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Oral Answers to Questions

Volume 492: debated on Wednesday 6 May 2009


The Secretary of State was asked—

Home Repossessions

1. What discussions he has had with ministerial colleagues and Scottish Executive Ministers on assistance for people in Scotland facing home repossessions. (271861)

My right hon. Friend the Secretary of State and I have discussed measures to support people in the economic downturn with both ministerial colleagues and Scottish Government Ministers.

I thank my hon. Friend for that response, but what discussions has she had with Scottish Parliament Ministers about the Scottish repossessions working group and what, if any, progress it has made? What discussions has she had about whether the pre-court protocol that exists in England and Wales could be better utilised in Scotland as well?

The important point is that Scottish house owners should not have any less protection than house owners south of the border enjoy. The pre-court protocol in England and Wales has been successful in helping to stem the number of repossessions cases that pass through the court system. In addition, I am sure that my hon. Friend will welcome the new home owner mortgage support scheme introduced last month, which covers about 80 per cent. of all lending and will offer relief on mortgage interest payments for up to two years for those who suffer a substantial but temporary loss of income. I very much hope that the work of the repossessions working group in Scotland will lead to further protections so that the trauma of repossession can, as far as possible, be avoided.

The Minister mentioned the home owner mortgage protection scheme; it was announced back in December, but has only just come into being. Likewise, the consultation on the sale and rent back proposals does not even conclude until this May. Would the Minister like to take this opportunity to remind the House that congratulations are due to the Scottish Parliament on having had mortgage protection in place since 2001, on having a mortgage rights Act and on committing more money pro rata to mortgage to rent and mortgage to shared equity schemes than elsewhere in the UK?

I certainly welcome any such measures, and I can advise the hon. Gentleman that the consultation on sale and rent back concluded last week. We hope that there will be a move to bring the regulation of these schemes under the Financial Services Authority, and we are already ensuring that when mortgage lenders write to people who have got into arrears, they advise them of the potential pitfalls and problems of such schemes. It is also important that people who face repossession have the best possible advice when they get to court. In England and Wales, people are offered free advice at court. I know that some courts in Scotland have started along that route, but I very much hope that the number doing so can be increased so that a consistent level of advice and service is available to anyone facing the trauma of repossession at this time.

Budget 2009

2. What discussions he has had with Scottish Executive Ministers on the implications for Scotland of the measures contained in Budget 2009; and if he will make a statement. (271862)

Good morning, Mr. Speaker. The Budget included new measures to support Scots on modest and middle incomes through the recession, and I look forward to discussing those plans with the CBI, the Scottish Government and trade unions at our next meeting.

My right hon. Friend will be aware that there has been a lot of discussion in Scotland about the implications of the Budget for the finances of the Scottish Government. Will he make clear just how much the Scottish Government are getting as a result of the Budget? What assistance can he give the Scottish Government in terms of their own budget in the current financial circumstances that we are all facing?

My hon. Friend raises an important point. An international financial crisis is sweeping across the globe, but, despite that, the Scottish Government will continue to receive increased funding—an extra £700 million next year. That is a very important statement of intent of continued support. [Interruption.] Scottish National party Members may shout, but the fact is that the Scottish Government now have double the budget that Donald Dewar had when he was First Minister just a decade ago. The people of Scotland will judge whether their current Government are twice as good as Donald Dewar’s Government.

Does the Secretary of State agree that the one Government policy that is having no visible effect in Scotland is the temporary reduction in value added tax? Would not that money have been of greater economic and social benefit to Scotland if it had been spent on home insulation, replacing inadequate schools and building council houses?

I have great respect for the right hon. and learned Gentleman, but the fact is that the VAT cut is working in Scotland. Independent economists now assess that that is the case. The Centre for Economics and Business Research says:

“The figures are clear; the VAT cut is working.”

We have never argued that the VAT cut that helps so many Scottish families is, in and of itself, the solution. We have, of course, to continue to look for other ways to support Scots families through, and beyond, the recession, and the Labour Government are determined to do just that.

Largely as a result of this Government’s reckless tax and spend approach, the Scottish block grant has, indeed, grown to twice the size of 10 years ago. Despite some implausibly optimistic forecasts in the Budget, it is clear that the Treasury is now on course to run out of money, yet all the First Minister has done is attempt to persuade the Government that no cut at all can be made to the block grant. Has the Secretary of State informed the Treasury that, following this development, the Chancellor now looks like only the second most deluded politician in Scotland?

That is entirely pleasant. I wonder whether the hon. Gentleman has entered himself for the gold medal in that particular competition following his celebration of the 30th anniversary of Mrs. Thatcher’s ascent to power and the disruption of Scottish industry. I am glad to see him in his place following his celebration of that anniversary and Scotland’s commiseration of it over the weekend.

In the previous recessions of the 1980s and 1990s, a generation of young people were abandoned to a life of poverty and a life on benefit. It is our intention to do, wherever possible, the exact opposite to what the Tories did, so that a generation of young people are not abandoned to a life of unemployment free of any hope.

The Secretary of State can resort to all the old mantras that he wants, but they will do him no good because the public know where the buck stops for this crisis. Does he really disagree with the view of the Centre for Public Policy for Regions that the years of the Scottish Executive coffers being full to overflowing thanks to block grant increases are over? Will he confirm that, as a direct result of Labour’s financial mismanagement of the UK, up to £4 billion in real terms will have to be cut from the Scottish budget over the next four years? Is it not about time that he and his Prime Minister finally took responsibility for Labour’s catastrophic economic failures and, in particular, the damage that they have done to Scotland’s public finances?

The hon. Gentleman refers to relying on old mantras. I would never mention the old lady or the iron lady in those terms, but if he wishes to insult her in that way, he can do so. The fact is that Scots know what happened in the previous recession. They know that industry was destroyed and that instead of supporting that industry and the people who were made redundant, the Conservatives simply cast them aside. Hundreds of thousands of Scots were made unemployed; hundreds of thousands of Scots were deliberately pushed on to incapacity benefit and a life free of hope, which is why I am happy to announce today that we will be organising a jobs summit next month in Scotland to ensure that the lessons are learned from the previous recession, so that young Scots can benefit from the £1 billion announcement that the UK Government have made about preventing long-term youth unemployment in Scotland.

Further to the Secretary of State’s answer to my right hon. and learned Friend the Member for North-East Fife (Sir Menzies Campbell), can he confirm that if that VAT cut, which has had so little impact, had been reversed, it could have brought Barnett consequentials for the Scottish Government of almost twice the sum that has been complained of as a cut by the Scottish Government? Did the Government not realise that that VAT cut was doomed to fail when they enlisted the support of the SNP for it in the Lobby here?

The hon. Gentleman is just wrong; the economic experts say very clearly that the VAT cut is working. A philosophical disagreement is involved here. Of course the Scottish Government are getting more money and their budget continues to increase, but the UK Government’s view is that money should also be in the pockets and purses of Scottish consumers, so that they can spend and thus ensure that the Scottish economy is bolstered and that the recession is shallower and shorter than it would otherwise be. The VAT cut is, of course, one of a range of measures, another of which is the scrappage scheme for cars, which has been welcomed by the industry in Scotland. That is another important measure of a Labour Government who are taking decisive action to do what we can throughout this international recession.

Economic Downturn

3. What discussions he has had with the First Minister on the effect on Scotland of the economic downturn. (271863)

The Prime Minister recently hosted a dinner with the CBI, the Scottish Trades Union Congress and all the party leaders in the Scottish Parliament to discuss working together through the recession.

I suggest that our constituents watching these exchanges are hardly likely to be impressed by what they see on the television. Given that unemployment is rising—it has increased by 87 per cent. in my constituency alone in the past year—and people are worried about losing their homes, does the Secretary of State think it would be better if less time was spent bickering and engaging in political point scoring between Westminster and Holyrood, and more time was spent on working together to help Scots to deal with the effects of the recession?

I cannot come to a judgment as to what the hon. Lady’s constituents who are watching her on telly make of her performance. I have tried my very best in my time in this job to say to Scotland, and to politicians throughout Scotland, that it is time to set aside some of the traditional disagreements. I have tried to bring together all the politicians of different political parties, but a philosophical difference remains. The SNP believes that Scotland would be better off being like Iceland, whereas I simply believe, as do most Scots, that we are stronger, better off and better protected because we are part of one of the largest economies in the world.

Has my right hon. Friend seen the statement by Michael Levack, the chief executive of the Scottish Building Federation, in which he said:

“In the current economic downturn, unless we see rapid progress towards the Scottish Futures Trust actually starting to fund new infrastructure projects, we could see a significant number of construction firms left high and dry within a matter of months and faced with the real prospect of having to down tools.”

When my right hon. Friend meets the First Minister and his Cabinet, will he draw their attention to that statement by builders who face a fall off the cliff in October or November of this year?

My right hon. Friend raises a very important point about the future of the construction industry in Scotland. Of course, the failure of the Scottish Futures Trust to build schools and other public works in Scotland is remarkable, but that will be debated in detail in the Scottish Parliament. For our part, after ensuring that savers were saved from the actions of the banks, our focus was on getting the banks to begin to do more to support the construction industry. There are early signs that that is happening, but more needs to, and will, be done.

We are all reminded of the description of the Labour party by Lord Mandelson that

“we are all Thatcherites now”.

No, we are not—not on these Benches—unlike the Labour Government and their privatisation and cuts agenda. In the same vein, the Treasury has confirmed savage cuts in public spending in the years ahead. In the teeth of a recession, how can the Secretary of State marry his rhetoric against cuts with his plans to cut £1 billion of public spending in Scotland?

We no longer hear from the hon. Gentleman about Iceland or Ireland and the arc of prosperity—now the arc of insolvency. He talks about Thatcherism. Let us recall that it was in this very Chamber just three decades ago that his party ensured the defeat of a Labour Government and a general election. In the Scottish Parliament, the SNP has been supported admirably by the Conservative party in different votes. Despite the SNP and its relentless personal attacks, I am determined to rise above that and work to do what is best for Scotland. The public will punish whichever political party continues to put itself before our country.

My right hon. Friend has always recognised the importance of Ministry of Defence expenditure to the economy in Scotland, and he is well aware of the centre of engineering excellence at SELEX in Edinburgh, which leads on the radar contract for the Typhoon. Given that it has now been reported in the industry that we have negotiated a good new deal on tranche 3, split into two and with the Saudi Arabia export planes counted, will he resume his discussions with colleagues in the Cabinet, such as the Chancellor and the Secretary of State for Defence, with a view to ensuring that Britain stays fully behind this world-beating new plane?

My right hon. Friend raises an important point, and he has raised it many times before. I will of course look into the points that he raises, but the wider point that he makes is a fair one. MOD contracts are of great importance to Scotland and its economy, especially the new aircraft carrier orders. It is a fact that Royal Navy orders have ensured years of work in Scottish shipyards, which is of great importance to current workers and those on apprenticeships. It is very welcome investment indeed.

The decisions in the recent Budget, including, for example, the increase in the price of fuel without concessions for remote rural areas and the increase in whisky duty, have made the economic downturn worse in the remoter parts of my constituency. Those increases severely affect Islay especially. Will the Secretary of State come with me to Islay to meet local businesses and discuss how the Government can help to see them through the recession?

I am always happy to meet the hon. Gentleman to discuss any issue relating to his constituency. The Budget ensured record investment in Scotland, building on the pre-Budget report. I have pointed already to the VAT cut, but we also have the support for pensioners in the winter fuel payment and the car scrappage scheme. In a real policy innovation, we are also considering new ways to support grandparents who look after their grandchildren. Of course, I am happy to listen to any representations that he wishes to make.

My right hon. Friend will remember the meeting he attended in Prestwick, where a number of industrialists were very concerned about banks and the problems associated with banks. He will know that he is coming back to Ayrshire for a further meeting. He should be aware that a number of the industrialists are now concerned about the Scottish Executive’s lack of activity in providing them with relief from the problems that they face because of this economic downturn.

I look forward to returning to Ayrshire to meet leaders of large and small businesses and to discuss ways in which we can provide further help to their companies at this difficult time. One thing raised on a separate visit to Ayrshire was how we support people on the minimum wage in the retail and entertainment sectors. That is why we will take further measures to ensure that it is against the law for tips to be used as subsidies for people on the minimum wage. People have to be sure that when they offer a tip in a restaurant or a bar, that goes to the staff rather than to the employer to be used to subsidise low pay.

It is 10 years since devolution and since my hon. Friend the Member for Dumfriesshire, Clydesdale and Tweeddale (David Mundell) and I entered the Scottish Parliament as two brand new MSPs. We should not let the occasion go without registering that. It is of course amazing that the silence from the party that introduced devolution 10 years ago has been deafening. Does the Secretary of State think that because devolution has meant that the Prime Minister has had less influence on economic development in Scotland, the country will be in a better position to weather the storm than the rest of the UK? Is it not ironic that the one part of the country that is shielded from the Prime Minister’s economic policies will be the country that he is from?

I welcome the fact that the Parliament that the hon. Gentleman opposed continues to be a success. After his short term in the Scottish Parliament, I welcome him to the green Benches here in the Palace of Westminster. The fact is that Scotland, England, Northern Ireland and Wales are stronger together and would be weaker apart. Together we have this unity and Members on both sides of the House—except for four or five who sit opposite—have a sense that our country has a remarkable history. We have achieved so much together and together we can get through this recession strongly, effectively and successfully and we can continue to be the brilliant, wonderful, successful nation that we all believe that we can be.

Oil and Gas Fields

4. Whether he has had recent discussions with the First Minister on the development of small and technically challenging oil and gas fields; and if he will make a statement. (271864)

I thank my right hon. Friend for that extensive answer. The financial support promised in the Budget for the oil and gas people and the work that my right hon. Friend is doing with the Scottish Executive deserve congratulations. Will he assure me that the work that he is doing within Cabinet to secure money for Scotland will not be put in danger because of the separatist Administration north of the border?

I will continue to do all I can to support the oil and gas industry in the North sea. I believe that the North sea has a big future not only with its continuing oil and gas industry, but as a world centre for carbon capture and storage. That is why the new investment is so essential. The field allowance has ensured that companies can continue to invest by removing the supplementary charge from up to £75 million of their profits so that they qualify for the small field allowance. That is an important announcement, which will be welcome on both sides of the House.

I thank the Secretary of State for his answers so far, but does he recognise that the impact of that field allowance is limited to only very specific marginal fields? The crisis facing the North sea is much bigger now, given the credit crunch and the banking crisis. Will he work with the Chancellor to see whether more can be done to bring forward tax reliefs that will allow new entrants to explore up front during this credit crisis and so that the Government ease the industry’s cash flow?

Of course I have those conversations with the Chancellor and I have spoken to the hon. Gentleman about some of these issues in the past. As he knows, the fuel allowance has been carefully targeted to ensure that, as far as possible, it supports those projects that would not otherwise go ahead. That is the purpose of the targeted way in which it is being introduced. We continue to look for additional ways to support the industry in Scotland and throughout the United Kingdom and I look forward to discussing them with the hon. Gentleman, the Chancellor and the industry in the future.

Sheep Tagging

5. When he next expects to meet members of the Scottish Executive to discuss the co-ordination of implementation of policy on sheep tagging. (271865)

My right hon. Friend has no plans to meet the Scottish Executive to discuss the electronic identification of sheep. However, the Secretary of State for Environment, Food and Rural Affairs is in regular contact with his Scottish counterpart on this issue and, on 27 April, he met representatives of the Scottish sheep industry.

Is the Minister aware that a recent survey carried out by NFU Scotland revealed that 74 per cent. of farmers said they would reduce the size of their flocks if electronic tagging with individual registration came in? Is she aware that these EU proposals could do untold harm to Scottish agriculture? What is wrong with the existing system?

The Government recognise the concerns that the costs could well be disproportionate to the benefits. That is why we have been working closely with the devolved Administrations, including the Scottish Government, to seek a number of concessions. In fact, we met the Commission again on 4 May, when it appeared supportive of our new proposals about third party reporting; we very much hope that they will be passed. We recognise that there are additional costs, but this is a mandatory scheme and it must be implemented by the end of this year.

As a crofter, I wonder whether the Minister will do all she can to prevent this daft, unworkable and expensive scheme coming into being.

I hear what the hon. Gentleman has to say, but I again point out that the scheme is mandatory. The EU has stated that it is not prepared to review the scheme until implementation. However, we are working very closely with the Scottish Government and the other devolved Administrations to try, as far as possible, to reduce the impact on sheep farmers. We have already achieved a number of important concessions and we continue to work closely with the Commission to achieve more.

River Forth (New Crossing)

6. What the outcomes were of his recent discussions with the Chief Secretary of the Treasury and the Cabinet Secretary for Finance and Sustainable Growth in the Scottish Executive on funding for the construction of a new crossing over the River Forth. (271866)

I want to see the new crossing over the River Forth built. We had a constructive meeting on 4 March and identified a number of ways of dealing with the funding of a new bridge.

I thank the Scottish Secretary for that answer. People in Fife are getting exasperated by the failure of the Scottish Executive and the UK Government to reach an agreement on this. The £1 billion that has been offered is not new money, and not a single penny has been raised by the Scottish Government to pay for this bridge. I know that the Scottish Secretary and the First Minister are not best buddies, but can they please kiss and make up and sort out this problem before it has an effect on Scottish jobs and Scottish investment?

I know that the hon. Gentleman has been campaigning for this bridge for some time, as have my hon. Friend the Member for Glenrothes (Lindsay Roy) and others in Fife. We had that meeting, and we offered a package of support of up to £1 billion for the new Forth road crossing, including £500 million as consequentials from Crossrail. I am disappointed, and I think all of Scotland will be disappointed, that the Scottish Government at the moment refuse to accept this offer of unprecedented support for this Forth crossing, but despite the opposition, the offer still lies on the table.

Does my right hon. Friend accept that not everyone agrees that there should be a second bridge going across to Fife? Indeed, many of us believe that it should be a tunnel, because it would last a lot longer. The problem with a second bridge is that in 30 years’ time it will have the same problems as the present bridge, and maybe we should be looking at an alternative and that should be a tunnel—and we could take out some coal at the same time.

I am happy to listen to my hon. Friend’s representations that we should have a bridge, a tunnel, a flyover or any other sort of crossing across the Forth. The important thing is that we make progress. That is why the Treasury offered unprecedented deals to the Scottish Government of up to £1 billion to help to make a reality of the Forth crossing—because it is so important to Scotland’s economy. I repeat, despite the SNP’s opposition to an unprecedented offer, the offer still stands.

Does my right hon. Friend agree that a funding mechanism is vital, not just for Scotland’s infrastructure but, as we have already heard from my right hon. Friend the Member for Stirling (Mrs. McGuire), for the future of the construction industry in Scotland, which is in decline due to the failure of the Scottish Futures Trust?

My hon. Friend raises an important point. He is an acknowledged expert on the construction industry in Scotland. Of course, the Scottish Government have to get Scotland building again, and it is for them to discuss how they do that. As for the UK Government, stability in the banking sector and the way in which we save savers from the actions of the bankers, the fact that there needs to be additional support for the construction industry in Scotland is generally recognised. However, I am confident that with the stability that the UK Government have ensured in the banking sector, Scotland’s construction industry can have a bright future.

North Sea Oil

I continue to discuss the issues with members of the Scottish Government, and with those in the oil and gas industry in Scotland.

I thank my right hon. Friend for that reply. Does he agree that as well as economic investment, investment in human resources is important, not least because of the demands of health and safety?

My right hon. Friend raises a crucial point. Business confidence is important, but so is the confidence of those who work in the North sea, following the recent dreadful, high-profile tragedy that claimed so many lives. That is why there is again consideration of the reintroduction of personal locator beacons. However, in the past, those lights interfered with the long-range beacons fitted to helicopters and life rafts. Of course we are looking into the detail of that horrific crash, and are seeing what lessons can be learned. The reintroduction of those beacons is now under consideration.

Prime Minister

The Prime Minister was asked—


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

Many regions of the United Kingdom, such as Northern Ireland, found it challenging to compete when times were good. In the depths of the current recession, what additional assistance can the Prime Minister offer the devolved institutions to improve the everyday lives of millions of United Kingdom citizens?

I hope that the hon. Gentleman agrees with me that the £600 million fiscal stimulus into Northern Ireland, which allows people to have more money to spend, advances public works programmes and gives more help for the unemployed, is the best way to deal with the problems that we have at the moment. In addition, 3,500 businesses in Northern Ireland have been able to defer their taxes to enable them to have better cash flow. We will continue to do everything that we can to make sure that businesses, home owners and individuals who are facing doubts and uncertainty about their jobs come through this difficult recession. We will continue to offer people real help now.

The Prime Minister will have seen the distressing reports this morning in The Guardian about the trafficking of children, who arrive at Heathrow, are taken into care, and are then trafficked into prostitution and used as child labour. He has always taken a personal interest in the care and safety of children. May I ask him to secure a report for the House on the measures that the Government are taking with the local authority to tackle this problem and prevent this human suffering?

Child trafficking is completely unacceptable and inhumane, and anything that we can do to stop child trafficking, we will do. I will investigate, with the Home Secretary, the reports that are in the newspaper this morning. We will do everything that we can to protect these children. We are leading internationally in asking other countries to help us ban the practice of trafficking children. We will do everything that we can.

There have been a series of U-turns, defeats in Parliament—even when the Government have a majority—and Ministers, including Cabinet Ministers, openly questioning the authority of the Prime Minister. Does the Prime Minister agree that those are signs of a Government in terminal decline?

Once again, the right hon. Gentleman cannot ask questions about the economy, swine flu or the difficult decisions that we have got to take in the world. Once again, he reduces everything to personality. We are getting on with the business of governing.

If the Prime Minister got out and knocked on a few more doors, he would realise that his leadership is the issue. He likes to talk about these issues of substance, but his failure to reform welfare, his failure to deal with the deficit, and his failure to run a united Cabinet all have two things in common: they are failures, and they are his failures. So let us take the state of his Cabinet. This weekend, the Secretary of State for Communities and Local Government wrote an article calling the Government’s performance “lamentable”. Given that she is openly mocking the Prime Minister and his authority, what is she still doing in the Cabinet?

What would be unacceptable is if we were to follow the policies of the Conservative party. What would be lamentable is if we were to adopt the Conservatives’ policy of doing absolutely nothing. Once again, the right hon. Gentleman has nothing to say about the big issues of the day; once again, he has nothing to say about unemployment; once again, he has nothing to say about the help that we are giving people for housing; and once again, he has nothing to say about help with businesses. Talking about U-turns, this is the man who promised to support the Government through the economic crisis; within a few days, he had abandoned that promise with his U-turn.

I am afraid this just won’t wash. The Communities Secretary—she has appeared; I am glad she is still here—did not write an article about the NHS. She did not write an article about unemployment. She did not write an article about the recession. She wrote an article about the Prime Minister’s leadership and his failure of authority. Let me read out what she said:

“YouTube if you want to.”

How much more mocking can one get than that? She also wrote:

“All too often we announce . . . five-year plans, or launch new documents—often with colossal price tags attached—that are received by the public with incredulity at best and, at worst, with hostility. Whatever the problems of the recession, the answer is not more government documents or big speeches.”

Having just made a big speech, who on earth does the Prime Minister think she is referring to? Does he not realise that his Government simply cannot go on like this? Let me ask him again: why is she still in the Cabinet?

What we are doing is taking action on the recession. We are helping the unemployed get back into work—opposed by the Conservatives. We are helping people with their mortgages—opposed by the Conservatives. We are helping people with cash flow for their businesses—opposed by the Conservatives. We are going to give a September schools guarantee to every school leaver that they will get work, training or educational support, which is also opposed by the Conservatives. Let us talk about the real issues in government. It is about making big decisions in difficult times. The right hon. Gentleman is not up to the task.

The big issue in British politics today is the fact that the man who is meant to be leading our country shows such appalling judgment. That is the reason he is losing his authority. Let us look at the string of misjudgments that we have seen. The Prime Minister has made U-turns on Titan prisons, the internet database, MPs’ expenses and that humiliating defeat on the Gurkhas. Why does he think he got so many judgments so badly wrong?

If the right hon. Gentleman wants to talk about U-turns, the biggest U-turn is his supporting public spending, and now saying that he will not match our public spending. The biggest U-turn on education is to support money for education, and then to say that he will cut it. The biggest U-turn is to say that he was supporting us on the police and is now planning to cut police expenditure. Let us remember that he was the “hug a hoodie”, which was another of his big U-turns. Compassionate Conservatism—it has gone, gone and gone.

I am sure that sounded just great in the bunker, while the mobile phones and printers were flying round the room. The biggest U-turn of all is that of the Prime Minister, who fought the last election accusing us of £35 billion in spending cuts. On his own arithmetic, he has cut £85 billion from his own spending. If he is so confident of his arguments and his judgments, and if he thinks he is on the right side of these arguments, why does he not do what Margaret Thatcher and Tony Blair did after four years of a Parliament and call a general election?

The reason I am confident about what we are doing is that there is nobody in the world supporting the policies of the right hon. Gentleman’s party. Go to America, Germany, France or Italy—he has no supporters in Europe. He is completely isolated because he wants to cut spending during a recession, and everybody else recognises that we cannot cut our way out of recession. We have to invest our way out of recession. The Conservatives are in the dark ages on policy. They have to think again.

The Prime Minister talks about isolated. He is isolated in his own Cabinet—he is the only one who thinks he is any good. What is it about this Prime Minister and elections? He would not fight an election to win the leadership of the Labour party; he did not fight an election to become Prime Minister; and he does not have the courage to go to the country now. Is not the truth that Britain needs a strong Prime Minister with a united party capable of taking long-term decisions? Instead, we have a wasted year with an utterly busted Government. No one doubts that he might have come into politics for the right reasons, but is it not clear that he is just not up to the job? The public know it, his party knows it, and now the Cabinet knows it, so why not do the last bold thing left and call an election?

I have listened to the right hon. Gentleman’s six questions, and not one of them has been about policy. He has not raised the cause of the unemployed in Britain once; he has not mentioned mortgage holders or home owners once; he has not mentioned small businesses once; he has not mentioned the state of the economy and what we can do to improve it once; he has not mentioned the public services once; and he has not mentioned health and education once. He is completely out of his depth when it comes to the big issues in this country.

Is my right hon. Friend aware that in just a fortnight’s time, a £120 million designer outlet will open at Gloucester docks, with the creation of more than 1,000 local jobs? Will he call on the regional development agency to continue to invest in urban regeneration companies? It is creating jobs and investment in communities such as mine, and that is a real contrast with when the Opposition were in power.

I am grateful to my hon. Friend, who fights very hard for the interests of his constituents. More jobs are coming to his constituency as a result of what he is doing, and he knows that the Conservative party would abolish the regional development agency. We will support it, we will invest; they would make cuts. That is the dividing line between the parties.

Yesterday, the Prime Minister gave a speech on education and young people. It was his big chance to show that he still has some big ideas for the country: to explain why one in three 11-year-olds still cannot read or write properly; to explain why we have more young people than ever before in prison, in debt or on anti-depressants; and to explain why under his Government we have the unhappiest children in the developed world and a care system in crisis. How is a bit of tinkering with the schools complaints procedure going to fix any of that?

Let us deal with the right hon. Gentleman’s first point, about children and reading. Far more, and a far higher percentage of, children are able to read and write at 11 as a result of the decisions that we have taken as a Government. There are 30,000 children who now get personal tuition to be able to read, and another 30,000 who get personal tuition to be able to write. No Government have invested more in reading, literacy and counting for children, and we have doubled our expenditure on the education of every child over the past 10 years. Of course, there is a great deal more to do and, of course, we are worried about instances of children in care, where there has to be reform. But, we have doubled investment in education over 10 years. It could not have happened under a Liberal or Conservative Government.

There comes a point when stubbornness is not leadership; it is stupidity. [Interruption.] At least I say it to the Prime Minister’s face; Labour Members say it behind his back. For the past 12 years, this Government have vilified and criminalised young people and abandoned a whole generation, and all the Prime Minister can do is spin a vacuous speech to keep his own party off his back. Is it not now obvious that he does not really care about what is right for the country? All he really cares about is saving his own skin.

I am sorry that the right hon. Gentleman prepared his answer to the second question before he got the answer from me. The truth is that we are doing more than ever before to help children realise their potential. Sure Start did not exist until there was a Labour Government; nursery education until age three did not exist until there was a Labour Government; and all the programmes that have doubled expenditure and raised standards in primary schools did not exist until there was a Labour Government. Of course, we have more to do, but it would be better if he supported us in doing the right things, rather than attacking us when we are doing the right things.

May I say to my right hon. Friend that, despite the current state of the economy, Rother Valley still has 3,000 fewer people unemployed than it had in 1997? May I encourage him to keep up that help and assistance for areas that need it and to forget about the blustering from the Opposition Front-Bench spokesmen?

My right hon. Friend is absolutely right. We are doing everything that we can to protect jobs and help people into jobs. Some 350,000 people, who did not receive tax credits before, now receive them to make up for the short-time working that they have to undergo, and we are trying to help people who are unemployed to get back into work as quickly as possible, given that there are almost 500,000 vacancies in the economy. What will not work is doing absolutely nothing and failing to help the unemployed. I must tell my right hon. Friend that, in the Budget, the Chancellor was given an estimate that if we had refused to take action, 500,000 more people would either face unemployment or be unemployed. That is the difference between Conservative policies and Labour.

Q2. My constituents who have worked hard and saved hard now feel betrayed, because the value of their savings has slumped and interest rates have plunged close to zero. Indeed, the banks that those constituents’ taxes have helped to bail out are the very ones offering them virtually nothing for their savings. What message does the Prime Minister have for my constituents who now wonder why they bothered to save? (272703)

As the hon. Gentleman knows, the worst thing that could happen to savers would be rampant inflation wiping out the value of their savings. We have kept inflation low during the past 11 and 12 years. The second thing that we have tried to do in the Budget—particularly for elderly savers—is to increase the amount of money that can be invested in individual savings accounts. Soon that will be £10,000 a year. We are aware that low interest rates put additional pressures on savers. We have taken action in the Budget to help them, and I hope that the hon. Gentleman will support that.

In my constituency today, we have the biggest town centre redevelopment in the north-west of England. It includes a new shopping centre, a hotel, a new office block, two primary care centres and a new police station. The Opposition’s spending plans would cut 200 officers from Greater Manchester police. What would be the point of a new police station with that level of spending cuts?

My hon. Friend makes a point. When people are looking, in every area, at the numbers of police who are going to be on the beat, or the number of teachers or classroom assistants who are going to be in schools, they have to compare the spending policies of our party with the spending policies of other parties. It is absolutely clear that thousands of police would lose their jobs as a result of the policies of the Conservative party. It is also clear that spending on regeneration would be brought to a halt by the policies of the Conservative party. People face a choice. We have to invest our way out of recession, as America and other European countries are doing, and not cut our way out of recession. That is the 1930s route; we are taking the modern way out of recession.

Q3. What does the Prime Minister intend to do about the important issue of bullying in the workplace, given the reliable reports of a senior Whitehall boss throwing around mobile phones and printers and swearing at switchboard operators? (272704)

I have always recommended that the Prime Minister treats everything from the Opposition as a joke.

The Prime Minister will recall meeting me and my hon. Friends the Members for Paisley and Renfrewshire, North (Jim Sheridan) and for East Lothian (Anne Moffat) to hear our arguments against the use of service charges and tips to pay the minimum wage. What are the Government going to do to end that scandalous practice, which is harming millions of people in this country?

Last month marked 10 years of the national minimum wage, which I am proud to say was introduced by this Government. It has helped millions of workers over these years. There has been an issue about tipping; consumers—people who are buying goods—leave their tips in good faith, expecting them to go to the workers themselves. Our public consultation, which we promised, has shown that consumers, workers and businesses support a change that would mean that tips would be in addition to the national minimum wage. I believe that that is the right policy, and that is why we will implement a change in the current policy.

Q4. The Prime Minister will be aware that twice as many people have signed the online petition at No. 10 calling for his resignation than voted for him at the last general election. What is his response to them? (272705)

I have listened to Tory Back Benchers for the past 20 minutes, and not one of them has asked a serious question about policy. They should be ashamed of the way they are treating the House of Commons.

Q5. This weekend, I witnessed the great escape of Brighton and Hove Albion in securing its place in the first division. Its next goal of championship football is boosted by construction under way at Falmer Community stadium, which will eventually provide 66 apprenticeships, not to mention those involved in building it. That is a stark contrast to Brighton and Hove city council— (272706)

Let me, too, congratulate the Brighton team on its success; I think that the whole House will want to do so. I saw some of the photographs of the celebrations. I understand that Brighton has delivered nearly 4,000 Skills for Life achievements, and that is helping young people. I believe that the Learning and Skills Council has provided Brighton and Hove Albion’s football in the community scheme with funding, and we will continue to support that. Football clubs that are at the centre of their communities are good for every community, and Brighton has proved exactly that. It brings not only community support but football success.

Q6. Two years ago, the Prime Minister ruled out holding an immediate general election on the grounds that he needed time to set out his vision. Will he tell us how that epic project is proceeding before the British people and he are put out of their collective misery? (272707)

Has any Question Time exposed the hollowness of the Conservative party more than what we have seen today? We are dealing with an international financial recession, a health epidemic, which we must deal with in the most sensitive way, and problems that arise from mortgages, unemployment and businesses. I am ashamed that not one Conservative can even raise a question about these issues.

Q7. I am sure that my right hon. Friend agrees that it is absolutely vital to retain what we have left of British manufacturing. In recent days, there has been speculation about the future of the General Motors plants in Britain—in Ellesmere Port and in Luton. Will he undertake to do everything possible and necessary to ensure that those plants stay open and that we keep those jobs in Britain? (272708)

We are in regular touch with every one of the major car companies in Britain. As my hon. Friend knows, proposals arising from Fiat in relation to Chrysler and General Motors are being discussed. There is another Canadian bidder looking at trying to move into Europe. A number of issues have to be discussed in relation to these offers. We are determined to protect our Ellesmere Port and Luton operations of General Motors. We are also determined to help Jaguar Land Rover and all the other companies that exist in our country—Honda, Toyota, Nissan—and we are determined, as he knows, to help LDV, as we have done, to give the company a loan that enables it to complete due diligence on a new bid that is being made for it. Where we have had requests, we have been prepared to consider them and, in many cases, to take the action that is necessary.

On another serious policy issue, given the Prime Minister’s commitment to greater parliamentary scrutiny, will he confirm today that there will be a full parliamentary debate and vote before the next stage of the Trident programme?

There are regular parliamentary debates on these issues. There is the defence debate that takes place every year. The House of Commons came to a view on this issue, and people are perfectly free to raise it on the Floor of the House. Defence debates happen regularly and will continue to do so.

Q8. My right hon. Friend will be well aware of the difficulties facing employers and employees in the construction industry—problems that have been further compounded by the activities of illegal gangmasters. Will he therefore agree to meet me and other like-minded colleagues to talk through the issues involving illegal gangmasters in the construction industry? (272709)

I am happy to do so. This issue concerns me and anybody who looks at the performance of the construction industry. We are also, as I said last week, looking at the operation of illegal blacklists in the construction industry, which is an unacceptable practice.

Q9. Can the Prime Minister tell me whether the Communities Secretary’s complaints about his Government’s failures were dealt with in the usual way? (272710)

If the hon. and learned Gentleman were asking about how we are regenerating the area that he represents, the housing policy that the Communities Secretary is responsible for or the funding of local government, it would be a serious question. But unfortunately, even before the local council elections, the Conservatives cannot ask anything about local government. Of course, they are prohibited by their policy from asking anything before the European elections about Europe.

Q10. When the Government are looking at allocating the very welcome additional £300 million to be made available to further education colleges, will the Prime Minister look especially at those schemes that are directly linked to regeneration projects, such as the one in Blackpool, where a site has already been cleared in the town centre for our excellent college to move into and spearhead the regeneration of the town? (272711)

I know very well about the issues in Blackpool, about the importance of learning, education and training and about the big plans that exist in Blackpool to extend further education. We have put aside an extra £300 million of capital funding for further education colleges. We are now working with the Learning and Skills Council to deliver a swift resolution to these issues. Since 2001, 700 projects at 300 colleges have been funded. I have to say that in 1997 not a penny was going to investment in further education colleges. Over this spending period, as a result of the announcements in the Budget, we will be spending £2.6 billion, and I hope that my hon. Friend’s colleges will benefit.

We in this House owe a debt of gratitude to the Gurkhas, who have served this country through wars going back a number of hundred years. Did the Prime Minister notice that last week, the whole House united to reject the present Government’s position, including 100 of his colleagues? It looks like the Government are beginning to say that they do not feel bound by that vote. Will the Prime Minister tell the House whether his Government will be bound by the terms of that vote last week?

We are the first Government who have given justice to the Gurkhas; we are the first Government who have allowed Gurkhas right of settlement in the United Kingdom; we are the first Government who have given Gurkhas equal pensions and equal pay; and we are the first Government to double the pension of Gurkhas who stay in Nepal. We will listen to the voice of the House, as it was expressed last Wednesday. We are speeding up the 1,500 applications and hope to have them completed by the end of May. We are looking at the five judicial reviews as a matter of urgency and will complete that work very soon, and we will come back to the House with a statement. I have always said that we want to do this stage by stage, and we will come back to the House with a statement.

Q11. Does the Prime Minister agree that, based on what I heard again last night at a packed meeting about the serious experiences of failings that people have had at Stafford hospital, which they allege are continuing, there is an urgent need for a change of culture, stronger public and patient involvement and a way of resolving and closing the issues for grieving relatives, including an inquiry that answers all their questions? (272712)

It pains us all to have to look at the appalling failures that happened at Stafford hospital, but I hope that my hon. Friend agrees that since they were exposed, swift and decisive action has been taken locally. That includes the opportunity for anyone concerned about care that they or a loved one received at Stafford hospital to seek an independent clinical review.

A report was done last week that showed that there have been significant improvements at Stafford. Recommendations in such reports will support the staff at Stafford hospital. Extra nurses have been employed and an experienced assistant director of nursing has been brought in. We are boosting the front-line staff, and we are further improving patient care as part of a package of measures. The Healthcare Commission has already conducted a full investigation and produced a detailed report laying bare the failures, but I can say that anyone concerned about care of any loved one will have an independent clinical review.

Q12. One million people across the north-west of England worked to raise the £6 million that the Christie hospital stands to lose in the Icelandic bank Kaupthing. Why is the Prime Minister now the one person standing in the way of compensation? (272713)

I met the nurses at the Christie hospital when I was in the north. I have also heard and answered questions in this House about it and written many letters to people, because I am worried about the situation, too. The fact is that we are not the regulatory authority and that many, many more people had finances in institutions regulated by the Icelandic authorities. The first responsibility is for the Icelandic authorities to pay up, which is why we are in negotiations with the International Monetary Fund and other organisations about the rate at which Iceland can repay the losses that they are responsible for. However, we have also agreed that we will look at the particular case of the Christie and see what we can do to understand how we can meet its need.

We and the hon. Gentleman have to accept the fact that many more people who were affected by the Icelandic regulatory authority lost money as a result, which means that certain precedents would be set. We have to look at the matter in the round, and we will do so.

Local people are very concerned about Swindon borough council’s cuts in park-and-ride services and about cuts of up to four branch libraries, despite more than £400,000 of extra funding from the Government. Is that not a warning of Tory public service cuts instead of Labour investment?

Mr. Speaker, you do not have to look in a crystal ball; you look at every Tory authority round the country. They are cutting back on public services, obeying the orders of the Conservative leadership that cuts in public services come before the investment that they need. That is one of the issues that people will be talking about in the next few weeks, because it affects real lives.