With permission, Mr. Speaker, I shall make a statement on prisons and probation.

Let me begin by paying tribute to the 70,000 staff working in the services. Last Monday, the Minister responsible for prisons, my right hon. Friend the Member for Delyn (Mr. Hanson), issued a written ministerial statement about the serious disturbance that occurred at Ashwell prison, Rutland on Easter Saturday. Prison Service staff acted with exemplary skill and professionalism in dealing with the riot. I thank them sincerely, as I do officers of Leicestershire constabulary and other emergency services who so ably assisted. Prison Service and police investigations are now under way.

Investing in prison and probation services has been a key priority for this Administration. Prison places are up by nearly 25,000, to 85,000, with spending rising by a similar proportion. The probation case load has risen by 52 per cent. since 1997, but spending has increased by 70 per cent. in real terms. This is the first post-war Government to see a sustained reduction in crime—down 39 per cent. since 1997, with the chances of being a victim the lowest for a generation. There was a 23 per cent. fall in adult reoffending between 2000 and 2006.

Understandable concern has been expressed about the numbers of juveniles and women held in custody. There has, over the past year, been a reduction of 8 per cent. in the number of juveniles in jail, while the number of adult women prisoners has fallen by 3 per cent. over the same period. In response to my noble Friend Baroness Corston’s recommendations, I have committed £15.5 million over two years to help divert vulnerable women offenders from prison. We also want the Prison Service and the NHS better to deal with offenders with mental health problems. My noble friend Lord Bradley’s report on this will be published shortly.

My noble friend Lord Carter of Coles was asked in 2007 to consider how better to manage short and medium-term prison pressures. I published his report alongside an oral statement on 5 December 2007. Since the publication of Lord Carter’s report we have already provided an additional 3,500 prison places. Lord Carter recommended that net capacity should be brought up to 96,000 by 2014 and that 7,500 of these places should be created by the construction of three 2,500-place prison complexes, described as Titans. In June last year we launched a consultation on those proposals. I am most grateful to all those who responded. The Government’s response to the consultation is published today, along with the document “Capacity and Competition Policy for Prisons and Probation” and an economic impact assessment. Copies are available in the Vote Office and the House Library.

Once a prison is established in an area, almost without exception the local community becomes very supportive of it. A prison is a source of secure, well-paid employment and a focus for much highly creditable volunteering. The research evidence, which shows that prisons have no adverse effect on house prices or crime rates, is then borne out by experience, although proposals for new prisons can at first be controversial.

I did see merit in Lord Carter’s proposals for 2,500-place prisons, especially as they would have been complexes with four or five distinct and separate regimes, but most of those whom we consulted took a different view, and believed that the advantages were far outweighed by the disadvantages. Not the least of those of that view was Dame Anne Owers, Her Majesty’s chief inspector of prisons.

I have looked very carefully at everything that has been said and, in the light of the consultation, concluded that the right approach is to deliver the 7,500 places not through Titans but through five prisons holding 1,500 offenders, each divided into smaller units. We already operate successfully a number of prisons at or around that size.

You’re a great man!

We will leave that to one side for a moment.

The new prisons will be neither Victorian replicas nor large warehouses. They will be modern, purpose-built institutions for adult male prisoners only. They will be safe, secure and effective in helping prisoners deal with their offending and develop the work, education and life skills that they need to turn their lives around.

I can announce today that we are working to secure sites for the first two 1,500-place prisons at Beam Park West in the London borough of Barking and Dagenham, and at Runwell in the borough of Chelmsford in Essex. Both prisons will be privately built and run, and their construction and operation will sustain many hundreds of jobs. Prison capacity planning depends crucially on projections of future demand and judgments about the cost-effectiveness and appropriateness of replacing older places with new capacity. Those and other considerations are kept under constant review, and further decisions about sites and the removal of older provision will be announced in due course. However, in that context, I can tell the House that we will not be pursuing a prison on the Omega site in Warrington.

Work is already in hand to increase capacity by approximately 8,500 places over the next three years. It also remains my intention to withdraw the end-of-custody licence scheme as soon as safely possible. The expansion will include two new public prisons, Isis, adjacent to Belmarsh, and Coltishall, a former RAF base in Norfolk; and two new private prisons, Belmarsh West and Maghull. We are also expanding HMP Littlehey, near Huntingdon, to provide 480 places by early next year, as a quicker, more cost-effective option than buying and converting a prison ship.

At all times, but especially in today’s economic climate, we have a duty to ensure that prison and probation services work as efficiently and effectively as possible in the interests of the public. We are seeking to improve the efficiency of public sector prisons through reforms to work force structures for new uniformed staff and by reducing management costs. From today we will consult on the detail of those plans.

Nearly 90 per cent. of prison places are delivered directly by the public sector, but the private sector also plays an important part. The Government’s approach to competition was described in last November’s pre-Budget report and in last Wednesday’s Red Book.

I have already set out the situation for new-build prisons. Five existing prisons have previously been subject to competition. Of those, Manchester, Buckley Hall and Blakenhurst are run by the public sector, and Doncaster and Wolds are run by the private sector. Each will be subject to a new competition as their current contracts end. Blakenhurst now forms part of HMP Hewell, so we will put the Hewell cluster out to competition when the contract for Blakenhurst ends in August 2011. Two poorly performing public prisons will be market-tested this year—Birmingham and Wellingborough. Public, private and third-sector providers will all be invited to bid in respect of those market tests.

It is against a background of greatly increased real-terms budgets that the probation service is being asked to make some savings of low percentages this year and thereafter. Detailed analyses show that, historically, the work load and resources of probation areas have not necessarily been well matched—especially when measured against convictions, the key determinant of work load. So, we now seek to target resources better to match needs. We want to be clearer about the service that probation should deliver, to reduce administration costs and rigorously to manage contracts.

The probation trusts programme gives areas greater control over budgets and enables the private and third sectors to provide more services. If probation boards fail to become trusts, then from 2010 options will include amalgamation into existing trusts or being put to competition in the open market. Probation court services will remain with the public sector, as required by the Offender Management Act 2007. Probation areas are now also required to review their services against a national “best value” framework. If services fail to meet the standards necessary, areas must improve performance or use competition to identify alternative providers. As the first services to be reviewed in 2009, at least 25 per cent. of community payback and victim contact services will be subject to competition in this open market.

As I have already reminded the House, since 1997 we have provided nearly 25,000 places to accommodate the most serious, dangerous and persistent offenders; and we are committed to bringing the total number of places up to 96,000 by 2014—just five years away. Over the past decade, prison conditions have been transformed. As Her Majesty’s chief inspector of prisons has acknowledged, prisons today are more decent, more constructive and considerably more secure. They are places both of punishment and reform. The measures I have announced today for expanding and modernising the prison estate, and for the management of prisons and probation, will allow us to realise still further improvements to public protection and reoffending, with maximum benefit for the tax-paying public. I commend this statement to the House.

I thank the Justice Secretary for advance sight of his statement. I join him in paying tribute to the service and commitment of prison and probation staff, and police and emergency services, under such challenging conditions. May I therefore express my disappointment that once again he has trailed a major policy announcement in the weekend press, with the Government’s usual disdain for this House?

I should say at the outset that I welcome the Government’s U-turn on Titan prisons; giant warehouses are no good for reforming prisoners or for protecting the public. However, the Justice Secretary first announced Titans amid great fanfare in 2007. Why has it taken almost two years to work out what Opposition parties, the chief inspector of prisons, the voluntary sector and prison officers told him then? Is it because the Government ran out of money, or because the policy ran out of spin? The stark reality is that this U-turn is the nail in the coffin of a flawed approach to tackling crime.

Violent crime has nearly doubled under Labour, with Ministers advised to expect a further surge during this recession. The Justice Secretary has released more than 50,000 prisoners early, including 14 violent offenders every day, to grossly inadequate aftercare; and we have seen Ashwell prison virtually destroyed in a riot. Does he now at last accept that these systematic failures are the direct result of his Government failing both to provide enough prisons and to provide the right prison regime? Take prison numbers; more than half of prisons are overcrowded, and 70 per cent. of prisoners are in overcrowded cells; and on top of early release, dangerous offenders have been moved to open prisons to create space. We now face the possibility of serious unrest, with prisons bursting at the seams. Can he tell the House whether he received any warning from the Prison Service of the riot at Ashwell before it took place? Has he received any further warnings of possible unrest elsewhere?

The current crisis is a direct result of reckless neglect by Ministers. Many will suspect that the sudden conversion over Titans is really just cover to delay or dilute the Government’s pledge to provide the additional 15,000 places that we need, net, by 2014. Ministry of Justice officials advised only last year that 15 prisons would be needed to match the capacity otherwise provided by Titans, but the Justice Secretary is now proposing just five. Will these be mini-Titans, or is he reneging on his pledge to provide the extra places that we need within the timetable that his officials have said is necessary? We will look carefully at the particular sites that he now proposes. Can he explain what consultation process is under way for each site?

Then there are the costs. The Prison Service already faces a black hole of nearly £500 million. How will the Justice Secretary fund these proposals? He says that he intends to end early release. Well, he has said that before. When will it end, and does he recognise that nothing can make up for the failure to invest in the prison estate since he was first warned of the looming crisis more than a decade ago?

As I said, I welcome the abandonment of the Titan model in favour of smaller prisons, because we will never reform our prisons until we reform the poor regimes that are the direct result of overcrowding. However, these proposals are too little and too late. Can the Justice Secretary confirm that more than half of all prisoners now have serious drug addictions, but that fewer than 10 per cent. are on rehabilitation programmes? Can he confirm that vital programmes in work and skills have been shelved because of the overcrowding, and does he accept that far from a reduction in adult male reoffending from prison, as he claims, there has in fact been a rise in reoffending from 57 per cent. in 1996 to 65 per cent. in 2006, at which point the Government fiddled the figures rather than tackle the problem?

Turning to probation, the Justice Secretary has, I think, announced cuts. Will he tell the House how many probation areas will see a reduction in their budget, and can he guarantee that public safety will not be compromised? Amid the disinformation and bluster, two things are now crystal clear. The Government are papering over the cracks of a prison crisis that is entirely of their own making and, as the author of that failure, the Justice Secretary appears incapable of providing a credible solution.

Let me respond to the hon. and learned Gentleman’s points. First, on leaks, I can tell him—if he had been in my Department, this would have been visible and palpable to him—that I did not appreciate the leaks that took place. But the last party and the last individuals in the country to complain about leaks should be the Opposition and their Front Benchers. They actively encourage leaking, and they need to bear that in mind. They want a culture of leaking, in which people are not loyal to the Government of the day. [Interruption.] Well, that is what he sought, and as one sows, as the good book says, so shall one reap.

The hon. and learned Gentleman asked me why it has taken until now to alter the policy in respect of Titans—it has been altered, and I make no pretence that it has not been. Well, we had a consultation. Lord Carter of Coles was asked to produce a report, and he went away and produced it. I was attracted to his proposals; there was no dispute about that. I thought that large prisons, provided that they were divided into smaller units, would work and be cost-effective. On the face of it, the arithmetic was also very attractive. We had a consultation, and rather to my surprise there was overwhelming opposition to the proposals for very large prisons, not least because prisons had not been built on such a scale before. We had no experience of that, and experience abroad was, on the whole, not good. Yes, I did listen to people—I plead guilty to that. I have never had an ideological view in favour of 1,500 or 2,500-place prisons. I have a view in favour of prison expansion, but I happen to think that today’s proposals are the better way, and a number of prisons of the size that I have described already exist.

The hon. and learned Gentleman asked me about an advance warning about Ashwell. No, we received no warnings, and neither did anybody in the Prison Service, so far as I know. Nor have we received any warnings about any impending difficulties inside prisons, although he would not expect me to go into any detail if we had. Riots and serious disturbances take place from time to time in prisons, but since he was trying to imply that things had got worse since 1997, I shall say that actually they have got a lot better on almost every measure. There is 10 times the investment in drug treatment. I will send him explanations of this, but there are much better reoffending rates than ever before. After a temporary period when the prisons were under very serious pressure, they are no longer “bursting at the seams”. The number of escapes has gone right down, to zero last year, and touch wood and please God that may continue. That can be compared with the early 1990s, when there were four escapes a week—so many that private offices did not bother to tell their Ministers, as they were seen as routine. Prisons are safer.

On probation, we already told the probation services about some reductions in their budgets for the current year, but that budget was over their budget for last year. Since those services have underspent by getting on for £30 million, there will, in practice, be no cuts to budgets for this year.

The hon. and learned Gentleman may wriggle, but the Conservative Government established a measure, which they said was the best measure of crime rates—the British crime survey. The Conservatives admitted that, according to the British crime survey, crime had gone up by 50 per cent. between 1981 and 1997. According to the same measure—theirs—it has gone down by 39 per cent. since 1997. We are the first Government since the war to get crime down and we are proud of it.

I welcome my right hon. Friend’s statement, especially his commitment to dealing more sensitively than through the normal Prison Service with vulnerable women, and to addressing mental health issues. Far too many of our prisoners have a difficult background and end up with mental health issues.

I particularly want to ask my right hon. Friend about community payback. The public need to know that people who have offended are doing useful things in the community, and that that is one way in which we can begin to turn lives around, especially young offenders’ lives, so that they recognise not only the impact of their crime, but what they can give back. What proposals does he have to ensure that community payback genuinely works more effectively and that many more local people are properly involved?

I am grateful to my right hon. Friend for her approval of what I have said. It is important that the public are better informed and involved in community payback. That is why we have introduced the high visibility jackets, which have gone down very well throughout the country, as a senior officer in the Lancashire probation service told me in Blackburn on Saturday. Even in areas where there is a bit of resistance, the public now see the point. We want the public to make proposals for the use of community payback schemes. At a residents’ meeting—again in the blessed borough of Blackburn—on Friday, exactly that proposal came up, so the point is getting through.

I also thank the Secretary of State for early sight of his statement—and for the advance warning I gained by listening to him on the “Today” programme. I also welcome the announcement that the extravagant and much-derided Titan programme has been abandoned, but I do not welcome much of the rest of the statement. How is building five very big—dare I say Promethean?—prisons instead of three enormous Titan ones any sort of change of direction? Raising the prison population to 96,000 is inherently the wrong policy, even if the right hon. Gentleman has found a slightly cheaper way of doing it—although he failed to tell us precisely how much cheaper, and I will press him on that.

By linking the fall in crime with the rising prison population, the Secretary of State seems again to claim that prison works, but will he not admit that crime rates have been falling since the mid-1990s in almost the whole of the western world—except, it seems, Belgium—regardless of whether countries have used prison more? In relative terms, Britain is in the same place now in the international league table of crime as it was then—in the top two. In comparative terms, the Government’s prison expansion policy has made absolutely no difference to crime.

Does the Secretary of State not recognise that the current financial conditions mean that the country can no longer afford that sort of posturing? As the Prison Reform Trust pointed out, we already spend an astonishing 2.5 per cent. of our gross domestic product on criminal justice. We now need to concentrate all our resources ruthlessly on what works to prevent reoffending and to prevent crime. We know that short-term prison sentences do not work. Three quarters of all young offenders reoffend within a year.

Will the Justice Secretary now admit that his own Department produces briefings that clearly indicate what does work? For example, alcohol and drug treatment in the community both work. They work on the one hand to reduce violent crime and, on the other, to reduce acquisitive crime. We also know that restorative justice works to reduce both. He should be retargeting the overstretched probation and prison resource budgets on what works, not tinkering with the details of how probation and prison are delivered.

The country can no longer afford to waste resources on policies, the only objective of which seems to be to curry short-term favour with tabloid editors. We would not allow tabloid editors to decide what sort of treatments should be used to prevent swine flu, so why should we allow them to decide what works to reduce crime? The game of punitive leap-frog between the Labour and Conservative parties is an expensive indulgence that the country should no longer tolerate.

I note what the hon. Gentleman has said and I now look forward to every Liberal Democrat “Focus” leaflet across the country declaring the consequence of that policy, which is that dangerous and violent offenders and persistent drug dealers will no longer be sent to prison. As for crime rates, perhaps he will also ensure that not a single author of a “Focus” leaflet will ever claim credit for getting crime down in his or her area or criticise a Labour or Conservative council for some failure in the other direction.

Frankly, the hon. Gentleman’s remarks were waffle from beginning to end. What we know is this: of course it is true—there is almost a consensus on it in the House—that where possible, offenders should not be sent to prison. That is why we have put large sums of additional money into the probation service, including £40 million recently, to help the courts divert persistent offenders away from prison. The number of short-term prisoners has been going down. It is the serious offenders who are going to jail—the ones whom the hon. Gentleman seems to want to release.

As for crime rates, all I can say is that there is a relationship between central Government and local government policies and whether crime goes up or down. That is, without question, the reality. The political choices that the public make about crime and law-and- order policies make a difference to whether their streets are safe or not.

I know that the right hon. Member for Berwick-upon-Tweed (Sir Alan Beith), as the Chairman of the Select Committee on Justice, would have liked to be here, were it physically possible, in order to respond to today’s statement on behalf of the Committee. As a member of the Committee, may I welcome my right hon. Friend’s decision not to proceed with Titan prisons? I also welcome his reference to the drop in the number of young offenders held in custody and his intentions in relation to both the Corston report and prisoners with mental health issues. I must inform the House that the Committee found the report by Lord Carter deeply unconvincing.

Members will read today’s statement and documents with great interest, but my right hon. Friend will be the first person to acknowledge that the devil is in the detail. Will he undertake to continue to listen and respond to concerns from the Committee, not least on the need to invest in community sentencing and restorative justice, to make investments that work in cutting reoffending and, in particular, to get the judges to understand the value of such sentences? Will he also undertake to listen to what the Committee has to say about justice reinvestment and the work on the role of the prison officer that the Committee is engaged in?

The answer to all my right hon. Friend’s questions is yes. I am very committed to restorative justice, which has been a passion of mine for many years. In respect of the judiciary, it is worth both him and the House bearing in mind that the judiciary is committed to making use of alternatives to prison, but the criticism usually made of the judiciary is not that it is too hard on offenders, but that it is too soft. The judiciary is in a difficult position, as are all public policy makers.

Will the Secretary of State confirm that Boreham airfield was also on the list for consideration as a Titan prison? Can he assure me, for my constituents’ peace of mind, that Boreham airfield will not be proposed at a later date for consideration as a mini-Titan prison? Boreham would be totally unsuitable for that purpose and the people of Chelmsford would not accept it.

The hon. Gentleman will recognise that we have announced the two sites today, and a list was made public on Friday, in response to the hon. Member for Billericay (Mr. Baron), of the large number of sites that we have looked at. We have made relative assessments those sites. I cannot make a prediction for ever and a day, but we have announced two sites today and the one to which the hon. Gentleman referred is not one of them. I would add that it is improbable that we would build two prisons quite so close to each other on such different sites.

According to a statement on page 125 of the Red Book, published last week,

“all new-build prisons will be built and managed by the private sector”,

yet the Secretary of State seems to have been saying something rather different this afternoon. He mentioned a couple of new-build public sector prisons. If he is moving away from all-private-sector new build, I would very much welcome that, given the lack of evidence that such developments are cost-effective or that the private sector runs those prisons efficiently. Will he clarify the position, and will he also confirm that the five existing prisons that to go out to competition will be open to competition from the public sector as well as the private sector?

The answer to my hon. Friend’s last question is an emphatic yes; they will be open to competition from the public and private sectors—and, indeed, from the third sector. So, too, will the two prisons—at Birmingham and Wellingborough—that are to be market-tested. I very much hope that prison officers and the public sector will put in a bid. As for the cost-effectiveness of the private sector, on page 7 of the capacity document that we have issued my hon. Friend will see a reference to the cost-effectiveness benefits that have resulted from having part of the service in the private sector. What was in the small print in the Red Book is fully consistent with what I have said. Should there be any doubt about it, what I have said is the truth.

May I ask the Secretary of State and Lord Chancellor whether it is still the intention to build a prison for 1,600 inmates adjacent to Featherstone and Brinsford in my constituency? If that is still the intention—the application has gone in from his Department—will he give me an assurance that it will be a public prison, not a private one?

The answer is yes to the hon. Gentleman’s first question. That is still our intention. The answer to his second question is that I cannot give him that commitment because no final decisions have been made.

My right hon. Friend is well aware that my constituents want the Omega site in Warrington to develop as a high-quality business park containing quality offices, new technology manufacturing and associated hotels and retail premises. Will he assure us that his statement today that the Department is not seeking to locate a prison on the Omega site will hold for now and for the future?

Yes, I can give my hon. Friend that assurance. As far as this Government are concerned, that is an absolute guarantee. We have, and will have, no plans for a prison on that site. We cannot say that about everywhere, but one of the compelling arguments that she and my hon. Friend the Member for Warrington, North (Helen Jones) have advanced is that Warrington already has two prisons—Thorn Cross and Risley. We also took into account the attractions of that particular site.

The Justice Secretary has announced today that there will be five prisons, each holding 1,500 offenders, but he has identified only two sites: one in Essex and one in metropolitan Essex. Today’s Colchester Gazette reports that his Department is looking at three sites in my constituency. Will he explain what consultation has taken place with the local authority and the local Members of Parliament? Will he give us a decision on whether Essex is going to get one of the additional three sites?

We have no plans to build additional prisons in Essex, apart from the ones that have been announced. Last Friday, we responded to a freedom of information decision of the commissioner—the FOI request had been put in by the hon. Member for Billericay—and from recollection, the information provided listed 72 sites across the country. That reveals an inherent problem in the planning of all such big projects: to begin with, such sites must be identified fairly privately—the hon. Member for Colchester (Bob Russell) will know that, as I think he served on a local authority—but many sites are ruled out from the beginning. However, an FOI request was made. I thought there were good reasons, precisely so as not unnecessarily to worry local residents as the hon. Gentleman’s constituents have been worried, not to make those proposed sites public, because these were simply inquiries. However, wherever a decision is made to secure a site—that is the decision, and no more, that I have announced today in respect of Runwell and Beam Park West—there is a proper planning process and process of public consultation in the normal way.

I would have liked to ask the Secretary of State why he thinks locking up an additional 25,000 people—many if not most of them with drug and mental health problems—is a matter to boast about, but I will not, as I must ask him about probation cuts in Leeds and west Yorkshire. He said that this is simply a matter of moving resources to convictions. The Leeds MPs have been approached by the Leeds probation officers, who tell us that they are losing a large number of posts, yet the work load is growing.

Will the Secretary of State agree to look at the Leeds situation to see whether Leeds MPs are being misled. If they are not, will he reverse these cuts in my area?

I am very well aware of the concern of parliamentary colleagues and the probation services across the Yorkshire and Humberside region. There are particular reasons for the levels of concern, and of course I am ready to meet with my hon. Friend and his colleagues. As the Minister of State, my right hon. Friend the Member for Delyn (Mr. Hanson), who has responsibility for prisons and probation, has just commented, Steve Wagstaffe, who is the new regional director of offender management for Yorkshire and Humberside is examining the budgets of those probation services in conjunction with those services. If we need to make other decisions, we shall do so.

The Beam Reach business park in Rainham in my constituency was actively being considered as a potential site for the prison in London and I note that Beam Park, which is on the edge of my constituency, has now been put forward. Will the Secretary of State confirm the category of prison envisaged at Beam Park and the nature of the consultation and discussions that will take place with local residents, so that they are clear as to the proposals being made?

It will not be an open prison and it will not be a category A prison. For different reasons, open prisons and high-security prisons most worry local residents. It will be a normal category B or category C prison. The precise decision will have to be made closer to the time of opening, but of course there will be a lot of consultation about that. In some areas—although not, as it happens, in my area of east Lancashire, where we want a prison but cannot find a site for one, despite active local authority support across the political spectrum—there is public concern about the siting of prisons. I understand that, and I saw for myself in Peterborough, for example, huge opposition to Peterborough’s new prison when I was Home Secretary, but it now has a prison, which is working well and is publicly supported. I am glad to see the right hon. and learned Member for Sleaford and North Hykeham (Mr. Hogg) expressing his support for that.

There will be anxiety, but these are very good, well- paid, secure jobs—typically for those who have lost their jobs as semi-skilled or skilled manual workers, especially men, in manufacturing industries. This is really good news for the area, economically as well as socially.

Is not asking the public what offenders should do as part of the community payback scheme the worst kind of populist nonsense imaginable? May I also ask my friend about the small print of the prison budget in the Red Book, where he calls for £82 million of savings to be made by allowing prison staff arrangements to be reprofiled? What, exactly, does that mean in plain English?

Go on—condemn populism.

One man’s populism is another man’s or woman’s democracy. I say to my hon. Friend, who shares a valley with me, and much else besides, that all of us have an interest in maintaining and responding to public approaches and public attitudes. Personally, I do not think that it is remotely populist in the pejorative sense of the word to ask the public where they think various works of environmental improvement should be carried out. The public, not me or the local probation service, came forward with that idea at one of my residents’ meetings on Friday. Why should we as Members of Parliament, Justice Secretaries or the probation service think that we know best and the public know least.

May I say to the Justice Secretary that he is quite right to jettison Titans? I noted in the statement that the new prisons are to be run privately. May I also say to him that it is very important that the contracts make express provision for proper and purposeful activity, particularly education and work, and that furthermore the Department must do its best to prevent people from being churned through those prisons? What is important is stability within the population, so that purposeful work can be delivered.

I entirely agree with the right hon. and learned Gentleman in all the points he makes. One of the values, if one gets them right, of larger prisons—for example, the cluster at Her Majesty’s prison Hewell, formerly Blakenhurst, between Bromsgrove and Redditch—is that it is possible for prisoners to serve the whole of their sentence in one place: in a cat. B local prison, to a cat. C trainer, and then to a cat. D open prison. With one offender manager, there is a better chance of ensuring that prisoners stay straight when they leave.

rose—

Order.

With permission, Mr. Speaker, I should like to make a statement on the reports of human cases of swine influenza, known as the A(H1Nl) infection, in some parts of the world, notably Mexico and the United States of America.

The outbreak began in Mexico on 18 March, and as at 9 pm last night, there have been over 800 cases and 89 deaths in that country. However, to date, only 18 cases in Mexico have been confirmed as being caused by the H1Nl virus, and it is highly possible that other, more routine causes of infection are also currently circulating in that country.

On Tuesday last week, under the terms of the international health regulations, the United States reported seven cases of the H1N1 infection. On Friday 24 April, the United States Centres for Disease Control and Prevention confirmed that samples from Mexico contained the same virus as those in the United States. Twenty cases have now been confirmed in five different states of the USA, four have been confirmed in Canada and one in Spain. Suspected cases have also been reported in New Zealand, France and Israel, although it is important to note that these are suspected cases and have not yet been confirmed as the H1N1 infection.

In the UK, 25 cases under investigation have been reported. Eight of these have proved to be negative, and three are currently undergoing further specialist tests. These three patients are in isolation wards in hospital, after recently travelling in Mexico. People who have been in close contact with them are being contacted. The remaining 14 suspected cases are undergoing initial investigation and the people involved are sufficiently well to be managed in the community.

It is too early to say whether the cases in Mexico and the US will lead to a pandemic. Scientists do not yet understand the extent to which cases in Mexico and the US are linked and are not yet able to make a complete assessment of the health implications of this new virus.

A pandemic is declared when the World Health Organisation raises the pandemic alert to phase 6. That means that there is widespread person-to-person transmission of a virus in the general population. At the moment we are at phase 3.

The director general of the WHO, Dr. Margaret Chan, has declared that this is a public health emergency of international concern. The WHO is convening a committee of experts from around the world that is meeting this afternoon to review the situation and to determine what further action is required at a global level.

In deciding the state of the pandemic alert, the WHO bases its decision on expert scientific advice based on the available epidemiological and scientific evidence. The range of symptoms in the people affected is similar to those of regular human seasonal influenza. It is important to note that, apart from in Mexico, all those infected with the virus have experienced mild symptoms and made a full recovery. The swine flu that has been isolated in Mexico and the United States is sensitive to the antiviral drugs Tamiflu and Relenza. Those drugs are effective in treating the illness, provided they are taken quickly enough. They can also reduce the length of symptoms and usually their severity.

I would like to outline the measures that we are taking in response to this significant health threat. The UK has been preparing for a flu pandemic for the past five years. We have established a stockpile of enough antivirals to treat more than 33 million people—half the UK population. All NHS organisations have pandemic flu plans in place and the Department of Health is now working closely with the NHS to ensure that those plans can be put into action so that antivirals can be made available to the public very rapidly should we reach that stage.

Over the weekend, the Government have been putting in place precautionary measures to implement the plans that we have been developing in case of more widespread infections in the UK. I have spoken to ministerial colleagues and my Opposition shadows this morning, and I will be convening a meeting of the Civil Contingencies Committee immediately following this statement.

We have enhanced our port health checks so that passengers arriving in the UK with symptoms of illness are identified and assessed. Information is being made available to passengers arriving at ports and we have provided urgent advice to doctors. Should the virus start spreading widely in the UK, we propose to use our antiviral stockpile for treatment of symptomatic patients. We already have advance agreements in place with manufacturers, should a vaccine be developed, although it is important to note that it will be some time before scientists can develop a vaccine, as the virus is not yet sufficiently understood. Experts are currently examining whether vaccination with the regular, seasonal flu vaccine can in any way boost immunity to the H1N1 strain, and we are considering how best we can use the limited stocks that are currently available within the UK.

Many people will wish to know whether they should wear face masks. Although we are aware that face masks are being given out to the public in Mexico, the available scientific evidence does not support the general wearing of face masks by those who are not ill while going about their normal activities. We are, however, urgently looking into how we can increase our stockpiles of face masks for health care workers who are treating sick patients. We have also established infection control guidance to support staff when treating or caring for people who have symptoms.

We already have well-advanced plans for providing information to the public in the event of a pandemic, in particular about what people can do to help themselves in the event of swine influenza being confirmed in the UK. Updated information is available on the NHS Choices and the Health Protection Agency websites. Further information is also available for health and social care staff on the Department of Health website. We are putting in place an information line containing recorded, up-to-date information for those who want to know more about this type of flu. In addition, NHS Direct is providing information to people who have recently travelled overseas and are worried that they may have symptoms.

There are three key messages that I would like to stress at this stage. First, it is important to emphasise that in all cases outside Mexico the symptoms of this illness are mild and all patients have made a full recovery. Secondly, we can all take simple measures to prevent infection, in particular, covering one’s nose and mouth when coughing or sneezing, and washing hands regularly. Anyone who develops flu-like symptoms should go home and contact their general practitioner. Thirdly, anyone who has recently travelled to the affected areas and is experiencing influenza-like illness should stay at home in order to limit contact with others and seek medical advice by phone from a local health professional or NHS Direct. In line with advice from the World Health Organisation, there are currently no travel restrictions on those who are planning to visit affected areas. Anyone who is planning to do so is advised to ensure that they take the measures I have outlined to prevent infection and consult a doctor immediately if they show signs of flu-like symptoms. To enable local health services to respond to the pressure that the possibility of a pandemic may put on services, we are working with primary care trusts to ensure that arrangements are in place to support that distribution arrangement for antivirals, should it become necessary.

There is understandable trepidation and concern across the world. Here in the UK, we are monitoring the situation very closely, alongside the WHO and our international partners. The UK has been preparing for such an occurrence for a number of years, and the WHO has recognised that the UK and France are the two best-prepared countries in the world. I wanted to use this opportunity to update the House on what we know so far, but I shall, of course, keep Parliament fully updated on what is obviously a rapidly developing situation.

I am sure that the House is grateful to the Secretary of State for making a statement at the first opportunity, and I was grateful for the opportunity to see it beforehand and for the conversation that we had about this matter this morning, to which he referred.

May I express—I hope on behalf of the whole House—our sympathy with, and support for, all those in Mexico who have suffered as a consequence of this outbreak? I hope that, through the WHO, we will be able to continue to give the greatest possible support to that country. However, the current situation illustrates a point that we have discussed before in relation to pandemic preparedness: that an influenza pandemic would expose dramatic differences in the ability to respond in different parts of the world between the most developed countries and the least developed countries. The national reporting systems in Mexico are clearly not as good as they should be. For a month, several hundred cases had emerged in Mexico before the point last week when the CDC in Atlanta—the Americans’ responsible authority in this area—on behalf of the WHO, became aware of the new strain and was able to trigger the necessary alerts. Clearly, the UK and developing countries are interdependent, and we should be supporting them and trying to ensure that we have not only better alerts, but the resources available to support such countries in responding more rapidly and more effectively to flu outbreaks.

As the Secretary of State said, the United Kingdom is among the better prepared countries, and we have been discussing such preparations for nearly five years for that to be the case. If the WHO, which is meeting this afternoon, moves the alert status from phase 3 to phase 5, as is possible, given the nature of what we know, that will trigger a response in this country. As the Secretary of State implied, it is important for us not to assume that what is in the UK pandemic plan and its underlying assumptions about the likely profile of an influenza pandemic is what we will experience in this case. That plan is much more geared to more severe symptoms than we have seen in the cases that have emerged in America and elsewhere; this is, in a sense, more like the Russian flu of 1977, which was an H1N1 flu virus for which the vaccine was available within three months and the clinical attack rates and mortality rates were much lower than were assumed in the pandemic plan. We do have reasons to be optimistic, including the mild nature of the flu that has been experienced in other countries. However, we do not know whether there is a much greater prevalence in Mexico, with only the most severe cases going to hospital.

It is important that we review our preparations, and I have several points to make in that respect. We have a stockpile of treatments, although in an answer on 12 January the Minister of State, Department of Health, the right hon. Member for Bristol, South (Dawn Primarolo) said that Department modelling had shown that prophylactic or preventive use of antivirals in a flu pandemic would be effective. That would require a stockpile of 75 per cent. equivalent of the population, rather than the 50 per cent. that we have at the moment. Perhaps the Government could tell us what further steps they have taken following that reply in January.

The Secretary of State will also know that for four years we have told the Government that other countries, including France and Australia, have a strategic stockpile of face masks and gloves. It is not for distribution to the whole population, but it is to ensure that everybody in frontline care would be able to wear face masks and gloves. The Government say that they are urgently looking for face masks, but when SARS—severe acute respiratory syndrome—emerged the international supply of face masks disappeared almost overnight. It is therefore unlikely that the Government will be able to procure face masks very readily.

The Secretary of State may be able to tell us something about vaccine research and our support for it. In November 2005, President Bush devoted $2.8 billion to improvement of vaccine technologies, and I hope that we can say that we are doing our bit, especially as we have some of the leading scientists in the area.

If there is a change in the WHO alert status, it will trigger a communication exercise with the public about our pandemic preparations, under the pandemic plan. On 22 January, my hon. Friend the Member for Rutland and Melton (Alan Duncan) asked for a debate in Government time on pandemic preparedness, but the Government have not given us that. I wish that they had, as it is better to discuss the issues raised by a pandemic before it happens rather than when we face the immediate prospect of it happening. None the less, will the Government now accept that request?

The flu contingency plan states that if a WHO phase 5 alert is declared, UK Health Departments will run a national door-drop and advertising campaign. Are the Government ready and willing to do that, were it to be triggered today? Why is the EU Commission offering travel advice while the WHO and the UK Government are not? Will those who are travelling to Mexico or the south-west states of the US have access to antiviral treatments for prophylactic purposes on the NHS, rather than just through private prescriptions, to reduce the risk of transmission?

I welcome what the Secretary of State had to say about updating the House regularly and I heartily endorse what he said about the general importance of hand hygiene. I look forward to further updates in due course.

I agree with the general points that the hon. Gentleman made. It is important that we deal with this across parties and across all the devolved Administrations. That is how I intend to proceed. He is also right to draw attention to causes for optimism, and it is important to get the balance right. We do not want to frighten the lives out of individuals unnecessarily, but we do want people to be properly alert to the dangers. The media yesterday were fairly well balanced, but some hyperbole crept into some reports this morning.

It is important to stress that there is no pandemic at this stage. The scientists are working hard on the issue, and we will know from the WHO meetings later whether we move to a phase 5 alert. I agree with the hon. Gentleman that that is still not phase 6, but it is important to recognise also the mild nature of the symptoms outside Mexico.

The hon. Gentleman mentioned the dramatic differences in countries’ preparedness. I am not prepared at this stage to say what happened in Mexico, but what I do know is that Mexico has been a very active member of the WHO and it is always present at the G7-plus and is always keen to talk about this issue. I want to know more about what happened before I say anything that is even mildly critical of the Mexican authorities.

The House has discussed pandemic preparedness. I know that we have not discussed it on numerous occasions, but we have probably discussed it more than many other Parliaments. There is a broad measure of agreement between us and, as the hon. Gentleman knows, the matter has been discussed between Ministers and shadow Ministers and with officials, so I think that we have given sufficient time to it.

It was Opposition time.

The hon. Gentleman says that that was Opposition time, but I am talking about parliamentary time as if we all owned that time.

The hon. Gentleman asked whether we are ready for a national door-drop. Yes, we are. He mentioned face masks. I wish we were further ahead with face masks, but we have nearly enough face masks for staff, and it is important to note that they are not just ordinary face masks. The face masks that we would give to NHS staff have much better filters and are much more sophisticated, as they need to be. We need to ensure that we address that situation quickly.

The hon. Gentleman mentioned advice that came from the Commission. My understanding is that the advice came not from the Commission but from the commissioner, and it probably was not that helpful.

The UK and the US are working closely together on vaccine research, in which GlaxoSmithKline, in particular, is an important player. The partnership between the US and the UK will lead the way in vaccine research. If this turns into a pandemic, the key issue will be to identify the strain of H1N1 and to produce a vaccine. It is likely to take between six months and a year to identify the strain and to produce and manufacture the vaccine.

The hon. Gentleman’s final point was about prophylactic drugs. The last time we debated this subject, we were prepared for an H5N1 virus—an avian type of flu. As the hon. Gentleman mentioned, this is a human type—H1N1—which gives us some cause for optimism that we can tackle it. We do not know yet, but the general flu injections that people take might help. However, the H5N1 prophylactic that we had available is not applicable in this case.

I was talking about antivirals.

The hon. Gentleman says from a sedentary position that he was talking about antibiotics—I am sorry, I misunderstood him. We have sufficient stocks of antibiotics. They are very important, because most of these cases will lead to complications, which antibiotics will deal with. If he was talking about using antivirals as a prophylactic, we have sufficient quantities. The hon. Gentleman’s point was whether we should give prophylactics to people who go to the affected countries. My view at the moment—we will discuss this further—is that we should not, because we need to ensure that we have sufficient stocks for 50 per cent. of the population if an outbreak occurs. We will obviously keep that under examination, but at this stage I do not think that that would be wise.

I, too, want to thank the Secretary of State for coming to the House at the earliest opportunity to give this statement on what must be a busy day for him as he assesses the advice that he is getting. My hon. Friend the Member for North Norfolk (Norman Lamb) wants to apologise for his absence.

Does the Secretary of State agree that the difficulty in understanding the nature of the threat is caused by some of the mysterious aspects of this outbreak? Why do the cases appear so much more severe in Mexico than elsewhere in the world? Will the outbreak always be this virulent? Did it actually start in Mexico? The Secretary of State said he was convinced it did, although one cannot be certain that there were not sub-clinical strains elsewhere before the first Mexican report? Has the antigen drift made it less pathogenic as it has spread from Mexico? That is one cause for hope, and it is why we are seeing different pathogenicity elsewhere.

How easily is the disease spread from human to human? That is not yet known, but how easily the disease is spread from human to human and whether that transmissibility is sustained as the virus changes, as such viruses do, will determine as much as anything else the extent to which the disease is likely to become a pandemic. Of course, we do not know what protection, if any, is available from the H1N1 seasonal flu vaccines.

It is important to note that only one published paper on the two isolates from California has been available on the CDC—US Centres for Disease and Control Prevention—website. It is not yet possible to compare those isolates with the Mexican isolates to see whether the genetic changes—the genetic assortment that appears to have taken place, according to that paper, between the 1918 north American strain and the 1979 Europe and Asian strain—are replicated in all such cases. There are simply too many unknowns, so I share the Secretary of State’s caution, but it is wise to assume that the worst may happen and to plan for it, which the Government appear to be doing.

I have a number of questions. First, may I pursue the issue of preparedness in other countries? We are in a world of global travel, so the weakest link in surveillance and reporting will be the one that causes delay in bringing the virus to scientists to study so that public health experts can give advice. Will the Secretary of State say more about what we can do to improve surveillance and public health in areas such as central America—not just in Mexico—as we needed to do, and still need to do, in the far east in relation to the threat of bird flu?

Is the Secretary of State certain that we have right the proportions of the antivirals, Relenza and Tamiflu? If there is a differential, and it is possible for the virus to become resistant to one but not the other, which would be unusual but possible, it might be good to have a balance of both. As I understand it, we have a preponderance of the oral form but not a huge amount of the inhaled version—for obvious reasons in terms of ease of delivery—and that might become a factor.

Has the Secretary of State given any thought to what might happen if the worse comes to worst and the buying of antivirals by asymptomatic people, privately or over the internet, causes problems for public confidence in the distribution system? I share his scepticism about the appropriateness of providing prophylactics to travellers, as that might be an inappropriate way, outside a country’s plans, of introducing antivirals that could lead to resistance.

Order. Perhaps the hon. Gentleman could draw his remarks to a conclusion, as a number of Back Benchers are hoping to contribute.

Finally, can the Secretary of State reassure us that there will be full international co-operation between scientists and countries? That scientific effort will give us the information we need, and the hope of a vaccine sooner rather than later.

I think the hon. Gentleman was musing aloud during the first part of his contribution. I do not know the answers, and the WHO does not yet know the answers to the issues he raised about the strain and how we can deal with it.

The hon. Gentleman asked what we can do on the weakest link argument. What we can do is support the WHO. Although the WHO is keen to ensure that all countries co-operate, he knows that one country in particular—Indonesia—is refusing to provide certain information about avian flu that could help us. It is very important that every country gives information to the WHO so that it can co-ordinate activity. Supporting Margaret Chan and her colleagues at the WHO is the greatest contribution we can make.

The hon. Gentleman says that there is a preponderance of Tamiflu, which is quite true. I understand that Relenza can be used by women who are pregnant or breastfeeding, for whom Tamiflu is inappropriate, so I think that we have the right balance. There is a preponderance of Tamiflu because it can be taken by most of the population, except pregnant and breastfeeding women and some other groups. We are fortunate to have Relenza for them because many countries have only Tamiflu.

It is important that hon. Members do not get into the issue of buying antivirals yet—there is not a phase 6 alert. We have talked about all the things that we need to do at this stage, and the hon. Gentleman is right that full international co-operation is absolutely essential, which is why the WHO deserves all our support.

rose—

Order. I ask Back Benchers to limit their supplementaries to one brief question, and for similar responses, because many hon. Members wish to catch my eye and we have important business on the Budget to follow.

There is absolutely no complacency on such issues, but we are all reassured that the Secretary of State has made a statement in the House immediately and that the UK has been singled out as one of the better prepared countries.

The Secretary of State will know that I have a particular interest as one who initiated some of the preparations and as the MP for Monklands hospital. The situation at Monklands is being dealt with by the Scottish Government. I have been in touch with the local MSP, Karen Whitefield, and the Minister, Nicola Sturgeon, who has acted with commendable speed. Will the Secretary of State reassure the House that there will be maximum co-operation, liaison and exchange of information between the devolved Governments and central Government, because something such as this is no great respecter of borders inside or outside the United Kingdom?

I can give my right hon. Friend that assurance. Two of the three cases under examination involve people from Scotland. I spoke to Nicola Sturgeon yesterday and again today. She has acted with admirable promptness and has been extremely co-operative. We will work together on this, because it is otherwise no good talking about international co-operation—[Interruption.] Of course, this is international co-operation. This is a UK-wide issue, so we will deal with it as such through Cobra. We will ensure that there is absolute solidarity and close working between all the devolved Administrations.

The Secretary of State said that if the virus starts spreading widely in the UK, the Government propose to use their antiviral stockpile to treat symptomatic patients. What would he say to elderly and vulnerable constituents in Kettering and elsewhere, and to the parents of young children, who might not have the symptoms, but want to ensure that they do not pick up swine flu if it spreads widely in this country?

If people do not have the symptoms, the advice at this stage is that which I gave in my statement: catch it, bin it, kill it. People should ensure that they use a handkerchief or tissue when they cough or blow their nose, ensure that that is thrown in the bin, and then ensure that they wash their hands. That advice is very simple, but it is the most profound that can be given in such circumstances.

If people do not feel unwell at all—if they feel fine—I would not want them to be concerned, whether they are elderly constituents in Kettering, Hull, Cambridgeshire or anywhere else. If they start feeling sickly but have not been anywhere near Mexico or the US, they will, in all probability, have a cough or cold—adults get between five to eight doses of that each year—and they should deal with it in the normal way. If, however, they have had contact with anyone who has been in those affected countries, they should go home and contact the Health Protection Agency or a health professional. That is the advice that we should give, rather than giving anyone the feeling that we have moved to a phase 6 alert when we have not.

I thank the Secretary of State for his statement and the information that he gave. May I take him back to a point made by the hon. Member for Oxford, West and Abingdon (Dr. Harris)? There is a marked difference between the death rate reported in Mexico and that reported outside it, apparently due to the same strain of flu. Does the Secretary of State think that more than one type of flu might be going around, which would make the dangers more complicated than have been realised, and is he in close touch with the Mexican authorities, especially those in Mexico City, about the public health warnings and advice they are giving, especially regarding people cleaning their noses and wearing face masks to try to reduce the spread of the virus?

My hon. Friend is right: the situation in Mexico is complex. I mentioned 800 cases and a large number of deaths, but at the moment only 18 of those cases are linked to H1N1, which is why there is the suspicion that there are other illnesses involved in Mexico. We are in close touch with the authorities there through the WHO, but I can assure my hon. Friend that no one is in closer touch with them than the US authorities, because of course this is a cross-border issue for the US. We want to help the Mexican authorities to deal with the matter, and we want to help them to help us understand what is going on there, because until we do we will not have the key to whether this is the kind of pandemic that we all hope it is not, but that we fear it may be. The key is finding out what happened in Mexico.

I appreciate that the Secretary of State has given thought to prioritising to whom to give vaccines should the need arise, but, following on from the question put by my hon. Friend the Member for Kettering (Mr. Hollobone), does the Secretary of State feel that there is an argument that some priority ought to be given to certain groups of people—for example, to those on the front line of health services, who may well be dealing with people who come in with the relevant symptoms, or those working in airports and port authorities?

It is important to be clear—I am not saying that the hon. Gentleman is not—that we do not have a vaccine. We do not have something that can be injected or taken to prevent anyone from getting this flu. We have an antiviral; if people develop the symptoms—if they are symptomatic—and take it, all the evidence is that they will recover very quickly. We cannot take that action until they are symptomatic. There is a view that one could use those antivirals as a preventive measure, but no one is absolutely sure of that. As for using up that precious stock of antivirals, it should be borne in mind that we were catering for 25 per cent. of the population; we have now expanded provision to cater for 50 per cent. of the population. We do not want to diminish and dilute that by using the antiviral in a way that we are not sure will have a beneficial effect. There is not a vaccine, a pill or tablet, or medication that anyone can take to prevent the illness—yet. There may well be, once the scientists have had a chance to examine the strain and produce a vaccine, but that will take some time.

rose—

Order. May I reiterate my earlier comments? The time left for this statement is very limited, so I re-emphasise the importance of brief questions and answers.

My right hon. Friend the Secretary of State will know that modelling the spread of such illnesses is incredibly difficult. As by the hon. Member for Oxford, West and Abingdon (Dr. Harris) indicated, that is partly because of the way in which we travel today and because such a virus can mutate and change, hopefully becoming less harmful. Perhaps that is where we are. It requires a hugely challenging laboratory exercise to maintain a full understanding of what is happening. Is my right hon. Friend satisfied that he and his colleagues in the Department for Environment, Food and Rural Affairs have at their disposal the resources for that, so that we can not only follow the path of the illness, but ensure that we learn lessons from what has happened?

Order. The hon. Gentleman must bring his question to a close.

I am entirely satisfied that that is the case, and entirely satisfied with regard to the NHS. The matter has been a tier 1 priority in the operating framework for the past three years. However, I am not complacent about the issue. The hon. Member for South Cambridgeshire (Mr. Lansley) raised an important point: we are talking about something that is actually happening, as opposed to preparing for something that we were worried about, so we have a chance now to modify our approach, depending on what we find. However, I think that we are in a better state of preparedness than most other countries.

Will the Secretary of State assure us that just as there are good relations between England and Scotland at ministerial level, there are good relations between officials?

Yes, I can. At the officials’ Cobra meeting yesterday, Scottish officials were involved and made an important contribution. There must be good relations, and that is the case at ministerial level and at official level.

We know already that flu is the largest vaccine-preventable disease in the UK and the viral load is much higher in children under two, so as we look to the future beyond any immediate danger, will my right hon. Friend consult the Joint Committee on Vaccination and Immunisation and consider an annual flu vaccination programme for children under two, who are more likely to pass the virus on to their families, carers and friends? Such a programme would have the added benefit of scaling up the public health response, which would enable us to respond to the threat in any future pandemic.

My hon. Friend raises a more general point about flu inoculation. We give children the flu jab if they are asthmatic and particularly vulnerable to flu. I will talk to my colleagues about how far we can move to a vaccine for those under two years of age. That is an important general point. With reference to swine flu, the antivirals work for children as well. That is very important.

The British pig industry has been having a particularly hard time of it recently, so the chief veterinary officer’s remarks this morning reassuring people about the safety of eating pork were most welcome; only the New Zealand farming industry to date has issued a statement saying, “Don’t stop eating pork.” Has the Secretary of State met his colleague, the Secretary of State for Environment, Food and Rural Affairs, to discuss reassuring the public about the safety of eating pork and, if necessary, diverting funding to promote a safety in eating British pork campaign?

I have just spoken to my right hon. Friend, and I will speak to him again at the Cobra meeting immediately following this statement, at which we will discuss that. My right hon. Friend tells me what the hon. Gentleman already knows: we do not have any pigs or pig products from Mexico in the UK.

The idea of phoning NHS Direct is very good. NHS Direct would fax the chemist, and the person affected would get a friend to pick up the pills. My concern is that people will be very scared and NHS Direct might be overwhelmed with calls. What preparations have been made for escalating the number of staff responding?

That is the next phase. We are not at that phase yet. The hon. Lady rightly points to our plans, if we are at a stage 6 alert and are dealing with a pandemic, in which case we would want everyone, especially those who are elderly and living alone, to have a friend who can go and collect their drugs for them, to avoid people travelling around. We have good plans to ensure that, at that stage, people can access such a distribution system and that it would work. It is important to emphasise that we are not at that level at present, and I hope we never get to that level.

I beg to move,

That leave be given to bring in a Bill to amend the law relating to the regulation of domestic energy providers; to require an energy company to publish on invoices information indicating whether the customer is on the cheapest tariff offered by that company, based on pattern of energy use, and the savings to be gained from any switch to this tariff; and for connected purposes.

The idea behind the Bill is relatively simple—too many consumers are paying too much for their energy consumption. Energy companies could do more to provide information to highlight where customers could find cheaper tariffs.

I am grateful for the cross-party support for the Bill, as can be seen from the names of sponsors from both sides of the Chamber. It is supported by those who signed early-day motion 749, from which the Bill is drawn. I welcome Conservative Front Benchers’ support for the Bill. When I raised the matter with the Secretary of State for Energy and Climate Change in the House, he described the idea as “ingenious”. I welcome the third-party support outside this place from groups such as Consumer Focus, Which?, the Energy Action Group, Help the Aged and Age Concern, which have all lent their support to the debate.

The Bill’s aim, I hope, is to help consumers realise that perhaps they need to do more to achieve cheaper tariffs. It is designed to help all consumers, but particularly those in fuel poverty. We know the definition of fuel poverty: 10 per cent. of a household’s income being spent on keeping their living areas warm. It is much easier, however, to quantify the issue itself, because Government figures are at least two years out of date and the independent group Consumer Focus estimates that about 5 million households are in fuel poverty. If we needed evidence of that, we might look only at the winter of 2007-08, when something like 22,000 people over the age of 65 died of a cold-related illness—far more than in many European countries with colder climates.

Constituents often write to me—I am sure I am not the only Member who receives such correspondence—and graphically describe how they have to deal with the effects of high energy and food prices. Indeed, they often have to choose between the two. One constituent said that he could afford only one hot meal a week and lived off biscuits and bread, because he could not afford the high energy prices he was charged.

We know that too few consumers switch between suppliers. Ofgem is looking at the issue and has suggested that an annual prompt, reminding consumers how they can switch from one supplier to another, would be a good idea. Often, however, the problem is that consumers do not know whether they are on the cheapest tariff with the energy company that already supplies them. That is the point of the Bill; it is designed to make all that information much clearer. By way of early-day motion 749 and the Bill, I have suggested that energy companies be obliged to provide information—assuming the customer is on a direct debit and has online access—about whether their consumers are on the company’s cheapest available tariff, given their pattern of energy use. There should also be clearer information on energy company bills about whether savings could be accrued if the consumer were to switch to the cheaper tariff.

That is the bare minimum of information, and much more could be included in the energy bill. Certainly, more tariffs, including social tariffs, could be put on bills to ensure that all consumers saw whether they were on the cheapest tariff. The proposal has various advantages: consumers would be able to see how much they might save if they switched; it would act as a reminder and allow people to see whether consumers take advantage of the latest discounts; and it might encourage some consumers to pay by direct debit or set up online access, which could help with their bills, and might even help the energy company itself.

The fact that bills are too complicated is beyond doubt. Which? estimates that, on average, there are 15 tariffs per energy company. If we take into account all the variants, including payment methods, special offers, discounts and so forth, we see that there are about 4,000 different tariffs, and the evidence clearly suggests that that is all very confusing. I have recently seen evidence to suggest that a quarter of all those who switch, and up to half of all those who switch as a result of direct selling on the doorstep, switch to a worse tariff. That is clear evidence that there is a lot of confusion out there. Until recently, a customer on a social tariff had no guarantee that they were on the cheapest tariff. Thankfully, Ofgem has taken some action to try to put that right, but it clearly illustrates that there is widespread confusion with regard to this plethora of different tariffs. That is wrong. We need simple measures, with energy companies putting on bills information about the cheapest tariff, given certain preconditions. Payment by direct debit and online access are two of the preconditions. However, that is a bare minimum—it does not prevent energy companies from adding other tariffs, including social tariffs, to try to ensure that they meet their social responsibility to help the customer to achieve the cheapest tariff possible.

The direction of travel is in our favour. Ofgem is considering the issue. It has suggested, for example, that energy companies might be required each year to display on their bills the customer’s usage against an average group of tariffs and declare whether the customer has paid a premium. That is a step in the right direction, and it is to be welcomed. However, an annual statement is not good enough. This prompt—this comparison with cheapest tariffs—should be issued when consumers get their bills through the door, because that is when they are most aware of their tariff.

We all accept that energy companies need to make a profit—there is big investment to be made in the infrastructure and so forth—but at the same time they owe a social responsibility to their customers, and that needs to be met. The industry has made some helpful moves. Energy companies have introduced social tariffs and funded the Home Heat helpline, and the Energy Retail Association and Citizens Advice have been helping customers, but they could take this one further, very simple step to help customers to achieve the cheapest tariff. That would create a lot of good will for them and do a lot to help consumers with their bills at this time of very high energy and food prices. Ofgem is heading in the right direction, and the industry is trying to make moves to help consumers, but we need a clear message from Parliament on this issue. I therefore commend the Bill to the House.

Question put and agreed to.

Ordered,

That Mr. John Baron, Mr. Lee Scott, Mr. Frank Field, Mr. Peter Kilfoyle, Nick Harvey, Mr. Peter Ainsworth, Mike Penning, Dr. Kim Howells, Mr. Peter Bone, Dr. Ian Gibson, Mr. David Laws and Dr. Richard Taylor present the Bill.

Mr. John Baron accordingly presented the Bill.

Bill read the First time; to be read a Second time on Friday 16 October and to be printed (Bill 87).

As Britain recovers from the impact of the world recession, it will be British business and the skills of the British people that will ensure that the upturn comes as quickly, as strongly and as sustainably as possible. Today’s Budget debate is about the best way of supporting British business and the British people this year, next year and in the years to come. It is about whether we invest for growth or undermine recovery with ill-conceived cuts. It is about whether we identify the parts of the economy in which we have real strengths and the potential to have global leadership, or refuse to support them effectively.

The debate is also another opportunity to set out the gulf between the main parties on how we respond to the global downturn. I believe that that gulf has become increasingly clear over the past few days. There are three defining issues for today’s debate, on which the Opposition first show that they do not understand the problem, secondly propose policies that would make things worse and thirdly do not understand what needs to be done. That is what this debate today is about.

Is that really what this day’s debate is about—the Opposition? Is it not extraordinary that the Government begin with an attack on the Opposition rather than with an exposition of their own case?

There will be a good deal more of that before I have finished, but I will of course set out precisely what the Government propose to do for business and the British people to develop their skills and bring about recovery. However, this is a Budget debate, and it is important to understand that there are choices to be made between the approach that is being taken by this Labour Government and the approach that is being put forward by the Opposition. I make no apology for setting out the key issues on which that choice has to be made.

The Opposition believe that the challenges facing Britain are more or less a uniquely British problem, created here and with answers that lie solely in Britain. They are wrong. What started with the fall-out from sub-prime mortgage lending in the US has spread quickly around the world, turning into the credit crunch, which in turn has hit businesses in all parts of the economy in every part of the world. What this country is experiencing is the first global recession since the end of the second world war, and what is happening to us is, in essence, happening to all comparable countries.

Given that the Secretary of State mentions the world “comparable”, if things are happening comparably to all of us in this environment, why are we worse off than comparable economic powers in the G20?

The interesting point is that the fall in UK gross domestic product in the last quarter of 2008 was the same as the fall in GDP in the eurozone as a whole and in the United States of America. In Japan, GDP fell by 3.2 per cent. in the year to February 2009, and Japanese exports fell by 45 per cent. So in fact, I am right to say that the experience of similar economies is broadly comparable to our own. It is because our challenges are broadly similar to those of other countries that our response needs to be broadly similar. That means maintaining investment in the economy and avoiding cuts in public spending in the middle of the recession.

I apologise to the Secretary of State for missing the opening moments of his speech—it is ironic that a ten-minute Bill does not always have to last 10 minutes.

Can the Secretary of State explain why this global downturn has occurred, whether it started here and what has caused it if not policy mistakes by this Government and a number of other Governments around the world?

I have to say that the ten-minute Bill that preceded the debate was one of the best timed that I have experienced. I think that the hon. Member for Billericay (Mr. Baron) ended some three seconds short, so that is a poor excuse for turning up late for the beginning of the debate, when I explained how what happened in the United States of America in the sub-prime market and its link to the various financial instruments around the world have affected the real economy. The key point is that many countries are affected and we have to examine the responses that are being made.

The response around the world, which I believe to be right, is that Governments should maintain investment in the economy at this time and that they should avoid cuts in public expenditure in the middle of the recession. The G20 summit was about international action to get the global economy back on track—countries around the world introducing a huge fiscal stimulus and more resources for the International Monetary Fund and for developing countries.

The Secretary of State said that he does not believe that public expenditure should be constrained in the recession, yet the Budget introduced a cut of nearly £1 billion in education and more than £2 billion in health. I wonder whether he can square those two points.

I said that public expenditure should not be cut in the recession—that is the Conservative party’s policy. The Budget sets out clearly that public expenditure will continue to grow—certainly not as rapidly as in the past 10 years, but it will continue to grow. That is a different approach from the Conservative party’s insistence that we should cut public spending now.

The main Opposition party makes its second defining mistake because it does not properly understand the nature of the problems that face this country. It perceives our problems as uniquely British and therefore turns its back on important international action. The Conservative party says that all that matters is action now, here, to reduce borrowing and cut spending. For that reason, the Conservatives proposed a series of policies which, individually and together, would make things worse.

The Secretary of State suggests that one should not cut in the teeth of recession. That is sensible, and it is therefore disappointing that the Government are doing that. Even if we assume that their figures are right, if we find that, towards the end of the year, we have not recovered and the independent forecasters who forecast negative growth next year are correct, will we look forward to a pre-Budget report in which the Government reverse the damaging cuts planned for next year?

The Government are setting out plans to maintain public spending on front-line services to grow them in future. I am not about to set out a different Budget from that which my right hon. Friend the Chancellor introduced last week. That Budget defined the key choice that voters in this country must make between a strategy of maintaining investment and growing our way out of recession and Conservative party policies, which would make things worse.

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In a moment, I will set out exactly why those policies would make things worse, but first I shall give way to the hon. Gentleman.

Will the Secretary of State confirm that, from 2011, according to the Government’s figures, Government spending will grow at 0.7 per cent. a year? Will he also confirm that, in Margaret Thatcher’s toughest year when Prime Minister, public spending grew by more than 2 per cent.? This Government will have to cut harder and faster than ever happened under Margaret Thatcher because of the huge public debt that they have incurred.

That is an extraordinary intervention for the hon. Gentleman to make, when his party demands massive, real cuts this financial year. The Budget sets out real growth in public expenditure and the efficiency savings that will be necessary to ensure that we maintain spending on front-line services. It is interesting that the hon. Gentleman asks a question that is designed to divert attention from the policies, with which I am sure he does not agree, of Conservative Front Benchers to do enormous damage to our economy through cuts.

The Opposition’s record is very clear. They opposed the fiscal stimulus set out in the pre-Budget report last November. The immediate victims of their policy would have been the families whose incomes would immediately be cut today by tax increases. However, the money from that fiscal stimulus is now feeding through to benefit British business. The Opposition have proposed spending cuts of £5 billion in this financial year. They have never said where that would come from, but they have none the less promised cuts now. The shadow Chief Secretary to the Treasury has promised to repay £6 billion of debt next year. Again, he has not said where that would come from or how that payment could be made, but we should take what the Opposition say at face value.

I was out in my constituency on Saturday and met a constituent who had lost his job on Friday and whose wife had had a baby on Wednesday. I was pleased to be able to inform my constituent that he could get a career development loan and that his family would be able to apply through the tax credits system on the basis of changes in their circumstances. That constituent was optimistic about his chances of finding work in this recession. Will my right hon. Friend join me in congratulating our right hon. Friend the Chancellor on the VAT cut and will he challenge the Opposition? We cannot leave a generation unemployed through this recession.

I agree with my hon. Friend. The approach taken by the Opposition when they opposed the fiscal stimulus is one that would have been designed to hammer the sort of family she met in her constituency last week, taking away the support that is now being offered through tax cuts, which boost family budgets, and the support for people who lose their jobs. That is wrong at the level of the individual and the family and it is wrong at the national level, too.

Taken together, the policies advocated by the Opposition would take billions of pounds out of the economy now, and away from British business now, in the middle of the recession. It is the wrong time to do that, when a struggling private sector needs public sector support and investment. The Opposition make the wrong judgment today, as they did last year in the banking crisis. If we followed their advice, the recession would last longer, the recovery would be slower and the cost would be greater in the long run. It is a mistake to believe that their cuts would help us out of the recession. We have to invest and grow our way out of recession.

It is on that point that the Opposition make their third defining misjudgment, because they cannot offer British business and the British people the support that they need to grow this country for a more prosperous future. Our Budget builds on the measures that we have already taken to get lending and credit going again following the banking crisis, to boost the economy and to provide extra support for skills training for those who lose their jobs in order to get them back into work.

The Secretary of State is talking about support for individuals. Does he accept that people over 50 have suffered disproportionately during the recession from the loss of jobs and will he look into specific measures targeting help at them? May I also congratulate him on not sitting on his hands, but taking action to get us out of this recession?

There are two ways that we help those whom the hon. Gentleman is concerned about. One is by having a fiscal stimulus and maintaining public expenditure, because that increases, with others, the number of jobs available in the economy. The second way is the measures that we took earlier this year to create more than 100,000 additional training places for people losing their jobs, so that there is support for those who need to retrain and reskill.

Is my right hon. Friend aware of any other major advanced industrial economy that is not pursuing fiscal stimulus policies and is not proposing to invest—or actually investing extra—in education, training and science?

No, I am not aware of any country that is proposing to pursue the policies being advocated by Her Majesty’s official Opposition. The reason is that in other countries the judgment is that opposition to a fiscal stimulus, opposition to necessary borrowing and an insistence on cuts would mean that those Governments would not be able to take the measures that need to be taken to support their businesses and families, and exactly the same would apply if we followed the strategy being advocated by the Opposition. If we did that, we would not be able to take the measures that we have set out in the Budget.

If we followed the Opposition’s advice, we would not be in a position to enable more than 100,000 firms to benefit from HMRC flexibility on payment. We would not be in the position in which the Government have signed £1 billion of guarantees under the working capital scheme or in which nearly £290 million of applications from 2,500 small businesses were being dealt with under the enterprise finance guarantee. Nor would we be in a position in which the Government strategy in this Budget has enabled us to extend more support for businesses’ short-term cash flow.

If we listened to the Opposition, we would not be in a position to enable businesses to spread this year’s business uprating over three years. We would not be in a position to extend enhanced loss relief, allowing losses to be offset against tax bills due on the previous year. That alone will benefit 140,000 firms. We would not be in a position to introduce a top-up trade credit insurance scheme to help businesses to maintain their finances. Because we recognise the importance of the motor industry now and in the future, we are able to complement the £2 billion loan guarantees that we have made available with a time-limited vehicle scrappage scheme to boost sales and lower emissions.

The House and the country need to know that the Opposition cannot promise any of this support for British business. Their only proposal to date has been a national loan guarantee, but they set aside no money to pay for it—as ever. It was, of course, the shadow Business Secretary who said that the taxpayer would take a hit, but the rest of his Front-Bench team have refused to provide any finance for the scheme, and it was an empty promise.

While we are supporting business, we are also supporting individuals and families who have been hit by the downturn. Once again, the Opposition have to admit that their ill-judged economic strategy means that they could not match these measures. In total, the Budget provides an extra £1.7 billion to help people to get back into work quickly and to guarantee a job or training for young people. We have already begun to provide more than 100,000 retraining places for those losing their jobs; now, we will be able to invest an additional £260 million in training and recruitment subsidies to help young adults aged 18 to 24 who are approaching 12 months of unemployment to get the skills that they need to get into work or to guarantee them a job offer. A further £655 million of funding from the Budget will enable us to deliver more opportunities for 16 to 18-year-olds in schools and colleges next year. There will be more than 250,000 apprentices starting this year—nearly four times more than in 1997—and more students will be going into higher education than ever before: 40,000 more than two years ago.

Recognising that this year’s graduates face a more challenging labour market, we have already announced 2,000 new paid internships supported by the higher education economic challenge fund, and we will build on that in the weeks to come. Following an agreement with my right hon. Friend the Secretary of State for Work and Pensions, graduates already claiming jobseeker’s allowance for six months or more will be able to do a work experience internship for up to 13 weeks alongside claiming benefit and looking for work. We will continue to invest in Train to Gain. It is a hugely successful work-based training scheme that is popular with employers, and it will soon be training about 1 million people a year. It is typical of the Conservatives that they have already promised to scrap it.

The Budget commitment to an additional £300 million of capital spending for further education colleges in this spending review period, and a further £900 million in the future, will be widely welcomed. It will bring around £400 million worth of extra work for the construction industry in the next two years, creating jobs and apprenticeships.

The shadow spokesman for Innovation, Universities and Skills has already warned the colleges not to rely on the Conservatives to match even our previous spending plans for 2010-11. It is because they have made such a fundamental misjudgment about the nature of the challenge that they cannot match the measures that I have outlined. That is why the choice is so important. The Conservative party— [Interruption.] The hon. Member for Bexleyheath and Crayford (Mr. Evennett) says from the Opposition Front Bench that I do not believe that. I believe it profoundly and absolutely: the choice between the political parties—between the Government and the Opposition—is more stark, more marked and more clear today than at any time in recent years.

While I entirely agree with my right hon. Friend that it is important that the investment in colleges takes place quickly—before the money would be cut in the unlikely, awful event of a Conservative Government taking office—may I put it to him that there is a more pressing reason for that? The investment in colleges is vital to economic recovery, as well as being vital to training—for example, the investment in the new college at the former MG Rover site at Longbridge. To make sure that those projects remain on track, will he ensure that that money gets through and does so as quickly as possible?

My hon. Friend makes an important point. He will know, as the House does—we have discussed this before—that in 1997 the capital programme for FE colleges was zero. Even before last week’s Budget announcement, we had a budget of £2.3 billion for investment in FE colleges. I know of his interest in the Longbridge scheme and the importance he attaches to it. We have asked the Learning and Skills Council to move quickly to consult the sector on the criteria to be used for prioritising the funds. I hope that it can give clarity and certainty to colleges in the near future, but the development of that capital programme is ultimately a responsibility of the LSC.

The Secretary of State says that the Conservatives do not care about FE colleges and funding, and that our record is woeful. This afternoon at 2.30, as he might be aware, I had an appointment with his colleague, the Parliamentary Under-Secretary of State for Innovation, Universities and Skills. That appointment was to discuss the failure to fund Blackpool sixth-form college’s capital programme and Myerscough college in my constituency. It was cancelled. Subsequently, I have found out that the Minister then spent time in the gym. If he has time to spend in the gym, but no time to meet me to discuss the funding of colleges, does not that say a lot about the priorities of the Secretary of State’s Department?

My hon. Friend the Minister, who has responsibility for colleges, has met an enormous number of Members of Parliament, who understandably have had concerns about the FE capital programme. I am quite sure that if he was not able to meet the hon. Gentleman today, he will be able to do so in the not-too- distant future.

There is an even more fundamental flaw in the Opposition’s thinking. As Britain recovers, we will need to grow an economy that is better balanced and more equitable. Yes, the finance sector will still have an important role to play, but we need to grow British businesses in all the sectors where we have the ability to compete and lead around the world—the digital economy, life sciences, renewable and nuclear energy, electric vehicles and low-carbon advanced manufacturing—as we move towards a low-carbon economy.

The huge potential is there, founded on the record doubling of investment in science and research over the past 10 years—this Budget maintains the science ring-fence on the research councils budget—but we cannot just hope to exploit our potential. We must make it happen and the Government have a key role to play—working with markets to ensure that British companies and British employees have the best chance of competing fairly but successfully, here and abroad, in those huge new markets.

I agree with the right hon. Gentleman that we need a balanced structure for taxation. Admittedly, the Government have scrapped VAT on a lot of bingo costs, but why have they decided to highlight bingo as an area of gambling to be more heavily taxed with the increase in bingo duty in the Budget?

I am not even going to pretend to be particularly well equipped to answer a question on the taxation of bingo. I read far, wide and deeply to prepare for this debate on British business and skills, but I clearly and unaccountably failed to go into sufficient detail. Having slightly made light of the hon. Gentleman’s question, I know from representations made to me and to many other Members of Parliament over the years that an important constituency interest is involved. I do not want to mock his question, so perhaps I may write to him on the matter, or encourage one of my Treasury colleagues to do so. I have tried to give a fair answer to his question.

I agree entirely with my right hon. Friend that we must have a more balanced economy in future, with a bigger emphasis on manufacturing and other sectors rather than just the financial sector. He talks about fairness in competition. Does he agree that it is necessary to have an appropriate exchange rate for sterling to ensure that we compete fairly, and not have the overvaluation that we have had for the past 11 years, leading to our structural trade deficit, which is now coming back into line, I think?

The right hon. and learned Member for Rushcliffe (Mr. Clarke) can probably give a better lecture on the dangers of setting targets for exchange rates than I can. We tend not to set targets for exchange rates and steer well clear of that topic.

The reason for setting out the approach that we need to build areas of the economy where we have a competitive advantage is that it highlights another investment that we can make because of how we are responding to the global downturn which is available to us and not to others. The Budget has created a new £750 million strategic investment fund to support advanced industrial projects of strategic importance. Part of that is earmarked for crucial investment in low-carbon industries, which together with other public and private investment will create a £1.4 billion programme of targeted support for the low-carbon economy.

I wonder whether the Secretary of State is disappointed that having spent nearly £1.5 billion a year on funds to encourage renewables, we are at the absolute bottom of the European league for the amount of energy that we get from renewables.