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Written Statements

Volume 514: debated on Tuesday 20 July 2010

Written Ministerial Statements

Tuesday 20 July 2010

Business, Innovation and Skills

“A Strategy for Sustainable Growth”

Balanced and sustainable economic growth can only be driven by business and enterprise. Business in the UK cannot prosper while the risk of a debt crisis hangs over the economy. This Government have therefore rightly put decisive action on the fiscal deficit at the centre of its agenda. Equally though, it is vital we recognise strong and continuing growth is a key route to getting this country back on track, including paying down our debts. Today I am publishing “A Strategy for Sustainable Growth”, which sets out some of the challenges and choices we face moving forward.

There are three key planks of our strategy

promoting the efficient operation of markets to support growth;

smarter public and private investment in the economy, including creating a highly skilled workforce; and

encouraging entrepreneurialism and individual engagement in the economy to support growth.

Despite the constrained fiscal environment, we believe there are good reasons to be optimistic that we can achieve balanced and sustainable growth. It is Government’s role to provide the vision and strong leadership necessary to make it happen.

As set out in our strategy, a more sustainable and balanced model of growth will be one that develops our exports, enables business to grow, spreads jobs and opportunities across regions, protects and builds on Britain’s strengths, and positions us to prosper through the transition to a greener economy. Government must ensure there is stability, certainty and fairness in the business environment which will encourage private sector investment and entrepreneurialism.

We also need to recognise and understand how Government policy impacts on business—and where we can get rid of unnecessary barriers to growth. Our deregulation agenda is an important part of this.

Government must also ensure that when they use public money they elicit the greatest possible economic returns. We need to make more use of our scientific and research excellence so that innovation can drive long-term growth and change, and we need to ensure we have the skill and infrastructure needed to meet new challenges and make the most of the opportunities available.

Copies of “A Strategy for Sustainable Growth” have been deposited in the Libraries of both Houses, and are available on the BIS website.


Office of Tax Simplification

The independent Office of Tax Simplification has been established today to provide advice to the Chancellor on delivering a simpler tax system. Michael Jack and John Whiting have been appointed as the interim chair and tax director to lead the office for the first year.

Culture, Media and Sport

Sport (Priorities)

I am announcing today the coalition Government’s three immediate priorities for sport. These are, in order: first, strongly to support England’s bid to host the FIFA 2018 World cup; secondly, to deliver the London 2012 Olympic and Paralympic games on time and on budget; and thirdly, on the back of a successful games, to secure a mass participation legacy for sport.

This Government see that legacy for sport comprising five key policy components:

1. In financial terms, we will restore sport’s share of national lottery funding to 20%. A public consultation has already started and this Government hope to lay any resulting parliamentary legislation in the autumn.

2. We are committed to ensuring that sport has an efficient, modern delivery structure. So, while maintaining their current roles and responsibilities, we will therefore push ahead with plans to bring together UK Sport, Sport England and the Youth Sport Trust under one roof so that they can work better together for the long-term benefit of sport.

3. In the elite and high performance area, we want to use the bid for the FIFA 2018 World cup to enshrine, across primary legislation, what sporting governing bodies can expect from Government when bidding to their international federations for the right to host world-class events.

4. In school sport, we want to have a renewed drive on competition. We will therefore introduce a school sport Olympic-style competition that will build on the good work already done by the UK School Games, while providing a stimulus and focus for competitive sport among schools at local level.

5. On the community sport and mass-participation side, we can confirm that, using the extra money we expect to flow through to sport from the lottery reforms, Sport England will take the lead responsibility for delivering the participation legacy from the London 2012 Olympic and Paralympic games. This gives Sport England two clear aims, delivering on their whole sport plans and driving a mass-participation sport legacy from the games and subsequent world-class events. Plans are being worked-up at the moment and we will make a further announcement in the autumn.

In addition, I am announcing today that I have asked the Central Council of Physical Recreation (CCPR), the alliance of National Governing Bodies of Sport, to undertake a review on behalf of the Department. This will look at whether the amount of money that governing bodies agree to re-invest in their sport’s grassroots, including in school and club programmes for young people, under the CCPR voluntary code relating to the broadcasting of major sporting events, can be raised from the existing 5% minimum to 30% or one third.

Environment, Food and Rural Affairs

Rural Payments Agency

The Rural Payments Agency (RPA) delivers £2.3 billion of common agricultural policy payments each year to the businesses and organisations which produce our food and maintain our rural economy, cultural heritage and environmental landscapes. Farmers applying for the single payment scheme payments from the Rural Payments Agency have experienced a turbulent few years. They deserve a better quality of service.

I am today publishing an independent review of RPA, completed by David Lane working with Deloitte, PWC and Gartner, and the Government response to it. Copies of the executive summary have been placed in the Libraries of both Houses. The related reports are available on the DEFRA website.

The review was commissioned by DEFRA in September 2009 and gives an evidenced view of RPA’s current state as well as preparations for the EU-wide common agricultural policy negotiations, expected to conclude in 2013. The review’s key findings are that:

RPA’s finance function and controls need to be strengthened, and that it was particularly concerning that the agency management could not form a view on the value of the debts that were on RPA’s accounts;

there are significant opportunities to provide a better quality of customer service and deliver efficiencies through improvements in the operational processes;

that a significant opportunity exists in developing new IT systems for post 2013, learning from the rushed implementation in 2005;

there was a lack of appropriate governance and oversight from within RPA’s leadership and DEFRA; and

there are considerable gaps in the organisation’s controls and leadership capability.

Since the well-publicised problems in implementing the single payment scheme in 2005-06, RPA has made significant improvements, particularly in the speed of making payments to customers. This has been achieved against a backdrop of a poorly specified IT system, which constrained the ability of staff to get the job done, and reducing staff numbers. However, there is significantly more to be done. The administrative cost per payment is too high and where there are problems, it takes too long for them to be resolved.

I will not allow this state of affairs to continue. We are moving into a new and challenging phase for RPA and the review highlights how important it is that RPA has the right capability in place to lead the organisation through this period and the right degree of oversight from DEFRA. I will personally drive forward progress by chairing a new oversight board. As announced last week, the chief executive is leaving at the end of July and we will seek a new chief executive from the widest available pool. In the meantime an interim chief executive has been appointed and I will make an announcement shortly on this. The interim chief operating officer and interim finance director appointments are due to end shortly. This gives the new chief executive the opportunity to build a leadership team to deal with the new challenges. I will work with the RPA management team to deliver the standard of services our customers deserve.

The key challenge for the agency is to deliver a better quality of service, while reducing the operating costs so that both farmers and taxpayers are getting a better deal. It is also to build a strong organisation that is ready to deal with the changes that are likely to come with the reform of the common agricultural policy. My priorities for action are:

Delivering improvements to customer experience through improving the accuracy of the agency’s information, while maintaining an acceptable speed of payments.

Ensuring that the agency is focused on improving value for money, aggressively pursuing efficiencies while balancing the need to provide a good service to farmers.

Ensuring that the agency becomes a more efficient operation, getting the basics like financial controls and accounts right.

Making essential preparations for the new schemes which are likely to be introduced after the 2013 common agricultural policy reform negotiations.

In the current financial climate, RPA will need to look radically at its operations and drive for efficiencies. Following the principle that Government should only do those things which only Government can do, we are examining how parts of the DEFRA network’s assets could be marketed or be run better through other partners, while protecting key DEFRA outcomes. In keeping with this principle, the review identified a number of options including outsourcing parts of or all of RPA’s operations. These options will be evaluated and considered by my RPA oversight board. There will need to be prioritisation between those investments which we can make, and focusing attention on those areas which will have the greatest impact.

I thank the review team for this report. I will be working with the oversight board, RPA staff, customers and Members of Parliament to ensure that all of the recommendations are carefully considered and action is taken. I will update the House on progress at appropriate times.


Commission on the Funding of Care and Support

I have today placed in the Library the terms of reference for the Commission on the Funding of Care and Support. Copies are available to hon. Members in the Vote Office.

I am also pleased to announce to the House that Andrew Dilnot will be chairing the commission. There will be two additional Commissioners, Dame Jo Williams and Lord Norman Warner. The commission will also draw on the expertise of two expert independent panels, one comprising academics and the other experts drawn from the financial services industry.

Urgent reform of the social care system is needed and the Government have made clear their commitment and determination to reach a fair and enduring settlement for the system for generations to come. We want a sustainable adult social care system that gives people the support and freedom to lead the life they choose, with dignity.

This announcement follows on from the commitment set out in the coalition agreement to—

“establish a commission on long-term care, to report within a year. The commission will consider a range of ideas, including both a voluntary insurance scheme to protect the assets of those who go into residential care, and a partnership scheme as proposed by Derek Wanless”.

It is my intention to publish a White Paper next year, which will bring together the conclusions of the commission, with the work being led by the Law Commission on creating a single modern statute for social care, and the Government’s vision for social care. This will be followed with legislation to establish a sustainable legal and financial framework for adult social care in this Parliament.

Home Department

Serious Organised Crime Agency (Annual Report)

The annual report of the Serious Organised Crime Agency for 2009-10 is being published and laid before Parliament today. As required by the Serious Organised Crime and Police Act 2005, the report includes an assessment of the extent to which the annual plan for 2009-10 has been carried out. Copies of the report are available in the Vote Office.

The report covers the financial year immediately preceding the general election. We set out our plans for policing in our coalition agreement and we will review SOCA alongside our review of the wider policing landscape.


Bribery Act

The Bribery Act 2010 creates a new set of offences that should equip prosecutors and the courts with the tools they require to ensure that all forms of bribery, at home and abroad, are met with an effective criminal justice response. As I stated in my statement of the 15 June following my appointment as international anti-corruption champion, effective implementation of the Act, which demonstrates cross-party commitment to the fight against bribery, is a coalition priority.

Section 7 of the Act creates a new offence which can be committed by commercial organisations which fail to prevent bribery committed for their benefit. However, it is a defence for an organisation to prove it had adequate procedures in place to prevent bribery being committed on its behalf. Section 9 establishes a duty on the Secretary of State to publish guidance about procedures which commercial organisations can put in place to prevent bribery. We believe it is important that the guidance to be issued takes account of the views of those with an interest in this area, including both business and non-governmental organisations. We also consider it vital that the timing of the publication of the guidance allows for an adequate period of familiarisation before the commencement of the Act.

We therefore propose to conduct a public consultation exercise on the form and content of guidance to be issued under section 9 of the Act beginning in late summer with a view to publishing guidance early in the new year in preparation for commencement of the Act in the spring of 2011.

Prime Minister

Machinery of Government Changes

Three Machinery of Government changes are being announced today affecting the responsibilities of the Food Standards Agency in England; responsibility for Directgov; and responsibility for the Licensing Act 2003. Legislation to give full effect to some of these changes will be brought forward in due course.

Food Standards Agency in England

The Government recognise the important role of the Food Standards Agency in England, which will continue to be responsible for food safety. The Food Standards Agency will remain a non-ministerial department reporting to Parliament through Health Ministers.

In England, nutrition policy will become a responsibility of the Secretary of State for Health. Food labelling and food composition policy, where not related to food safety, will become a responsibility of the Secretary of State for Environment, Food and Rural Affairs.


Responsibility for Directgov will transfer from the Secretary of State for Work and Pensions to the Minister for the Cabinet Office.

The Licensing Act 2003

Responsibility for the Licensing Act 2003, except in relation to regulated entertainment, will transfer from the Secretary of State for Culture, Olympics, Media and Sport to the Home Secretary.

Further details of these changes, and other recent significant changes, will be published in due course and copies will be placed in the House Libraries.