, guidance will be published. A further request has been made to the Intelligence and Security Committee to review recent developments, and Peter Gibson will examine the matter and report annually to the Prime Minister. It is not unusual in complex matters for the Attorney-General to examine the issues first and request the police to investigate. Obviously, the police can investigate of their own volition, but it is not unusual for the Attorney-General to undertake a preliminary review—and that is exactly what she is doing.
When my right hon. and learned Friend responded to the shadow Leader of the House, who requested a debate on the Mid Staffordshire NHS Foundation Trust, she said that there had been a statement yesterday and that there would be Health questions next week. That is not good enough. That hospital is about 12 miles from my constituency and I am intensely concerned about what happened there. The preliminary reports are horrifying and shocking. Please may we have a debate in Government time soon?
Action has been set out following the statement, and my hon. Friend will be able to ask further questions of the Health Secretary. It is important to reinforce to bereaved families who have lost relatives in that hospital the fact that they can individually have a review of their relatives’ cases.
The Leader of the House knows that although the Government have a good-sized majority, the vast majority of the British public voted for Members of Parliament who sit on the Opposition side of the House. May we have a debate on the need for electoral reform, so that the Government of the day have the support of the majority of the people?
We have no proposals for such a measure in the legislative programme.
When can we have some time set aside to set up a Regional Select Committee for London? The Mayor has cut major infrastructure projects in London, the 50 per cent. target for affordable housing has been cut, and a £75 million revenue black hole has been created in the budget of Transport for London. London Members of Parliament want a voice on those issues and an opportunity to scrutinise the Mayor—or at least, Labour Members want that, even if the Liberals and the Tories do not. When can we set up a Committee for London?
I agree with my hon. Friend. When we debated the regional Committees in the House, we said that because of the different governance arrangements in London, with the Mayor and the Greater London authority, we would have to consider the issue further. However, I agree with the points that my hon. Friend has made. We need to look into the issue and make progress on it.
In the early hours of Sunday morning, mindless and vindictive vandalism was committed in my constituency. When my constituents woke up, they found that every road sign that had the words “Hospital” and “A and E” on it had been sprayed out. That was legal, because the primary care trust had instructed the highways authority to do it. The vindictive and mindless vandalism that took place was the closure of my acute hospital in the middle of the night. The A and E department, intensive care and the stroke, cardiac, maternity and all other acute services were closed on Saturday night. Can we have a Secretary of State come here for a debate about why so many facilities are closing round the country?
That is an example of where, if the hon. Gentleman had mentioned to me that he was raising that issue, I could have given him a more substantive answer than this, which is simply that he has an opportunity to put that question to the Secretary of State for Health next week.
I do not wish to add to my right hon. and learned Friend’s woes, but could we have an early debate on the problem of FE colleges? A modest college in Rotherham has spent millions of pounds, closed a road and published its plans, but has suddenly been told that it cannot go ahead, having received full authorisation up to that moment. Either the Learning and Skills Council officials who authorised that were wrong and should resign or the senior civil servants who supervised and authorised it should resign. If the matter came across a Minister’s desk, questions have to be asked. The issue is important for the construction industry and for the confidence of some of the weaker economies in our country. Will my right hon. and learned Friend find time for a debate and tell the Prime Minister that we need clarification and for the money set aside to renew our economy to be put into the FE college building programme?
We have acknowledged that there is a problem and Sir Andrew Foster is investigating how it arose. However, my right hon. Friend will acknowledge that, unlike under the previous Administration, Thomas Rotherham college has had considerable investment over the past 10 years.
It is not Thomas Rotherham college—I am really sorry.
Okay. Well, even if my right hon. Friend was not asking about Thomas Rotherham college, it is in his constituency and has had considerable investment. I am not saying that there is not a problem about FE; Sir Andrew Foster is looking into it.
In announcing the business the right hon. and learned Lady suggested that next week’s defence debate might be used as an opportunity to raise the important issue of the reserves review, which is long awaited and much delayed. Will she confirm that the matter is of sufficient importance and involves so many MPs who have reservists as constituents—a great deal of work has been put into this—that it should be the subject of a proper oral statement by the Defence Secretary? Will she also confirm that that should be done as soon as possible, as the review is now completed?
There will be a full-day’s debate next week on defence, as I have said. There will be an opportunity for hon. Members to raise the question of reservists with the Minister concerned, but if they are not satisfied thereafter, we can look at the situation again.
Many right hon. and hon. Members head back to civilisation on a Thursday to the midlands and the north along the Euston road or through the Euston area. May I counsel them not to go near the 13th floor of Euston tower, 286 Euston road, which houses the central London tax office of Her Majesty’s Revenue and Customs for my constituent the Air Logistics Group, as well as for many hundreds of other businesses. There appears to be a serious black hole there, which is obviously a danger to public safety. Information is not coming out of that Government office, despite faxes, e-mails, telephone calls and requests for refunds from my constituent, who is concerned about a bill for more than £25,000 for corporation tax for 2008. We are told that the office is behind with its post. The Government signed up to the prompt payments code at the end of last year and set a limit of 10 days on all transactions with the private sector in particular, but that is not happening. Can we have a debate on the HMRC, its resources and how it handles—
Order. I say to hon. Members that I am not going to get through all the Back Benchers in this question session if the supplementaries are as long as that. They are not an opportunity to make a speech; it is a question that should be put to the Leader of the House.
Treasury questions are next Thursday and there will be a full-day’s debate on the economy. HMRC is processing promptly all the applications from those businesses that want to defer their tax. I will raise with the Chief Secretary to the Treasury the issues to do with the tax office that my hon. Friend raised.
Does the Leader of the House recognise that Select Committees are one of the most important ways in which we have the opportunity truly to hold the Government to account? However, the Regional Select Committees are a total travesty. Will she become the Leader of the House for once and abandon them, and instead have the regional Grand Committees, to which every Member in the region concerned is entitled to attend?
The House voted for Regional Select Committees to be set up and for them to be reviewed at the end of this Parliament. That being the will of the House, that is what is happening.
Derian House, a children’s hospice in my constituency, and St. Catherine’s, which is next door in South Ribble, are doing the good work that the Government rely on. People who are dying, who need that loving care, are dependent on the income of those hospices from charitable donations and the money from the Government. As my right hon. and learned Friend well knows, the children’s hospice is the poor relation for direct funding from the NHS. What can she do through this credit crisis, as charities struggle with the amount of money that they receive, to ensure that the funding gap can be bridged through the NHS? It would be a good idea to have a topical debate on funding for the hospice movement.
I will take that as a suggestion for a topical debate. The Government have put extra money into the strategy for end-of-life care, and £10 million extra into children’s hospices in particular. We have also helped with gift aid. However, some hospices have been hit particularly hard because their reserves were in Icelandic banks, which has added to their problems at a time when charitable giving has fallen. We are acutely aware of the effect that that might have on health services that are incredibly valued by families who need them. I agree with my hon. Friend’s point and will look into the issue for a topical debate.
At the end of another week when significant redundancies have been announced in the knitwear industry in Hawick in my constituency, will the right hon. and learned Lady ensure that when the Chancellor introduces the debate on the economy in due course, he acknowledges the challenges facing that world-class industry and brings forward a set of proposals to support it?
I will bring the points that the hon. Gentleman has made on behalf of businesses in his constituency to the attention of the Chancellor, and if he thinks it right, he can include them in his remarks to the House.
Is my right hon. and learned Friend aware of the article in The Independent today about restaurant owners using the credit crunch as an excuse to ask the Government not to stop the inclusion of tips in the national minimum wage? We fought long and hard to close that loophole, so I hope that she and other members of the Cabinet and the Government do not agree with those restaurant owners, who are bad employers exploiting young people. When will the legislation come forward to this House?
I agree with my hon. Friend. From this October, all staff must get the full minimum wage, excluding tips. We can all support the “fair tips, fair pay” campaign and ensure that we give our tips in cash.
In her rather shrill defence of the catalogue of incompetence that has led to the FE crisis, the one thing that the right hon. and learned Lady did not say was whether Ministers would come to the House to answer to Members from across the House whose FE colleges face such difficulties. The Association of Colleges says today that those FE colleges that were encouraged to devise and develop projects for capital expansion have already spent £150 million in doing so. A Minister says that we should not be in this state and that the programme has not been managed properly, but what Ministers will not do is come to this House and answer for the incompetence that has led to this situation. Will the right hon. and learned Lady bring about the opportunity for Members from across the House to defend their colleges and to make Ministers answer the questions that they seem so reluctant to answer?
Given the risk of being shrill, perhaps I should answer the hon. Gentleman in a very deep voice. I refer him to the written ministerial statement that the Secretary of State for Innovation, Universities and Skills issued on 4 March. The Prime Minister answered questions on this matter yesterday in Prime Minister’s questions, and Sir Andrew Foster’s report will be forthcoming shortly. At that point, it might well be that the Secretary of State comes to the House to make an oral statement.
It is really important that schoolchildren have an opportunity to visit the House, but I am struggling to arrange that for schools in my constituency. I am told that we are completely booked up until at least September or October. It is particularly difficult for schools in the north, because they have to come on a Monday or Tuesday; the other days are no good to them. Could those schools be given some priority, because it is easier for schools in London and the south-east to come later in the week?
My hon. Friend makes an important point. All our constituents find it incredibly valuable that schoolchildren come to the House. If I may, I will ask the Deputy Leader of the House to look into this matter, and possibly issue a written ministerial statement about it. Speaking as a London MP, I am sure that we would all readily understand the idea of making such visits possible for schools from outside London, for which more complex arrangements have to be made, and do what we can to help.
Given that the Prime Minister appeared to be in denial yesterday, that the Minister responsible for further education, the Under-Secretary of State for Innovation, Universities and Skills, the hon. Member for Birmingham, Erdington (Mr. Simon), was embarrassingly hapless when interviewed on the “Today” programme this morning, and that the right hon. Member for Rotherham (Mr. MacShane) has just made it clear that a serious problem exists, surely it would make sense for the Secretary of State, and not a hapless junior Minister, to come to the Dispatch Box early next week to answer questions from Members who are worried about their colleges of further education. If the Leader of the House will give us a simple yes, we will all be happy.
In order that hon. Members should not be unduly alarmed, and that no one should suffer from any confusion about whether the 261 final approvals that have been given will be going ahead, perhaps I will ask the Secretary of State to issue a written ministerial statement containing a list of the 261 final approvals, so that everyone is clear about which is going ahead this year. Sir Andrew Foster’s report will be forthcoming shortly, and it is at that point that the Secretary of State should come to the House with the full facts of the situation at his disposal.
Could we have a debate on the future of the country’s rape crisis centres? My right hon. and learned Friend will be aware of the excellent work done by their staff, most of whom are volunteers, but there is genuine concern about the future funding for the centres. Will she use her good offices to advance the argument for keeping them funded, in order that women, in particular, can use their services?
I agree with my hon. Friend. All local authorities ought to be supporting those local services that help the victims of rape—one of the most traumatic crimes. We set up a £1.1 million fund last year to help the rape crisis centres that were threatened, and none has closed because they were all able to apply to the fund, 100 per cent. of which was spent. Today, we are announcing the second round of the fund, which will be £1.6 million. It is important to support the victims of rape, but it is also important to hold the perpetrators to account. It is therefore welcome that, over the past 10 years, the number of men convicted of rape has increased by 46 per cent. We have a great deal more to do in the criminal justice system, but we are making good progress, and rightly so.
The Leader of the House did not respond to the point raised by the hon. Member for Rutland and Melton (Alan Duncan) about Equitable Life. She will be aware, however, that the latest damning indictment of the Government’s mishandling of the Equitable Life fiasco was delivered only today by the Public Administration Committee, under the chairmanship of the hon. Member for Cannock Chase (Dr. Wright). Given the strident criticisms in the Committee’s report, will the Leader of the House now find time for a debate about the Government’s handling of the whole Equitable Life fiasco, so that people can have their money returned to them?
I did respond to the shadow Leader of the House’s question about Equitable Life in some detail. In order not to squeeze the time of other hon. Members, I will not go through it all over again.
Is my right hon. and learned Friend aware of the abysmal success rate in tracing employers’ insurance liability certificates in cases of asbestos-related disease? This morning, I received a letter pointing out that last year certificates were traced in only 25 per cent. of pre-1972 cases, and that for post-1972 cases the figure was only 38 per cent. There is an alternative: an employers’ liability insurance bureau. Will she arrange for a topical debate on the concept of such a bureau?
Perhaps there will be an opportunity for my hon. Friend to seek a Westminster Hall debate on that subject. I will bring his comments to the attention of Ministers in the Department for Business, Enterprise and Regulatory Reform. It is another example of where regulation is important to protect people.
May we go back to the reply that the Leader of the House gave to the hon. Member for Cheadle (Mark Hunter) about Equitable Life? In her first response, she referred to the statement by the Chief Secretary to the Treasury last November. That statement has just been dismissed by a Select Committee of the House as
“shabby, constitutionally dubious and procedurally improper”.
May we have not just a debate but a debate with a vote, so that the House can decide whether it supports the Chief Secretary, or the ombudsman and one of its own Select Committees?
The Liaison Committee chooses which Select Committee reports are debated in the House. I have nothing to add to what I said to the shadow Leader of the House.
In the next few days, the parents of four and five-year-olds will learn which primary school their children will be going to in September. Three weeks ago, the parents of children transferring to secondary school were told which secondary school their children had been allocated. As this is the first year of the new school admissions code, will my right hon. Friend find time for a debate on the working of the code, once we have the full analysis of secondary and primary school admissions?
I know that 87 per cent. of parents got their first choice for their children in the recent admissions allocation. The most important thing is that not only do they get the school that they choose, but that every school is as good as possible. I will raise the question of the monitoring and reviewing of the schools admission code with the Secretary of State for Children, Schools and Families and ask him to write to my hon. Friend.
May I join other hon. Members who have asked for a debate on Stafford hospital? Almost 15 years ago to the day, my mother died in that hospital. She got excellent care there, and there are a number of people who work there who will be horrified at what has happened. For the sake of those people, who have given good, loyal service to the national health service, we need a chance not only to say what has gone wrong in this instance, but to pay tribute to those people who have worked so hard in that hospital.
I am sure that many of the people who work in that hospital will appreciate the right hon. Gentleman’s comments. Perhaps I can also remind the House that the Secretary of State for Health has said that there is new leadership in the accident and emergency unit—which had been the major problem—to ensure that all patients can be confident that they will be properly looked after from now on.
Next week, we will consider the massive Coroners and Justice Bill on Report. Mr. Speaker, you will be selecting the amendments and, as there are so many parts to the Bill, they will inevitably fall into at least eight substantive groups. We are grateful to the Leader of the House for providing two days’ debate, but does she recognise that the ability of the House to scrutinise the legislation will be measured, in part, by whether we have time to debate all those groups? Will she take steps to ensure that there is adequate consultation between the parties so that those two days are used effectively to scrutinise all the parts of this important piece of legislation?
I take seriously the points that the hon. Gentleman raises. It was on the insistence of the Secretary of State for Justice that we should have two days of debate for the important remaining stages of this Bill. I will reflect together with my right hon. Friend on the hon. Gentleman’s points about how to ensure that those two days are used in the best possible way for these important measures.
Can we please have a debate in Government time on the Floor of the House on asylum policy? Given that Adam Osman Mohammed, a south Darfurian, who came to this country to seek asylum in 2005 was denied that asylum, was returned to Sudan and subsequently shot dead by Sudanese security officers, does the right hon. and learned Lady accept that it is important that this House should debate the issue of returns—and sooner rather than later—so that we can establish that, while war crimes, crimes against humanity and ethnic cleansing are taking place in that country, Ministers have no plans to return further Darfurians to risk of imprisonment, torture or death?
There will be a debate on Africa the week after next and there are Home Office questions next week. The hon. Gentleman will be aware that in that case, an appeal was made against the decision of the authorities and a court went through all the evidence and decided that the man should return. Obviously, the very sad subsequent circumstances are being looked into, but this happened following a judicial challenge and a judicial process.
I agree with the Leader of the House’s earlier comment that this is a time to put more money into the economy. Could she therefore find time for a debate on the proposed cuts to the budgets of Scotland, Wales and Northern Ireland, which will have an effect on those economies?
There are not cuts to the budget in Scotland. In fact, as my right hon. Friend the Secretary of State for Scotland said yesterday and as other Ministers have made clear, there is increasing investment going into Scotland and Wales, as there is into England. At the same time, as the fiscal situation becomes more difficult as a result of a fall in stamp duty and a fall in other money coming into the Treasury across the board, it is important that we all play our part—whether it be central Government, local government or the devolved Administrations—to make sure that every single pound of public money is properly spent. That is what the First Ministers in Scotland and Wales have agreed to work on with the Chancellor. That is the right process to be going through, but it should not be alleged that these are cuts in the budget. That is not what is happening. Cuts in the budget are being proposed by the Tories, but it is not what we are doing. That is why the public sector debt as a percentage of GDP is rising.
Can we have an urgent debate on the decision of the House of Lords last night to vote down Government proposals for a retrospective business tax for UK ports, which would give the Government an opportunity to review the implications and perhaps review their decision?
There is an Opposition day debate next week, which I suspect might well include those issues. Meanwhile Government business is dealt with in the normal way.
Can we have an urgent statement from the Defence Secretary in response to this morning’s report by the Public Accounts Committee on the future of the UK’s nuclear deterrence capacity. The Committee points out that Britain will have to design the new submarines before the United States designs the new missiles that will have go into them. As the Committee points out, it will be difficult to design a missile compartment before knowing the design of the missile, so can we have an urgent response from the Defence Secretary?
We welcome the Public Accounts Committee report. The defence equipment Minister has said:
“Our ability to maintain the Trident nuclear deterrent is not in doubt… Although I recognise the timelines are challenging, I remain very confident that we will deliver a new submarine on time and maintain our continuous at-sea deterrence.”
It is a challenging timetable, but the Minister expressed his confidence, and there will be a defence debate next Thursday.
Can we have a debate as soon as possible on motoring in the United Kingdom, which is one of the most expensive parts of the world in which to be motoring? With the recession, it has got a lot tougher. The Chancellor has an opportunity to repair some of the damage he has done by axing the proposed 2p a litre tax increase, which is about to come about next month. In rural areas, a car is not a luxury, but a necessity. The Chancellor might also like to look at the scheme rolled out in France and Germany, whereby people with old bangers are able to trade them in and get a €2,500 or £2,500 benefit, as that would be environmentally friendly and would help to get rid of some of the clapped-out vehicles on our roads.
The Secretary of State for Business, Enterprise and Regulatory Reform has had extensive meetings, and, indeed, a summit with the automotive industry, which we are determined to support. We continue to invest in public transport so that people have an alternative to relying on their cars—and that means public transport in rural as well as urban areas. In particular, we look ahead to new technology, new design and new manufacture of green cars, which are more environmentally friendly. The Budget is due, I think, on 22 April. The hon. Gentleman is doing what the Prime Minister yesterday accused the Leader of the Opposition of doing—of asking us to do more, while saying that we should spend less. The hon. Gentleman should decide which side he is on.
Can we have a debate on the probation service, so that we can discuss why, at a time when the Government continue to increase numbers at the headquarters, they are cutting services on the front line? In the Thames Valley over the next three years, that means a 20 per cent. cut—of some £6.4 million—with an anticipated loss of some 140 front-line jobs. Why are we increasing the number of bureaucrats while cutting front-line probation officers? What impact will that have on reoffending rates in my constituency?
I will raise that with the Secretary of State for Justice and ask him to write to the hon. Gentleman.
When the Leader of the House responded to my hon. Friend the Member for Rutland and Melton (Alan Duncan) and tried, not very successfully, to defend the Solicitor-General for her ill-judged comments, she mentioned her role in leading for the Government in the detailed stages of the equality Bill. At oral questions last October, I asked the Parliamentary Secretary, Government Equalities Office, when that Bill would be brought forward and she said that it was in a good state, but that she wanted it to be in the “best possible state” and that it would be introduced “soon”. It is now five months later, and just two weeks ago, the Leader of the House said that we would not see it for a few months. Will she tell the House when we will see that Bill?
Soon, and I look forward to the hon. Gentleman’s giving it his full backing. I hope that he will feel able to support it when he sees its progressive and far-reaching proposals.
Could I take the Leader of the House back to her reply to my hon. Friend the Member for Rochford and Southend, East (James Duddridge) and really urge her and her colleagues to think again about the imposition of retrospective rates on businesses in ports? The fact is that the Treasury Committee had condemned what is going on, and we have had completely different conflicting versions from the Department for Transport and the Department for Communities and Local Government, and now the House of Lords has passed a motion of regret. Meanwhile, back in the real world, one business has gone bust and a whole mass of them are shedding labour in our ports. I urge the Leader of the House to talk to her colleagues to get them to have a fresh think on this matter.
There is an Opposition day debate on Wednesday 25 March on a subject chosen by the Conservatives—the impact of business rates and how to help businesses through the recession. No doubt the hon. Gentleman will find an opportunity to raise the matter then.
Could we have a debate on the parliamentary ombudsman generally? When our constituents send us cases of alleged maladministration and we pass them on to the Parliamentary Commissioner for Administration, our constituents expect, if the ombudsman finds maladministration, that some remedy will follow the inquiry. If there is no remedy, it doubles the sense of injustice, but also reflects on Parliament as a whole. After all, this is the parliamentary ombudsman. What is the point of having a parliamentary ombudsman if, when she finds some maladministration, absolutely nothing happens? Can the House please have an opportunity to debate the parliamentary ombudsman’s role and powers and how the ombudsman’s reports should be implemented?
What has happened in response to the ombudsman’s reports is not nothing, but three things. We have acknowledged that there was regulatory failure, we have apologised for it and we have set up an ex gratia payments scheme for those who lost out not only through the regulatory failure, but through the management failures in Equitable Life that started it all off.
The Leader of the House will be aware that the Secretary of State for Communities and Local Government has now written to you, Mr. Speaker, to confirm that details of this year’s programme of spending on preventing violent extremism will be published. I raised the matter in business questions last week. However, the letter also confirms that the Department does not currently hold the details. The question that naturally arises is how we can be sure that violent extremists, or at any rate extremists, have not got their hands on some of the money. Does the Secretary of State plan to come to the House to make a statement?
I am sure that the Department for Communities and Local Government will want to understand how all the money that forms part of the budget for the Prevent programme has been spent, and will want to account for it fully to the House.
The Traffic Management Act 2004 gives local authorities extra powers to control the proliferation of roadworks in their local areas, yet to date no such permitting schemes have been introduced anywhere in the country. Could the Secretary of State for Transport come to the Dispatch Box to make a statement about this sorry state of affairs?
I suggest that the hon. Gentleman table a written question to the Secretary of State for Transport.
May we have an urgent debate on human rights in China, and in particular on the case of Shi Weihan, who is currently languishing in a Chinese prison on the basis of what I believe to be trumped-up charges, and will the Leader of the House express a view on whether a British diplomat should be present at the trial, which is to be held tomorrow?
I thank the hon. Gentleman for raising the issue of human rights in China, and for bringing the specific case of Mr. Weihan to the House’s attention. I think we all share his belief that human rights should not be abused in China. Ministers have raised the matter, and I understand that our embassy has asked whether it is possible for someone from the embassy to attend the trial and has raised its concerns about the issue with the Chinese authorities. I will ask the Foreign Secretary to write to the hon. Gentleman informing him of the latest developments.
Points of Order
On a point of order, Mr. Speaker. I wonder whether you have been informed whether the Secretary of State for Health has given any indication that he will come to the House and make a statement about problems in the Royal London Hospital Trust about Dr. Iwegbu, who has been reported to the General Medical Council and against whom there are six interim orders, one of which states that he is not allowed to practise elective or trauma surgery on paediatric patients.
I do not want to involve myself in the GMC’s ruling when it is made, but it was brought to my attention this morning that this doctor has been calling himself a professor for some time. The trust has now decided to stop him doing so. An e-mail states that “discreet changes” should be “made throughout the Trust” so that no “embarrassment” is caused to the “Professor”.
The public, including patients, have seen the doctor in good faith in the belief that he was a professor in the medical profession. Surely it is not right for such information to be sneaked out in e-mails. I fear that a cover-up is taking place in the trust over the question of whether or not this gentleman is a professor in the medical profession, and I think that the Secretary of State should come here to explain what is going on.
That is not a matter in which I can intervene. It is clearly a matter for the Secretary of State.
On a point of order, Mr. Speaker. Can you tell us how you can defend and enforce the conventions of the House? Yesterday a major debate on the economy took place, initiated by the Opposition. According to convention, the Chancellor of the Exchequer should have responded to that debate. In answer to a question from my hon. Friend the Member for Aldershot (Mr. Howarth), the Chief Secretary to the Treasury said that the Chancellor of the Exchequer had been in the House on Monday and would be in the House again next week. It so happened, however, that the Chancellor of the Exchequer was present during Prime Minister’s questions yesterday, and was also present—and voting—at 7 pm. So he was in the House yesterday, but was refusing to comply with the normal conventions by responding to a major debate initiated by the Opposition.
The Opposition have relatively few powers left to them in the House, but I should hope that one of them is the power to require the Chancellor of the Exchequer to come to the Dispatch Box to respond to a debate.
When right hon. Members, and indeed hon. Members, come into the Chamber at one stage and again at a later stage, that does not mean that they are doing nothing. They are leading very hectic lives.
Let me say in defence of the Chancellor of the Exchequer that, in my experience, he is a regular attender at the House, and he does make statements. We must ensure that we do not criticise unfairly. I know that the hon. Gentleman does not want to do that.
It is up to Ministers to decide which Minister should take the lead in certain debates. Knowing the Chancellor of the Exchequer as I do, I do not think that he would do anything that would constitute any disrespect to the House.
Legislative Reform
I beg to move,
That this House disagrees with the Regulatory Reform Committee in its recommendation that the draft Legislative Reform (Insolvency) (Advertising Requirements) Order 2009 should not be approved.
The House regularly debates the need for regulatory reform and the need to reduce unnecessary red tape. Part of the backdrop to those discussions is the responsibility of all of us to ensure that rules that may have been cast a long time ago have not become outdated or been overtaken by the way in which people lead their lives, trade and do business, or obtain information.
It is incumbent on Government to take that responsibility seriously. Regulation is a legitimate part of the modern world—we live in a world with rules—but we do not want business, or creditors when insolvency is involved, to be burdened with rules when they no longer serve the purpose for which they were designed, or when it may be possible to do the job in a better way and, perhaps, at a lower cost. The order that we propose would give further help to creditors by reducing the bureaucratic burdens and costs imposed by one of the current elements of our insolvency arrangements.
I acknowledge that insolvency can be a complicated business, and that having to deal with a failing business is stressful enough, particularly during the current economic difficulties. I therefore feel that it is incumbent on us to do as much as we can to make the system simple and streamlined, bearing in mind the duty that we owe creditors in such circumstances. The order is part of that streamlining process.
Let me explain what the change means in practice. When a company finds itself unable to pay its debts, a liquidator is appointed to find and distribute the company’s assets. That can be done through compulsory liquidation, members’ liquidation or creditors’ voluntary liquidation. I shall not go into the details of the differences between those types of liquidation, but this order deals with voluntary liquidations.
Before the Minister gives us the background, can he explain succinctly why he does not believe that the judgment of the Regulatory Reform Committee is correct? Why is he second-guessing the judgment of a Committee that was set up by the House specifically to deal with circumstances of this kind?
If the hon. Gentleman will exercise just a little patience, I shall come to that in a couple of minutes.
In the case of a voluntary liquidation, a meeting of the company’s creditors must be called under sections 95 and 98 of the Insolvency Act 1986. Notice of the time and venue of the meeting must be sent directly to all known creditors, advertised in the London Gazette and, at least once, in two local newspapers that are circulated in the areas where the company has its principal place of business. The Government propose to remove the obligation to advertise in two local newspapers. That means that it will be up to liquidators, under section 95, or the company, under section 98, to decide whether advertising is needed, and, if it is, to choose the most appropriate method. I stress that it will still be open to liquidators and companies to use local newspapers if they consider that to be the most appropriate mechanism in the circumstances.
I am always happy to give way to the hon. Gentleman.
The Minister is always immensely kind to me. I am most grateful to him. As he will know, insolvency notices provide a sizeable part of the income of many of our local newspapers—he will see the irony in the fact that those newspapers are the subject of the topical debate to follow. Indeed, the Government have expressed considerable concern about the solvency of the local press. Has the Minister taken that into account? I hope to speak in the topical debate, but I would like to hear his answer to that question.
I am sure that it is more in order for me to concern myself with this debate, rather than the next one, in which I will not be seeking to speak, but I will say that we want to ensure that the advertising in terms of the insolvency process is the most effective. That is our concern and why we have proposed the order.
The hon. Member for Christchurch (Mr. Chope) asked why I disagreed with the Committee’s verdict. The Delegated Powers and Regulatory Reform Committee in another place was satisfied with the order; it gave it the thumbs-up, to use the colloquial phrase. The House of Commons Committee also stated that all the preconditions in the Legislative and Regulatory Reform Act 2006 and the Standing Order tests had been met, but it expressed several reservations and stated that, in its view, the order should not be approved. Those reservations are set out in the report, and I am sure that my hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller), the Committee Chairman, will explain them, but, in brief, the Committee felt the order was too “narrow in its focus” and that its effects would be “minor”. It felt it may be unlikely to result in further dividends for creditors and would not provide them with enough protection.
We have two main reasons for wanting to introduce this order. First, it has the potential to save business and creditors money, by reducing costs. Each advert costs an estimated £300 a time, and since there is a requirement to place two adverts, that cost is obviously doubled. That £600 charge may not be a life-or-death sum in each individual case, but when one adds up the sums involved throughout the process, it can increase the costs of insolvency. For creditors who have already lost money, it is important to ensure that their money is spent usefully during an insolvency process, so that as much as possible can be returned to them at the end of that process. The savings from the proposals, together with parallel changes that we propose to the insolvency rules, will combine to mean estimated savings of some £17 million a year. This is not a “narrow” measure.
I am pleased to hear that the Minister is concerned about the cost of insolvency practitioners. Is he therefore saying this proposed change is consistent with a narrative that will put pressure on insolvency practitioners to charge less? I have been appalled by the amount of money that has been absorbed by insolvency practitioners in some cases, and I am just seeking an assurance, without going into details that take us beyond today’s debate, that other measures will be introduced to make sure insolvency practitioners do not take a disproportionately large amount of the funds when they are disbursing to creditors.
There are rules governing charges, which I will come on to, but certainly the motivation behind the order is to increase the pot of money that is available to creditors. As I was saying before the hon. Gentleman intervened, the savings from the proposals, together with parallel changes that we propose in the insolvency rules, will mean estimated savings of £17 million per year. That is part of a wider package of proposals to streamline the process.
The Minister says there are estimated savings of £17 million per year. I thought it was £3.6 million.
The £17 million figure is the savings from both the order we have proposed, which has been considered by the Committee, and the parallel changes to the insolvency rules, which are dealt with in a separate order under the negative resolution procedure. The reason we have to do it this way lies in the origins of the insolvency legislation. There will be estimated savings of £17 million a year from the changes.
That is only part of a much wider package of proposals to streamline and modernise the insolvency rules and other relevant provisions—part of which, I should inform the House, will include a further legislative reform order—which should save a total of about £40 million per year. Huge sums may not be involved in each individual case, but over the piece the savings gained for the insolvency process are certainly worth having. We believe the costs of introducing the order are minimal, and there is no reason why we should not introduce the changes.
The Committee expressed concern about the money going to liquidators rather than to creditors, but protection against that is already built into the legislation. The terms governing the liquidator’s remuneration will be fixed by the creditors and the creditors can apply to the court if they consider the amount of the liquidator’s remuneration to be excessive. Any liquidator taking remuneration that was not justified could find themselves subject to the scrutiny of the courts. I understand that the Committee—this is reflected in its report—was concerned that the savings would not be passed on, so let me make it clear to the House that I want them to be passed on. There is absolutely no reason why what we propose today, and what we propose in the other connected changes to come, should increase fees charged by insolvency practitioners. This is not about increasing fees; it is about avoiding unnecessary expenditure.
Insolvency fees may be managed through the creditors’ committee, but does my right hon. Friend the Minister agree that it is often very difficult to get creditors to serve on those committees and therefore to provide the adequate scrutiny?
That may be the case, but, as I said, the fees will be governed by the courts. I stress that the proposal in the order is not about increasing fees for liquidators, but increasing the pot of money that is available to creditors.
I am very encouraged by the tone of the Minister’s comments, but is he aware that some of the insolvency practitioners at the higher level of management charge more than £700 an hour for their time? That means that the £600 saving he cited is negated in about 55 minutes when certain practitioners are employed. Can he therefore assure us that, as well as discussing the measure today, he will consider whether we have adequate protection against the charging of such enormously high costs in circumstances when, by definition, the companies involved do not have much money?
The fees can be high, but I put this point to the hon. Gentleman: given our concern about fees, it would be an odd judgment for us not to approve changes that would free resources for creditors.
I paid particular attention to my right hon. Friend the Minister’s last statement about his expectations. For the avoidance of doubt, I want to be clear that he is saying that he, as a Minister of the Crown, expects this saving to be passed on to creditors and not to be held by insolvency practitioners.
I am very happy to repeat that. There is no reason why anything we are proposing in the order before the House, and the Committee’s report on it, should increase fees for practitioners. On the wider subject, I should inform the House that changes that are intended to come into force next year as part of the wider process of change in the insolvency rules will increase the transparency and accountability of insolvency practitioners.
This is not just about cost; it is about ensuring that where money has to be spent, that is done in the most effective way. The requirement to use local newspapers goes back to the beginning of the last century and the business practices at that time, when it was more likely that a company would be dealing with customers from its immediate local area. That is sometimes still the case in today’s business world, but it sometimes is not, and trading patterns are more widespread than they once were.
What assessment has the Minister made of the relationship between small businesses involved in insolvency and those that he is discussing, which trade over a wider area? What evidence is there to support the statement that he has just made?
The point about the order is that it gives both the companies involved and the insolvency practitioners the flexibility to choose the best medium for reaching the people whom they wish to reach. Obviously, in the age of digital communication and wider trade patterns, the local paper may not always be the best way of reaching creditors. For example, where a business that was trading all over the country goes bust and we are seeking to identify unidentified creditors, how confident can we be that an advert in the local people is the best way to achieve that, given that all the customers may have been from hundreds of miles away? We are talking about a flexibility that simply reflects that reality.
May I offer another suggestion? A lot of local papers are on the internet, so advertising via the local newspaper means that people who trade with these businesses miles away can still access that sort of information.
That is a perfectly valid point. I stress that nothing in the order prevents an insolvency practitioner from using the local paper—and its website—if they think that that is the best route by which to reach people. We are changing the requirement in legislation that they must place such adverts in the local press in every case, regardless of the trading patterns involved. That flexibility makes sense; it makes sense to be less prescriptive and to take into account the greater variety of media that are available today compared with when the rules were first instituted about a century ago. In about 98 per cent. of cases the advertising does not result in an unidentified creditor coming forward, so it is perhaps worth asking ourselves whether there is a more effective way to operate. That is what we have done in this order. It is about giving people the flexibility to choose the most appropriate media available and to use whatever sums are spent on that in the most effective way to try to identify unknown creditors; as I say, that may be done through a variety of media. There is also a misconception that the advertisements are about a wider public aim of bringing information about the liquidation into the public domain—that is not the case. Their purpose is to reach unknown creditors—that is the purpose set down in the legislation. The adverts are also not intended as general public announcements.
People have also asked about companies that might wish to conceal their insolvency from their creditors and whether our changes might enable them to do so. We think that that is very unlikely, because notice of the liquidation must be given to creditors personally; as we have heard about online publications, I should say that it is also placed in the London Gazette, which is available online. Companies are also under a legal obligation to maintain accounting records from which it should be possible to compile a list of creditors. They are required to provide that list for the purposes of the liquidation and to surrender the accounting records to the liquidator—a failure to comply with those requirements is a criminal offence. Liquidators must report to the Secretary of State on the conduct of the directors, and failure to comply with those requirements can lead to disqualification. So it would be both wrong and unwise of a director to conceal a creditor from the liquidator.
As I say, this is about using the most appropriate form of communication for the particular circumstances. Companies or liquidators can still choose to advertise in a local newspaper if they feel that that is appropriate. Some people have argued—this was reflected in the Committee’s report—that this is perhaps too minor a measure and that it is not worth introducing.
I am the longest-serving member of the Regulatory Reform Committee and its predecessors in the House. I was one of those who thought this was a trivial measure. I suspect that had the Minister and his civil servants spelt out, in the documentation that came before the Committee when we considered the measure, the much larger sum that can be saved with other measures that are coming along, we would not be discussing this matter this afternoon.
I do not propose to go over all the exchanges between officials on this matter. I believe that dialogue did take place, and my concern is to ensure that the savings identified in this order, taken in the context of the wider changes to insolvency rules that we propose, are made. I believe that these savings will make a difference to creditors, who are already having to cope with the losses that they face from insolvent businesses.
The order will give liquidators and companies greater freedom to target their advertising as effectively as possible, either through local newspapers or elsewhere. It is incumbent on us, particularly during an economic downturn, to do what we can to help business. Given the comments that have been made about the charges and the fixed costs involved in this process, it is incumbent on us to try to increase the pot that is available to creditors. That is the motivation behind the order, and for that reason I commend it to the House. I hope that the House will side with those proposals today.
It is always a pleasure to follow the Minister, who took such pains to be careful and reasonable in his exposition of the Government’s position and took time to try to anticipate many of the questions that will be raised in this debate.
It is vital that any modern economy such as Britain’s has an efficient and effectively functioning insolvency process, if only because at a time of pretty much unparalleled economic problems—this is one of the worst recessions for a generation or perhaps more—everybody involved in business needs to know that the insolvency process works as quickly, efficiently and effectively as possible and does not soak up in fees as many of the available assets in an insolvency as it might. It is to everyone’s advantage that as many as possible of a failing company’s assets find their way to its creditors, rather than being taken up in fees. I mean no disrespect to insolvency practitioners—I am sure that they are all stout and wonderful men and women, who are doing their work terribly carefully. None the less, it is clearly macro-economically to everyone’s advantage to ensure that as much money as possible reaches the creditors of a company that is going bust.
As I believe everybody here understands, when a company goes under there is not just the tragedy of the lost jobs and the destroyed hopes of its workers; the huge danger is the knock-on effect of the company’s suppliers being dragged down too. Any money that can be spared to pay creditors at a higher rate of pennies in the pound has to be to Britain’s overall economic advantage.
Taking the temperature of the interventions made, I would say that there is a great deal of sympathy on both sides of the House for the principles behind this measure. There are some specific questions and details on which I shall press the Minister for further answers—I am sure that such matters will dictate how Members react at the end of this debate in deciding how to vote.
The Minister has admitted that this is a relatively small step down an important road. This measure produces some £3.6 million worth of benefits, although it is part of a larger package that is worth roughly £17 million. Given the total number of likely insolvencies this year, that is a relatively tiny drop in the large ocean of Britain’s economy, but the best should not be the enemy of the good. Put another way, it is better to have half a loaf than none. If we can take a small step as a start on an important journey, we should do so.
The Minister said that other measures are in the pipeline, which might stem from a process that began in July 2005 as a larger scale project to consolidate and modernise the insolvency rules introduced in 1986. Paragraph 9 of annexe C to the regulatory impact assessment, which I am sure every Member here has read assiduously, states:
“It was originally intended that all the remaining proposals would be taken forward by means of one draft Order. However, in order to meet Ministerial priorities”—
I would be interested to learn what those priorities were—
“the advertising changes…will proceed within a separate draft Order”—
which is this one. It continues:
“The remaining proposals will continue to be taken forward within a subsequent draft Order that is likely to be laid early in 2009.”
We are in mid-March 2009, and it is important that Members and the public understand the Government’s intentions. The Minister has already said that he has plans to introduce more substantive cost-saving measures in due course, but we need to know precisely when. The Government were considering some seven or eight other proposals, and we need to know which will be introduced and when. The advertising market is suffering badly, so the local newspaper industry is unimpressed by this proposal. The Minister’s timing could have been better, and people would accept this measure more readily if they knew that it was part of a wider package rather than something that picked on the local newspaper industry in particular. I hope that the Minister will be able to provide a timetable when he replies to the debate.
The Minister also mentioned the concern about whether the savings will get through to the creditors, and it is important that we have certainty on that point. If the local newspaper industry feels that it is being picked on, the strongest counter-argument would be for the Minister to look the editors of those newspapers in the eye and say, “This is part of a package of measures that will help the wider economy and potentially save many companies from going bust.” It is therefore essential that the money gets through and achieves the outcomes that the Minister promises. He has already made several comments that will reassure many people that the Government are serious about ensuring that the money reaches the intended recipients. Are the Government willing to consider post-legislative review of the success of this measure, in a year or two’s time, to ensure that it—and the others that the Government have promised—has had the intended impact, and that the money has not been swallowed up by the addition of a couple of extra hours to the insolvency practitioner’s bill? If the Minister can provide some reassurance on that point, the insolvency profession will also know that the Government will remain vigilant on the matter.
The crucial issue is the protection of creditors. The Minister has already pointed out that in roughly one in 50 cases—not a large number, but none the less an important proportion of cases—if a newspaper advertisement is not placed in the local press, some creditors do not know that a creditors’ meeting is taking place. If they do not know, they cannot attend and represent their interests, which may mean that they lose out in the eventual insolvency procedure. They may not get as much money as they might have done if they attended the meeting to ensure that their interests were properly put forward. The Minister pointed out that the order is not intended to stop advertising entirely, but to provide greater freedom and flexibility to the insolvency profession to decide whether to place advertisements in the local press or, in the case of larger companies that do not operate in only one newspaper’s area, in alternative sources of media—perhaps on the web or in the trade press—to ensure that the job of informing creditors is done more effectively.
The Minister also said that the Government will not suggest to insolvency practitioners that, in the right circumstances, they should not continue to advertise in the local press. For many companies, especially small ones that trade locally, advertising in the local press will be the right approach, and if the insolvency profession exercises its discretion intelligently—as I am sure it will—the advertisements will continue to be placed as at present. Will the Minister confirm that the basic duty on the insolvency profession to ensure that creditors are properly informed will not be weakened by this measure? If that fundamental legal duty is not eroded by this measure, it will further underpin his case that this is about greater flexibility and efficiency rather than removing an essential protection for potentially important groups of creditors in the local economy.
We will listen carefully and with great hope to the Minister’s responses on those points before we decide how to respond.
I have listened to both Front Benchers and have heard much common sense, with the exception of the observations that the hon. Member for Weston-super-Mare (John Penrose) made about the newspaper industry. We have to be practical and say that, in these difficult times, we should ensure that creditors are supported. As much as I—like all hon. Members—am a great fan of my local press, I think that supporting creditors should be our focus. I see that the hon. Gentleman agrees with that observation, and I agree with him about the need for post-legislative scrutiny of measures such as this one.
I wish to place on record my thanks to the Clerks and other staff who support my Committee. They have to cope with an extraordinarily varied pattern of work, on many different subjects, to very tight timetables, as established by the Standing Orders of the Committee. I also thank my hon. Friends who serve on the Committee, on both sides of the House, although—regrettably—no Conservatives take up their positions. If we are to have a constructive dialogue on these important issues, I would welcome the hon. Member for Weston-super-Mare if he were to relinquish his Front Bench role and join us. Perhaps he prefers to remain where he is.
The consultation on this order elicited some 16 written responses, most of which were favourable. As one would expect, the bodies that raised objections included the Newspaper Society and the Association of Business Recovery Professionals, but the latter withdrew its objection when it realised that professionals would be given the flexibility to make judgments about the most suitable method of advertising given the nature of the business being put into liquidation. We understood that.
There is no issue of substance between the Committee and the Government on the need to save money and I shall illustrate that shortly by citing some figures from a real case in my constituency. I have discussed the case with lawyers who are experts in insolvency, and they are horrified by the figures involved.
The text of what became paragraph 3 of the final report was put on the record in my Chairman’s draft report:
“In light of widespread concerns about existing insolvency procedure, including the fees structure, and given the potential volume of changes anticipated from the Insolvency Service”—
taking into account the effect of the current economic situation—
“we are surprised at the narrow focus of the draft Order.”
With hindsight, it was regrettable that there was not greater clarity in the communication between Officers of the House and the Department on the broader strategic approach that is envisaged. I am led to believe that a miscellaneous provisions order for insolvency legislative reform is likely to appear in early April, according to information received by my Clerks this morning. Perhaps that answers one of the questions that the hon. Member for Weston-super-Mare quite reasonably posed. With hindsight, it is a pity that we did not have a clearer picture.
We asked for a legal opinion on whether we could be assured that the money saved by the proposal would end up in the hands of creditors. The answer that we received was, “Not necessarily.” That is why it is very important that the House takes note of the Minister’s words in my earlier exchange with him. The Minister expects the money to end up in the hands of creditors and there can be no reason why an insolvency practitioner should hold on to the money rather than pass it on to the creditors.
The hon. Gentleman raises a very important concern. I understand that the whole reason for doing that is to ensure that the money ends up in the hands of the creditors. Every small business man would support that, because they are the ones who get caught out and hurt by such cases. Will the hon. Gentleman explain where his fears might lie? I am perfectly happy to take the Minister’s advice that he is confident, but I want to be aware of the fears that the hon. Gentleman might have so that I can monitor the situation.
My fears come from the reality of current practice. As the Minister explained, fees can be subject to legal challenge. We now have an unambiguous statement on the record from a Minister of the Crown that makes it clear that if subsequent proceedings challenged whether advertising savings were not passed on to the creditor, it would be wrong for the practitioner to do that. If my right hon. Friend the Minister disagrees with that interpretation, I would welcome an intervention from him. As he does not want to intervene, I think we now have absolute clarity on his meaning. I do not think that there is any dispute around the House.
I took particular interest in this order because it coincided with my dealing with a specific case. It is not fair to name the individual concerned, because he is a constituent who, despite his best efforts, has unfortunately been bankrupted. The action came, as it quite often does with small businesses, from HMRC. The sum involved was £5,249.52. The final costs—the amount that he was required to pay in full—were £34,293.81. I cannot find any legitimate basis for some of the fees listed. Trustees’ future remuneration cost £2,500, legal fees were estimated at £5,000 and trustees’ remuneration was estimated at £7,659. That seems an absurd set of fees for dealing with something that could have been knocked out on the back of a fag packet in five minutes.
The Committee and I want to be sure that in dealing with the order, which genuinely makes a welcome saving, we do not lose sight of the bigger picture. When we introduce the miscellaneous provisions order and all the rule changes that my right hon. Friend the Minister rightly wants to introduce, we need to get to grips with some of these stupid things. They are stupid. There can be no basis for the emergence of figures such as those in my example.
The Committee did not oppose the substance of the Government’s proposal; in fact, we did quite the opposite. We were concerned that the documents before us did not inspire confidence that there was determination to drive the process forward and to ensure that people such as my constituent do not face figures that are out of kilter with any measure of reality. I hope that, on the basis of the assurance that my right hon. Friend the Minister gave to the hon. Member for Montgomeryshire (Mr. Öpik) and me, we will be able to make progress and ensure that when the full picture emerges—including the draft order that we are due to see, I am told, “in early April”—it is much more transparent and helps hon. Members giving help and guidance to their constituents to feel confident that fee structures are based on fair and reasonable practices. I hope that they will be able to be confident that insolvency is fair to the people who have often worked extremely hard but whose businesses have failed for reasons beyond their control—brought to an end by something further up the food chain—and to their creditors, and that it is not focused on the financial interests of the professionals charged with managing the process of insolvency.
The Committee also wants my right hon. Friend to assure us that although we disagree on the order, the Department will make no attempt—I do not mean this pejoratively—to steamroller the Committee into a line of thinking. The Minister’s assurance on the procedures and practices that were given when the rules were established should also be maintained. We could have used our nuclear option and sought to veto the order. The Minister would have been honour bound to accept our veto, but we do not want to get into that sort of game. We want to ensure that the processes that evolve from the Committee’s work enable us constructively to progress the legislative reform process. I hope that the Minister will give the Committee the assurances that it seeks in that regard as well.
The House may be aware of my interest in procedural issues. I am a bit of a glutton for punishment and am attending this debate wearing two hats—one as my party’s temporary Front-Bench spokesman on these matters, and the second as a member of the Regulatory Reform Committee. I also happen to sit on the Modernisation Committee: interestingly, that Committee does not meet any more, so we are obviously modern now.
I am also an enthusiastic member of the Procedure Committee, which means that I turn up to its sittings as well. The House may not be surprised, therefore, to hear that my concerns about how this matter is being handled are procedural, and are about the process by which the Government are driving through a proposal against the recommendation of the Regulatory Reform Committee, and against the concerns expressed in writing by the Chair of the Business and Enterprise Committee.
People outside Parliament argue that politics is broken, while a group of parliamentarians are concerned about Parliament’ ability to represent citizens being constrained, citizen, and about the fact that the Executive control Parliament. The order before us may be relatively minor, with £3.6 million being taken away from the newspapers and probably given to the Government—I shall say more about that later—but the real question is why the Government have seen fit to use a whipped process to go against two Select Committees of the House.
Governments are supposed to work by explanation and by giving information about the decisions that they take. Although it seems clear that this decision was taken outside Parliament, the Government are using the whipped process to make even the Chair of the Regulatory Reform Committee go against his Committee’s recommendation.
My hon. Friend the Member for Cambridge (David Howarth) has what he calls his “dustbin” theory of decision making—that is, that a dustbin is taken round and everyone chucks a bit in—but what we should really be looking for is evidence-based decision making. It is wrong for the Government to go against the recommendations of the Regulatory Reform Committee and of the Chair of the Business and Enterprise Committee because that decision is not based on evidence.
When an insolvency occurs, the business involved normally ends up insolvent, although sometimes it will end up solvent. Not all creditors are the same: there are priority creditors, such as Her Majesty’s Revenue and Customs; there are secured creditors, which generally are the banks or the Government, and finally there are the unsecured, smaller creditors. As it is found out what the assets are—perhaps someone will have managed to sell off a going concern—people will go through all those creditors, ending up with a sum of money at the end of the process.
If we reduce the costs of the process by saying that the newspapers will not be paid £3.6 million a year, the result will be that, in different insolvencies, that money will go to different people. The likelihood is that it will go to HMRC—the Government—or to the banks. Mainly it will go to the Government, so the effect of the cost of insolvency going down by about £600 will be that the smaller creditors about whom we are all concerned are unlikely to receive much in the way of additional funds from most insolvencies, although they will get some.
That is not necessarily the big issue, but we do not know for sure, because we have not been given the evidence that we need to make this decision. Instead, the Government have decided to use their power, as the Executive controlling the legislature, to force the change through.
What effect does advertising in local newspapers have? That is an important question. We know that there is an effect, and that one person in 50 who finds out that he or she is a creditor of a firm involved in insolvency does so by that means. Such people may or may not get some money out of the process, but it can be argued that the information could be better communicated by the use of alternative advertising techniques, such as notices placed on the internet or in the London Gazette.
The Government’s case is that, if people in business know that there is a place online to which they can go to find out where there are insolvencies, it is likely that they will not get caught out by an insolvency that they do not know about. On the Committee, I was relatively sympathetic to that approach, but we have not been given the evidence on which to make the decision. That is why I believe that the Government are going about the matter in the wrong way, from a procedural point of view.
This may be connected to the targets for removing administrative burdens from the civil service. It is a good idea to do that, and there is no question but that this order ticks that box, we do not have the key information that we need to make to decision. People are to be told that the only place where they can find out about administrations and insolvencies is the London Gazette website, but it is hard to predict what proportion of the 2 per cent. of unsecured creditors who find out about an insolvency that affects them because it has been advertised in the newspaper would fail to find out about it if the information were no longer available from that source.
My feeling is that people who have been in business for some time will learn relatively quickly how to go about getting the money that they are owed, and that is why I was sympathetic to the proposal. However, it is important to realise that we do not have the figures to allow us to analyse the different types of insolvency, or to determine where the £3.6 million saving would go.
There will be very few circumstances in which the money will go to the insolvency practitioner, although that is obviously possible. Given that this is a £600-per-transaction arrangement, one would expect that in many transactions only the secured creditors—the banks and HMRC, and thus mainly the Government—would get the money. At a time when local newspapers are suffering financially from the loss of advertising, we are going to take £3.6 million away from them and give an indeterminate but substantial amount to the Government.
I should point out to the hon. Gentleman that HMRC has not been a preferential creditor since 2003.
I accept what the Minister says, and I am very pleased to say that I have not been involved in an insolvency for some years. However, my point that there are priority and non-priority creditors remains important.
The hon. Gentleman has mentioned priority creditors. Does he believe that some creditors should have priority, or does he agree with me that the priority should lie with employees owed money in the form of redundancy payments or wages?
I agree that there is a need to review the priorities. This area of law is very complex, and one point made by the Committee is that we are looking only at a teeny-weeny bit of it here. My concern is that we do not have the evidence that we need about who would be affected by the proposal. It is most likely that the Government will be the substantial beneficiary, but we do not know.
The full power of the Whips is being used in respect of this order, and that is why I support the proposals from the hon. Member for Nottingham, North (Mr. Allen). He believes that Select Committees should be elected, because that would weaken substantially the sanctions that could be taken in situations like this against recalcitrant Select Committee members or Chairs. The reality of the power of the Executive to control the legislature is that if we do not get a balanced legislature through electoral reform, civil servants will continue to persuade Ministers on the basis of targets, and Ministers will continue to exert their ministerial power, through the Whips, to force decisions on this Chamber without evidence.
I have not talked to my colleagues about pressing for a Division on this matter. If there were to be a Division, I would vote against the motion, but I would do so on the procedural point. We are going about things in the wrong way. The power of the Government is being used—
On a procedural point, the hon. Gentleman heard my hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller) say that the Committee has a stronger power, which is to recommend that the measure be vetoed. Members of the Committee are in the Chamber, so they can correct me if I am wrong, but my understanding is that the Committee did not use that power because its concerns were not about the substance of what we were trying to do. In those circumstances, bringing the order to the House is not to railroad the House. If there are concerns, a perfectly proper response is to have a debate about them. I have tried to respond to the concerns of the Committee today. That is not railroading or steamrollering; it is perfectly in line with the proper procedures of the House.
I accept much of what the Minister says. Sympathetic though I was to the proposals in the Committee, I think that the Chair would accept that it was my suggestion that, as other members of the Committee—generally Labour Members—were uncomfortable with the proposals, we should be a little bit resistant. We then encountered the power of the Whips, and that is the point at which what the Government are doing is inappropriate. Obviously all these things are valid proceedings, but this one is inappropriate. It would be far better to have more dialogue with the Committee and look at the evidence. In practice, it would be nice if the Minister told us how much of the money will go to the Government, but he cannot be expected to know the answer, because it would require some work by civil servants. A decision will be taken within three hours of the commencement of this debate, and we shall go one way or the other—but we do not know. That is the wrong way to proceed.
If we want proper evidence-based Government decision making, we must have the evidence during the decision-making process. When there is a deadline, and the whipped process is involved, we have to make a decision without knowing the facts. That is an appalling way of running Government. If there were a Division I would vote against the order on that procedural point. Although we do not have the evidence, the probability is that the substantive argument is reasonable, in that commercial creditors will learn where they can find out whether there is something that they should be worried about. In a recession, I am unhappy with taking money from newspapers and giving it to the Government, but I am most unhappy about the fact that the Government are using the power of the Executive to force a decision through the House, without evidence and against the recommendation of one Select Committee and of the Chair of another.
It is good to be able to support many of the comments made by the Regulatory Reform Committee Chairman, my hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller). As we have heard, we are not discussing one of those matters of national importance that we often debate in the House these days, but this subject still has a significant degree of interest.
The Government’s recommendations may not have a negative impact on millions of people, but those who do feel their impact will feel a little less comfortable with the whole voluntary liquidation process. We have already heard about the process set out in the order, so I shall not go into great detail about that, other than to say that the need to advertise in the London Gazette would stay, but—the bit that worries me—the need for local advertising would disappear, and be replaced with additional advertising as deemed appropriate in each case.
As we have heard from my hon. Friend the Committee Chairman and my right hon. Friend the Minister, the Committee’s first report of the Session concluded that the order had a narrow focus, with the possibly minor effects that have already been referred to. Given the wider concerns about insolvency, which were discussed in the Committee too, and the growing number of such cases in the current economic downturn, the sector should be subjected to a review, to modernise insolvency legislation, even wider than the one under way. That remains my belief, and the example that my hon. Friend the Member for Ellesmere Port and Neston gave about an insolvency in his constituency shows why the sector needs closer scrutiny.
I do not doubt that the order will deliver minimal financial savings from the insolvent estate—the estimate is £600 per case. We have heard suggestions from Opposition Members about where that money might go. In my experience—to reinforce the comments of the hon. Member for Birmingham, Yardley (John Hemming)—it is unlikely to get into the hands of the unsecured creditors. Does the order remove a burden from the creditors? Indirectly. It removes a function from the insolvency practitioner, but whether removal of that burden—if we want to call it that—actually puts funds back into the hands of creditors, especially unsecured creditors, can never be measured. Perhaps I am being cynical, but my experience tells me that all too often no funds are available after the costs of the insolvency practitioner have been met. The result is that individuals and businesses who have lost money have little or no return. That is a real concern for me.
There are other ways to deliver returns for creditors, such as maximum caps. As my right hon. Friend the Minister is aware, I tabled a parliamentary question on that matter, to which he courteously replied. There is much more we can do to focus on returning funds to creditors, secured and unsecured, beyond this narrow order.
I understand that there is an obvious need for practitioners to be recompensed, otherwise there will be nobody to do the business, but apart from words said in this place, there seems to be little acknowledgement that the process is meant to benefit creditors. The process is not intended to keep insolvency practitioners in business and generate income for them. Unsecured creditors are the real victims in such cases. Recent reports of fees of £35 million for individual windings-up are mind-boggling, as were the numbers cited by my hon. Friend the Member for Ellesmere Port and Neston about the size of the insolvent estate in his example. The insolvency practitioner involvement that could deliver a £35 million winding-up cost is beyond my comprehension.
I have never had an awful lot of confidence that an insolvency, voluntary or not, would generate much payback for my business. Many businesses the length and breadth of the UK will have similar feelings.
The order retains the burden to send notices to all creditors and to update the insolvent company’s website. I argue, as I did in Committee, that the removal of the need for local advertising is detrimental to small businesses and individuals securing information relating to the insolvency.
We have heard from my right hon. Friend that the “burden” of the requirement to advertise locally only involves doing so in the local newspaper serving the area where the head office of the business is situated. I fully understand and accept that, but the House must grasp the fact that most insolvencies in the UK are not the size of Woolworths; they are local, and local papers provide a necessary flow of information to potential local creditors.
As no other changes were proposed in the order, I found it peculiar that we were faced with it in the first place, and it is intriguing that we are now debating it on the Floor of the House. There have been representations about the revenue for local newspapers from advertising costs. I support the Newspaper Society’s representations about that loss of revenue, but I could not argue solely on that basis that I was not content with the order.
The order will remove the flow of information. It does not deliver more information, and that is what is needed. If I went to businesses in my constituency, or to people in the sector of which I have experience, and asked them if they knew about “the Gazette”, they would obviously think that I was talking about some local paper. Most of them would have no comprehension of what the London Gazette is.
Information needs to be more available, not less, and I do not think that that will be the result of the order. In a submission, we were asked to have faith in the accounting records of the businesses that are in trouble, and to rely on those accounting records to provide a full list of creditors. I question whether that is realistic. Businesses in trouble do not make record-keeping a priority. Staff are paid off, and jobs are merged. There is not enough time to do jobs fully. Short cuts are taken and there is often inappropriate behaviour. I urge the Department to grasp what goes on in such situations on the ground.
The expectation that directors will co-operate with insolvency practitioners is fine; that is what we should expect. However, there are different levels of co-operation. Many directors also have limited knowledge of the operating processes of their companies. That applies particularly to basic housekeeping functions, such as the upkeep of sales and purchase ledgers. Those functions are vital in determining who a creditor is. Directors do not provide us with all the answers, and I say that having been a director for more than 20 years.
I am unconvinced that the savings of more than £3 million will be delivered. I am uneasy about whether, in 80 per cent. of cases, no additional advertising would be required—but that is what will have to happen if we are to achieve those savings. We heard from the Minister about £17 million of savings more generally; those are in what is coming the Committee’s way. However, this order relates to savings of £3 million. I can understand that in 80 per cent. of cases—the percentage of cases that will have to be affected if we are to generate the £3 million-plus of savings—those concerned would not get the additional advertising, but I am yet to be convinced that they do not merit it.
To my mind, the order does not do anything to improve our insolvency practices, or to justify creditors’ belief and hope that insolvency practices will deliver something for them. I share the Committee’s view that it would be appropriate to review those processes fully. I am sure that if the order had been part of a Bill that improved those processes and therefore improved the return to creditors, particularly unsecured creditors, members of the Committee would have supported it wholeheartedly. However, as a stand-alone order, it leaves me a bit baffled.
The fact that the insolvency sector is growing is a sign of our times, sadly. The fact that costs in the sector seem to be escalating should worry us all. I urge the Government to address some of the major concerns regarding costs, rather than focusing on the minutiae dealt with in the order.
May I first declare an interest? I own a small newsagent’s in Swansea. I thought that I would cover myself just in case I said something in favour of local papers in this debate—or in the next one, for that matter. I should like to pass on apologies from my hon. Friend the Member for Christchurch (Mr. Chope), who intervened on the Minister for Employment Relations and Postal Affairs at the beginning of the debate. He is chairing a Committee and sadly, cannot be here, but I am sure that he will read Hansard diligently tomorrow to see the answer to his question.
The focus of the debate is tight; I will try to make my contribution as exciting as I can, but the subject is a bit turgid, to say the least. However, clearly the issue has an impact on a number of people, because the requirement to place two advertisements in local papers has probably been about for a long time. I see that the London Gazette was first published in 1665; the hon. Member for Chorley (Mr. Hoyle) probably remembers reading the first edition when he was a child, but perhaps not. Things have moved on just a little since 1665.
I was reflecting only today on where we are now, compared to where we were when I first became a Member of Parliament. It is not so long ago that I had my first mobile phone. It was the weight of a brick, and the reception was so poor that, at times, it was as useful as a brick. I then got my first computer, so I threw away the typewriter and the Tipp-Ex, which was all rather exciting. Then the internet came along. We can all remember the days when we would try to download the first page of a document on a dial-up. We could go and bake a cake, or do something else, while that page was downloading. Now, we are talking about 100 megabytes a second. So times have moved on, and newspapers are moving along with them. A lot of the newspapers that we are talking about are online, but we are not quite at the stage at which many of them will be able to survive the recession. Things are pretty tight for them.
I suppose that the big question is whether we are talking about retaining an obligation on liquidators to advertise in two local newspapers as a means of preserving local newspapers. That is clearly not why the obligation was created in the first place. The aim was to get the information out to the creditors, and clearly in 1665 advertising in two local papers, and using the London Gazette, was the way to do that. I do not know how many people read the London Gazette these days. I suspect that it is not a lot. I suspect that more people read it online than buy copies of it. I would not even know where to buy a copy of it. Speaking as a former newsagent, I do not think that we ever sold a copy. I do not think that we even stocked it. I certainly do not remember any of my customers coming in and saying, “Have you got the London Gazette?”
Is there any truth in the rumour that the hon. Gentleman sold the first copy of the London Gazette back in Swansea? He would remember that day well, wouldn’t he?
Touché! It is 15 all. What I am trying to say is that I can understand what is behind the thrust towards the regulatory reform in question.
On the subject of creditors, I was interested to hear a number of the exchanges about the little person—the small to medium-sized enterprise that finds that when another firm falls through, it is likely to be the body that loses the money. As my hon. Friend the Member for Weston-super-Mare (John Penrose) said earlier, there is a knock-on effect. Clearly, if a firm falls through, it could take other firms down with it. I am sure that that happens more than regularly.
The important thing is that we get the information out to creditors, but we also need to look at the whole issue of creditors to make sure that it is not the small to medium-sized enterprise—the small person, the one-man band, the small partnership—that loses out every time. The SME should get its fair share. If other people get 10p in the pound, why does the SME get nothing? We need to look at the issue again, and now is the appropriate time to do so, what with the recession and 85 small businesses falling through every day. That is a phenomenal number. It means that there are a lot of firms going out of business, and a lot of creditors who will need the information about those firms falling through, so that they can put in their claims.
I was surprised to hear about insolvency practices charging £700 an hour. If they do, or if the amount is anywhere near that, we need to look into the matter. We should worry about not the £600 that goes to two local newspapers, but the thousands of pounds that go to insolvency practitioners. That is clearly the business to be in. If we cannot be in banking and pay ourselves huge bonuses, we should be insolvency practitioners. There must be a little list of these top jobs. I am shocked to hear that that is what insolvency practitioners charge. Clearly, if they charge that sort of money, it means that the money is not getting through to the right people, which is those in the SME sector, who are spending a lot of cash in the meantime.
We are considering one narrow issue—businesses falling through—but as I recall, when I applied for an off-licence for my shop, we too had an obligation to advertise in local papers. I suspect that the same is true for planning applications. Does the order mean that the Government are considering all those instances, too? If they say that in one narrow area—in cases in which businesses fall through—it is unnecessary to advertise in two local newspapers, and that obligation is to go, I suspect that every Department will consider the issue, because the order will be a precedent. If the Minister is saying that trading has changed, I agree, but if the obligations are to disappear for one section of people, clearly the same will happen somewhere else, too.
That brings me on to newspapers, which are going through a tough time. Many of them face annihilation: circulation figures are going down and, at the same time, advertising revenues are disappearing. All that the measure will do is make the situation worse. Some of the businesses that might go bust that would normally have an obligation to advertise are newspapers themselves—at least the London Gazette will get an advertisement out of the measure—so they will not be around to take such advertisements.
We need to look at the usefulness of local newspapers. I said that many of them are available online, but some failed when they were making money to invest in their online services. I suspect that many of them wish that they had done so, as many newspapers, whether national, regional or local, are going online and spreading their advertising on the internet. I think that that is great, because people who have moved away from their local area can find out what is going on there and, indeed, read the classifieds. Newspapers need time, however, to make that investment, so if we vote on the issue, I would delay or defer the measure for five years, so that local papers have an opportunity to reform and to make the investments necessary to ensure that they are up to date. In 20 years’ time, many youngsters may not buy papers at all, as they will get everything online. With the iPhone, the BlackBerry and mobile wi-fi, they can download stuff, so the big question will be whether we will need to buy hard copies of newspapers. We like to do so, as it is a traditional thing for us—I love to buy newspapers and make marks on them—but will the youngsters of tomorrow feel the same?
Does the hon. Gentleman agree that many small businesses in the UK still do not have internet access because they do not think that they need it? They might be right, because they know their businesses better than we do. The benefits of internet access are limited for a small one-man plumbing operation, whose business is gathered by word of mouth.
A one-man band such as a plumber is a good example, because they tend to work from early in the morning until late at night. The last thing that they want to do is sit in front of a computer when they get home—they want to have their tea and go to bed, because they are tired. I accept that we have to be careful in our assumptions. We are not imposing an obligation on the liquidators to put anything on the internet—they can do so additionally if they think it appropriate. We are therefore talking about the London Gazette: it was founded in 1665, and it will still be here in 2365, the way that we are going.
Will my hon. Friend tell us whether he has any shares in the London Gazette, because it sounds as if he does not have much of an interest in the paper?
This is the best advertising that the London Gazette has had since 1665. I suspect that sales will soar tomorrow, as people go out and get a copy to see what it looks like. The publication is available online, the Minister told us, which is reassuring, but the thrust of my argument is, first, how do we get the information to the creditors and, secondly, can we make sure that creditors lower down the food chain will receive the money?
The savings will not go to the Government, because the Minister said that it will go to primary creditors, whoever they are. However, the people lower down the food chain, whom the hon. Member for Chorley was talking about, are the ones we really care about. If the £600 saving goes to small and medium-sized enterprises, I would support that, but there is a big question mark about whether that is the case. I hope, however, that in making these changes we will not push local papers closer to the brink of collapse. If this is the start, I am sure that there will be other regulatory reforms in future that will remove the obligation to place advertisements in local papers, which will further cripple the papers that we all cherish in our local areas.
Does my hon. Friend not think that, apart from the fact that there is a delicious irony in the Leader of the House choosing to hold this debate immediately before a debate on the future of local newspapers, it is a particularly difficult time for newspapers, with the cost of newsprint at an all-time high? Sadly, given the number of insolvencies, papers are almost completely dependent on such advertisements to support their classified sections.
I hear what my hon. Friend has to say, and I completely agree with him. It is rather absurd, and what is even more absurd is the fact that this debate will run longer than the debate about the future of local newspapers. That is rather sad; we could have merged the debates.
I assure the House that I will be as brief as possible so that we can make progress.
I thank the Minister for his exposition of the order, which allayed a number of my fears. However, there is a world of difference between removing the obligation to advertise in newspapers and discouraging insolvency practitioners from advertising in local newspapers. We have to be careful lest the one stray into the other. There is a big push to use the internet. I am a great supporter of the internet, but we must recognise that it has its limitations. A benefit of the age in which we live is that, as the marketing industry knows, we have several different channels for reaching the market. The old ones do not necessarily fall out of use, and are still appropriate in the right circumstances.
We must achieve a balance between, on the one hand, access to information and the protection of creditors and, on the other, the need to reduce red tape and costs. I would differentiate between large companies, which trade widely and for which local newspapers are not particularly relevant, and small and medium-sized businesses, which are the backbone of our industry—they are certainly the mainstay of my constituency—and local newspapers play a major role for them. The notices that appear in those publications are well read, newspapers at that level are accessible—people can pick them up, read them on the train, and fill in time wherever they are—and, most importantly, they are trusted. At the moment, in relation to insolvency, the internet is not always trusted, and there have been a number of cases in my constituency in which companies have gone into liquidation but the liquidators have not been quick enough to stop the internet trading arm continuing to trade, so people have lost their money. They just go into the pool of creditors, even though the normal business has stopped trading.
I am all for reducing red tape. We may not be here specifically to benefit the media, but the points made by my hon. Friend the Member for Ribble Valley (Mr. Evans) are right. We must recognise the state that the local newspaper business is in. It is facing hardship, and we need to ensure that we do not damage it even further. I therefore seek reassurance from the Minister that, if the measure goes through, insolvency practitioners will not actively be discouraged from using newspapers; that newspapers will continue to have the means to convince insolvency practitioners of their value; and that we will monitor the process to ensure that, ultimately, creditors do not lose out.
I am delighted to be able to take part in this debate, because we have uncovered a devilishly cunning plan on the part of the Government. The order has nothing to do with the £600 that will be saved in advertising insolvencies. In the Minister, we have new Labour’s very own Moriarty, because behind that smooth exterior lies a sharp brain. We are approaching a general election, and Government Members do not want my constituents or their constituents opening the local paper day after day, week after week, seeing companies going to the wall. We know that some companies will go to the wall due to the bad management of their proprietors, but many companies are going to the wall due to the bad management of this Government.
The order is a devilishly cunning plan and it nearly passed this place unnoticed, but thanks to the probing by my hon. Friend the Member for Ribble Valley (Mr. Evans) and some Labour Members, we have uncovered it. The Minister has a chance in a few moments to set our minds at rest. Is he really Moriarty or is he a force for good?
I do not want to try your patience, Mr. Deputy Speaker, but let us not be too po-faced about the £600 that will be returned to creditors. If there are 10 creditors, that will be £60 per creditor, and if there are 100 creditors, £6. The £600 is a red herring.
I am sorry to stop the hon. Gentleman in flow, but his breakdown of the £600 does not work in practice, because it depends who is a secured creditor and who is an unsecured creditor. The £600 will go to the secured creditors. It will not end up in the hands of the unsecured creditors.
The £600, though, does not make the critical difference, as the hon. Gentleman so eloquently pointed out in his speech. It is the behaviour of the insolvency practitioners that we need to be concerned about—£700 an hour? I am sure some of them charge £800 or £900 an hour. They are a disgrace. They are doing a good business at present, largely thanks to the Government whom the hon. Gentleman supports. However, it would be churlish of me to pursue that, as I have great regard for him. I recognise that he is one of the few Members on the Government Benches who has run a business for a considerable time.
This could well turn into a witch hunt—
Order. Not so long as I am in the Chair.
Your words are most welcome and I am assured, Mr. Deputy Speaker, but I am concerned about the vilification of many good practitioners around the country who do a very good job indeed, particularly at this time, working into the late hours because of the number of insolvencies taking place. I want a little balance in that respect, and I am sure my hon. Friend would agree.
I thank my hon. Friend for pointing that out. Let us remember that marriages among insolvency practitioners are being destroyed as they work 15 to 20 hours a day at £700 an hour through the night to deliver a public service both to themselves and to their clients.
Mr. Deputy Speaker, you look incredibly bored by this speech, so with that in mind, I shall sit down.
The hon. Member for Weston-super-Mare (John Penrose) asked me some questions about savings and other changes that we are introducing, and asked me to put those in context. I propose to do that.
We intend to introduce a further legislative reform order which, like the one that we are discussing, will make parallel changes in the insolvency rules. Together those proposals will contain more about information and how it is supplied. They will cover meetings to do with creditors, reporting by office holders, clarity and accountability on remuneration and so on. So the order is part of a wider programme of change.
Before the Minister moves on from that point, can he indicate whether the timetable mentioned to the Chairman of the Select Committee for the order to be introduced during April is realistic, or whether he expects the process to take longer, and if so, how much longer?
I am tempted to use that tremendously flexible parliamentary word, “soon” in respect of the introduction of the order. We hope to introduce it within the April-May timetable.
The hon. Gentleman said that he wanted to be clear—it is a perfectly fair request—that although we would be less prescriptive about the method of trying to contact unidentified creditors, the duty would still exist. I refer him to paragraph 3(b) of the order, which states that
“the liquidator—
(a) shall summon a meeting of creditors . . . not later than the 28th day after the day on which he formed”
the opinion;
(b) shall send notices . . . by post to the creditors”
shall advertise—I shall return to our friend the Gazette—
“in such other manner as he thinks fit”
and shall
“furnish creditors free of charge with such information concerning the affairs of the company as they may reasonably require”.
So there are still important duties to try to identify creditors.
My hon. Friend the Member for Ellesmere Port and Neston (Andrew Miller) spoke about the costs and fees involved, and a number of other hon. Members also referred to those. As I said in my opening remarks, there is recourse to the court on these charges, and we are bringing in measures to achieve greater transparency and accountability, which the House will have a chance to discuss, through the methods that I outlined.
I want to respond to my hon. Friend’s point about steamrollering, which was also the subject of the speech from the hon. Member for Birmingham, Yardley (John Hemming). That is not at all what we are doing. As my hon. Friend said, the Committee had some sympathy with the substance of our proposals, but questioned their scope and effect. Other options were open to the Committee, which they did not take. Following the Committee’s consideration, it is perfectly proper to allow the House, as we are doing, to have a full debate and to ask the House to approve the order.
I must pick up on a point made several times both before and, more worryingly, after my intervention that the only beneficiary would be the Government. As I said, HMRC stopped being a preferential creditor some years ago. In the hierarchy of creditors, there are, first, the expenses connected with the liquidation, which we are trying to reduce through the order. Then there are the preferential creditors. In practice, the employees are high on the list, and rightly so. I agree with my hon. Friend the Member for Chorley (Mr. Hoyle) about that. Next in the hierarchy are banks, followed by unsecured creditors. It is not the case that HMRC stands first in line to benefit from the changes that we are proposing.
The point that I made about the banks is that some of the banks are, in effect, nationalised, so if they get the money, they are, in effect, the Government.
I want to be fair to the hon. Gentleman, but I am not quite sure that that is what he was driving at. I do not think he mentioned the banks. He was talking about HMRC.
My hon. Friend the Member for Ochil and South Perthshire (Gordon Banks) expressed concern about what he saw as the local bit disappearing. Let me gently disagree with him. The local bit does not disappear through these changes. They allow flexibility and choice, according to the particular circumstances of the case. It is still open to liquidators to advertise in a local newspaper if they think that is the best way to identify unidentified creditors.
The hon. Member for Henley (John Howell) asked me for a reassurance that there would be no act of discouragement. Of course there will not be an act of discouragement. All we are doing in the order is trying to take account of the effect of those adverts—as I said, only in one in 50 cases do they identify an unidentified creditor—and of the changes in the patterns of trade and communication since the rules were first established in the early part of the last century.
It is sometimes appropriate to issue guidance notes on matters of this kind. If the creditors were likely to be very local, could there be guidance to the effect that it might be useful to insert adverts in local newspapers?
I am sure that in its dialogue with insolvency practitioners, the Insolvency Service will make it clear that if people still think that that is the most appropriate course, they should take it.
I fear that we are slightly mixing up two debates. There is a perfectly legitimate discussion to be had about local newspapers, of which I am a great fan; there is another discussion about the best method of trying to identify unidentified creditors in the insolvency process and trying to give insolvency practitioners and the companies themselves the flexibility to choose the best method.
I now come to the point about the narrowness of the order. We might be in danger of putting too much weight on this process. Legislative reform orders are for a specific purpose; there are specific criteria. As one who picked up the baton of the Bill that gave rise to legislative reform orders halfway through its passage through the House, I can say that there are very tight controls on what they can contain. It has been said that the order is not ambitious enough and that there should be a much more wide-ranging reform of the Insolvency Service. That might be a legitimate point, but if we went down the road of totally recasting insolvency law, we would not do that through a legislative reform order; in fact, if we tried to, I suspect that the House would object and say that it was a proper matter for primary legislation.
If we are dissatisfied with insolvency in general and we feel that insolvency law needs wider reform, that should be a subject for primary legislation. If we rejected the proposals in the legislative reform order because we were dissatisfied with the insolvency regime more widely, that would show a somewhat odd logic. Our judgment of the legislative reform order and the Committee’s report on it should be based on the merits of the order itself and on whether the change is worth making. My contention is that it is.
I have debated with the hon. Member for Ribble Valley (Mr. Evans) a number of times, and we often hear about that newsagent in Swansea; it is a regular feature of his contributions.
Free advert.
I am sure that the newsagent benefits greatly from the number of times it is mentioned here, and good luck to the hon. Gentleman. He said that the order leaves us only with the London Gazette, and that the people of Swansea and Ribble Valley probably do not read that every day. He is right about that, but wrong in saying that our changes would leave us only with the London Gazette.
I have just been reflecting on my right hon. Friend’s earlier comments; I apologise for going back a paragraph in his notes. He was talking about the narrow nature of the order and he has acknowledged that there will be another order. The hon. Member for Weston-super-Mare (John Penrose) made a perfectly reasonable point in asking why there could not have been a single order. If there had been, we would have had a clearer picture of the Government’s strategy. I do not think that there is any difference across the House or between the Committee and the Government on the issue, but we would have had a clearer picture and been able to see what was in the Minister’s mind.
My hon. Friend may have heard the phrase “real help now”. It is precisely because we are in favour of real help now that we wanted to make the changes on advertising and bring them in as quickly as possible. Other changes are on a slightly slower timetable, but they will come in due course.
I return to my previous remarks. The hon. Member for Ribble Valley said that the order would leave us only with the London Gazette, which is a bit obscure for his constituents. I understand what he said, but let me make two points. The order does not leave us only with the London Gazette; it is open to the insolvency practitioner or the company involved to advertise
“in such other manner as”
they “think fit.”
Is the Minister not concerned that insolvency practitioners will develop their own process of best practice, which, over time, will negate the need even for the consideration of local advertising? The practitioners might follow their own practices that had evolved over the years.
The practitioners have a duty to try to identify the unidentified creditors. The point of the order is to give them flexibility and choice on how they try to do that.
It is important to be serious for a moment. I am not arguing that the London Gazette sells as well as the daily or local papers, but it plays an important role. It is used by credit reference agencies, financial institutions, Her Majesty’s Revenue and Customs, trade suppliers and so on. It is intended not to be in the living rooms of every citizen every night, but to act as a central record to which people from anywhere in the country can go to find out information about these matters. It plays a valuable role.
The hon. Member for Broxbourne (Mr. Walker) accused me of having a cunning plan, although I was not sure about what the nature of it was. Let me assure him and the House that my and the Government’s only intention with the order is to get a better deal for creditors and for the small businesses, about which we have heard, that are often at the sharp end of insolvencies.
The change is worth having; it would be a mistake for hon. Members to oppose good measures because they wanted other, wider measures that would not even be appropriate for legislative reform orders. Let us play on the pitch that we are on: legislative reform orders are appropriate for making particular changes. It would not be a good service to small businesses, which we care about, if we turned down a change that could benefit them; those other concerns should be dealt with in another way.
In conclusion, we often hear calls to reduce red tape and regulation, and they are repeated often in the House. However, there is little point in our calling for reductions in regulations and red tape in general and then opposing those reductions in the particular, when they are brought before the House. This measure is a benefit worth having. On that note, I ask the House to disagree with the Regulatory Reform Committee’s report and approve the order.
Question put and agreed to.
Resolved,
That this House disagrees with the Regulatory Reform Committee in its recommendation that the draft Legislative Reform (Insolvency) (Advertising Requirements) Order 2009 should not be approved.
Local and Regional News
Topical debate
I beg to move,
That this House has considered the matter of local and regional news.
I am grateful for the opportunity to open this debate on an issue that lies at the heart of the democratic process and in the soul of local communities. I know that many Members share my interest in, and concern for, the health and vitality of local and regional news journalism. Many of us, in our capacity as constituency MPs or, as in my case, as regional Ministers, have a great deal to do with the matter and are worried about what is happening. The Government are worried too, and the issue is at the top of our agenda.
In January, my noble Friend Lord Carter published his interim “Digital Britain” report. After consultation, the report will be published in its final form by early summer. I commend the interim report to Members who have not already read it. They will see that local, regional and national news is a key priority—not one with easy or ready answers but one for which we are urgently seeking the right solutions that will provide a choice of impartial news, whether on television or radio or in print.
Research carried out as part of Ofcom’s public service broadcasting review showed clearly that people trust and value the provision and choice of news services, particularly local and regional news. However, the sector is under pressure due to a combination of structural and cyclical factors, such as changes in readership or in styles of readership. People now tend to go online more for news, particularly younger people. My children think that I am antediluvian because I prefer to hold the thing that I am reading. They read the news online. Although newspapers are diversifying online, the physical circulation of print newspapers is suffering. It is declining by about 5.2 per cent. a year.
The Minister says that her children think that she is antediluvian—I am sure that they do not. We can see the trend in the disappearance of virtually every sporting newspaper, which used to be a mainstay. After the football finished on a Saturday, people would rush out and buy the sporting posts. They have virtually all gone now, as people access their information online or via the television.
Order. Before the Minister replies, perhaps it would be sensible at this stage to point out to hon. Members that there is still only an hour and a half for this debate. Every intervention extends the Front-Bench speeches, so that they could take up a total of 52 minutes out of the 90, and 12 hon. Members are seeking to speak. I propose now to reduce the time limit to five minutes.
Thank you, Mr. Deputy Speaker. You are right; this debate is not so much for Front-Bench as for Back-Bench contributions, so I will narrow mine down.
The drop in print readership has had a crucial effect on the advertising revenue that regional and local newspapers can expect to receive. In fact, it has changed the economy of the media as a whole. The effect on equity is dramatically illustrated by the share prices of two of the four major regional news groups, which have dropped by more than 95 per cent. Those trends are exacerbated by current market conditions, which particularly affect advertising spend. There are global difficulties, and a fundamental shift is being caused by the transition from traditional methods of news gathering and reporting to the versatility of the digital world, which allows us to get news wherever we are on mobile phones—things that we keep in our pockets. The Government therefore have an important role in ensuring that a vital service that the public trust and enjoy is maintained for them.
“Digital Britain” will provide a comprehensive strategy for maintaining this country’s leadership in all aspects of the communications, media and cultural worlds, and as such it will offer thoughtful and practical proposals. It will take into account the views and expertise of media industry professionals, detailed analysis of the needs of the public and the economy, and the public’s views on securing the future of local and regional news.
First, the report will consider various options to ensure that the audience can enjoy the provision of high-quality regional news. In that respect, the recent memorandum of understanding signed by ITV and the BBC is an important step forward. Other options are also being considered for the longer term, including a potential role for a new public service broadcasting institution that would build on Channel 4’s strength.
Secondly, the report will give priority to local and digital radio. Historically, Government and regulators have sought to secure the provision of news on radio by prescribing the number of hours of local news that must be provided by each station. Those licence requirements, alongside the localness regime, have secured a strong local news presence on the radio. However, although we remain of the view that local news is an essential part of the public value of radio, we also recognise the challenges that the industry faces. A review is already under way to examine the role that radio should have in delivering local content in a predominantly digital landscape. The review is expected to report back to Government in the next few weeks and will be reflected in the final report.
We are also aware that there is increasing support for a relaxation of conditions on greater consolidation of local media businesses. The principle is that by sharing resources, particularly in news gathering, we can help to reduce costs. We have therefore invited the Office of Fair Trading, Ofcom and other interested parties to undertake an exploratory review across the local and regional media sector to inform a decision on the existing merger regime.
We all recognise the difficult conditions in which the media currently work, but we should also recognise that the transition to a digital world brings enormous potential to widen and deepen the democratic process. The correct response to a digital Britain is for our media, the envy of the world, to apply their natural propensity for innovation and instinctive creativity to finding solutions to the challenges we face. That means that we need a new way of thinking so that we see a new era of possibility, not an endless vista of threat and decline. We also need a new approach whereby people in the media share a vision of the future and use the converged landscape to forge partnerships.
My right hon. Friend the Secretary of State for Culture, Media and Sport recently asked the industry to set out the key actions that it believes need to be taken in the short and longer term to sustain local media. He also agreed that the Government would host a conference bringing together all the interested parties—the National Union of Journalists, the Society of Editors, the Newspaper Society, local media, MPs and local and regional bodies—for a broad discussion of the issues affecting local media and potential new business models. That conference will take place as soon as possible. I am pleased that a more collaborative approach is already emerging, with the memorandum of understanding agreed last week between the BBC and ITV about the provision of news. That is a welcome step forward, which should enable others across the media landscape, including commercial partners, to examine new ways of delivering news.
Convergence in the media not only gives rise to challenges but creates new business opportunities. A sensible strategy that uses that convergence can help to sustain our vital local media. We must explore partnerships locally—private and public sector ones and those that involve local government, which has tended to turn to other methods of conveying its news. Is there potential for a new national network of local media consortiums? Is there potential for partnerships to emerge with the size, scale and vision to break down the old barriers into the media by offering work experience, training and apprenticeships to those who were previously excluded or would not have aspired to a media career, through lack of money or local opportunity? Is there potential to end the old “who you know, who can afford it” culture of journalism? That would be a truly worthwhile legacy of convergence.
My right hon. Friend the Secretary of State said earlier this year that the provision of local news and the plight of local newspapers have to rise up the political agenda. We are achieving that. We will work tirelessly to secure for local communities in every part of the country news that maintains the high standards that have long been associated with British journalism.
We are debating an immensely important subject—the future of not simply a specific industry or sector, but a sector that is vital to our democracy. It seems rather sad to me, as a relatively new boy, that we have only 90 minutes to debate the subject and not the full three and a half hours that we could have if the business ran until 6 o’clock. Perhaps the Modernisation Committee, of which I used to be a member and on which I cut my teeth, could consider the matter. One example of the fall-out is that we will hear from the hon. Member for Bath (Mr. Foster) for only six minutes, and that is unfortunate.
We are all used to local newspapers and to broadcasts on the BBC and ITV to which we can look for local news. Even in the current crisis for local newspapers, 40 million adults read 1,300 regional and local newspapers daily or weekly, some paid for and others free. A quarter of the regional press work force are focused on editorial activities. The sector still employs around 40,000 people, and 110,000 paper boys deliver local newspapers. It is still the largest advertising medium in the UK, taking almost £3 billion a year and accounting for 16 per cent. of all advertising revenue. While some of that is migrating online, about 95 per cent. is still print advertising. However, online is becoming more important for local newspapers.
We are debating the local and regional press because they find themselves in a perfect storm. They will not only have to change their business models radically in any event because of the advent of the internet, but they must do it in perhaps the toughest recession the country has experienced in our lifetime. The lifeblood of local newspapers in particular—classified advertising—was already migrating to the internet. Whereas, even five years ago, one would buy a local newspaper to find what jobs were available or what property one could buy locally, one can now do that at the click of a mouse on a range of websites. The recession has made the paradigm shift even more acute.
We debated local media as recently as the end of January in Westminster Hall. The Newspaper Society told me then that it predicted a reduction of 20 per cent. in advertising revenue in the third quarter of last year. I now understand that the advertising revenue of at least one major regional news company declined by 55 per cent. in the fourth quarter. Some people predict that about 40 per cent. of the 12,000 estate agents in this country will go out of business during the recession, and that will have an obvious knock-on effect on local newspapers’ revenue.
I do not need to spout a series of statistics at hon. Members, because we all buy our local newspapers assiduously and we can all see the physical manifestation of what I am talking about, which is that local newspapers are thinner and their coverage is perhaps sketchier than it has been. When we debated local newspapers in Westminster Hall at the end of January, we were all keen to praise the fantastic works that local newspapers do in our constituencies. In my constituency, we have the Herald series, which has a fine editor in Derek Holmes and Simon O’Neill editing the Oxford Mail, and a good local reporter, Emily Allen. I made the point that in my four years in Parliament, three reporters who worked for the local paper for 30 or 40 years have retired. We will not see their like again, in the sense that people are unlikely to work for a local newspaper for 10, 20 or 30 years, so everything is in flux.
As I have mentioned, however, it is not the recession alone that is causing the problem, but a shift caused by the internet and changing patterns of media that have been going on for quite some time. The revenue of commercial radio has fallen by 20 per cent. since as long ago as 2003, and some four out of 10 commercial radio stations are no longer profitable. ITV has proposed substantial cuts to its regional news service, but we cannot pretend that the cuts were forced on ITV only in the past few months—they have been a long time coming. We welcome the announcement that ITV is to work with the BBC to share costs, which I understand will be worth some £7 million a year by 2012. However, that is in no way enough to cover the huge gap in the cost of regional news, which is some £60 million.
The change is therefore urgently needed. However, although we obviously welcome the Government’s decision to look at the market and to get the Office of Fair Trading to hold an inquiry, we are within our rights to ask whether it is too little, too late. We certainly need a dramatic look at the regulations governing ownership and competition. Even in America, the Democrat leader of Congress, Nancy Pelosi, has written to the American Attorney-General asking him to intervene to save local news organisations. She makes a good point, which applies to this country, too:
“I am confident that the Antitrust Division, in assessing any concerns that any proposed mergers or other arrangements in the San Francisco area,”
which she represents,
“might reduce competition, will take into appropriate account, as relevant, not only the number of daily and weekly newspapers in the…Area, but also the other sources of news and advertising outlets available in the electronic and digital age”
That goes to the heart of my argument. The Competition Commission and the Office of Fair Trading have been very much behind the curve. They refused the decision of the BBC and commercial broadcasters to create Kangaroo because they were looking at too narrow a market. We urgently need to sweep away the rules of media ownership that prevent consolidation of local newspaper groups and alliances between local newspaper groups and commercial radio companies.
Five years ago those restrictions would have been appropriate, because they would have allowed one organisation to have a dominant impact on a local area. However, with the advent of the internet, that is no longer possible. There are now myriad local sources to which local people can turn. If we want to find a market solution to what is happening, we have to deregulate as rapidly as possible. We know that the Government have intervened in the past to suspend competition rules—for good or, as some might say, for bad—when the situation was urgent. I submit that the situation is now particularly urgent for the local press.
There is a great deal of concern about whether too many local councils are substituting their newspapers for local newspapers. Does the Minister take the same view as the Secretary of State for Children, Schools and Families on the Killian Pretty review of planning applications? It has recommended that local authorities should be allowed to pull planning application notices from local newspapers. The Secretary of State has indicated his opposition to that proposal. I asked the Minister from the Department for Business, Enterprise and Regulatory Reform about this in our debate in January, but he failed to give me an answer. This Minister is more robust and clear sighted, however, and I know that she will give us an answer on the Government’s position today.
We urgently need the OFT to get on with this inquiry. We need the rules to be pushed to one side, to allow newspapers and commercial radio companies to provide a market solution to their problems, and to consolidate and form alliances as and when they think it appropriate.
rose—
Order. May I remind hon. Members that Mr. Speaker has imposed a five-minute limit on Back-Bench contributions?
Inevitably, much of the focus of today’s debate will be on the crisis facing many of our local newspapers. I share that concern, as do those of my constituents who work in the local and regional Scottish press. I had an e-mail yesterday from a constituent who works for the Daily Record and the Sunday Mail and who was extremely unhappy about the impact that the merger of those papers will have, not only on staffing levels but on the working conditions and practices of those involved. I congratulate the National Union of Journalists on highlighting this issue in its campaign on the local and regional press.
Today, I want to talk briefly about a different aspect of the provision of local and regional news. The United Kingdom should take the opportunity to set up a network of truly local television stations. If that were done in the right way, it could benefit not only the news environment but local newspapers as well. Members will know that, with few exceptions, this country has very few examples of genuinely local TV. We have various types of regional programmes, and a regional opt-out here and there, but we have no local TV networks that are truly focused on local communities in the way that local radio is—particularly with the growing network of commercial radio stations, such as the excellent Leith FM, which is based in my constituency and with which I was fortunate enough to do an interview only an hour or so ago.
The present debate about the allocation of the digital spectrum means that we can, as part of the process, take steps to encourage the establishment of a network of genuinely local TV stations serving local communities. In Edinburgh, for example, we could have Edinburgh TV and, further afield, Fife TV or Scottish Borders TV. There are similar possibilities elsewhere in the UK to a greater or lesser extent.
There is a debate in Scotland at the moment about the possibility of a new digital TV channel for Scotland as a whole, alongside the debate about broadcasting in general that has followed the establishment of the Scottish Broadcasting Commission by the Scottish Government. There is a rather sterile debate about whether £75 million should be found for a new Scotland-wide digital channel, yet we are not having the same kind of debate about local TV in Scotland. I am sure that that applies elsewhere as well. If Scottish National party Members could have been bothered to turn up for this debate, they would no doubt have made some comments at this point, but unfortunately they do not appear to be here today.
A move towards establishing a local TV network in the UK would clearly involve certain crucial financial and organisational issues, but they could be addressed. We need to establish that, in principle, we want to see the growth of a genuinely local TV network that would be delivered on Freeview as a new local tier of public service broadcasting. Above all, that network should be delivered by organisations based in their communities and offering a genuine local perspective, and not a network that purports to be local but in fact carries little more than the occasional local item to justify its licence. Such a development could also benefit local newspapers.
I agree with the Minister that convergence offers great opportunities as well as great threats. In the process of considering how the world of local and regional news will move forward, we need to maximise the opportunities while remaining aware of the threats. For example, there is a threat that consolidation could result in even fewer players dominating even more of the media market at local as well as national level. We could see ourselves moving into a world where there is even less local news content in any local media form than there is at present. Those are directions in which we certainly do not want to move. If we work in the right way, we could actually see convergence and the development of local media such as local TV supporting other local media areas, so that the different forms could learn and benefit from sharing expertise, resources and, indeed, advertising, but that can be done only if we also accept that there has to be a real plurality of ownership, real competition and, above all, local TV and local media more genuinely based in local communities.
We have already heard about the crisis in the local and regional news—news that is trusted and valued by our constituents, and, as the Minister said, lies at the heart of the democratic process. That crisis has been brought on by the current economic difficulties and the resulting reduction in advertising spend—a reduced advertising spend that has to be spread ever more thinly as we increase the number of outlets, not least with the growth of online content. It is interesting to note that some analysts suggest that Google now has more UK advertising revenue than ITV.
Local and regional news provision comes, of course, from television, radio, newspapers and increasingly, as I said, online. Figures suggest that 24 per cent. of young people now get their news predominantly from online sources. We have a real crisis in all four of those outlets, and it has led to something like 2,000 job losses in the last 12 months.
In television ITV, along with the BBC, is one of the key providers of regional news, yet we have seen its recently announced £2.73 billion pre-tax loss for the last financial year, due largely to a downturn in advertising revenue. We have also seen the number of regions for regional broadcasting brought down from the original 17 to nine, which I think amounts to a real loss for our constituents. In Bath, for example, my constituents will now get their local news from as far away as Penzance—and I have to say that, frankly, they are about as interested in that as they are in news from Bolton, which is the same distance away from Bath.
Commercial radio, too, is facing huge problems. We know that five local stations have been forced to close in the last 12 months, and RadioCentre predicts that between 30 and 50 stations are in imminent danger of closing. There have also been a number of mergers, which have undermined the value to local communities.
As many people have reported in recent debates, newspapers have fared no better, with 60 titles closed in the last 12 months and a 14 per cent. reduction in the work force. Many of our valued daily newspapers, such as the excellent Bath Chronicle, have had to become weekly rather than daily publications. I am sure that all Members speaking in this debate will be keen to sign, if they have not already done so, early-day motion 916, offering support for local journalism, and also early-day motion 1044, which reports the concern of many of us about the recent decision of the Guardian Media Group to reduce the number of offices serving local communities in the Greater Manchester area. Even online provision has been affected.
The question, then, is: what can be done? We are in a difficult position, midway between the preliminary report by Lord Carter on “Digital Britain” and the final result, which is due out in the early summer. Many of us were disappointed that we did not get more detail in the preliminary report, but it is worth placing on record my belief that it is possible to move forward in a number of areas.
In the case of television, it is clear that major structural changes are needed. I do not want to see the BBC’s licence fee being top-sliced and I do not want to see the crazy Conservative proposal to freeze the licence fee implemented. If the best they can offer the British people is a £3 per household cut as their solution to the current economic crisis, that is a bit bizarre. It is particularly bizarre to do that at a time when the hon. Member for Wantage (Mr. Vaizey) claims that he welcomes the conversations, discussions and agreements going on between the BBC and ITV to share resources and facilities that will help ITV through its difficulties.
I am grateful to the hon. Gentleman for conveying the Liberal Democrats’ message that there will be no help for the taxpayer from them during a recession. If he honestly believes the propaganda that spending £68 million would lead to a single job loss at the BBC rather than a cut in some very expensive salaries for “talent”, he really is a prisoner of the BBC’s corporate affairs department.
I hope that the hon. Gentleman took the time this morning to read the report of today’s speech by Mark Thompson, who heads the BBC. It gives full details of the major changes and cost savings that the BBC will make. Those savings will help to support other commercial public sector broadcasters, which I welcome, but I hope that the Minister will also be prepared to help ITV by, for instance, relaxing the rules governing its contract rights renewal.
The Secretary of State’s unwillingness to consider the possibility of product placement, which could have brought additional money into broadcasting and, perhaps, removed some revenue from online services, was antediluvian. The Minister might also consider allowing more flexibility, not in the total amount of advertising time on our commercial channels but in the time slots in which advertisements are placed.
I hope that the talks between Channel 4 and the BBC will continue, because, among other things, they may help to protect ITN.
Attention has already been drawn to the problems of radio, but we should now concentrate on the issue of cross-media ownership. There is an urgent need for us to consider ways in which the rules can be adjusted if we are to protect commercial radio stations. I hope that that will involve the introduction of a new localism test for stations applying for licences. The current test to establish whether a radio station is truly local does not deliver what my constituents—and, I suspect, many others—want.
We must also think about newspaper ownership, and try to find ways of supporting newspapers. Many newspaper owners were concerned about the proposals for BBC Local, which they rightly feared would damage local newspapers. Perhaps the proposal could be reformulated: the BBC could offer financial rewards to local newspaper and radio journalists in return for what they could provide. There are many good ideas to be explored, and I hope that the Minister will explore all of them.
This subject is crucial to us as politicians, and to the nation. It involves our roots, and it involves local democracy. In this country, power is much better scrutinised at the centre by a well-organised and energetic national press than it is in the localities, where it is hardly scrutinised at all—and that scrutiny is becoming weaker and less adequate.
The local and regional media are fundamental to local democracy, to community—a local or regional news medium represents a community talking to itself—and to the provision of local information. They provide what people want to read about in the localities. We must therefore try to find ways in which we can serve and help the threatened local media.
I am not greatly concerned about the threat to radio. It is a real threat, but I am not particularly bothered about financing and supporting our local juke box. There is no reason why that juke box should be placed in Grimsby—or, for that matter, in London, although the BBC, with Radio 1, is well qualified to place it in London. We happen to have some very good local radio stations in BBC Radio Humberside, Compass FM and Lincolnshire FM, although perhaps I am prejudiced because they are in my area.
I am, however, worried about the threat to regional news on television and the regional production of television programmes, especially given the announcement of the closure of the television centre that brought television production to our area and put Yorkshire and Lincolnshire on national television screens. The closure will mean a loss of jobs and a contraction of local news services. Yorkshire Television, the ITV licence-holder in the county, is shedding 40 of the 100 jobs in regional news. That must mean that there will be a less adequate service and less adequate competition with the BBC.
I am also concerned about the pressing newspapers problem. The National Union of Journalists estimates that 900 jobs have been lost in local newspapers since June last year. Since that is its estimate of vacancies and redundancies notified to it, it must be an underestimate, so I should think that well over 1,000 jobs have been lost in local newspapers. They are struggling. There are two reasons why, and it is important to differentiate between them. The first is the effect of the recession, which is affecting advertising revenues, particularly from estate agents and the local property market. The second is the growing competition from the internet, with classified adverts being placed on internet sites. It is important to differentiate between the long-term trend threatening the long-term viability of the local press, and the immediate problem of threats caused by the recession. Both, however, have produced a steady process of job shedding.
Those problems have also resulted in the local press moving down market. The local press has become much more tabloid—much more interested in rape, murder, arson and other sensationalist aspects of local news. That might boost circulation in the short term, on a one-edition basis, but it becomes jading as a constant diet, and people do not want to read it. This has also produced an over-emphasis on populist politics. It has driven politics—and us as MPs—out of local newspapers, which used to be our way of reaching our electors and our community. That trend is overdone.
The complaints from the media owners about loss of profitability, and whether they can survive, are also overdone. The figures show that. The NUJ has compiled all the figures. Trinity Mirror had an operating profit of 19 per cent. last year, and the figure for the Johnston group was 29 per cent. We should compare those figures with the figure for Tesco, which is 6 per cent. Why do these companies want to make such huge profits out of the local media? We should also take into account the excessive competition from freesheets, and the waste of money involved in the London freesheets competition.
How can we help the organisations concerned through the current situation? First we must bring the parties—the editors, journalists and owners—together to discuss what is wrong, and we should involve the BBC, particularly in training and media studies. We must try to develop a strategy for the industry, with the industry.
The hon. Member for Bath (Mr. Foster) said that freezing the BBC licence fee would not do any good, and that it would be a gesture. Perhaps Mark Thompson would like to make a gesture, too, with the £816,000 package he gets? A lot of people in my constituency have to scrape hard to pay the licence fee, which will be £142.50 when the increase comes through next month. Freezing the licence fee would send the right signal. Everybody else has to tighten their belts. Indeed, the local newspapers, that we all love, are doing so, because they have to. As the hon. Member for Great Grimsby (Mr. Mitchell) said, their advertising in areas such as employment, cars and property is shrinking. Therefore, they are making journalists redundant—some of whom have, no doubt, worked on the paper for a long time. There will also be fewer opportunities for young journalists leaving media courses, as they will find it more difficult to secure employment with such newspapers.
We cherish these newspapers, and we must see what we can do to give them some support. In my patch, we have the Lancashire Evening Telegraph and the Lancashire Evening Post, and the weeklies, The Longridge News and the Clitheroe Advertiser and Times. They have internet sections as well, and they must do that for the future; they must see the internet not as a problem that will put them out of business, but as an opportunity that will give them great potential for the future, with advertising online as well as in the newspaper. Goodness knows what will happen in 40, 30 and 20 years’ time.
Will newspapers in the form that we know them today survive at all? Perhaps all the local news will be accessed via iPhones, BlackBerries or goodness knows what other devices that we can only imagine now. There are probably kids in silicon valley working on the next device that everybody will be buying to download newspapers. We must ask what can be done in the meantime to ensure the viability of local newspapers, so that they are still around to embrace the new technology. There is nothing worse than seeing a newspaper that was established 100 years ago or more going to the wall because of the current financial crisis. We must do everything possible to support local papers.
We use local papers to get our messages across, because the news is local to people and they savour finding out what their politicians are doing. We get lots of opportunities to get stuff in the local papers, whereas it is far more difficult, although not impossible, for us to get stuff in the national papers or on to the national TV or radio news. People want to know what is happening locally—in their own communities—and thank goodness we are helped by journalists who are employed here in Parliament and are basically conduits for us to get our messages across. I should also mention the team of expert journalists who work for these papers in our own constituencies, because they know our patches as well as we do and, thus, when we talk to them they know what we are talking about.
On regional TV news, I am delighted that the BBC was not allowed to do what it wanted to do—develop its local TV stations, featherbedded by its £3.5 billion of licence fee payers’ money, which it gets whatever it does. The plans would have crippled a lot of our commercial newspapers and, indeed, ITV, which is against the wall at the moment, as I have seen in my region. Granada TV, my local station, does a great job with “Granada Reports” and “Party People”, which is the local political programme, but even over the past 12 months the coverage of “Party People” has diminished—instead of being on every week while the House is sitting it is now on once a month. The tremendous current affairs programming that Granada used to do, which involved great expertise, has been diminished; Granada is having to pull its horns in simply because of the financial crisis.
I hope that the Minister has some answer on giving support to local papers and regional news. I think that product placement would have been one of the answers; it would have given ITV an opportunity to get some extra cash, at least during this recession.
I welcome the selection of this subject for today’s topical debate, because it is clear from what has been said that we face a crisis in our local and regional news journalism. Every hon. Member has local stories to tell to highlight that. As my hon. Friend the Member for Great Grimsby (Mr. Mitchell) has said, the National Union of Journalists estimates that at least 1,000 editorial jobs have been lost since last June, and many other jobs will have been lost as local newspapers and offices have been closed. We understand that at least 60 titles have closed in the past six months; indeed, only last week a group of 18 local newspapers went into administration. The estimates are that we could lose a third of all local newspaper jobs by 2011.
It is clear that we face a crisis in this industry, and that has many implications for local communities. We talk a lot in this place about community identity and community cohesion. One of the most powerful ways in which communities achieve cohesion is through an identity that is reflected in the sharing of information about what is going on locally. If we were to see the end of local and regional press, that would have huge implications for all of us.
What we are seeing is an intensification of a process that has been going on for some time. The current difficult economic times have meant that over the past few months there has been a large decrease in the amount of advertising revenue on which local newspapers are able to rely, but in reality that trend has been going on for some time. Some newspaper groups are perhaps taking advantage of the fact that we are in such difficult economic times to go ahead with proposals that they were intending to implement anyway. The reality is that our local newspapers are owned by a number of large organisations, which, in general, are still making heavy profits. Mention has already been made of the fact that profits for local media organisations of 20 to 30 per cent. were normal, and now that profits have fallen to single figures, the organisations are not used to that.
In my constituency, for example, the Largs office of the Largs and Millport News—a historic newspaper that has been around for generations—has closed, and it now operates out of Ardrossan, which is outwith the circulation area of the paper. That story is being repeated nationally. Local offices are closing and newspapers are moving to other areas of the country with which they have traditionally had no connection. We are also seeing more common pages produced to be published in several newspapers in different areas.
We have heard calls this afternoon for the relaxation of media ownership laws and deregulation, but that is not the approach that the Government should take. Several suggestions have been made about how the Government could assist local media, including providing guaranteed advertising, but simply putting extra funding from Government into failed models is not the way forward. Local media face a huge challenge from the digital age and web-based technologies, and the answer is not international companies coming in to run local newspapers. We need local newspapers that are genuinely responsive to, and reflective of, the communities that they serve.
I welcome the comments made by the Minister this afternoon about bringing together all the partners in the sector—the trade unions, including the National Union of Journalists, and the enterprise organisations and regional development bodies in Scotland, England, Wales and Northern Ireland—to look at ways to put local journalism at the heart of the local media. We need quality media, and by bringing everyone together, I hope that we will be able to find creative solutions for the future.
I felt compelled to take part in this debate as only last week one of my local newspapers, the Reading Evening Post announced that it will stop publishing daily and will instead publish twice a week. That will mean the loss of some 100 jobs, which is bad enough in itself, but the change will also have an impact on the wider community. Local newspapers are incredibly important to local communities. A local newspaper can act as the glue that binds communities together. For example, local charities, voluntary organisations, sports clubs and many other organisations rely on their local newspapers to support everything from fundraising to recruiting new members or volunteers.
The Evening Post is one of only three regional newspapers to have increased its circulation over the past year, so it is very disappointing that it faces these cuts. It has a good team—I know the editor, Andy Murrill, well, and although politically we differ markedly, I know that he is a very good editor who cares deeply and passionately about Reading and its people. His newspaper reflects his view that being involved in and supporting the diversity of the town is essential to both the present and the future of the town.
My constituency is a very diverse area with many different ethnic groups and religious creeds. Relations across those groups are good precisely because the newspapers in the town, especially the Evening Post, have taken such a positive approach to building understanding and good relationships. Andy Murrill deserves enormous credit for the part that he has played in that.
In order to weather the economic storm, local papers need both our understanding of the challenges they face and our support. I believe that the public sector has a role to play, particularly with regard to advertising, of course, in circumstances where that represents the best value. Local newspapers give councils, hospitals and the police, for example, an enormous amount of positive and free publicity, but those organisations have been switching their marketing and advertising spend to glossy in-house publications, recruitment websites and their own websites. I think that Reading borough council’s glossy magazine costs about £60,000 a year, from memory, and it is read by probably 100 people in the borough. Taxpayer-funded organisations have a duty to get best value, spending their money wisely. Why print their own magazine when two perfectly good local newspapers exist to communicate exactly the same information? It makes no economic sense at all. In these difficult times, a two-way partnership with the public sector needs to be encouraged and established in which editorial content is financed through recruitment and public notice advertising. It is much better value for money and keeps local newspapers going.
There is also a role for the Government. They need to look urgently at the law regarding monopoly restrictions on local newspapers. There is now so much media choice, with radio, TV, other niche publications and websites, that the notion of strictly newspaper-dominated local monopolies simply does not hold water. There is also a certain paradox. Some newspaper groups have always enjoyed a monopoly in certain towns with absolutely no problem at all, yet newspapers cannot merge in other towns to safeguard their futures. That does not seem to be either fair or in the community’s interests. The Office of Fair Trading perhaps needs to consider how it interprets the law with regard to the wider operation of the local media rather than simply considering the local newspapers. The Reading Chronicle is part of a family-owned group, yet it was forced to sell one of its Slough newspapers owing to the OFT ruling that it would have a local monopoly.
I can understand the concerns about local monopoly positions. I know that some local politicians in particular are concerned about the political and editorial stance of some local newspapers. My view is that local newspapers that want to maintain circulation will avoid getting involved in the childish political squabbles that take place from time to time and will focus just on serving the interests of their local communities.
I would have liked to have gone on to talk a bit about local television, but I think that I am going to run out of time. My message to the House this afternoon, as well as to my local media, is: use it, or lose it.
I want to use the debate to highlight my concern at the decision by the Guardian Media Group to announce 150 job losses at the Manchester Evening News and its 22 weekly newspapers, including the extremely successful Stockport Express, which serves my constituency. The weekly newspapers will continue to exist but their offices will be closed and the papers will all be written and designed at head office in Manchester by a remote pool of journalists. That development chimes with an unwelcome national trend towards centralisation of services and people. Sixty local newspapers out of 1,300 closed last year according to the Newspaper Society, and we do not want our weekly newspapers in the Manchester area to end up suffering the same fate.
Local newspapers such as the Stockport Express, which has been going since 1889, play an essential role at the heart of their communities. That is because they are written by journalists who are constantly out and about and who know the local area and its people well. Local newspapers strengthen democracy and community life and hold local government and other organisations to account. They also provide a forum for individuals and organisations to speak to each other.
Unlike many other newspapers locally and nationally, the Stockport Express is bucking the national trend and is gaining new readers all the time. It is the only paper in the north-west to have increased its sales. The latest ABC figures show that circulation has risen by 1 per cent. while every other title was down, in most cases by more than 5 per cent. In fact, the Stockport Express is the only one of 25 paid-for weekly papers in the whole UK to have seen an increase in sales, so it is very sad that instead of building on such a great success story, the Stockport Express is about to be weakened by having no editorial presence in the town. The rise in sales of the Stockport Express under the able editorship of Mandy Leigh has been accomplished as a result of the paper’s reputation as a trusted, honest and open community newspaper. It is very grass roots: it understands the community and gives it what it wants, which will not happen if the editorial staff are all based in Manchester.
The Stockport Express has six very popular district pages devoted to small areas of the town. Those are the pages that readers often turn to first, and people tell me that it feels as though they know exactly what is happening in their road. The paper also runs hard-hitting campaigns, such as the one to save Stockport’s Plaza theatre. That campaign is going from strength to strength. The paper has exposed countless stories of wrongdoing, and its very good sports page is often devoted to coverage of Stockport County, the local football team. Readers have been following the team’s financial ups and downs, as well as its success in the league, and each week there is another episode in what is an exciting saga.
The paper provides a vital voice for the man or woman in the street. People feel that they can turn to it if they have an issue or a problem that they want to air. If they are unhappy with the care an elderly relative has received, for instance, they feel confident that their local paper will give them a fair hearing and will not willingly misrepresent them.
Highlighting individual cases also brings to the attention of local and national policymakers wider cases of injustice, and that can help to bring about change. I remember how one such incident began with a story in the Stockport Express on neighbours’ complaints about noise and antisocial behaviour arising from a small children’s home. It transpired that there was no need for such homes to be legally registered but, after a successful campaign, legislation was introduced in 2000 to require small children’s homes to register, which allowed better monitoring of such premises. I can think of many examples over the years that illustrate the important part that local newspapers play in the democratic process of bringing about change.
The Stockport Express has also been a prolific winner of awards over the years. It was the last holder of the Guardian Media Group’s award for best paid-for weekly, and is the current holder of the How-Do award for weekly newspaper of the year. Several of its journalists—including chief reporter Peter Devine—and photographers have won national awards.
If the Guardian Media Group proposals go ahead and the Stockport Express is produced in Manchester, face-to-face contact with the town of Stockport will be lost and there will be no on-the-spot journalists. The upshot will be that the bond between paper and town will be loosened, which can only damage the paper’s future prospects.
When I gave my maiden speech in the House of Commons in May 1992 I praised our good local press, which then comprised of six papers. Since then, all of them have closed, apart from the Stockport Express and its sister paper the Stockport Times. It is ironic that The Guardian began in Manchester as a successful independent community newspaper, and yet the Guardian Media Group plans to take this drastic action.
Local newspapers provide a documented record of our social history that cannot be replaced by social networking sites and the internet. They are a record for generations to come, and for a town to lose one would be to lose its collective memory. Therefore, I urge the Guardian Media Group to think again about its proposed cuts.
I rise to speak unashamedly in support of my local newspapers, which have had a long and impressive involvement in the community. The most important of the various local newspapers is the Northampton Herald and Post, but the paid-for daily the Northampton Chronicle and Echo dates back almost 300 years. We are very proud of it, and it is an integral part of what Northampton is all about.
The Chronicle and Echo is produced six days a week, and it offers the community an excellent product. I am not currying favour by saying that, because the truth is that the Chronicle and Echo is a vital part of our community. I am not sure that it gets all the recognition that it deserves—and therein lies one of the problems that we face.
I do not believe that the value of the Chronicle and Echo is recognised enough in the House, or by local government officials in the Northampton area. They always allude to it as “the Chronic”, which gives the House some idea of how it is regarded. Yet I assure the House that, if it were to disappear—I do not think there is any threat of that, and I would be horrified to learn otherwise—those same people would shout their mouths off because it was no longer there. The paper’s value to local democracy is immeasurable.
The paper is the major vehicle for broadcasting local democracy—for understanding it and raising interest in it in the community. We misunderstand what local newspapers are about if we fail to recognise that role. I pay tribute to David Summers, the editor, Richard Edmonds, the news editor, Wayne Bontoft, the reporter, and the journalist team, whose jobs are under threat, as are those of many journalist teams up and down the country.
I pay tribute to the bravery of those journalists. They get involved in political matters. They encourage political involvement. Thank God, the days when local newspapers simply carried obituaries and photographs of weddings are long gone—not that that was ever part of the Northampton local newspaper scene. Local newspaper teams show considerable courage and journalistic ability in reporting local news honestly and clearly. Without that, our local democracy would be less.
In the brief time left for my speech, I shall talk about the difficulties faced by the local newspaper. The number of car adverts has fallen dramatically. That is a simplistic statement, because we know that people are not buying cars in anywhere near the numbers of a year ago. There has been a massive fall in car advertising. On Thursdays, the major day for job advertising, the number of job adverts has gone down from 1,000 to 200. That is a reflection of the problems we face nationally, but—importantly—that newspapers face in terms of advertising revenue.
Official notices are absolutely vital. Although I understood the reasons for passing the insolvency measure earlier, it will none the less further hit local newspapers. We need to understand that. I call on the Government to ensure that as much as possible of the advertising revenue in their remit is directed to local newspapers. If ever they needed the help of the Government, the House, and indeed local authorities, it is now. If we lose our local newspapers, we will regret it for ever more.
Like my hon. Friend the Member for Stockport (Ann Coffey), I am concerned about the decision by the Guardian Media Group to close local news offices across Greater Manchester, coming as it does when the Manchester Evening News, the regional sister paper, has already faced substantial cuts. The decision means that scores of journalists will lose their jobs, which will have a huge impact on the quality and coverage of local news in my Denton and Reddish constituency. There will be a profound impact on great local titles such as the Stockport Express and Times and the Tameside Advertiser.
We all know that local newspapers have an absolutely central role at the heart of local communities, so I was shocked by the announcement that Guardian Media Group is making 150 redundancies, including 78 journalists, and closing all its weekly newspaper offices in Greater Manchester. It means that 39 jobs will go at the Manchester Evening News and another 39 jobs will disappear in the weekly newspapers, including the titles covering my constituency—the Stockport Express and Times and the Tameside Advertiser.
The plans also mean that all weekly papers in the MEN group, from as far north as Accrington to as far south as Wilmslow, will be based at its Deansgate office in central Manchester. That is devastating not only for the staff involved, but for Greater Manchester and the surrounding areas as a whole.
As we have already said, local newspapers play an essential role at the heart of their communities and are written by a group of dedicated journalists. Local newspapers provide quality, independent journalism; they hold authorities to account and campaign on behalf of readers, to professional standards of fairness and accuracy and with no agenda other than the public interest. It is more important than ever to preserve those principles, but the closure of local newspaper offices will have a profound effect on them. The founding fathers of The Manchester Guardian, as it was originally called, and in particular its long-time editor, C.P. Scott, would be appalled and saddened by the developments. As he said in his centenary lecture, a newspaper is
“much more than a business”.
It
“reflects and influences the life of a whole community”
and has a
“moral as well as a material existence”.
Let me give examples from my constituency. The Stockport Express and Times and the Tameside Advertiser are an integral part of their communities, and have been for many years. They play a major role in informing residents about events, crime, and local schools and their activities. They celebrate local success and highlight failures, and call the council and Members of Parliament to account through their investigative journalism.
In Tameside, many people feel that moving the branch office from Ashton-under-Lyne will mean that local people will have reduced access to democracy. In my constituency, many people pop into the Ashton office to give journalists a juicy story, to find out more about something that appeared in the previous week’s paper, or just to voice their concerns about certain issues. The same is true in Stockport, as we heard from my hon. Friend the Member for Stockport.
Similar issues arise from reduced distribution. A substantial number of people do not have internet access, so they cannot go online to find out what is happening. The beauty of purely local newspapers is that they avoid that problem. If we lose that presence in the two boroughs that I represent, people will feel that the title should no longer be the Tameside Advertiser or the Stockport Express; the newspapers will be more a Tameside or Stockport version of the Manchester Evening News, with a reduced number of pictures and stories, and more shared elements across the whole of Greater Manchester.
For journalists, unemployment is a big issue. Most have trained to postgraduate level, and then spend at least 18 months training to take the national certificate examination in journalism. At present there are virtually no jobs to be had in journalism, certainly not in Greater Manchester, where the Manchester Evening News media have a virtual monopoly. That means that standards in journalism will be lowered, and we should all be concerned about that.
Localism is the important factor for people in my constituency. The Stockport Express and the Tameside Advertiser are wonderful local campaigning newspapers with dedicated journalists. The Stockport Express has been an institution in Stockport since 1889. The Tameside Advertiser is a newer title than its Stockport sister paper, but it is just as highly regarded in the borough. This disgraceful decision urgently needs to be reversed. The newspapers are the key to campaigning in our areas, and we need to make sure that they are preserved for the future.
I am well aware that the subject of today’s debate is local and regional news, but I hope that hon. Members will understand if I restrict my remarks to the job losses announced at the Guardian Media Group just last week. I should like to take this opportunity to refer hon. Members to early-day motion 1044, which is in my name.
There is no point denying that local news is going through a torrid time, with advertising revenues falling and the recession hitting it hard. I am aware that the Guardian Media Group job losses are just the most recent example of a problem that is prevalent across the country. I rise to speak today to say that the newspapers that cover my constituency of Cheadle are under threat. The Guardian Media Group owns not only the Manchester Evening News but some two dozen titles across Greater Manchester, including the Stockport Express and Times, which, as we have heard, covers the whole of the Stockport borough, including my constituency.
Just last week, the chief executive of the Guardian Media Group announced 150 job cuts. That includes the jobs of 78 journalists, 39 of them from the Manchester Evening News and 39 from weekly newspapers right across the Greater Manchester area, including the Stockport Express and Times. Some of the job cuts will be voluntary, but there is little doubt that for the first time in its long and proud history, the Guardian Media Group will be responsible for compulsory editorial redundancies at the Manchester Evening News.
The group also announced that it would close the Stockport editorial office—and, indeed, all its editorial offices across the Greater Manchester area—with the result that the Stockport Express will no longer be produced in the area that it covers. Instead, it will be designed around a common template, with the central section containing common pages drawn from the Manchester Evening News leisure and entertainment content. It will be created at the Manchester Evening News offices in Deansgate by a combined pool of journalists, and the content of the paper will be shared with the Manchester Evening News. In other words, it will not remain local, and it will not retain the local community flavour that has been created by hard-working, locally based journalists. That will be a devastating blow to the community. The Stockport Express is vital to the life-blood of our area. It increases community engagement, and it strengthens local identity. The editor, Mandy Leigh, and all her team deserve congratulations on producing award-winning newspapers.
Many residents rely on the local paper for local news, to hear about local events, and to keep connected as a community. For elderly and infirm readers especially, the local paper is a vital source of information and a key link to the local area. As a former employee of the Guardian Media Group myself, I am all too aware of the dedication and hard work that many people have put in over the years to build up Greater Manchester’s local weekly newspapers, and it would be a tragedy if that hard work was allowed to go to waste. Local papers, including the Stockport Express, provide excellent, quality, independent journalism. They report the news fairly and accurately to the public. They play a vital role in scrutinising and reporting the work of the Government and local elected representatives, holding public authorities to account and campaigning on behalf of local residents, all of which, in a time of economic uncertainty, are more important than ever.
Local papers reflect the local community, they cater for its needs and they work on its behalf. The plans by the Guardian Media Group will sever that link with the local area, losing the vital ingredient that makes local papers local. That can only damage the future of those papers. I join other hon. Members who have appealed to the Guardian Media Group to reconsider the proposals in the best interests of our community. I am happy to tell the House that it is a message that several of us will repeat to the chief executive of the Guardian Media Group, Mr. Mark Dodson, at a meeting later this afternoon.
I requested this debate last Thursday, and I am pleased that we are holding it today. I am pleased that everyone has enjoyed it so far, and I hope I can join in with a further contribution.
I want to speak about regional television and the fact that regional television companies are under the cosh, none more so than Granada. The hon. Member for Ribble Valley (Mr. Evans) rightly stressed the importance of political programmes. The BBC screens a regional political show on Sunday, and we must ensure that we retain the showing of “Party People” at least once a month. Indeed, it should not be shown once a month but once a week. That is what competition is about, and it is unfair that there is no competition in regional and local news, because of the dominance of the BBC.
I have nothing against the BBC, and I want it to remain in place, but I want to ensure that there is a challenge and true competition, which must come from local newspapers, local radio and local television. Regional news and regional current affairs programmes must continue. Indeed, regional current affairs programmes are just as important as regional news. It is only right that BBC funding should be top-sliced, and that money should be put into a pot to ensure that there is true competition. The BBC has programmes online, and it has local radio, regional television and national television. There is nothing wrong with that, but I want competition to continue. It is important that ITV remains one of the main competitors.
The issue of product placement has been raised. My right hon. Friend the Secretary of State got it absolutely wrong—product placement is a way of getting new revenue in and ensuring that there is true competition in the market. That is what we have to remember—it is about competition.
Of course, we must talk about local radio, which is under the cosh, but there is some good news for my hon. Friend the Minister. On Saturday I had the pleasure of reopening the new studios for that great community radio, Chorley FM, which is broadcasting all over Chorley as we speak. Chorley FM shows that there is some good news coming out.
As for our local newspapers, both daily and weekly, none are more important than the Lancashire Evening Post, the Lancashire Evening Telegraph and the Bolton News. My constituents rely on those newspapers. There are times when we do not like what newspapers print, and there are times when we love what they print. The important point is that they are there to provide news locally, and it is local news that would not be picked up in any other way if it were not for local radio and local newspapers, such as the campaigning Chorley Guardian.
Chris McGuire and Vanessa Taylor, the veterans of the newsdesk and the Chorley Guardian have not only run important campaigns, but have played an important part in raising money. After one of my colleagues on the local authority tragically died of cancer, the Chorley Guardian ran the Mary’s Prayer campaign, which raised the much needed sum of £50,000 for cancer charities.
My constituent, Jessica Knight, was, tragically, subjected to a frenzied knife attack, was stabbed 35 times and survived. The Chorley Guardian and the Chorley Citizen ran a great campaign. The Chorley Guardian raised £20,000 on behalf of Jessica Knight to set up a trust fund for the family during those difficult times. What other local newspapers have done is good, and if they did not such things, who would do it? There is nobody to step in and take their place.
We have touched on what has happened under the Manchester Media newspapers. The Chorley Citizen was running a very good weekly free sheet in Chorley. Unlike Preston and South Ribble, which lost their Citizen newspapers, Chorley’s remains, but it is now operating out of Blackburn. The news comes from that distant headquarters. Thank goodness we have Chris Gee as a reporter, a local person well qualified to report that local news. That is what it is about—local people guaranteeing the news.
If people want to know about a birth, a death or a marriage, as many do, they pick up the Chorley Guardian. They look at the news and they want to find out who has died and who has been born. They all want to hear the good news as well. That is what the local media do. There is no alternative, so the Government must stand up and top slice some of that money from the BBC. Let us make a difference for the people we represent, give that money to the local media and ensure that there is competition in this country, not the dominance of the BBC.
We tend to think of local media, as we have done today, in terms of their broadcast role, but they are businesses in their own right, and not all of them are large groups. As my hon. Friend the Member for Reading, East (Mr. Wilson) pointed out, many of them are family owned. That applies to my own area. They are facing the normal business pressures that all businesses are facing in the recession, plus the knock-on effects and the specific problems of their industry.
I am glad that the undermining of local newspapers by the BBC over local video on demand has passed, but it is necessary to have a reasoned debate about how the future of local media will develop on a multimedia basis and the regulatory regime that will apply.
There has always been cross-fertilisation of different media. During the mid-1990s I was a business presenter for the BBC. Being a Conservative in the BBC at that time gave me a hint of what being an endangered species must be like. My experience of TV newsrooms was that they were fed by local papers, and not the other way round. We live in a world where we are blessed with different means of getting our messages across, and we should not throw out the old ones as we go along and pick up the new ones.
A number of points have been made about newspapers, principally that local newspapers are at their best when they have an affinity with the local area and when they have taken on a campaigning role. I pay tribute to the Henley Standard for the support it gave me for the recession networking event that I provided last week, and for its own Think Local campaign to help local shops in the town.
During the debate we have developed considerable consensus about the challenges facing newspapers with the drop in advertising income, loss of jobs and loss of titles. I hope we will also achieve some consensus about the solutions, such as freeing up restrictions, encouraging innovation and encouraging newspapers to take on roles within their own community.
We have not heard a lot today about what is local in terms of television, although the hon. Member for Great Grimsby (Mr. Mitchell) rightly touched on the matter. One of the great problems for my constituents is that the geographical areas covered by regional broadcasting have got bigger and bigger; someone in my constituency watching “local” news can see items about Birmingham or Southampton. Those reports will be important for the local communities involved, but they are not local news for my constituents. We will not have time today, but there is an issue of balance that we need to discuss and work through. What should the balance be between the need for regional television to have controllable and reasonable costs, and what works for the audience in respect of the regional network’s coverage?
It is time to end the endless review culture. The delay in sorting out the future for local media, including both newspapers and broadcast media, will cost jobs and erode an important part of our local heritage.
I shall be very quick, Madam Deputy Speaker, because I know that the hon. Member for Colchester (Bob Russell) would like a quick word if he catches your eye.
I thank the Minister for the speed with which she and the Secretary of State responded to the National Union of Journalists group’s request for a conference to consider these issues. The meeting with the Secretary of State was very useful. It shows the benefits brought by all-party groups and how important it is for us to broach all issues relating to this crisis. I congratulate the Minister on what she said.
It was a brilliant idea.
We look forward to going ahead with what my hon. Friend has just described as “a brilliant idea”.
I want to talk about two issues. There is a view among those who work in the industry that the recession is being used as a front for some of the cuts in local and regional media. We know that the industry is in decline, although interestingly that decline is not anything like the same locally and regionally as it is nationally. Despite that, local and regional media are being sacrificed, often because of national titles. I hope that the conference will identify, consider and act on that issue.
Before making my second point, I shall refer quickly to my local newspapers, the Stroud News and Journal, the Dursley Gazette, The Citizen and Stroud Life. I feel sorry for the staff in local media. Some of the terms and conditions under which the journalists, photographers, editors and sub-editors work, and the pay that they receive, are simply unacceptable. The pay was low before the current cuts were imposed. Many people working in the sector are on the minimum wage—and, dare I say it, below it. Recently, more people have been encouraged to come on work experience as a way of getting a job. Disgracefully, that has included the BBC. It has been said that work experience is the best way to get into the industry, and the issue then becomes about people who have money and can afford to work free for six months. That precludes so many others.
It is right and proper that we look at the impact on people who work in local media; as hon. Members have said, we depend on them to get our message across. Furthermore, the general public have to trust and rely on them. If those people are treated in that deplorable way, we will not get quality and there will be no fairness.
I am grateful to the hon. Member for Stroud (Mr. Drew) for shortening his speech. With all due respect to the hon. Member for Hackney, North and Stoke Newington (Ms Abbott), it is an affront to the House that we can now have a two-and-a-half-hour Adjournment debate, given that many of us would like to speak at greater length on this subject. That demonstrates that the Government are not that serious, bothered or concerned about what is happening in our provincial press. I have been advised that local newspaper week—“week” as in seven days, not “weak”—will be from 11 to 17 May.
I speak as a former branch secretary of the north Essex branch of the National Union of Journalists, and it may come as a surprise to colleagues that 40 years ago I was editor of a weekly newspaper. Looking back, it is clear that that was the heyday of local newspapers, when their penetration in local communities was virtually 100 per cent. What we are now witnessing is happening not only in newspapers but in regional television. Anglia Television, for example, has contracted its two news services into one, which means that across the east of England there is 120 hours a week less airtime for regional television.
In recent weeks, all our local newspapers, the Colchester Gazette, the award-winning Essex County Standard and the East Anglian Daily Times, have sacked staff—not that we read about it, because a non-aggression pact is in place. However, I can say that the Colchester Gazette has dispensed with the services of 13 experienced journalists including the editor, the news editor, the chief sub-editor and the features editor. I am not criticising local journalists or the editor, who is now running the Gazette and the Southend Echo, but the paper is now produced in Basildon and printed in Brighton for Colchester—it is our own BBC. My concern is that there is less and less coverage of our local councils, courts and so on, which is a serious problem for local democracy and accountability. Local journalists want to report on those things, but they are being prevented from doing so by commercial circumstances.
Newspaper conglomerates have built up massive profits over the years. They have not invested properly, yet they still want to cream off as much profit as they can. The Government need to act and get a grip on that.
In the very short time that I have, I shall briefly cover three subjects. The first is the need to review the rules governing media ownership, which Members have mentioned in this passionate debate. I point out that the Government have already asked the Office of Fair Trading and Ofcom to examine the merger regime for local and regional media and let us know whether any changes are needed. They issued a discussion paper on 13 March inviting responses by 31 March, which is a short window.
I turn to national and local government support for local media through advertising. We need partnership working, and I know about the Killian Pretty recommendations and that planning applications and information are worth about £40 million a year in advertising revenue. I urge hon. Members to get their local councils and local papers working together on that.
I shall end by talking about job losses and short-time working. I have enormous sympathy with what the hon. Member for Colchester (Bob Russell) said. I did an interview with the Colchester Gazette this afternoon and spoke to a young reporter who was deeply shocked at having been asked to take a week of unpaid leave. At the East Anglian Daily Times, I spoke to a much older reporter who was shocked at being made to work short time and at the fact that his job was under threat. Those are the human tragedies behind the figures that several hon. Members mentioned in huge detail. The Government do care about this issue, and we are doing something about it. I thank hon. Members for their contributions.
Question put and agreed to.
Resolved,
That this House has considered the matter of local and regional news.
On a point of order, Madam Deputy Speaker. Further to the important point that the hon. Member for Colchester (Bob Russell) made in his speech in the topical debate, it will be apparent to you and all those in the Chamber this afternoon that one and a half hours has been wholly insufficient to deal with an issue of huge concern to hon. Members representing constituencies throughout the country. I had intended to intervene, but I understood that there was such pressure that you decided—entirely rightly—to reduce hon. Members’ speeches to five minutes. It would therefore have taken time out of their contributions if I intervened. The hon. Member for Stockport (Ann Coffey) has tabled an important early-day motion on the matter—
I am sorry. The hon. Member for Stockport signed that early-day motion. Will you, Madam Deputy Speaker, consider having a word with Mr. Speaker to ascertain whether, when we have a topical debate, which is a good institution, some discretion could be given to the Chair to extend the debate when it appears, perhaps at the last minute, that more Members want to speak than was first believed? We would not then have two and a half hours on an individual Member’s Adjournment debate and the House would have an opportunity to discuss a topic further because, in my case, I have been told that the Aldershot News will be merged with the Aldershot Mail—
Further to that point of order, Madam Deputy Speaker. When we introduced topical debates, I thought that there was provision for flexibility for the Chair. If that is not correct, will you advise us about how we can ensure such flexibility in future?
Further to that point of order, Madam Deputy Speaker. I am the third complainant, though the hon. Member for Chorley (Mr. Hoyle) spoke during the topical debate, so he is in a better position. May I also ask you to use your influence with Mr. Speaker—and we can obviously approach the Leader of the House—so that we can consider the flexibility of rules on a Thursday? For example, if an Adjournment debate does not take up the whole of the rest of the time, perhaps we could resume the topical debate afterwards and thus use the time allocated. Often, as you know, there is great pressure on the topical debate when the subject is important, and the House would be grateful if, together, we found a solution that allows big issues to be discussed by everyone who wants to participate.
Further to that point of order, Madam Deputy Speaker. The subject of a topical debate is, by nature, something that is in the news, but also important. Could the flexibility that we all seek be such that the Adjournment debate, which is supposed to run for only half an hour, stick to its half hour, and the topical debate could run until 6 o’clock? Clearly, we will now finish early if the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) does not take two hours over her Adjournment debate. She probably will not because she expected only half an hour. We want to give you, Madam Deputy Speaker, the ability to use your discretion and wisdom to extend a topical debate.
The points of order that four hon. Members have made on their concerns about the topical debate are now well and truly on the record. It is a matter for the Leader of the House and the Modernisation Committee. Those views are on the record and will be taken up.
City and Hackney PCT (Tuberculosis)
Motion made, and Question proposed, That this House do now adjourn.—(Helen Goodman.)
I am grateful for the opportunity to address the House on a vital public health matter in my constituency: tuberculosis. My Adjournment debate is about City and Hackney primary care trust and that disease.
Tuberculosis stalked the pages of the Victorian novel. To someone who reads enough of them, it appears as if there was not a home without some young woman slowly expiring from that horrible disease. However, it became a 20th-century public health success story. Cases of TB in the UK fell to only 50,000 in the 1950s, and in my lifetime and that of the Minister, it was virtually eradicated. In the late 1980s, there were barely 5,000 cases a year.
Tragically, the incidence of TB has begun to rise again. In a deprived inner-city area such as Hackney, it is one of the most serious public health issues that we face. In contrast with the situation not so many years ago, when TB had been virtually eradicated, England now has one of the highest rates of TB in the western world, and in recent years Hackney has consistently had one of the highest rates in England.
What is more, the pattern of TB infection has changed. In the 1950s, the disease was found throughout the general population. However, the resurgence of TB has been confined to certain distinct groups. What all those groups have in common is their extreme social exclusion. TB was always a disease of poverty and poor housing, and the street homeless are more likely to have it. Drug addicts, prostitutes and sufferers from AIDS are more likely to have TB. Immigrant groups, whether legal or illegal, and would-be economic migrants and failed asylum seekers who come from parts of the world where TB has not been eradicated, are also more likely to have it.
Order. Is the hon. Lady prepared to accept the intervention?
indicated assent.
Although the time constraints are not quite what they otherwise would be, I nevertheless thank you, Madam Deputy Speaker, and my near neighbour, the hon. Member for Hackney, North and Stoke Newington (Ms Abbott). I agree with much that she has said so far, particularly about how the disease can almost seem like something out of the pages of bygone novels—although I recently read the autobiography of the former football commentator and journalist Brian Granville, who came from a relatively wealthy London family, but who suffered from the TB in the late 1940s. The hon. Lady said that hitherto the main concern was about immigrant groups in our part of central London, as well as in relatively poverty-stricken groups. Does she recognise that the increase in tuberculosis now poses a threat to health more generally, rather than just within the most poverty-stricken groups to which she has referred?
There is no doubt that as TB is on the rise again, it will inevitably become a threat to the health of the general population unless we take the correct measures and give the right support in order to reach out to the groups in which it currently flourishes. TB is horrific whoever suffers from it, but it could again become a threat to the health of the general population.
Hackney faces a particular crisis. The most recent figures for Hackney show that we have 60 cases per 100,000 people, compared with 15 cases per 100,000 people nationally, and we have one of the highest rates in Europe. I became more familiar with the issues to do with TB partly through my general casework, which I am sure is also true for the hon. Gentleman, but also by dealing with a case that was brought to me by my constituent Andrew McCabe. I do not wish to detain the House, nor do I wish the Minister to answer questions about a specific case. However, I would like to read into the record the life and death of Philip McCabe.
Philip McCabe was a TB patient in Hackney who died on 6 February 2007, at the very early age of 36. Following an initial two weeks’ treatment, a failed discharge saw Philip sent home completely unsupported. He spent four days alone in a state of collapse, having suffered a seizure on the day of discharge. He was returned to Homerton hospital by ambulance, but accident and emergency staff refused to admit him. They sent him home, informing no other party—neither his GP nor their Homerton hospital colleagues who were treating him as a TB out-patient—of his return.
Personal and clinical contact was non-existent. Philip was left unsupported, and soon his medication—given to him as supervised consumption, through community directly observed treatment—was handed to him for an unspecified period. Untaken medication was later found when he died. Although Homerton hospital was aware of the problem, no action was taken, and it continues to claim, quite incredibly, that there was a 97 per cent. compliance rate. The patient was not monitored for the dangerous side-effects of TB medication, which can cause liver damage, especially when taken with alcohol. There was intermittent telephone contact, followed by a seven-week period of no contact because his TB nurse was on extended leave.
Philip developed liver failure, which was not noticed by Homerton hospital. This eventually led to his readmission, but only at the insistence of his GP. The hospital initially resisted. During this whole period of out-patient care, no liver function monitoring was undertaken. There were no weekly multidisciplinary meetings, and this led to some very serious prescribing errors. When his TB nurse eventually returned to work and realised that there had been a lack of contact, he phoned Philip’s pharmacist. Together, they decided that he needed immediate intervention. He arrived at Homerton hospital on 2 February 2007, and was kept in A and E for four hours. At the end of that time, the staff excluded him because of his demands.
The security guard who escorted him from the premises took pity on Philip, however. He was suicidal, distressed and clearly very ill. He had no keys to his flat and no money; he just had a large suitcase. The security guard called Philip’s mother in Lancashire, and she rang and begged the hospital to readmit him. However, she was told that it could not do so, because he would have to re-register, so as not to extend the waiting time—for the sake of the records and the targets.
Despite the fact that Philip was excluded, there is no video of what happened in the accident and emergency unit. He did not receive medical intervention. He was transferred to a psychiatric ward in a neighbouring borough and became lost in the system. Having entered the mental hospital, he decided to discharge himself the following evening, as his physical health needs were not being met. Within two days, he was dead.
This is not an atypical story about a TB sufferer. Philip McCabe’s life was chaotic, and he presented with many of the issues that are prevalent in the populations that I described earlier. However, there is no question but that his final weeks were tragic, and his brother—my constituent—and others in his family are continuing to raise questions about his treatment.
Within weeks of his brother’s death, Andrew McCabe wrote to the director of public health with a number of issues, including the records of Philip’s directly observed therapy—the therapy that was supposedly observed by a pharmacist. He was worried about the calculation of the medication levels, about the lack of monitoring, and about the lack of personal contact between the TB team at Homerton and the out-patients department there. He was also worried about the policy of excluding people from TB treatment on an ad hoc basis, about the lack of communication between departments, and about the use of prescriptions.
As well as raising those specific questions about the treatment of his brother, Andrew McCabe raised more general questions about policy and practice in relation to TB in Hackney. He also asked, not unreasonably, if he could sit in on Hackney’s TB strategy group. He pursued these questions over many months, and finally, on 21 November last year, the Healthcare Commission wrote back to him to tell him that it was upholding his complaints. It would be useful if I could read some of the things that the commission said in its comprehensive report.
The commission pointed out the failings in the way in which the primary care trust had dealt with Andrew McCabe’s complaints. It said specifically:
“Mr McCabe has, in essence, raised several questions regarding the basis of the commissioning contracts and obligations between the PCT and Homerton University Hospital NHS Foundation Trust. He has also questioned how the PCT monitors the quality of the services provided by the Hospital. In my opinion, these are legitimate questions, which the PCT have failed to answer in a timely and sufficiently detailed way.”
The report goes on to say:
“In my opinion, the PCT were incorrect in not answering the complaint”
until another complaint had been reported.
The Healthcare Commission continued:
“By effectively putting on hold its commissioning responsibilities and obligations for the duration of”
another review,
“I consider that the PCT failed to address your concern either appropriately or with due urgency. Furthermore, any delays in the receipt of appropriate clinical advice…should not have been used by the PCT as a means of further avoiding its role and responsibility…The PCT needs to review the way in which it answers such justified commissioning questions and how it monitors the standards of its commissioned services. The PCT need to provide Mr McCabe with a clear and detailed account of its commissioning performance indicators and compliance reports.”
The Healthcare Commission, then, was not satisfied with the PCT’s policy in refusing to allow Mr. McCabe to sit in—not to be a voting member, but just to sit in—on the TB strategy working group.
The Healthcare Commission was similarly critical of the strategic health authority’s response to Mr. McCabe’s complaints. The commissioner said that he was
“satisfied that the SHA did not reasonably or appropriately respond to the concerns which you had brought to their attention.”
It seems to me that this represents quite comprehensive criticism not necessarily of the treatment of Mr. McCabe’s brother, but certainly of the treatment of Andrew McCabe’s complaint.
I got involved in this case quite soon after Philip McCabe died. I wrote on 20 February 2008 to the chief executive of the PCT about the points that Philip’s brother had made to me. I will not detain the House with all the letters that went backwards and forwards, with the holding replies, or with the months of delay between one letter from the PCT and the next. However, the inordinate delay from February 2008 to the end of 2008 finally culminated in a meeting between myself, Jacqui Harvey, the chief executive of the City and Hackney PCT, and Dr. Lesley Mountford, the director of public health.
I do not wish to be unduly critical of these ladies, who have no doubt devoted their lives to public service, but I was mildly surprised that after 10 months of correspondence with me about their treatment of Andrew McCabe and about their policies and procedures relating to tuberculosis generally, they seemed to have so little grasp of the facts and issues involved. Jacqui Harvey told me things during the course of the conversation that seemed to me improbable. She claimed that they were absolutely confident that they could track every TB sufferer in Hackney, because of comprehensive port-of-entry screening for TB.
I travel in and out of the country fairly regularly and I do not see people being screened for TB, so it seemed improbable that it was happening, even with airlines from countries where TB is much more prevalent than it is here. Of course, when I wrote to the Home Office I found out that we do not have comprehensive port-of-entry screening. I cannot understand why, 10 months after I started writing to them, the chief executive of the PCT and the director of public health should try to say something different. They claimed to be training housing officers, people in social services and so forth. I wrote to housing and social services about the training provided for identifying TB sufferers, but I have yet to receive a reply.
It seems to me that after spending 10 months sending me a series of holding replies, the chief executive, Jacqui Harvey, and the director of public health, Dr. Lesley Mountford, thought that they could have a holding conversation with me—without addressing any specific concerns. To add insult to injury, when I raised the question of Mr. McCabe attending the TB strategy group just as an observer, Jacqui Harvey accused me of trying to rush her into a decision. I cannot believe that after 10 months of letters, anyone could describe that as “rushing” someone into a decision.
At the beginning of this year, I went to Dr. Figueroa, a public health consultant who chairs the TB strategy group. He spoke very passionately about removing the stigma in relation to TB. I share his concern. However, he was less able to answer the detailed questions that I asked about the way in which directly observed therapy was managed, about record-keeping, and about the response of the PCT to the Healthcare Commission’s report. It is hard to escape the conclusion that, certainly in relation to this issue and perhaps in relation to others, the PCT is presiding over a culture which, although it may pay lip service to public engagement, does not genuinely welcome it.
One of the things that concern me about the correspondence and meetings that I have had with the PCT is the fact that it says that it cannot audit the services that the provider, Homerton hospital, is offering TB patients. Apparently, that is because of the nature of the contract between the PCT and the hospital. If PCTs are contracting such important services in a way that prevents those services from being audited, there must be something wrong with the contracting process.
I am also concerned about the possibility that the Health in Hackney scrutiny commission is not taking TB as seriously as it should. Only three days ago, members of the commission chose to vote against including TB in the Health in Hackney work programme for the following year.
I am concerned about the way in which my constituent was treated. There are unresolved concerns about the sort of health care that his brother received. However, I do not want to end my speech without paying tribute to extraordinary work done at the grass roots by the TB outreach team in Hackney. When I leave the House this evening I shall visit a night shelter in Stoke Newington, in my constituency, to see the population of homeless people and sex workers whom the outreach team—which I believe is under-resourced—attempt to treat and support. We need more outreach teams and a more comprehensive approach. However, having met the persons involved, I want to pay tribute to their dedication and commitment.
It seems to me—and the Healthcare Commission confirms this—that the PCT has not dealt properly with the complaints made by my constituent Mr. McCabe. There is more to be done in engaging the public. Why should it take a year to decide whether someone—an informed, educated person whose experience of TB comes from being his brother’s carer—should be allowed to attend some meetings as an observer? Why should the PCT complain, 10 months after the issue was raised, that it is being rushed?
More generally, let me say this. We know that some of the populations in which levels of TB are rising are difficult to reach—for instance, drug users, sex workers and the street homeless—but I also know that many of the failed asylum seekers and would-be economic migrants who have come to this country are particularly hard to reach because they do not want to engage with the authorities. Many of them do not have a GP. The notion that GPs can identify TB among many of my constituents is unrealistic, given the demographics of my constituency. Rightly or wrongly, the Government have pursued policies in relation to illegal migrants and failed asylum seekers that are designed to make their situation so difficult that they will return to their countries. Tragically, however, many are not doing so, and they are forming a population of super-socially excluded people who, as I have said, are particularly hard to reach.
I am concerned about the absolute level of TB in Hackney. It may well be that, according to some measures, Hackney is doing better work in relation to TB than other areas, but that does not mean that it is doing well enough. I am concerned about this rising public health threat, especially as the marginalised status of many of the sufferers—be they street homeless, people with substance abuse problems or failed asylum seekers—means not just that they are difficult to reach, but that it is not possible to apply as much political pressure and to tug as strongly at the heartstrings of the nation as it is on behalf of other groups who are subject to other ailments.
The battle against TB was a success story, but TB is on the rise again. It is especially on the rise in inner-city areas of London and in other conurbations. Good work is being done, but more needs to be done. In particular, PCTs need to do more in engaging and involving the public and must not set up unnecessary barriers, especially those PCTs with populations who tend to find it hard to engage with the authorities in the first place.
I am very sorry that all this time later, my constituent, Andrew McCabe, is still trying to get answers to questions, but I am glad that two years after Philip McCabe died—so sadly and so alone—I am able to raise the issues his death highlights on the Floor of the House.
I will not detain the House for long, and I appreciate that the great bulk of the comments of the hon. Member for Hackney, North and Stoke Newington (Ms Abbott) concerned a particular constituency case. As I am sure she and the Minister are aware from the title of the primary care trust under discussion, it covers a small part of my constituency in the City of London, where we have Barts hospital and a thriving and growing residential population. Most of my constituents are based in Westminster and look to St. Mary’s, Paddington as their local hospital, and others of them look east to the London hospital, but the Homerton plays an important part for those of my constituents who live in the City of London.
To be fair, some of the concerns and problems in my constituency are on a much smaller scale than those in the hon. Lady’s, but an increasingly large street-sleeping homeless population has become a growing problem in particular. Tremendous and positive strides forward had been taken on that, but it has become more of a problem over the past year or so, and I fear that it will continue to be so.
Does the hon. Gentleman agree that one current problem is the numbers of eastern Europeans among the street homeless? With the collapse in the economy and their not being able to access public funds—I am not disputing that—there is a very worrying rise in their numbers among the street homeless, and there are simply not the resources to deal with them.
I entirely agree. Another feature worth mentioning is that a considerable number of street sleepers in the City of London are employed. They are people who have come to this country to find work, and who find it so expensive to get any housing that they utilise the open spaces in the City of London. The hon. Lady is right that there has been such a rise in the five years since the 10 new nations joined the European Union, and particularly around the Victoria area, given the importance of the Catholic cathedral in Westminster to much of the population concerned.
I hope that the Minister will make a few general points, as well as respond to the specific points in the hon. Lady’s speech, and that she touches on some of the issues to do with screening of the migrant population in particular risk areas. The hon. Lady referred to the port-of-entry screening. I entirely agree that much of this problem is in every sense beneath the surface in that, as she pointed out, a significant number of illegal immigrants do not register with GPs and play no part with any officialdom. Given the concern about general health—I would be interested to know the answer to this, because I am not an expert on tuberculosis—what advice is the Minister getting from public health experts about the precise nature of this threat? Is there a real threat to the population at large?
With that in mind, what steps are being taken to ensure that there is proper port-of-entry screening for migrants coming from specific target countries where there is much risk, and that more care is taken of street sleepers? Are we ensuring that where there is any risk of TB starting in that population, proper public health steps are being taken? I appreciate that it is important that we do not get hysterical and make a big fuss, but those of us who represent inner-city areas recognise that the sheer hyper-diversity and hyper-mobility of the population makes not just TB but other diseases a real concern.
The hon. Gentleman mentioned port-of-entry screening. There seems to be an opinion among the professionals that comprehensive port-of-entry screening would not be practical and would increase the stigma. My argument is simply that people should not say that there is port-of-entry screening if there is not. If it is seen not to be effective and to have too much stigma attached, let us not do it. It is misleading to pretend that we have some port-of-entry screening when we do not.
I thank the hon. Lady for her intervention; she obviously has become more acquainted with the nuts and bolts of this issue than perhaps I have had reason to do hitherto. We do not wish to become hysterical about this, but great and increasing mobility is part of what it is to represent our large city. I suspect that even in Bristol—the Minister must have found this in her constituency—there is an increased amount of mobility and great diversity in the population. I hope that she will be able to touch on some of these strategic issues, as well as deal with the specifics raised in the contribution made by the hon. Member for Hackney, North and Stoke Newington. Stigma is not an issue of which I, for one, have become especially aware. The hon. Lady rightly pointed out that TB was so widespread at some times that no great stigma was attached to it; it applied throughout all areas of the population. The single most important thing for us to do, on behalf of all our constituents, is to give our level best to ensure that a public health problem that we thought had been consigned to history remains just that and does not become a major problem in the years and decades ahead.
I congratulate my hon. Friend the Member for Hackney, North and Stoke Newington (Ms Abbott) on securing this debate, even though it has taken her a long time and a great deal of detective work to get answers to the questions that she and her constituents wish to see answered. I know that she has great concern about the tuberculosis services in her constituency, and she has touched on much of that today. The hon. Member for Cities of London and Westminster (Mr. Field) also made some pertinent points.
I shall do my best to give the House an indication of exactly how the Government intend to proceed, but I wish to start by echoing again the point that my hon. Friend made about the services in her constituency. Notwithstanding the very detailed questions and the specific experience involved in the case of Philip McCabe, my hon. Friend recognised that a lot of good work is being done by national health service staff and other organisations across the whole of Hackney and Stoke Newington, and I echo that. She is raising important and specific points, but she has made it clear that she values and accepts the work that others are doing, and I support that.
I do not want to turn this issue into a public health scare story about immigrants, but the danger is that because the issue involves excluded groups, it does not necessarily get the attention that it deserves.
My hon. Friend has been in the House as long as I have—we entered together in 1987—and she has a remarkable ability to predict what Ministers are about to say or to guide them to what they should say next. On this occasion, I was about to deal with that important point. In addressing the serious health issues for those infected with TB and ensuring that they get the services that they deserve and need, we need to be very careful—I think that the hon. Gentleman was trying to be careful—not to add further to stigma and alarm in our communities and, therefore, inadvertently put further barriers in the way of those people coming forward for treatment.
TB is not a threat to the general population of the UK—I do not think that the hon. Gentleman meant to imply that—and that is why the Government of the day stopped the inoculations for TB. I do not know whether the hon. Gentleman is old enough to remember—I certainly am—when we had to have those inoculations at school. The risks have considerably diminished, and the strategy to tackle TB—informed by the science and the analysis by the Department of Health—is now based around an action plan with three specific themes: first, to reduce the risk of people being newly infected with TB; secondly, to provide high-quality treatment and care for all people with TB; and thirdly to maintain low levels of drug resistance, especially multi-drug resistant TB. I shall explain why that is important, although having heard the details of my hon. Friend’s constituent’s case I can see why she thinks that those three principles were not followed.
Two thirds of all TB cases occur in people who have come to live in the UK, and some 39 per cent. of all cases in 2007 were in London. My hon. Friend mentioned screening, but most TB is categorised as latent and non-infectious, and is therefore difficult to detect. In as many as a third of all cases, especially in those travelling to the UK to live and work, the TB will be latent. Only roughly one in 10 will go on to develop active TB that is infectious to others.
Regrettably, there is no reliable test to determine which latent TB carrier will develop the active disease. That should reassure the hon. Gentleman about the work that the Department and the health service are doing to reach out to the very groups that he and my hon. Friend identified. Perhaps I should at this point address the question of whether there is screening. I suppose the answer is yes and no, so I shall try to be more specific.
The long-standing policy is that immigrants from high-prevalence countries who seek to enter the UK for more than six months are screened for TB on arrival at the port of entry. A scheme to test applicants overseas rather than at the point of entry began in 2005 and testing currently occurs in seven high-incidence countries. So, to answer my hon. Friend’s point, there is some screening, but she is quite right that it is not systematic screening of everyone, and nor could it be—nor should it be, in my opinion. Such proposals need to be proportionate to the risk, which means that there is not screening across the board for very obvious reasons.
As my hon. Friend pointed out, the PCT in Hackney has the 11th highest rate of TB in the city—just over 60 cases per 100,000 people. That is not the highest rate in London, but the lowest is 6.7 per 100,000. The data for the past five years show that rates in City and Hackney PCT have been declining and continue to do so.
Rates have declined, but the decline is a marginal decline. On screening, the problem is that too few people are known to the health authorities. A press report a few years ago said:
“Less than half of people who died from tuberculosis in two east London inner city boroughs were known to the health authorities during their illness. A survey of TB in Hackney and Tower Hamlets showed that even among those being treated, only 27 per cent were notified. Doctors warned that without notification the risks of spreading the infectious disease were increased.”
I agree with my hon. Friend. The point that I wanted to make specifically arises from the chief medical officer’s action plan, which gave guidance on how to develop effective TB services. He made the same point as my hon. Friend about the need to reach out to those high-incidence areas and to communities and sections of our communities that are much more difficult to reach for a series of complex reasons, and where there is therefore the greatest risk of infection increasing. My hon. Friend and the hon. Member for Cities of London and Westminster both pointed out that people who are homeless traditionally find it much more difficult to access health care, as do people with alcohol dependency, injecting drug users and prisoners. All those issues are specifically addressed in the action plan, which provides detail about how the strategies in areas of TB incidence should ensure that the cases are found and about how those areas should have an active policy of doing that.
Indeed, that was further underlined by the good practice guide in March 2006, when the National Institute for Health and Clinical Excellence—NICE—issued clinical guidance for the management of TB and measures for its prevention and control. That guidance made specific recommendations about the types of treatment that should be used, particularly directly observed therapies, and about how to reach out to those vulnerable groups.
The plan identified 10 action points. It said that there was a need to raise awareness among professionals to minimise delays in diagnosis and to ensure that treatment is completed. It also said that there should be high-quality surveillance. I am always nervous about using that word, but by that it meant that health providers should monitor their communities so that they know where the risks lie and where the services are located.
The plan also emphasised the necessity of excellence in clinical care, and it said that patient services should be well organised and co-ordinated—a point that my hon. Friend the Member for Hackney, North and Stoke Newington made with regard to her constituent. The plan said that there should be highly effective disease control and management, that there should be an expert work force with strong commitment and leadership and that international partnerships should be formed to ensure that effective contributions are made towards controlling TB globally.
Most important of all, in 2007 the Department initiated what it called a “find and treat” programme in London, under which team members have been working alongside local TB services to look for cases of the disease among the homeless and other vulnerable groups. The aim has been to help improve the completion of treatment and actively promote the use of directly observed therapy. The find-and-treatment teams are using equipment such as mobile X-ray units to screen systematically in places such as homeless hostels and, if she has not done so already, I hope that my hon. Friend gets an opportunity to see one of the units in action. The teams also ensure that suspected TB cases are taken to local services for diagnosis and treatment. Although the treatment must be implemented in a clear manner, most of the decisions about how it is delivered are taken at the local level.
I hope that the hon. Member for Cities of London and Westminster is reassured that the find-and-treat initiative in London takes account of all the issues that he raised, and that it attempts to focus on the vulnerable groups about whom he is concerned. My hon. Friend the Member for Hackney, North and Stoke Newington also said that we needed to do more for those groups, and she has used this debate to ask whether such work is being undertaken in her PCT area.
The Minister mentioned directly observed therapy. I did not want to talk at length about that, but it was one of the concerns raised by Mr. McCabe. As a result of his complaints, and of the Healthcare Commission report, the City and Hackney PCT conducted an audit of its directly observed therapy services, but the audit remains in draft form only. There are many problems about how it has been drawn up, so will the Minister put pressure on the PCT to publish the audit in a proper form and fashion?
I was about to return to what my hon. Friend said about the specific case of Philip. I have not seen the Healthcare Commission report to which she has referred, but I know from what she has said in other debates that she appreciates that local PCTs must make their own decisions, even if she does not agree with that approach. However, I have heard what she has said about this particular case this afternoon, and I am conscious of the respective roles played by myself at the Department of Health and the PCTs, so I was going to suggest to her that I should take away all the unanswered questions that she has asked. I understand clearly that she and her constituent seek reassurance that the PCT has learned lessons from that tragic experience and that services will be better in future. Will she give me time—not too much—to consider? I will then meet her to see how much further on I have managed to get in answering her questions.
As my right hon. Friend says, I simply want answers both to my questions and those of my constituent and it has taken far too long for the PCT to give them. I am grateful to my right hon. Friend for her offer. I shall confer with my constituent and write to my right hon. Friend setting out the questions that we think have not been answered. When she has had time to reflect, I should welcome the opportunity to meet her—perhaps with my constituent—so that we can discuss how to take matters forward and ensure that the PCT, which has many excellent members of staff at many levels, dealing with TB and other issues, can learn the lessons from this episode, so that people need not die in the tragic circumstances of Philip McCabe.
I am grateful to my hon. Friend for her generosity in accepting my offer. I absolutely agree. It would be very helpful if she could write to me with the specific points that she feels have either not been satisfactorily answered or not answered at all. I am more than happy to meet her and her constituent. I thanked my hon. Friend for her generosity because she and her constituent have already waited a long time for answers. Although I am unable to give them at the Dispatch Box today, I certainly intend to try to do so in my meeting with her. When I acknowledge her questions, I should like to give her an indication of a reasonable time frame for me to find the answers and arrange a meeting.
I am grateful to my hon. Friend and to the hon. Member for Cities of London and Westminster for participating in this debate about a vital public health issue. We have more or less eradicated the disease in the United Kingdom. Those of us with experience of TB, which struck down many members of my family, particularly on my father’s side, know only too well how dreadful the disease is. We know that it is absolutely vital to have proper clinical understanding, science that informs the best treatment and services that deliver it to all sections of our community. I am grateful for the opportunity to confirm today both the Government’s continuing commitment to achieving that aim and the arrangements that I shall make with my hon. Friend the Member for Hackney, North and Stoke Newington to pursue sensible answers on the case she raised.
Question put and agreed to.
House adjourned.