House of Commons
Wednesday 8 September 2010
The House met at half-past Eleven o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Secretary of State was asked—
My right hon. Friend the Secretary of State and I have had numerous discussions with the Deputy Prime Minister and the Parliamentary Secretary, Cabinet Office, my hon. Friend the Member for Forest of Dean (Mr Harper), who is responsible for political and constitutional reform, on matters affecting Wales in the Parliamentary Voting System and Constituencies Bill.
My hon. Friend is entirely right. The Government’s proposals for electoral reform are founded on the principles of equality and fairness, and it is clearly fair that votes cast at parliamentary elections throughout the United Kingdom should be of broadly equal value, including in Wales.
There are currently approximately 170,000 people missing from the electoral register in Wales. On Monday, the hon. Gentleman’s colleague the Deputy Prime Minister announced that the Government are considering ways of putting those people back on the register. Will that happen before or after the Boundary Commission’s freeze date in December?
I have to say to the hon. Gentleman that the Labour party did not address that matter when it was in government. The vital consideration must be to ensure that all votes are fair and that all voters are fairly registered, and that will be the principle on which this Government proceed.
How can the Minister and the Secretary of State possibly justify cutting proportionately three times as many Welsh MPs as English MPs, creating monster constituencies in rural Wales and geographically impossible ones in Welsh valleys? Instead of ramming through those changes, why will not the Government maintain the existing system of public inquiries that has protected local interests for generations?
I am surprised that the right hon. Gentleman takes that view. I would have thought that he would be as anxious as Government Members to ensure that votes cast in general elections are fair and of equal value. As it stands, votes in certain parts of the country are worth significantly more than those in other parts. So far as constituency boundaries are concerned, I remind him that they will be determined by the impartial and neutral Boundary Commission, with which I have already had discussions.
But the Minister and the Secretary of State have presided over rigging the situation in advance. Is the Secretary of State proud that by slashing the number of Welsh MPs by fully a quarter from 40 to 30, she is the first Secretary of State for Wales in history to reduce Wales’s voice in Parliament? Why is she also the first Secretary of State to refuse a request for a meeting of the Welsh Grand Committee? Does she not understand the anger about that among Welsh MPs of all parties, including hers? We demand a meeting of the Welsh Grand Committee so that our constituents can see what is being done to them.
Again, the right hon. Gentleman is completely wrong. Our position, to which I would have thought he would be signed up, is that votes across the country should be of equal validity. The current position is that they are not. On holding a Grand Committee, I imagine and hope that he and the shadow Minister, the hon. Member for Caerphilly (Mr David), will be present at the meeting that we have convened this afternoon to put their concerns forward.
I have had several discussions with my right hon. Friend the Secretary of State for Culture, Media and Sport on the importance of S4C and Welsh broadcasting in general, and I will continue to do so to ensure that Wales receives a broad range of programmes about and for the people of Wales. I have also had discussions with the senior management at S4C.
I thank the Secretary of State for her reply. Does she agree that given its programming for children, its substantial forward spending on planned programmes and the profound sociolinguistic effect that it has, S4C is in no way just another television channel that happens to be in Welsh? It is not a Welsh version of Dave TV, nice thought that is.
I agree with the hon. Gentleman. From what I have seen of S4C, it is a television station that continues to meet the needs of Welsh speakers by providing programmes and services through the medium of Welsh. It is fair to acknowledge that it is dealing with some internal problems at the moment, but I have been impressed with the range of services that it provides, particularly to people who are learning Welsh. He may know that I visited the set of “Rownd a Rownd”, where I was extremely impressed by how we are bringing on young acting talent in Wales through that soap opera. I was impressed with the cast and the production team working on it.
The Secretary of State will also be aware of the significance of the independent TV production sector and the importance of its relationship with S4C. The sector was recognised in a Select Committee report in the previous Parliament as one in which Wales excels. Extensive cuts could jeopardise that. Will she continue to make the robust case to the Department for Culture, Media and Sport about the scale of the potential cuts?
I will continue to do that on a regular basis. One thing that is so exciting about the Welsh economy is our huge potential in the creative industries. There is tremendous potential between the BBC and ITV, which is expanding its news coverage, and S4C, but our broadcasting industry must face the reality of the budget within which we must work, thanks to the previous Government’s mismanagement of the economy. However, I stress that the television industry is the place for independent companies to do business.
I have already held discussions with my right hon. Friend the Defence Secretary on a number of military issues that affect Wales, and I have arranged to speak to him again during this two-week sitting of Parliament. I also wrote to him specifically on that issue in July, highlighting the importance of Airbus to the Welsh economy.
During the election, a number of Tory candidates in north Wales published leaflets that contained a pledge from the then Leader of the Opposition, who is now the Prime Minister, that that project would go ahead. Is that pledge still valid? Is it worth anything?
I know that the hon. Gentleman takes a great interest in such matters, and so he should, because Airbus employs, I believe, more than 6,500 people at the Broughton plant in his constituency. The order book for the A400M currently looks very healthy, with orders for more than 180 aircraft worldwide and at least 22 for the UK. I am confident that the position is secure.
The Secretary of State is right to concentrate on the importance of military activity and training in Wales. Will she therefore ensure that when she next meets the Defence Secretary, she stands up for the RAF in Wales, and bases such as RAF Valley, which has had substantial investment in the past 10 years? They serve the economy locally, but they will also serve our country well in future.
The hon. Gentleman should know that I have deep affection for RAF Valley, having done my armed services parliamentary fellowship scheme with the RAF. I was even privileged to sit in the back seat of several fast jets, courtesy of some first-class pilots. The RAF has a special place in my heart, and I can certainly assure him that I will always speak up loudly for RAF Valley.
My right hon. Friend the Secretary of State and I have regular discussions with Cabinet and ministerial colleagues, and we regularly meet the Association of Chief Police Officers Cymru, Police Authorities of Wales, the Welsh Local Government Association and other interested parties to discuss matters affecting policing and law and order in Wales.
With Welsh police forces facing budget cuts this year of more than £6 million, which is a real threat to front-line policing in constituencies such as mine, will the Minister tell the House how much it will cost to elect and fund the proposed directly elected police commissioners in Wales?
The hon. Lady will know that we have had to impose budget cuts to make a start on sorting out the appalling economic legacy that we inherited from the Labour party. Elected police commissioners will not cost a penny more than the police authorities that they will replace, and they will add the considerable value of ensuring that there is a democratic link between the electorate and those responsible for overseeing the police.
The Police Minister indicated that police authorities could make savings by reducing overtime, but police authorities such as Dyfed-Powys have already reduced overtime to a minimum as a result of previous efficiency savings. Will the Under-Secretary of State for Wales convey that to the Police Minister, and ensure that not all police authorities are dealt with on the same basis, so that peculiar requirements are taken into consideration?
The Government clearly recognise that any cuts present challenges to our police, as they do to other front-line services, but they also present an opportunity to refocus policing priorities and operational requirements. The Welsh police authorities have already shown an excellent lead by combining procurement, to the extent that they have saved more than £3.5 million in the last financial year, and I hope that that pattern will continue.
Following on from the Minister’s earlier response, the Local Government Association estimates that the cost of these police commissioners will be £50 million, or the equivalent of 700 police officers. Does not he agree that it would be perverse to introduce these superannuated sheriffs at the same time as making cuts in neighbourhood policing?
As I have already indicated, the cost of the police commissioners will not be a penny more than the authorities that they replace. The hon. Gentleman may like to know that I have already held a meeting with the Welsh Local Government Association. I have also seen the letter to which he alludes, and I have passed it on to colleagues in the Home Office. I reiterate that it will not cost a penny more than the police authorities that the commissioners will replace.
Winter Fuel Payments
Winter fuel payments provide assurance to older people that they can keep warm during the colder winter months by providing significant help with fuel bills. As announced in the Budget, winter fuel payments will continue to be paid for 2010-11, which will benefit some 680,000 people in approximately 494,000 households in Wales.
I wish to put to the Minister a question that was raised in a meeting of the over-50s group in my constituency last week. The Prime Minister gave assurances about safeguarding benefits for the elderly and the winter fuel payment during the election, but we now hear rumours that the qualifying age may be increasing from 60 to 66, or possibly more, and that the basic winter fuel payment could be cut by £50 for new recipients or £100 for the oldest. What merit should we give to those statements that were made during the election?
As the hon. Gentleman knows, the coalition agreement makes it clear that the Government intend to protect the winter fuel payment. It is clear that the age at which both men and women get winter fuel payments will move in step with the equalisation in entitlement to the state pension, but I reiterate that the coalition agreement makes it clear that we intend to protect that payment.
I have regular discussions with many ministerial colleagues to ensure that we support Welsh businesses. I have already met with CBI Wales twice, and I have quarterly meetings planned with the CBI along with other business organisations in Wales, so that the issues affecting individual companies are fed directly into coalition Government policy.
Over the last 10 years, Wales became the poorest part of the United Kingdom under the Administration of Labour both here at Westminster and in Cardiff bay. A recent Oxford Economics report suggests that over the next five years Wales will create only 4,000 new jobs. Given that Wales will have the same macro-economic conditions as every other part of the UK, is not that a sad indictment of the Administration in Cardiff bay and the legacy of Labour?
My hon. Friend has experience of the Welsh Assembly Government and the Welsh Assembly, so I will leave his comments to stand. I agree with him that the situation that we have inherited is shocking across the UK, and it is especially sad in Wales because gross value added per head is the lowest out of all the UK nations and has been that way since 1998. However, I want to be optimistic about the Welsh economy and I have recently visited some very successful businesses that are investing in Wales and looking at creating jobs, including Corus, Sharp and Ultrapharm—the latter is producing wheat-free healthy lifestyle products for Marks and Spencer. I have been impressed by the number of jobs that are starting to appear in the Welsh economy, and I want to encourage more businesses to come and do business in Wales.
With the public sector cuts inevitably having a disproportionate effect on the Welsh economy, what countervailing measures is the right hon. Lady arguing for with the Treasury to stimulate private sector growth in Wales?
I am sad that the hon. Gentleman has to ask such a question, but he knows that he has to because the last Government left this economy in tatters, and it has fallen to this coalition Government to put the economy back together again. As he well knows, we are providing an environment in which business can do business in the UK. We are reducing corporation tax by a penny each year, which will give us one of the lowest corporation tax regimes in the European Union, we have reduced the taxation regime for small companies, and we have incentives on national insurance for entrepreneurs setting up businesses. I can assure him that we are doing everything that we can to create a healthy environment in which businesses and private business can prosper.
The hon. Lady knows that the deficit needs to be tackled immediately, and it was her Government who left us in this dire financial situation. Of course, I cannot pre-empt anything that might happen in the comprehensive spending review, but I recognise the vital role that public sector contracts play in the prosperity of businesses across Wales, and I know that the economy is heavily dependent on the public sector, so I have already made representations to the Treasury, and will continue to do so. However, I am afraid that the financial mess we are in was the responsibility of her party.
Public Expenditure Reductions
My right hon. Friend has regular discussions with the First Minister on a range of topics, including the reductions in public spending necessary to tackle the deficit.
I am grateful to the hon. Gentleman for his interesting and brief response. Will he actually answer the question more fully by commenting on the fact that the latest employment outlook survey says that employers in Wales expect to decrease staffing levels in the next few months by 8%, and that the Federation of Small Businesses in Wales has said that
“it’s not surprising that small firms might be planning staff reductions”,
and that is due to major public service cuts? Will he for once speak up for Wales and accept responsibility for the situation that his Government are creating for communities in Wales?
I am glad to see that the hon. Lady recognises the appalling financial legacy of her Government. Under the last Government, unemployment in Wales increased by 60%, from more than 82,000 to 130,000 in the last 10 years. We can restore the Welsh economy and return life to it only by allowing the private sector to grow. On that basis, we have introduced measures, such as the national insurance holiday, that will stimulate significantly the private sector in Wales. Wales cannot rely on the public sector alone.
National Assembly Powers
I have had regular discussions with the First Minister and ministerial colleagues on the proposed referendum on the law-making powers of the National Assembly for Wales. Indeed, I discussed it with the First Minister and the Deputy First Minister on Monday.
I thank my right hon. Friend for her reply. Does she agree that, as devolution develops, we will need a fair constitutional settlement across the United Kingdom, and is it not the Government’s intention, therefore, to address English votes for English laws, and indeed English and Welsh votes for English and Welsh laws?
My hon. Friend knows that our approach to constitutional matters is informed and underpinned by our commitment to the Union and devolution and our conviction that power should rest in the hands of those we serve. Indeed, we have committed, in our programme of government, to establishing a commission to consider what has become known as the West Lothian question, and we are working to take that forward.
When the Secretary of State eventually comes up with a coherent and intelligible question for the referendum on further powers for the Assembly, will she be asking the Electoral Commission to carry out a further consultation on the question she will place before the House?
I feel that I should say to the hon. Gentleman, “Listen very carefully, I will say this only once,” because I heard an interview that he gave on the radio in which it appeared that he had not listened to the answers that I gave at the last Welsh questions. Can I just tell him that I have—[Interruption.]
I am very grateful to the Electoral Commission for its report and the 10 weeks of examination that it gave to the question that was designed by the project board. On Monday I worked with the First Minister and the Deputy First Minister, and I have considered its findings. We have all agreed that we should accept its findings and take forward the preamble and the question that has been put forward, on an objective and independent basis, by the Electoral Commission, and I shall be making a further statement to Parliament.
Expenditure Reductions (Policing)
Both my right hon. Friend the Secretary of State and I have regular discussions with Cabinet and ministerial colleagues on policing matters in Wales. We recognise that reductions in budgets will be challenging to our police forces, but will also present opportunities to refocus policing priorities and make operational efficiencies.
I thank the Minister for his response. Given how successful the Safer Caerphilly community safety partnership has been in substantially reducing crime and antisocial behaviour, will the Secretary of State give an assurance that she will fight any plans to cut funding for next year?
The question of funding for the police is a matter that will have to await the comprehensive spending review, but I am heartened by the comments of the National Audit Office and the Wales Audit Office about how it should be possible to effect reductions of £1 billion without any effect at all on front-line policing.
My right hon. Friend the Secretary of State and I attach great importance to rural communities in Wales and the economic challenges that they face. The Wales Office has set up a taskforce of officials to look at the rural economy and see what we can do to support and encourage growth in our rural areas.
I am glad to hear that my hon. Friend is contributing to that economic renewal and I hope that he will continue to do so in years to come. The Wales Office is currently consulting groups that represent businesses and the rural economy, to gather their views on what we can do to help them grow in these challenging times. I have already held meetings with a number of interest groups, including the farming unions, and I look forward to taking that work forward over the autumn.
There is a company in my constituency called Desk-Link. Unfortunately it is going through difficult times. Since January, many of the staff there have been paid late. Some workers have found that their tax and national insurance contributions have not been paid. Will the Minister ensure that Her Majesty’s Revenue and Customs and Jobcentre Plus assist my constituents in getting the support to which they are entitled?
My right hon. Friend the Secretary of State met the prisons Minister in July to discuss prison capacity in Wales.
Does my hon. Friend agree that the current financial crisis means that a new prison in north Wales is now a distant probability? If that is the case, what discussions has he had with the Ministry of Justice about rehabilitation services in prisons in England that currently service prisoners from north Wales, and in particular for those prisoners who have Welsh as their first language?
My right hon. Friend the Secretary of State and I have recognised for some time the need for a prison in north Wales. These are matters on which we have made representations to the prisons Minister, the Under-Secretary of State for Justice, my hon. Friend the Member for Reigate (Mr Blunt), but clearly the question of whether one is affordable will have to await the comprehensive spending review.
I have recently visited a number of venues associated with the leisure industry in Wales, and I have seen at first hand some of the preparations being made for the 2010 Ryder cup. I have been impressed by all the hard work that will make this event a great Welsh success, and I am sure that, like the people of Newport, we are all anxious to see this fantastic event tee off in three weeks’ time in Wales.
This is a wonderful, unique opportunity for us to show off our city of Newport and the rest of Wales. Will the Minister guarantee that she will do everything she can to ensure that there is a full legacy from the Ryder cup for the young people of Newport, Wales and the rest of the United Kingdom?
I agree entirely with the hon. Gentleman. The Ryder cup is going to be fantastic in Wales and I would urge Members to encourage their constituents who enjoy golf to visit this fantastic venue. The legacy fund already involves a £2 million investment by the Welsh Assembly Government, and it has so far distributed £1.5 million in grants for various projects across Wales. This is an event for Wales that all the political parties can come together and support wholeheartedly.
The Prime Minister was asked—
I have been asked to reply. As the House might be aware, the Prime Minister’s father was taken seriously ill last night and, quite rightly, my right hon. Friend has travelled to be with his father and his family. I am sure that I speak on behalf of everyone on both sides of the House when I say that we send him, his father and his family our best wishes at this difficult time.
I shall start by paying tribute to the brave servicemen who have lost their lives over the summer since the House last sat. They were: Corporal Matthew Stenton, from the Royal Dragoon Guards; Lance Corporal Stephen Monkhouse, from 1st Battalion the Scots Guards; Sapper Mark Smith, from 36 Engineer Regiment; Lance Sergeant Dale McCallum, from 1st Battalion the Scots Guards; Marine Adam Brown, from 40 Commando, Royal Marines; Lieutenant John Sanderson, from 1st Battalion the Mercian Regiment; Rifleman Remand Kulung, from 1st Battalion the Mercian Regiment; Sapper Darren Foster, from 21 Engineer Regiment; Sapper Ishwor Gurung, from 69 Gurkha Field Squadron; Lance Corporal Jordan Bancroft, from 1st Battalion the Duke of Lancaster’s Regiment; Lance Corporal Joseph Pool, from 1st Battalion the Royal Regiment of Scotland; and Captain Andrew Griffiths, from 2nd Battalion the Duke of Lancaster’s Regiment. Each of those men was an heroic, selfless individual who has given his life for the safety of us and the British people. Nothing can ease the pain of the loved ones, families and friends they have left behind, but their lives, service and sacrifice will never, ever be forgotten. [Hon. Members: “Hear, hear.”]
We also remember Dr Karen Woo, who was killed while providing aid and medical services to Afghan civilians, and we offer condolences to the wife and family of Ken McGonigle, a devoted father of four and former police officer in Northern Ireland, who died on 7 August while mentoring police forces in Helmand province. As I saw again when I was in Afghanistan last week, the bravery of our servicemen and others who are risking their lives daily to help the people of Afghanistan is both inspiring and humbling.
Yesterday, West Mercia police announced that they were laying off 300 personnel. Does the Deputy Prime Minister agree that, if it were not for the financial mess left by the previous Government, many of those jobs—and, indeed, thousands of other public sector jobs across the country—could have been saved? It is now left to the new coalition Government to take the difficult decisions to sort out the nation’s finances.
I certainly agree that the previous Government have left us with an extraordinary legacy, with the largest deficit in our peacetime history. It was they who took their eye off the ball and allowed the banks to lend money irresponsibly, and it was they who racked up these extraordinary debts and deficits—[Interruption.] They were irresponsible in government, and they are now living in denial in opposition.
We did not just inherit a legacy of deficit; we also inherited a legacy of bureaucracy. As Sir Denis O’Connor, the chief inspector of constabulary, pointed out in July, 2,600 pages of guidance were issued to police officers last year alone. He said that, if they were laid end to end, they would be
“three times higher than the Eiffel tower”.
We need less bureaucracy and more police on the streets. [Interruption.]
May I join the Deputy Prime Minister in paying tribute to all those who have lost their lives serving our country in Afghanistan since the House last met? We know that for each one of those individuals, there is a family who are immensely proud of their service but who are consumed with grief for their loss. Our thoughts and prayers are with those bereaved families and the comrades and friends of all those who have died.
I think that all of us had hoped that part of the opening of Prime Minister’s questions would be an opportunity for us to express congratulations to Mrs Cameron and the Prime Minister on the birth of their new baby—and, of course, on behalf of the Opposition, we certainly do so. Sadly, however, that is tinged with the dreadful news about the Prime Minister’s father. Let me say on behalf of the Opposition that I am absolutely certain that the Prime Minister has made exactly the right decision—to be where he knows he has to be, with his father and his family at this difficult time.
The Prime Minister in May brought Mr Andy Coulson into 10 Downing street. May I ask the Deputy Prime Minister whether he is entirely satisfied that, while Mr Coulson was editor of the News of the World, at no time was Mr Coulson aware of any use of unlawful hacking of telephones?
I am grateful to the right hon. Gentleman for his words about the Prime Minister and the great news about the birth of a new baby daughter. I will, of course, pass that on.
As for the issue of phone hacking, the right hon. Gentleman knows, as we all know, that this is a very, very serious offence—a very serious offence indeed. It is an outrageous invasion of privacy, and it is right that two individuals were convicted and imprisoned. As for Mr Coulson, he has made it very clear that he took responsibility for something at the News of the World of which he had no knowledge, and he refutes all the allegations that have been made to the contrary. That statement speaks for itself. It is now for the police and the police alone to decide whether new evidence has come to light that needs to be investigated.
Mr Coulson has made it quite clear that he had no knowledge and he refutes all the allegations. While, in a slightly rushed manner, I was preparing for today, suspecting that this issue might come up, I read in one of the briefing notes I received that when Andy Coulson resigned from the News of the World the first person to call to commiserate was the right hon. Member for Kirkcaldy and Cowdenbeath (Mr Brown). He told him not to worry, that he had done the honourable thing and that he knew he would go on to do a worthwhile job. [Interruption.]
My right hon. Friend and I are in complete agreement that if new evidence has come to light—and that is what I want and that is what I expect—the police will now actively look to see whether that evidence is worthy of further investigation. That is what the police are there for; that is what they should be doing.
Of course, it was under the previous Government—the Labour Government—that no further action was taken. It was the former Home Secretary, who has been making all sorts of pious remarks in the press, who decided not to involve Her Majesty’s inspectorate of constabulary. The Director of Public Prosecutions and the Crown Prosecution Service decided not to take any further action. If the police now think that new evidence has come to light, let them decide.
The Select Committee on Culture, Media and Sport, chaired by the Deputy Prime Minister’s hon. Friend the Conservative hon. Member for Maldon (Mr Whittingdale), said:
“The evidence, we find, makes it inconceivable that no-one else at the News of the World, bar Mr Goodman, was aware of the activity”
of phone-hacking. What does the Deputy Prime Minister know that the Select Committee did not know?
The police now need to decide whether, in the light of the new allegations that have been made, there is new evidence which requires further investigation. That is what the police are there for, and I want them to get on with that. That is what I expect they should do. But honestly, I am simply not going to take any lessons from a party whose members spent all their time in office back-biting against each other through leaks and counter-leaks to the press—the party of the dodgy dossier, of cash for peerages, of Damian McBride. Let us have a little bit of consistency on this, shall we?
So, when the police have uncovered 2,978 mobile telephone numbers of potential victims and The New York Times has named the Deputy Prime Minister’s own hon. Friend the Member for Bermondsey and Old Southwark (Simon Hughes) as a potential victim, does the Deputy Prime Minister expect us to believe that the only person who knew nothing about phone hacking at the News of the World was the editor—the very man whom the Prime Minister has brought into the heart of this Government?
What I expect and hope the right hon. Gentleman will believe is that it is now for the police to investigate whether these new charges and allegations have anything to them. That is what the police are there for. Does the right hon. Gentleman want us all to start second-guessing what is in the newspaper and what statements have been made? Let the police—[Interruption.] Look, we have a war in Afghanistan, we have a flood in Pakistan, and the right hon. Gentleman is inviting the Government to second-guess the work of the police. I should have thought that, after all the years during which he was involved in our criminal justice system, he would know better.
Yesterday a serving police officer was jailed for an appalling assault committed in a police station in my constituency. While I believe that we can draw confidence in the Wiltshire police from the brave officer who blew the whistle, does the Deputy Prime Minister agree that it cannot be right that, owing to restrictive police conduct regulations, the offending officer continued on full pay for more than two years after the attack?
Like, I suspect, many Members in all parts of the House, I was deeply shocked by the pictures of the offence that was perpetrated by the police officer. I also share people’s dismay that action was not taken more speedily. However stressful the conditions in which police officers work, it is absolutely essential that they uphold the very high standards of their own conduct in all circumstances, and that was clearly not the case in this instance. I am glad that action is finally being taken, although, like my hon. Friend, I wish that it could have been taken earlier.
Q2. This morning the Business Secretary reaffirmed his commitment to the separation of high street banking from casino banking. Does the Deputy Prime Minister agree that that separation is essential to ensuring that the British taxpayer need never again bail out banks that are too big to fail? (13118)
As the hon. Gentleman knows, there is a lively debate about the relationship between retail banking and investment banking. The former Chancellor has made his own views very clear from his party’s Front Bench: he does not think that there is a case for separation. The Liberal Democrats believed in opposition that there should be a separation, and a debate is now taking place within Government.
We have asked Sir John Vickers to chair an independent commission, which will consider how we can ensure that there is safety and stability in our banking system for good. That action was not taken by the last Government. We will look at the commission’s recommendations, and then decide.
Given that in the last year of the Labour Government they spent £10,000 for every man, woman and child in the country on current public spending, and given that that will go up to £11,500 a head over the five years of this Government under Budget plans, is it not clear that the coalition Government can get through without any damaging cuts to important public services?
As my right hon. Friend well knows, the challenge of balancing the Budget and filling the huge black hole left to us by Labour is, indeed, very difficult. That has, of course, been recognised by Tony Blair in his recent book, where he has said:
“if governments don’t tackle deficits”—[Interruption.]
I am relieved that Mr Speaker wants to hear that the book says
“if governments don’t tackle deficits…This then increases the risk of prolonged slump…If we fail to offer a convincing path out of debt, that...will itself plunge us into stagnation.”
Q3. The charity Shelter this week revealed that 54,000 children who live in households that are already well below the poverty line are going to lose out as a result of the changes to housing benefit, and the Department for Work and Pensions’ own document has revealed that 52,000 of the poorest pensioners will be on average £11 a week worse off as a result of the changes. Is that what the Chancellor meant when he said his Budget was tough but fair? (13119)
The United Kingdom now, after 13 years of Labour Government, has the highest number of children in workless households in Europe. That is an absolutely shameful legacy, and one of the things that this Government are going to do, which the previous Government failed to do, is create incentives to get people off benefits and into work. That is the surest way out of poverty and the surest way we can look after those children who were abandoned and not looked after by the previous Labour Government.
Q4. After the Chinook crash in 1994 on the Mull of Kintyre, every inquiry that has been held that has been independent of the Ministry of Defence has found it impossible to attribute negligence to the pilots who died in the crash. May I thank the Government for honouring the pledge made before the election to hold a review and ask how the independence of that review will be assured? (13120)
I am acutely aware of my right hon. Friend’s considerable expertise on defence matters and of his long-standing interest in this tragic disaster and the circumstances around it, and I am pleased to be able to confirm today that we will be holding an independent review of the evidence on the Mull of Kintyre disaster. I hope that the review will be welcomed by the families of those who died in that tragic accident. To ensure its complete independence, the review will be conducted by a respected lawyer who is independent of the Government and who has not previously expressed a view on the disaster. The reviewer and the precise terms of reference will be announced soon.
Last month the police ombudsman released his report into the Claudy bombing by the Provisional IRA in 1972, where nine innocent people were murdered. The ombudsman concluded that the Secretary of State at the time, a senior police officer and the Roman Catholic cardinal colluded to ensure that a chief suspect in the bombing who was also a Roman Catholic priest was transferred to the Irish Republic rather than be brought to justice. I will wish to raise the matter directly with the Prime Minister, but will the Deputy Prime Minister join me in calling for the Catholic Church to apologise for its part in this, and for the surviving members of the Provisional IRA, including the Deputy First Minister, who I understand today confirmed that he visited the suspect priest as he lay on his deathbed 30 years ago, to declare all that they knew about one of the worst atrocities in Northern Ireland’s troubled past?
As the hon. Gentleman knows, my right hon. Friend the Secretary of State for Northern Ireland made a full apology on 24 August on behalf of the Government. The Government are profoundly sorry that Father Chesney was not properly investigated at the time for his suspected involvement in this hideous crime and that the victims and their families have quite simply been denied justice. However, I wish to reiterate that, although after the attack the then Government acted wrongly in not insisting that the Royal Ulster Constabulary properly investigate Father Chesney, it was terrorists who were responsible for this despicable and evil attack, which took innocent lives, including that of an eight-year-old girl. My right hon. Friend has made it clear that a public inquiry is not being considered, on the grounds that there simply is not likely to be any further evidence to consider. We have co-operated fully with the ombudsman’s investigations, making all papers available to him, the Historical Enquiries Team is also now investigating the case, and in the interests of transparency the Government have published the only document that they hold referring to discussions about Father Chesney.
I certainly agree with my hon. Friend; we are absolutely committed to bringing justice to the Equitable Life policyholders. These people were shamelessly, shamefully betrayed year after year by the previous Government. We have published a Bill on this, we have taken the recommendations from Sir John Chadwick, which we will consider, and we will create an independent mechanism by which justice is finally provided to the policyholders, who were so shamefully overlooked by the previous Government.
Q6. Does the Deputy Prime Minister have any qualms at all about the coalition Government’s 2010 Budget, which took 2,000 front-line workers out of Jobcentre Plus? Given that fewer people were in work this June than the previous June and given this week’s review into the work capability assessment, will he ensure that the comprehensive spending review provides the front-line staffing resources that Jobcentre Plus offices around the country need to get people off benefit and back into work in the way that he just described? (13123)
I certainly agree, of course, that the most important objective of all is to increase incentives to work. That is why in that same Budget we increased the personal allowance by £1,000, taking close to 900,000 people out of paying any income tax. We did take measures to protect the vulnerable and the elderly: we dramatically increased child tax credit, and we provided a triple guarantee to pensioners, so that their pensions will increase by 2.5%, by inflation or by earnings. Of course it is easy in opposition to deny any responsibility for the mess in which we find ourselves in the first place, but I simply ask the hon. Lady and her colleagues whether they have any qualms about the fact that her party and her Government announced £44 billion-worth of cuts but never had the decency or honesty to tell the British people where those cuts would fall.
Q7. Given the number of disturbing cases such as that of my constituent, Andrew Symeou, a 21-year-old young man who was extradited to Greece well over a year ago under the European arrest warrant and who has spent more than 10 months in jail yet still does not face the prospect of a trial date, will the Deputy Prime Minister commit the Government to reviewing this very worrying legislation? Will he also agree to a meeting with the parents as a matter of urgency, involving either himself or the Prime Minister? (13124)
Of course I would more than welcome that meeting with either myself or the Prime Minister. We are all aware of the concerns about the way in which the European arrest warrant works. I understand that the Minister for Europe has met Mr Symeou’s parents and that the Foreign and Commonwealth Office would be willing to do so again. Of course this is in the context of even wider concerns about our extradition arrangements, not only those in the European Union, but those with the United States. That is why my right hon. Friend the Home Secretary has announced today that we will be reviewing the UK’s extradition arrangements in the round. The review will focus on the operation of the European arrest warrant, on whether or not the United States and United Kingdom extradition treaty is unbalanced, and on whether requesting states should be required to provide prima facie evidence to us.
Is the Deputy Prime Minister aware that today is my birthday? If I tell him how to pay for it, will he agree to give me a present of a couple of aircraft carriers? None of your foreign rubbish—I want British ones and I do not want to have to share them with some French bloke. If he had it Monday to Wednesday and I had it Thursday to Saturday and we shared weekends, we would have to get the permission of the Child Support Agency if we wanted to make any change in that. All that could be paid for by cutting our contribution to the European Union. Will he agree?
I of course congratulate the hon. Gentleman on his birthday and I am delighted to see that his enthusiasm for things European has not mellowed with age. I am happy to give him a gift, but on the question of whether it is a gift of the size and shape that he has requested, I am afraid that I cannot oblige him today.
My hon. Friend is of course right that fairness is one of the NHS’s founding principles and we must retain that principle. We need to consider measures to make possible dealing with people who have rightly been given care by the NHS—because the NHS provides care to everybody on the basis of need—and who are supposed to make a contribution but escape the obligation to do so. That is what we are working on and we will be coming forward with announcements soon.
Q9. What would the Deputy Prime Minister say to my constituent, Rachael Shipp, who now finds that all her hard work, community action and fundraising in line with big society thinking will come to naught as the Government cut the moneys promised to her neighbourhood group for their much-needed playbuilder scheme? She cannot understand why a referendum that has no electoral mandate and that she sees as irrelevant will go ahead at a cost, according to the TaxPayers Alliance, of £100 million which could be better spent on community schemes such as hers in Lilac avenue. (13126)
I am very amused that the referendum, which the hon. Gentleman claims has no mandate, was in the manifesto on which he campaigned at the last election. I know that Labour is enjoying denying any responsibility for the past—U-turn after U-turn after U-turn. One hundred thousand members of the public have made suggestions about how we can try to bring some sense to our public finances without hitting the vulnerable and without hitting front-line public services. Have we heard a single suggestion from anyone on the Opposition Benches? Not a single suggestion. Until the Labour party catches up with reality, it will not be taken seriously.
How can the Deputy Prime Minister justify to hard-working taxpayers facing economic difficulties in their own families and businesses the fact that he wants to spend £100 million of their taxpayers’ money on a referendum on the voting system?
I am amused that my hon. Friend gets a cheer from the Opposition Members who advocated that same proposal. That of course is the reason, as my hon. Friend knows, why we think that there is a compelling case for saving up to £30 million in the cost of holding the elections in May and the referendum on a separate occasion by combining the two on the same day. I suspect that she is not that keen on that idea, but I hope that over time she will come to support it.
Q10. The Deputy Prime Minister is famous for his humility. Following the report of the Select Committee and this morning’s report in the Financial Times, is he now prepared to apologise for the mistake that he made about Sheffield Forgemasters and to join the Liberal leader of Sheffield council in calling for some public finance for that project? (13127)
As the hon. Gentleman knows, the reason, regrettably, why the £80 million loan that was announced by the previous Government 11 working days before the general election to coincide with a nice photo opportunity for the previous Prime Minister at Forgemasters has not been able to proceed from this year’s Budget is that it is not affordable under this year’s Budget given that the structural deficit we inherited was so much greater than we thought. In other words, it was a promise made where the money was not available. It was a cheque written which the previous Government knew would bounce, but we have made it very clear to Forgemasters that we will continue to work with it to see how we can support it in future once the Budget situation becomes clearer after the comprehensive spending round.
Q12. Chinese lanterns pose a threat to farmers both because of the fire risk to standing crops when lanterns fall into fields and because the wire frames are cut into small pieces by harvesting equipment so that wire is incorporated into animal feed such as hay and silage, killing farm animals. What steps will the Government consider taking to reduce the risks in this area? (13129)
Everybody who lives and works in rural areas knows that this issue is causing a great deal of distress to both farmers and their livestock. We have been looking at ways in which we can deal with the issue and reduce the risks posed by the lanterns, while not wishing to ban them completely. The Department for Business, Innovation and Skills has been in contact with the manufacturers of the lanterns and has demanded that the lanterns in future should be 100% biodegradable and should have full safety instructions with them.
Q11. Will the Deputy Prime Minister join me in paying tribute to the Rotary Club of Braids in my constituency, which has raised thousands of pounds for shelter boxes to send to Pakistan and other areas that are devastated by events? Will he give a commitment that his Government will consider altering the gift aid scheme to ensure that bucket collections can be included, so that the club’s valuable work can go much further? (13128)
We will, of course, look at anything that will continue to encourage people to be as generous as they have been in responding to this truly horrific catastrophe. I was in Pakistan, in Sindh province, just last week, where I saw for myself the scale of the situation. It is genuinely difficult to comprehend that an area the size of the whole United Kingdom has been submerged under water. Some 20 million people have been displaced and my fear is that the worst is still to come as water-borne diseases start taking hold. That is why I certainly welcome the hon. Gentleman’s active interest in this issue and why I will welcome work from him and Members on both sides of the House so that we can work together to continue, both as a Government and as a people, to show the support that all the many distressed communities in Pakistan deserve at this time.
Q13. May I ask the Deputy Speaker about the Parliamentary Voting System and Constituencies Bill? If the Bill is significantly amended in Committee or defeated on Third Reading, will the Liberal Democrats leave the coalition, or can he give a guarantee that they will stay in it? (13130)
I am not sure if it will please or disappoint the hon. Gentleman when I say that the persistence and resilience of the coalition is not dependent on any one single piece of legislation. He will know—again, I am not sure if he will be pleased or displeased by this—that the Bill is only one part of a much, much wider programme of political reform. That includes giving people the power of recall so that they are able to sack their MP if they are shown to have done something seriously wrong, cleaning up party funding and producing proposals finally to reform the other place. I am afraid that political reform does not begin or just end with this one single Bill.
The hon. Member for Rhondda (Chris Bryant) has written to me concerning the hacking of the mobile phones of hon. and right hon. Members. Having looked into this matter, I have decided that it is a matter to which I should allow precedence. Therefore, under the rules set out at pages 167 to 168 of “Erskine May”, the hon. Member may table a motion for debate at the commencement of public business tomorrow. It will appear on the Order Paper after any statements and before the debate on UK armed forces in Afghanistan.
(Urgent Question): To ask the Chancellor of the Exchequer if he will make a statement on the reported errors made by Her Majesty’s Revenue and Customs that appear to have led to millions of people underpaying or overpaying billions of pounds of pay-as-you-earn contributions.
I am grateful for the opportunity to make a statement to the House about the action that HMRC is taking to rectify overpayments and underpayments in the PAYE system.
The PAYE reconciliation process occurs every year to reflect the changes in people’s earnings and employment status that happen over the course of a tax year. In previous years, HMRC employed a system of manually joining up separate pieces of information through PAYE. Each case of potential overpayment or underpayment had to be reviewed individually before reconciliation could be finalised. That was inefficient and clerically intensive work, and it resulted in a backlog of open cases. HMRC now employs a new computer system that matches records automatically to ensure that the correct amount of tax is paid.
The coalition Government have already started to look at how to reform PAYE further and make it more efficient. As part of the Government’s strategy to create the most competitive tax system in the G20, we are consulting on options to improve PAYE. The PAYE system was introduced at a time when people had one job—perhaps the same job for their whole career—and one source of income in retirement. However, that world has now gone and it is common for people to have earnings from multiple sources. That is well known, but it is something that the previous Government failed to address.
No reconciliation process was undertaken last year, so this year HMRC had to complete the reconciliation for two years instead of one. The preliminary assessment of this year’s reconciliation was first brought to my attention earlier in the summer, and while the majority of PAYE records are correct, we are acting promptly to put right the situation that we inherited, which has contributed to the number of individuals required to make payments and the size of payments owed. About 4.3 million taxpayers will receive repayments between now and Christmas, while 1.4 million will be sent letters specifying how any underpayment has been calculated and how such payments can be reviewed.
To begin the process of reconciliation, HMRC has sent out the first set of taxpayer notifications to individuals throughout the UK. Those individuals who have overpaid will receive a full refund. Those who have underpaid will make additional payments through the PAYE system, provided that the payment due is less than £2,000. If the payment due is more than £2,000, HMRC will contact the individual to discuss the issue. All payments will begin next year and no immediate one-off payment will be required. HMRC will review the responses to the first set of notifications and make any changes needed to operational plans before going ahead with the rest. Staggering the process between now and Christmas will help to ensure that HMRC can deal with all queries efficiently.
The Exchequer is owed a total of approximately £2 billion. The fact that we were left with the worst deficit in peacetime history means that we simply cannot afford to write off all the underpayments. To ensure that the tax system is fair for everyone and that everyone pays their fair share, we are taking action to recoup the funds as painlessly as possible. In cases of genuine hardship, HMRC will allow payments to be spread across a period of three years. As was already the case, it will not pursue cases when the amount owed is less than £300—that is an increase from the previous threshold of £50—which applies to 40% of all underpayments. Of course, in specific circumstances, HMRC will consider writing off underpayments where it can be shown that HMRC was provided with all the information necessary—although I have to tell the House, from historical experience, that that is unlikely to apply to many cases. We do not want to build up people’s hopes unrealistically.
This Government understand that there is an urgent need to reform our PAYE system. In opposition and from day one in government, we have sought ways to improve it. The system is outdated, inefficient and burdensome to the Exchequer and taxpayer alike. We need PAYE to reflect the employment issues that the 21st century presents, and that will be a focus of reforms that we take forward as part of our wider strategy for reform.
I thank the Minister for his technical explanation of the problem. I say at the outset that, given the scale of the problem—6 million people owing or owed perhaps £6 billion—it is disappointing that a Minister was brought here to make that statement and that the Government did not volunteer one earlier.
May I ask for more clarity? Is the number of people affected around the 6 million previously reported, and does the Minister discount the figure of 23 million reported in some of the press today? Is he confident that the previously reported figure for mispayments of £3.8 billion are correct, and does he give any credence to reports in the press today of an additional £3 billion of mispayment error? In short, I am trying to understand the full extent of the problem.
Can the Minister tell the House when those due to receive payments from the Revenue will get them? He confirmed the procedure for the Revenue requesting payment from those who have underpaid, and I am pleased that the offset is now £300, but can he give a cast-iron guarantee that those whose circumstances have changed dramatically—perhaps they have lost their job—will not be hounded for modest payments that they can no longer afford to make?
What action is the Minister taking to ensure that taxpayers are not now the target of fraudsters and scams? To get to the bottom of the matter, although he explained how the problem occurred, can he explain how long such errors have been occurring and when Ministers first knew about them? How could a system so flawed have been allowed to operate as it did? He spoke a lot about PAYE and his intention to reform it, but the public, employers and employees have a right to trust and believe that the PAYE system is reliable and works. What guarantees can he give us today that, after work is done on PAYE, it will be trusted and people’s family and household incomes and budgets will not be shredded, as they may be in the coming year, with demands for back tax because of miscalculations by the Revenue?
First, let I say that I am perfectly happy to answer these questions and I am genuinely grateful for the opportunity to do so.
The hon. Gentleman asked about the backlog of cases. That matter has been well known—I believe that he and I have debated it in the past, and a National Audit Office report published on 30 June gave the most recent update on the position. There is nothing new in the backlog that has emerged in recent weeks. There is a problem and we and HMRC are seeking to deal with it, but it is a problem that has existed for many years and we are critical of the previous Administration for the lack of progress in resolving it. A specific concern that has featured very recently is that it has emerged that, in the last two tax years, 4.3 million people have overpaid tax and 1.4 million have underpaid. Our aim is to send cheques to all those who have overpaid over the course of the rest of the year—in dramatic contrast with previous delays in addressing overpayments.
The hon. Gentleman is right to raise the question of changed circumstances, and it is absolutely right that HMRC considers hardship cases. That is why we have announced today that HMRC will show flexibility in some cases to spread payment over three years. As I said, we are not seeking to pursue the matter mindlessly, without taking account of individual circumstances, especially of those owing large amounts.
The hon. Gentleman also rightly raises the subject of fraudsters, and I am grateful to have the opportunity to reiterate that HMRC will not send e-mails to members of the public; communication will be in writing. Of course, people should be cautious.
How long has this problem persisted? The fundamental problem with PAYE, in the sense of there being too many open cases, and underpayments and overpayments, is a long-standing issue. In part it has to be recognised that, inherently in the PAYE system, there will sometimes be underpayments, because not all the information will be available in-year. For example, all the information about benefits in kind, company cars and so on, will not necessarily be available to HMRC or to employers. That will come to light at the end of the year, and then there will be a need for reconciliation, but that problem has always existed.
The hon. Gentleman specifically asked how long Ministers have been aware of the problem. This Minister has been aware of a problem with PAYE since day one, and that is one reason why we made proposals for reform when in opposition.
The hon. Gentleman asked also about future reform. It is important that there is trust in the PAYE system, and it is right to say that in 85% of cases PAYE is correct in-year, but there are still problems, and we are consulting on proposals so that information is more up-to-date—if you like, so that it is real-time information. That means that HMRC will be able to respond to changed conditions much more quickly, and that we will have a system that is fit for the 21st century, in which people move around, change jobs and have multiple sources of income. We think that that is the direction in which we need to move.
Is it not rather revealing that this question was not tabled by the Labour party, which presided over such a decrepit system for so long? Does not the sheer number of incorrect payments illustrate the need to move to a system that reflects modern working and allows tax payments in real time, rather than on the basis of either guesswork in advance of the tax year or reconciliation a year or two later?
My hon. Friend is absolutely right. As the Government, we are seeking to address the short-term issue, which is the overpayments and underpayments. We cannot just brush them to one side or park them for another year; we need to address them. However, we must also look at the longer-term solution, and that, as my hon. Friend rightly says, means moving towards a much more up-to-date system so that the information is more up-to-date and we are able to respond accordingly.
I understand that tax experts were briefed last week and told that a small number of notifications would be sent out in the next few weeks as the start of a process over the coming months, so why was the House not told, still less the public, what was intended? Why did HMRC’s website initially say absolutely nothing at all? Why has that arrangement, which was set out to a few experts last week, apparently now been abandoned and replaced, if we are to believe the reports over the weekend, with a headlong rush, whereby 6 million new calculations will be sent out in the next few weeks? Where is the plan for handling that huge exercise?
The Minister will have seen the questions that I tabled yesterday, but let me put four of them to him specifically. He has told us that HMRC will consider writing off demands when taxpayers can demonstrate that they provided all the necessary information to calculate their tax correctly. What exactly will they have to show, and how can they do so? If a problem arises because the employer, rather than the employee, has made a mistake, can he confirm that the employer will be held liable for the tax that is due?
Crucially, if people are required to pay more tax for a past year, their net income for that year will be reduced. In many cases, that will mean that they would have been entitled to more benefits—pension credit, housing benefit and council tax benefit—than they were actually paid. Can the Minister confirm that the rule will be changed so that those higher amounts will be paid to those individuals or offset against the extra tax that is due?
Anecdotal evidence suggests that HMRC call-response times have become much worse over the past few months, with many more people not being able to get through. Can the Minister confirm that the deadline for tax credit renewals has been extended from 31 August as a result? Clearly, sending out all those notifications will hugely increase the demand on those call centres, so how will that extra demand be managed? The press reports all refer to tax paid over the past two years. Does the Minister intend that, in due course, HMRC will look at earlier periods as well, or is the exercise limited to those two years?
Of course, it is a good thing that the previous Government’s investment has provided a system that is better able, in particular, to keep track of tax obligations, when people change their jobs or have multiple sources of income, but it is the Minister’s job now to ensure that the extra information that he has is used fairly.
I think we now know why Labour Members did not table an urgent question on this matter.
The right hon. Gentleman asked many questions—although there was not a word of apology for a tax system that is clearly encountering some difficulties—and I will endeavour to answer them all. First, there has been no change of plan. We have pursued the same proposal all along, namely to write to 45,000 to 50,000 taxpayers. We will use the information and the lessons learned from this relatively small sample to guide how correspondence will be undertaken with the remaining taxpayers affected. Let me reassure him that his fears about that are wrong. He also expressed concern about the public not being informed about the exercise, but we made great efforts to inform them over the weekend immediately after the decision was taken to proceed with writing those first letters to affected taxpayers.
The right hon. Gentleman referred to a concession that may be available, and he may recall that the A19 concession is available in circumstances where all the information has been provided to HMRC and it has had the opportunity to address it. We have looked into this. The A19 concession, which is well established—he will remember it from his time in the Treasury—does not apply that often in practice, and I do not want people to build up their hopes that it will offer some kind of panacea; that would be unfair on taxpayers.
The right hon. Gentleman questioned whether employers have made mistakes. In some circumstances, employers will have made the mistake that caused the overpayment or underpayment, but the principle remains the same—we have to collect the right amount of tax.
The right hon. Gentleman asked about means-tested benefits. In some cases, because net income was higher in a previous year, certain means-tested benefits would not have been available in that year, so sums are now having to be paid back. In those particular cases where tax underpayments are being recovered through the tax coding system, the corresponding fall in the net income for the taxpayer will increase the availability of means-tested benefits in that relevant year.
The right hon. Gentleman asked about the extension of tax credit renewals’ deadline, and I can confirm that it has been extended to provide additional time for claims. I have to point out to him, however, that the idea that call centres are under strain and that it is difficult to get through to HMRC is not entirely a new phenomenon: it is a long-standing problem. Let me take this opportunity to say to taxpayers who are understandably concerned about their position that they should wait until they receive a letter before contacting HMRC, as only then will it be able to deal effectively and efficiently with their concerns. Nevertheless, he raises a legitimate issue about call centres. We are providing additional staff—there is additional capacity now and there will be after the tax credit renewal process has been completed. We are taking steps to ensure that HMRC is able to deal effectively with those calling in with concerns.
Does my hon. Friend agree that the previous Government ignored not only the crippling budget deficit but the serious problem with PAYE? That is evidence as to why the coalition’s setting up of the Office of Tax Simplification is so important.
My hon. Friend raises an important point. One of the stresses and strains that HMRC has had to deal with has been the complexity of the tax system. If we can address that, we can establish a simpler PAYE system and reduce the demands placed on HMRC so that it can focus on these very matters.
It would be a disservice to the many millions of people affected—certainly the 1.4 million who are being chased for repayments—if we allowed this matter to be passed over in gaining party political points on either side. [Laughter.] It is not amusing to the 1.4 million people. The report says that it was the Minister who noticed the disparity in the figures and asked for a review. The result is sad, but I commend him for uncovering the problem. This issue raises important questions, and that is why party political point scoring would be wrong. It is not the first debacle from this department. As the Minister looks into it, can the House expect some resignations or disciplinary action in respect of the highly paid chairman and chief executive and board?
I appreciate that the hon. Gentleman has consistently raised concerns about HMRC. In my view, we need to focus on moving forward. The fundamental problem is the PAYE system and the inability, over many years, to bring it into the 21st century. In my view, the days of Treasury Ministers throwing staplers around should be past. We need to work with HMRC constructively to ensure that we have an improvement in our tax system.
While recognising that the Government had to deal with this inherited problem, will my hon. Friend give me an assurance that the Revenue will assist those who have a reasonable basis for showing that they provided the necessary information in good time and that they will not face obstruction or lack of information? Will he assure me that these efforts will not detract from the measures that need to be taken to deal with those who actively evade their taxes, unlike most of the people this problem will affect?
Will the Minister make sure that there are sufficient staff who are able to help vulnerable people unexpectedly facing big bills, with face-to-face discussions about how to deal with that? Last Sunday in my advice surgery, I spoke to a gentleman who is a courier earning £220 a week and has no bank account, but owes £18,000 in back tax because he has constantly had letters that he does not understand referring to extra charges, interest payments and so on. He has not been able to find anyone who can speak to him about the problem. Will the Minister ensure that there are enough staff to speak to people?
I am grateful for that question. It is absolutely right, particularly where those larger sums are involved, that HMRC deals with people sympathetically, and in order for it to do so there needs to be proper communication. That is a challenge for HMRC, but it is absolutely right that it focuses its resources on this matter.
A couple of years ago, HMRC lost my personal information and that of 25 million other people on the child benefit disc, and in my constituency surgeries each week, HMRC problems consistently generate the most casework. In opening the boot—or the bonnet—of the car that is the computer system at HMRC, what other problems is the new mechanic going to find?
HMRC has faced many problems and challenges over recent years: a merger, coping with a complicated tax credits system, and a number of other issues. We need to be realistic about what can be done with our tax system—tax simplification is indeed important—and allow HMRC to focus on its key concerns and do the very important job that it has to do.
Can the Minister outline the costs of this entire operation, and may I endorse the call for people who have underpaid to have the opportunity of face-to-face meetings if there are big demands on them, so that their cases can be heard properly? Can he indicate whether interest will be paid on top of the money to be repaid to those who have overpaid?
On the last point, yes, interest is applicable and a statutory duty. We are not in a position to assess the costs to HMRC. It is worth putting the matter in perspective by saying that most people have had their tax calculated accurately through the PAYE system, and that more will receive repayments than will have to pay extra. People should wait until they receive their letters. It is worth pointing out also that the problem of underpayments has existed in previous years, and many hundreds of thousands of people have had to repay tax through the PAYE system, so the phenomenon is not entirely new, although the scale is somewhat greater now.
May I first congratulate the Minister on moving from the £50 limit to a £300 limit? That will be very helpful. However, many thousands of the 1.4 million people will have changed circumstances. They may now be unemployed, have mortgages or be on short-time working. Will that be taken into consideration? For ever the pragmatist, may I suggest that a direct line be set up for MPs? I imagine that I will have to put a revolving door in my constituency surgery.
I note the hon. Gentleman’s point about a direct line, and I will certainly put that to HMRC management. I reiterate that we accept that there may be hardship, and I am sure his constituents will welcome the announcement today about repayments potentially being spread over three years.
The Minister said that one reason why some payments will have to be so big is that there has not been a reconciliation for two years. Can he explain why moneys were not required back from taxpayers up and down the country last year in the months running up to the general election?
My blood ran slightly cold for a moment when I thought that the TaxPayers Alliance had managed to get in here, but I know that my hon. Friend is a good representative for taxpayers. As for last year, it is fair to say that the introduction of the computer system was a relevant issue, but none the less the lack of a reconciliation has exacerbated the problem. The fact that nothing was done last year prior to the election has left us with a bigger problem this year. He can draw his own conclusions.
May I ask the Minister whether these circumstances have given the Government any further thought about plans to cut the future capacity of the Revenue and Customs? If he is giving positive consideration to the very good suggestion that there be a helpline for MPs, may I suggest, since many of the people affected will not have accountants to hand or be able to go to them, that it be available also to citizens advice bureaux, which will get an awful lot of inquiries?
That is an operational matter that HMRC will need to consider, but I will discuss it with senior management. As far as staffing is concerned, there will be a spending review announcement on 20 October, and any announcements on HMRC’s budgets will be made at that time.
The size of the problem, the number of people affected and the amount of money involved make it a real tragedy for this country. Some 2,000 of my constituents, and the constituents of each and every one of us, will have to stump up more money that is not planned for at a time when money is tight for everyone. May I urge Ministers to have compassion for those who find themselves in a difficult spot, and a review of HMRC, particularly its difficulties in operating computers?
I was a bit disappointed by the Minister being a little dismissive of my right hon. Friend the Member for East Ham (Stephen Timms) when he suggested that it was now getting harder to get through to HMRC. My experience, and that of many MPs, is that when people try to get through to tax credits staff, they just get an answer machine saying that they should phone back another day. They cannot even leave a message.
The situation is getting worse, and although I do not want to blame the Minister for that, may I urge him to consider more than just additional call centres? He should also consider the possibility of providing not just a helpline but more support for bodies such as Citizens Advice and other information agencies. Does he agree that there is a danger of scam e-mails, with people trying to take advantage of those who will be in a difficult position, and that people will need somewhere reputable to get information and support so that others cannot try to get money out of their suffering?
I reiterate that additional resources will be provided for call centres—I believe there will be about 20% extra staff by the end of the month, with contingency for more if needed. HMRC is focusing on that. I welcome the hon. Gentleman’s remarks about tackling fraudsters, and we can take back to our constituents the message that they should be wary, particularly of e-mails. HMRC will not e-mail people about this matter.
A lot has been said during these exchanges, and it may be confusing to some members of the public. May I ask my hon. Friend to give some ABC points to members of the public who have been affected or feel that they may have been, so that it can be recorded properly on tonight’s news?
First, I would say that people should wait until they receive a letter. When they receive one, if they are asked to pay money back they should go through the details carefully, and if they are concerned at that point, they should contact HMRC. They can be reassured that we are not demanding immediate payment, as there will be an opportunity either to spread it out over future months and years or at least to talk to HMRC about the details.
How does the Minister respond to the reports in the national newspapers that certain accountants are suggesting that there is no need to pay back the money, and to the confusion that that will undoubtedly cause many people? He mentioned flexibility in the response to the problem, but are not fairness and consistency also very important, to ensure that everyone is treated exactly the same?
It is right that people pay the tax that is due. I have read the newspaper reports, and it is right to say that a concession is available in some circumstances, but I have been straightforward in making it clear that we do not believe that it will be widespread. People should pay the tax that is due, and given the state of the public finances, we are certainly not in a position to wave goodbye to £2 billion. That would not be fair on those who have paid the correct amount of tax.
My hon. Friend has said that the NPS—the national insurance and PAYE service—system is now up to date and working, within reason, but he has also admitted that PAYE is a 1940s system and not up to date. A consultation is currently going on and is due to shut in about two weeks. One of the problems that he identified was that information can be up to 18 months old. When will we reach the stage of real-time collection, and if it does come in, how and by whom will it be administered?
My hon. Friend is right that we are consulting on moving towards a real-time system. I do not pretend for a moment that it is an overnight solution, but we are examining it so that over the next few years, we can move to a system that gives HMRC, which will of course continue to administer it, information that is up to date and adjustable in-year. That will ensure that we get a much greater level of accuracy in our tax system.
Like all hon. Members, the Minister will have constituents visiting him who have underpaid tax and who will feel that that is no fault of their own, and yet, under the system as it exists, they will be expected to pay back in full. Has he given any consideration to recognising clearly in the amount that must be paid back that our constituents have acted in good faith and that the fault lies elsewhere?
As I said earlier, concession A19 is for taxpayers who have acted in good faith when HMRC has had an opportunity to respond. However, I should also make the point that PAYE has always involved circumstances in which information comes to light after the tax year is completed and an adjustment must be made. That has happened throughout the existence of PAYE, but it has increased over the years as working patterns have changed, which is why we need to look at more fundamental reform of PAYE.
It would seem that the left hand of HMRC does not know of the information held in the right hand. What assurance can the Minister give to members of the public that such information can be better co-ordinated to ensure that such mistakes do not happen again?
The hon. Gentleman makes a good point. To be fair, the NPS system brings the information together, but unfortunately, that has highlighted more difficult cases. In fact, as we move forward with the NPS system and—potentially—further reforms, HMRC should have more accurate information and so be able accurately to assess the level of tax due.
I am tempted to ask whether the person who designed the computer system for HMRC is the same as the person who designed the computer system for claiming MPs’ expenses, but I shall resist, and instead ask the Minister this: why has he alighted on the period of only three years for people to make payments? Is it not the case that people on very low incomes may need longer if they are hit with particularly large bills?
The period of three years is one in which we have confidence that HMRC will be able to address the matter administratively. Beyond that, certain technical matters would need to be thought through. However, we are confident that HMRC is capable of addressing the matter over three years.
Does the Minister agree that the position of front-line staff in HMRC centres up and down the country is important? They do a stressful job at the best of times and regularly deal with frustrated taxpayers on the phone, but with the new problem, I am sure the Minister agrees that the staff’s position needs to be looked at. A statement of support for them from the Minister would be welcome.
I am grateful for the hon. Gentleman’s question. Some comments have suggested that the situation is the fault of HMRC staff who cannot add up, but those comments are ill-informed. The truth is that HMRC staff are committed to doing a good job. They are battling with a difficult system, and I give them my support. As a Minister, I have visited many HMRC offices, and I appreciate the hard work, enthusiasm and dedication of HMRC staff.
Does my hon. Friend appreciate that if the head of HMRC was instead the finance director of a financial services company that was seeking to claw back that sort of money from customers, he would be obliged to take himself off to Canary Wharf and satisfy the Financial Services Authority that he had complied with the requirements to treat customers fairly? Is the Minister satisfied that the mechanisms that he has outlined, including the period for repayment and other things, would satisfy the same approach that the FSA would take in relation to a private company?
The Minister is responding excellently to the question, but I must say to him gently that it would have been better had he made a statement rather than being asked to come to the House.
PAYE has always been a collection of money on account towards the final tax liability, but the Minister has not made it clear to me whether a great number of people are affected by the current situation just because people’s lifestyles have changed. Was there also an error in the basic collection by the Revenue of the correct information given by taxpayers?
Our understanding is that the fundamental problem is changing working practices—that is the long-term issue. Of course, there may be circumstances in which HMRC has made errors, but changing working practices is the essential problem. It is also the case that the new computer system more accurately and rigorously picks up problems than happened before. That is why we have seen the increase in underpayments and overpayments. However, my hon. Friend is absolutely right that there have always been underpayments and overpayments under the payment-on-account PAYE system.
I welcome my hon. Friend’s statement. The relationship between taxpayer and tax collector is extremely important. Many of my constituents find the fact that it is extremely difficult to get through to the Revenue at the moment very stressful, which they must do through no fault of their own, as other hon. Members have said. Will the Government look at that relationship and ensure that it is valued, so that both HMRC staff, who do an excellent job, and its customers, are treated the same way as we would expect in any public service?
May I congratulate the Minister on taking prompt and appropriate action on this inherited fiasco? Much mention has been made of telephone hotlines and so on, but the vast majority of people who receive requests or demands for the return of unpaid tax will not have advisers or anyone to assist them. Will he make an effort to ensure that the letters that are sent to our constituents are in plain English and easy to understand, and that they contain appropriate calculations that the individual taxpayer can appreciate and understand, so that they can make their decisions without recourse to either MPs, tax advisers or accountants?
Points of Order
On a point of order, Mr Speaker. At Health questions yesterday, the Health Secretary misrepresented my position on NHS Direct. He referred to a Department of Health press release dated 18 December 2009 and quoted partially from it to imply that he is simply implementing my plans. Let me quote a crucial sentence that he left out:
“111 will not replace…NHS Direct”.
By contrast, his Department’s press release of 29 August states:
“NHS 111 telephone number will eventually replace NHS Direct”.
That is a huge change of policy that affects thousands of staff in the NHS and, of course, millions of patients who rely upon the services of NHS Direct every year.
Is it in order for an announcement of that kind to made on the eve of a bank holiday weekend and for no written or oral statement to be made to the House? Will you, Mr Speaker, intervene in this matter to ensure that there is a detailed statement laying out the Government’s plans for NHS Direct, and do you agree that carrying on in that cavalier way is no way to run the NHS or to treat dedicated NHS staff?
I thank the right hon. Gentleman for his point of order. The response is as follows. First, it is entirely a matter for the Government to choose the timing, and indeed for the most part, the location of statements that they wish to make. It may well be that Members are unhappy about the timing, but the timing itself was entirely legitimate and proper, so there was no cause for me to intervene on that account.
Secondly, I would say to the right hon. Gentleman that in so far as he was—and remains—concerned that his position was misrepresented, the point that he has raised must constitute a point of debate rather than a point of order. He has now very forcefully placed on the record his own position for others to observe. I have a feeling that this very controversial subject, on which there are strong views, is one to which the House and individual Members will regularly return, and it is open to him to do so.
On a point of order, Mr Speaker. It is my understanding that you and the Serjeant at Arms have responsibility for the security and safety of Members of Parliament. Given that very serious allegations have been made against a parliamentary pass holder about the tapping of Members’ phones, will you consider whether that pass should be withdrawn until such time as investigations have been concluded, and will you therefore make a statement to the House, perhaps tomorrow before the debate requested by my hon. Friend the Member for Rhondda (Chris Bryant) takes place?
I am grateful to the hon. Gentleman for his point of order. He is right about my responsibility and I understand his concern on this important issue. However, I must say to him that there is a long-standing and generally accepted practice that we do not discuss security matters on the Floor of the House. In an attempt to be helpful to the hon. Gentleman, I may say that if he has a further and specific point that he wishes to raise with the Serjeant at Arms, it is proper for him to do so. It might be best for him to take the matter forward in that way. If he wishes to keep me abreast of developments outside of the Chamber, that is also an option open to him.
On a point of order, Mr Speaker. Further to your earlier statement consequent on the application made by my hon. Friend the Member for Rhondda (Chris Bryant), will there be an opportunity for the Prime Minister and the Chancellor of the Exchequer to confirm to the House whether Scotland Yard has identified them as persons of interest in the current News of the World investigation?
Further to that point of order, Mr Speaker. Is there any way in which Members who have waited a long time for the important debate on Afghanistan can stress to the Government, through you, that it would be iniquitous if the debate were to be cut short?
Sex and Relationships Education
Motion for leave to bring in a Bill (Standing Order No. 23)
I beg to move,
That leave be given to bring in a Bill to require schools to provide sex and relationships education to registered pupils; and for connected purposes.
As people say, “ And now for something completely different.” I first raised the issue of teenage pregnancy, which is a big problem in many constituencies, and of sex and relationships education some three or four years ago. I was then interviewed by an ITV journalist whose first question was “What is the nature of the problem with teenage pregnancy?” I explained, and his next question was, “And what causes teenage pregnancy?” I said, “Well, I’m not an expert, but I think it is something to do with sex.”
There are some very depressing facts on teenage pregnancy. In 2008, there were 41,325 conceptions to girls under the age of 18 and 7,577 to girls under the age of 16. Of the conceptions among girls under 18, 42.4% went on to have abortions. For the girls under 16, the figure was 52.9%. We would all agree that that is an unacceptable situation for our society. Even more distressing, in 2007, 369 girls under the age of 14 became pregnant.
The problem is writ large in many different ways. As someone who is deeply concerned about my constituents and the problem of long-term deprivation, I find it embarrassing that half of the conceptions by teenage girls occurred in the most deprived 20% of wards. Infant mortality among children born to teenage mums is 60% higher than it is for older mothers. Even more depressing, the daughters of teenage mothers are far more likely to go on to be teenage mums themselves. That means that in constituencies such as mine teenage pregnancy and poverty tend to be handed down from generation to generation, as inevitably as a title or seat in the House of Lords used to be. I want to see an end to that.
The most depressing moment that I have had in recent years in discussing this issue was in my constituency, when I met a brave and wonderful young girl. I hope that she will be a wonderful mother and have a fulfilling life. When I first met her, she was 16 and was pregnant for the second time. The first time, she was made pregnant when she was raped by her father at the age of 13.
We know that teenage pregnancy is an enormous problem across the country. The map of teenage pregnancy reflects the map of deprivation. We should be embarrassed by the fact that the international comparisons are terrible. We have the highest rate of teenage pregnancy in Europe—not just slightly, but by far. It is five times higher than in the Netherlands, three times higher than in France and twice as high as it is in Germany. We should do everything that we possibly can to change that.
Some 75% of sexually active 16 to 25-year-olds do not use condoms, and the number of sexually transmitted infections is steadily and dramatically increasing. Young people represent only 12% of the population, but account for nearly half of all sexually transmitted infections. HIV infection has trebled over the past 10 years, with 7,000 new diagnoses every year—and many thousands probably go undiagnosed. In addition, many schools still experience a high level of homophobic bullying, with youngsters suffering and going on to have major mental health problems. Some end up committing suicide. The incidence of suicide among homosexual pupils is six times higher than it is among heterosexuals. In 1990, only 10.3% of women had had their first sexual encounter under the age of 16, but in 2000 that had risen to 20.4%, which is another depressing statistic.
Some Members may say that all that was the fault of the previous Government—[Interruption.] I can see a couple of heads nodding. But actually the dramatic increase in teenage pregnancy rates happened in the 1980s and the early 1990s. I do not wish to attribute that to any particular Government or political party, but I simply make the point that now more teenage mothers are in education, employment or training and the figures have fallen in the last 10 years. They have not fallen enough, or anywhere near as much as we wanted them to fall, but they have fallen by 13.3%.
There is no point in being judgmental about this. I have met teenage mums who have been wonderful mothers. They have triumphed over the odds and gone to provide successful careers for themselves and their children. Likewise, I have met many teachers who teach sex and relationships education in school and who do it wonderfully, superbly, including in many faith schools up and down the land.
The judgmental attitude of the past, which meant that girls who got pregnant were thrown out of their homes and ignored by society—everything was brushed under the carpet—has not done us any favours. There is one big difference between this country and European countries with lower rates of teenage pregnancy: all the other countries provide statutory sex and relationships education to every single child from an early age. That is particularly the case in the Netherlands, which has the lowest rate in Europe and by far the best sex and relationships education.
According to reports in recent years on SRE in schools, a remarkably high number of girls get to their first period without understanding what is happening to their body because they have not had any SRE. Far too many children say that they would much prefer their first talk about this to be with their parents but that it is far too embarrassing and difficult for that to happen, and far too many say that the only SRE they had was at the age of 15 when they were told how to put a condom on, in some schools, a banana, and in other schools, a broomstick.
If we start too late, when youngsters are already having sex, we have already lost. We need to ensure that every child in the country has good SRE. Schools should not be able to opt out entirely from providing it, because every child should have the opportunity. Of course, if parents want to withdraw their own child, and if the child does not want to attend, they should be able to do so. That is right and proper, and my Bill would provide for it. However, I do not think that we should have whole schools opting out, either because the governors refuse to contemplate it, or because they are just too lily-livered to ensure that a proper curriculum is in place. That is why I believe that there should be statutory provision. This provision was to have been part of the Bill that came before the House before the general election, but there was a dispute and consequently these elements of the Bill were removed. However, I very much hope that hon. Members this afternoon will give the opportunity for the Bill to proceed.
I am thoroughly aware that just improving SRE in schools will not transform every aspect of the problems I have been referring to. Under-age drinking is still one of the main reasons a lot of young girls get pregnant, because all the good intentions that a couple might have at six o’clock on a Friday evening, when they are completely sober, might completely and utterly disappear when they are blotto at 11.30 pm. We need a better youth service so that young people are engaged with responsible adults who can give them a strong sense of their own self-confidence and self-worth, so that they can make better decisions in life.
In addition, it is important that we have proper early intervention, particularly for girls who are under-achieving in school. So often, young girls, when they feel that they are not loved at home or doing well at school, will almost, in the words of the Joseph Rowntree Foundation, make a career decision to get pregnant. We should be ensuring that there are better alternatives for those girls, so that they can make better choices for themselves and their children in life. I hope that the House will agree this afternoon that, in the words of the Secretary of State for Education,
“it is vital that all children have high-quality sex and relationships education”.—[Official Report, 12 July 2010; Vol. 513, c. 656.]
I want to make it clear that I do not propose to press this to a Division, but I give advance notice to the hon. Member for Rhondda (Chris Bryant) and his hon. Friends that there are many in the House, not just on the Government Benches but on both sides, who will fundamentally fight his proposals, because we believe that they are the wrong thing for this country. I believe that primarily because this aspect of sexual and relationships education is the fundamental, primary domain of parents within families.
The hon. Gentleman might not have intended to be disingenuous, but it simply is not true that there is not an obligation for elements of sex education to be present within our education system. It exists at secondary school level. One of the things that concerns me about his proposal is that it would introduce the concept of sex education for all key stages, which would include, of course, five and six-year-olds. I have a further concern. As is appropriate, curriculums are developed by school governors, with teachers and parental involvement. That is important. However, his proposal, which suggests a one-size-fits-all approach—imposing something from the centre—goes against the current thinking, which is about local schools knowing best, in conjunction with parents in particular. It is imperative that parents continue to be able to exercise the right to withdraw their children from lessons that they do not believe to be in their children’s interests, and if they would rather teach SRE themselves. He added the proviso that children should be able to make that decision for themselves, but I believe that parents should be able to override them until they become of an age when they are legally entitled to do other things themselves.
This imposition on primary schools is fundamentally wrong. Putting it on the statute book is heavy-handed and belies the fact that secondary schools already undertake elements of this education. The constant approach of getting the state to undermine and supersede parental authority is fundamentally flawed. What has been the impact of sex education? A campaigner for the British Pregnancy Advisory Service said:
“There have been a large number of studies about the impact of sex education on abortion rates and pregnancy rates, and these frequently tend to show they are not having the kind of impact that the family planning specialists want. They mainly make us feel good that we’re educating people more thoroughly, but they do not seem to have much impact on the abortion rate.”
Let us go further. The SHARE scheme in Scotland conducted a test across a wide number of schools using a well-documented control group. It is probably the most carefully designed and rigorously tested such programme in the United Kingdom to date, and at the end of it, the researchers concluded:
“This specially designed sex education programme did not reduce conceptions or terminations…compared with conventional provision. The lack of effect was not due to quality of delivery.”
They also said that
“complementary intervention should be suggested”,
including socio-economic interventions and parental influence. To be honest, we do not need a big research programme to know that parents are the best people to discuss with their children the concept of sex and relationships education. Dare I say it—I am not trying to be flippant—but perhaps for teenagers the very fact that their parents had sex to have them puts off the discussion. Perhaps that was the case when the hon. Gentleman was growing up. However, we should be braver than that.
In the evidence that the hon. Gentleman cited, he mentioned many different countries, such as Holland, which has invested in sex education. However, he might also have seen the article in The Times that read:
“The Dutch Government still penalises single mothers under 18, who are expected to live with their parents if they become pregnant. Until six years ago the Government gave them no financial support.”
That might be an example of socio-economic intervention.
The hon. Gentleman failed to mention Italy, which also has low levels of teenage pregnancy, but does not invest significantly in school sex education, so we should not follow the example of the Netherlands and other countries he cites, or indeed France where the abortion limit is at 12 weeks, and suggest that sex education from the age of six is the right way to reduce sexual intervention. Dare I say it, but in the last so many years when sex education has been the norm, the great experiment of the ‘60s—
Oh, it certainly has, yet the percentage of people having sex under the legal age limit has doubled. That is not a record that this country should be proud of. I agree with the hon. Gentleman: I am not condemning teenage pregnancy—far from it. I do not think that the age of somebody always reflects whether they are a good mother. However, the fundamental principle is that families and parents know best, not the Government, so we will oppose this Bill fundamentally, every hour, every day.
Question put (Standing Order No. 23) and agreed to.
That Chris Bryant, Ms Diane Abbott, Sir Peter Soulsby, Jessica Morden, Nick Smith, Katy Clark, Mrs Sharon Hodgson, Luciana Berger, Karl Turner, Heidi Alexander, and Alex Cunningham present the Bill.
Chris Bryant accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 11 February, and to be printed (Bill 69).
[4th Allotted Day]
Crime and Policing
I beg to move,
That this House notes with concern the Government’s failure to prioritise the safety of communities by not protecting central Government funding for the police; notes the conclusion of the Audit Commission and HM Inspectorate of Constabulary that any budget reduction over 12 per cent. will reduce frontline policing; pays tribute to the police and other agencies for achieving a 43 per cent. reduction in crime, including a 42 per cent. cut in violent crime, since 1997, and for maintaining that reduction through last year’s recession; notes that public perception of anti-social behaviour is at its lowest level since it was recorded in the British Crime Survey of 2001-02; further notes that the previous Government set out plans in its Policing White Paper to drive down policing costs whilst maintaining core funding; and condemns the Government’s policy of reducing police numbers, restricting police powers and imposing elected commissioners to replace police authorities, thus condemning the police service to unnecessary, unwelcome and costly re-structuring at a time when their focus should be on maintaining the fall in crime and anti-social behaviour.
The previous Government were the first since the end of world war one to leave office with a lower level of crime and disorder than when they came into power. In a previous debate when I mentioned that fact, the Home Secretary challenged it by rather bizarrely mentioning Michael Howard—now the noble Lord Howard of Lympne—who may have been many things, but was not a Government. Although it is true that the noble Lord Howard—recently much derided by his former colleagues—was the only Conservative Home Secretary in 18 years to preside over any reduction in crime at all, it was a modest reduction, to 4.6 million crimes a year, compared with 2.3 million in 1979, when the Conservatives were elected. In other words, without Lord Howard’s contribution, crime under the Tories would have more than doubled; thanks to him, it merely doubled, with violent crime rising by 168% and robbery by 405%.
The Conservative party that presided over that truly miserable record refuses to acknowledge the tremendous work of the police and other agencies in tackling its legacy. The Conservatives can no longer deny that crime has fallen, including violent crime, so they resort to saying that crime is still too high—and they are right: it is. But when they were in power, the chances of being a victim of crime were 40%; now it is 21.5%, the lowest since records began. The latest statistics, published by the new Government in July and covering 2009-10, confirm the trend. Both recorded and surveyed crime continued to fall, by around 9%, through the deepest global recession in the post-war era, thus effectively destroying the theory of Lord Howard’s fiercest critic, and probably his most feeble predecessor, the current Justice Secretary, that crime fell under Labour only because the economy improved.
The purpose of today’s debate is to set out why that record of success is being jeopardised and to highlight three specific areas: first, the Home Secretary’s failure to stand up to the Treasury and insist that policing and counter-terrorism be prioritised in the comprehensive spending review; secondly, her determination to restrict the ability of the police and other agencies to use DNA, CCTV and, now we discover, antisocial behaviour orders to deter and catch miscreants; and thirdly, the dogmatic pursuit of the abolition of police authorities and their replacement by a single elected commissioner.
In respect of the CSR, we know that some Secretaries of State are arguing vociferously for their Departments, but the one with the best argument is apparently content to take a 25% to 40% cut in her budget. Before Government Members seek to intervene on me with their Chief Whip crib sheets—subtitled “Patrick McLoughlin’s route to a ministerial career”—let me say that if Labour had won the general election, the Home Office budget would have been cut and the police would have had to make savings. That is not a matter for conjecture: £1.3 billion of savings that we would have implemented by 2013 are itemised in last year’s pre-Budget report, the Budget, last November’s policing White Paper and other public documents.
On that issue, I have read the wording of the motion carefully, in which Her Majesty’s loyal Opposition make the point that it is the Government’s deliberate policy to reduce police numbers, which is not the case. I simply make the point that I made before, in the debate in July, that the shadow Home Secretary specifically said on 20 April that he could not guarantee that there would not be a reduction in police numbers. Does he stand by those comments in the election campaign, and does he not see that even a fair-minded person would think his contribution today just slightly disingenuous?
I knew that that one would be on the crib sheet. Of course it was right to say honestly to the public that no Home Secretary could guarantee that police numbers would not fall by a single police officer. The number of police and recruitment for the police are matters for chief constables and police authorities. What we guaranteed, as I will explain in a second, was that the central funding that the Home Office provides—which has led to the recruitment of 17,000 more police officers and 16,000 police community support officers—would continue to be provided, index-linked, because we considered crime and policing to be a priority.
The savings that we set out included £70 million in reduced police overtime, £75 million from business support and back-office functions, £400 million from procurement and IT, and £500 million from process improvement. My deal with the previous Chancellor—the one who did produce progressive Budgets—was to prioritise the police and security services by maintaining the 2010 level of central funding necessary for the continued employment of record police numbers, thus reducing the Home Office budget by around 12%, or £1.3 billion,without hitting front-line policing.
We have had a report from Her Majesty’s inspectorate of constabulary and the Audit Commission endorsing that approach. The report, “Policing in an age of austerity”, concluded that
“cost cutting and improvements in productivity could, if relentlessly pursued, generate a saving of 12% in central government funding …while maintaining police availability.”
This is therefore not an argument about whether there need to be cuts to the police budget over the next four years; it is an argument about a cut of 12% or, as the Chancellor announced on 22 June, a cut of 25% for the Home Office, which he describes as an unprotected Department.
I assure my right hon. Friend that I thought of this question myself. On Monday I met the chief constable of Kent, who was concerned about the lack of information coming out of the Home Office. I do not know whether things were done in the same way when my right hon. Friend was Home Secretary, but although the Policing Minister said on Monday that we had to wait until 25 October for the comprehensive spending review, chief officers are now having to prepare their budgets without knowing even a ballpark figure for the cuts. Would it not be helpful if the Government could give an indication as to how much the figure could be, so that chief officers could prepare for what is inevitable?
I thank my right hon. Friend for that question. I do not think that the collegiate approach in this House has stretched as far as Members on the Opposition Benches getting the Government Chief Whip’s crib sheet. I know that that was his own question, although I suppose that it might have come from our crib sheet. The issue is this: we would not have revealed before a CSR what the settlement was. That is why it is difficult to itemise the savings in advance of a CSR. What can be done—and what we did with the police in the policing White Paper—is to identify those areas that I have mentioned and ensure that the police and the security services understand that we were prioritising police and security. Also, in this year Parliament, including those now on the Government Benches, approved the allocation of funding, knowing that there would be another pay increase in the three-year police pay deal. What has happened now is that the Government have not only demanded more savings this year, despite having to meet that pay increase, but frozen the precept. The police are in a far worse position, including the chief constable of Kent, than they would have been had we been in government.
It is extraordinary that the Government should refuse to add policing to health, education and international development as an area requiring special consideration. The Chancellor is fond of quoting Canada as a precedent for the kind of savage cuts that he heralded in the emergency Budget, but the Canadian Government were not foolish enough to slash police budgets. Expenditure on policing fell by just 0.1% in the years following the Canadian Star Chamber cuts, and then rose steadily thereafter. The number of police officers dipped by at most 3%. In this country, the budget will be slashed by at least 25%, which means a cut in police numbers of between 35,000, as estimated by Professor Talbot, the respected criminologist at Manchester university, and 60,000, according to the magazine Jane’s Police Review, which took what I hope is the exaggerated view that the cuts might amount to 40%.
The HMIC report means that there can be no further pretence that front-line policing can somehow emerge unscathed from this kind of budgetary carnage. As well as failing to protect central allocations, on which police forces rely for between 50% and 90% of their funding, the Government have placed a two-year moratorium on any increases in the local precepts. So much for localism. As a result, plans are already being drawn up in every police force throughout the country to cut the number of officers, as my right hon. Friend has pointed out. The 16,000 police community support officers, who are popular with the public and central to neighbourhood policing, are bound to go if there are cuts of 25%. As civilian staff, they are more easy to dispose of, which is why police forces such as Durham have already put every PCSO under notice of redundancy.
There was nothing about this in the coalition partners’ manifestos. Indeed, the Lib Dems, who believed that this country was under-policed, were promising to use the money saved by scrapping identity cards to recruit 3,000 additional police officers. We now have the Government’s own figures for the amount of money that will be saved by scrapping ID cards. I will willingly take an intervention from anyone on the Lib Dem Benches if they want to tell me how many police officers that equates to. Is it 3,000? No. Is it 2,500, 2,000, 1,000, 500, 200? No. If we used all the money saved by scrapping ID cards, we would get 117 extra officers, not 3,000. Would that we could look forward to any increase in officer numbers at all. It is now likely that the Lib Dems will preside over the loss of 3,000 officers every four months over the next four years.
My right hon. Friend is making a powerful point about the contribution of the Liberal Democrats. Many people have wondered whether this Government would be any different if the Lib Dems were not involved, but are we perhaps now starting to see how they are involved? When we look at the cuts in policing, the decision to put yobbos on to the street rather than in prison, and they ways in which the Government are on the side of the criminals rather than of the police, we can see that the lily-livered Liberals are indeed making their contribution to government, just as people were beginning to wonder what they were doing.
My hon. Friend makes an interesting point. During the general election, the Conservatives and Labour were united in saying, “Don’t let the Lib Dems anywhere near crime or national security—or immigration, for that matter.” We remember some of their policies in that area. I do not blame the Lib Dems at all for the Government’s policy on crime and policing. The Home Secretary has been careful to have only one Lib Dem in her team, and she is a very good Minister, but the Government have not allowed her anywhere near the important stuff in the Home Office. This policy cannot be described as a coalition approach. Certainly, the decision not to prioritise the police in the comprehensive spending review was made by the Conservatives.
I have mentioned the likely loss of police officers over the next four years. Let us have no doubt that cuts of this magnitude will also put national security at risk, as the most senior counter-terrorism officer in the UK has made clear. Insufficient resources will inevitably lead to the closure of regional counter-terrorism units, to fewer surveillance teams to monitor suspects, and to a reduction in the number of police officers who work full time on counter-terrorism.
Was my right hon. Friend concerned about yesterday’s announcement of the abolition of the Audit Commission? We are going to see massive cuts across the board, and the Audit Commission normally monitors, evaluates and supports the performance of the police. The cuts will have differential impacts, and in Swansea, 38% of the people are in public sector employment. They face massive cuts, and unemployment and education cuts are growing, which is fuelling more localised crime. Is he worried that we will not have the tools to assess what is happening, to enable the Government to channel resources to where they are most needed?
That is certainly an issue, particularly in the light of the HMIC-Audit Commission’s joint report. We must take a rigorous approach to its conclusion that, if the Government cut more than 12%, front-line policing will be affected. Perhaps this is one of the reasons why the Audit Commission has been done away with; I hope that HMIC will not come next.
As police numbers reduce, so will their powers. I shall deal with DNA and CCTV in a moment.