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Oral Answers to Questions

Volume 527: debated on Wednesday 4 May 2011


The Secretary of State was asked—

Work Programme

1. What discussions he has had with the Secretary of State for Work and Pensions on the awarding of contracts for the Work programme in Scotland; and if he will make a statement. (53554)

9. What weighting was given to the involvement of voluntary sector organisations in the assessment process of tenders of prime contractors for the Work programme in Scotland. (53564)

Over the past year I have had numerous discussions with ministerial colleagues on the development of the Work programme. The Government are encouraging prime contractors to engage voluntary and private sector organisations in the delivery of the programme.

Does the Secretary of State share my concern that the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling), may have broken the ministerial code of conduct in awarding the contracts to some companies? Will the Secretary of State make a statement on the matter, and what is he going to do to protect the companies that missed out on the awards that were given out?

The hon. Gentleman is making a very serious allegation, which my right hon. Friend absolutely refutes. As with any other instance in which people think something inappropriate is happening, there are appropriate channels through which it can be pursued. If there is some evidence on that or any other matter, those channels should be followed.

I declare an interest as a non-remunerated director of the charity Turning Point Scotland.

There has been great unease in Scotland about the tendering process for the Work programme contracts. The tender document clearly outlined the expectation that at least 30% of a prime contractor’s subcontracts should be delivered by voluntary sector providers, and it stated:

“This will be a key factor in the tender assessment process.”

Yet the successful bids commit to a mere 8% and 6% voluntary sector delivery respectively. I hope that the Secretary of State shares my concern, and my question to him is simple: what went wrong?

I acknowledge the hon. Lady’s work in the voluntary sector, and I believe that it has a very important role to play not just in getting people back to work but in many aspects of Scottish life. Let us remember that the Work programme is a step change in the provision of support for people to get back into work. We are determined to ensure that we tackle all the problems that have afflicted different parts of Scotland and the rest of the United Kingdom.

The invitation to tender document was absolutely explicit about the criteria, and they were the ones against which bids were measured. As far as the future involvement of the voluntary sector is concerned, the two preferred bidders have indicated that they fully intend to engage with the sector.

I call Sheila Gilmore, whose question has been grouped with Questions 1 and 9. She is not here.

Does the Secretary of State agree that to secure economic recovery, it is important to listen to the views of the job creators so that we minimise the number of people needing support from the Department for Work and Pensions in the first place?

Of course it is important that as we recover from the terrible economic situation that we inherited, we focus on creating new jobs. That is why we set out in the Budget continued plans to ensure that we keep interest rates low, reduce corporation tax and reduce the burden of national insurance, compared with the previous Government’s plans. We will continue with those measures, to ensure that we rebalance the economy and create more private sector jobs in Scotland and elsewhere.

But does the Secretary of State acknowledge the significance of the fact that 200 leading Scottish job creators have today signed a public statement saying that the best approach for the future is to re-elect the Scottish National party Scottish Government, and Alex Salmond as First Minister?

Funnily enough, I do not agree with the hon. Gentleman on that point. The best approach to the next Scottish Government is to ensure that we have Liberal Democrats at the heart of it, so that we can reinforce the central part that this Government are playing in rebalancing the economy of the UK as a whole. Our agenda for growth is absolutely essential to our recovery from the situation that we inherited.

I note that the Secretary of State, in his answer to my written question yesterday, stated that at his recent meeting with Scottish voluntary sector organisations, to which he dragged along the Minister of State, Department for Work and Pensions, the right hon. Member for Epsom and Ewell (Chris Grayling), he had encouraged the successful bidders to

“engage effectively with the voluntary sector”.—[Official Report, 3 May 2011; Vol. 527, c. 662W.]

Will he confirm what he expects that will actually achieve? Can he guarantee that voluntary sector involvement will be more in line with the UK average for the contracts tendered in the Work programme, or is the voluntary sector in Scotland only going to get the crumbs from the table?

May I first say that I was very pleased to invite my right hon. Friend the Minister of State to the employment gathering in Edinburgh, which was very well attended by representatives of the different stakeholders and by a representative of the Scottish Government? As we made clear at the time, it is our intention to ensure that the voluntary sector is as involved as possible. The two preferred bidders, Ingeus and Working Links, have made it clear that they are going to discuss the role of the voluntary sector in their supply chains. That discussion is ongoing and not yet resolved. Beyond that, there are other streams of work coming out of the Department for Work and Pensions for which the voluntary sector and others will be able to bid.

I note that the Secretary of State is still unable to provide us with a figure. Doubt will remain in the voluntary sector, which has suffered a massive drop in income as a result of the Work programme, which offers fewer places than were offered under previous Government-operated schemes. Does he agree that the experience and knowledge of the voluntary sector of the future jobs fund is testament to its strength? Does he agree that Scotland needs a new future jobs fund, so that we can offer places for the thousands of people who are coming out of school and college with nowhere to go?

I am happy to acknowledge that under the previous Government, of whom the hon. Lady was a member, youth unemployment rose consistently through periods of growth as well as during the recession. I accept that we have a major challenge, which is why I will bring together different employment sector representatives in Irvine in a couple of weeks’ time.

It is important for all of us that we get the voluntary sector engaged. The future jobs fund was a very costly scheme, and its results do not bear out the hon. Lady’s assertions. It is not the case that it led to sustainable jobs—but the new Work programme will do exactly that.

Universal Credit

2. What discussions he has had with the Secretary of State for Work and Pensions on the implementation in Scotland of the Government’s proposals for universal credit. (53555)

The Secretary of State for Scotland and I are in regular contact with the Secretary of State for Work and Pensions on a range of issues concerning implementation of universal credit in Scotland.

In Scotland, the public sector accounts for about 50% of gross domestic product. If we are to succeed in making the country less dependent on the public sector, we need to ensure that the private sector has access to the personnel that it needs to grow. Does the Minister agree that universal credit will help to make work pay, and that it will contribute to the rebalancing of the economy of Scotland and the UK?

I do indeed agree with my hon. Friend, who will be pleased to note that already during the incapacity benefit reassessment trial taking place in Aberdeen, a large number of people who not only want to work, but also want the support to help them to work, have been identified and have found opportunities to work in the private sector.

Will the proposed universal credit in Scotland be affected by the Chancellor’s proposed changes in tax and national insurance, particularly in relation to the tax proposals in the Scotland Bill?

The hon. Gentleman has followed the progress of the Scotland Bill in detail, but he will know that in relation to the core aspects of universal credit and benefits, the Government have given an undertaking that no one will be worse off in cash terms when universal credit is introduced.

Does my hon. Friend agree that the current complexity of the benefits system means that too many Scottish claimants do not receive the benefits to which they are entitled, and that universal credit will help to target the right support on the right people?

I certainly agree with my hon. Friend. The amount of benefit that goes unclaimed in Scotland is a national disgrace. The system of universal credit will simplify the benefits system, as well as making work pay and combating worklessness and poverty. That is something that hon. Members on both sides of the House should welcome; it is a marked change from the 13 years of inaction from the previous Government.

“The Plan for Growth”

3. What assessment he has made of the likely effect on the Scottish economy of the implementation of “The Plan for Growth”. (53556)

Returning the United Kingdom to sustainable economic growth is the Government’s overriding priority. We are doing everything to create the conditions that enable all businesses in Scotland to be successful and create more jobs. Our plan for growth is a plan for the whole of the UK.

What views and reactions is my hon. Friend aware of among our colleagues in the Scottish Parliament and the business community in relation to the Government’s proposals to support small and medium-sized businesses?

The Government’s proposals for reducing corporation tax and for making changes to national insurance have been widely welcomed by businesses across Scotland. Of course, as my hon. Friend will know, small businesses in Scotland have particularly benefited from small business relief, which was delivered by Conservative MSPs.

Inflation is at double the Government’s target, growth has been downgraded for the next two years, retail figures are down and consumer confidence is at rock bottom. Will the Minister for once stand up for Scotland and concede that while the cuts may be hurting, they are not working, and that it is time for the Government to have a plan B for growth?

This Government do have a plan for growth—unlike our predecessor. We have set out ambitious objectives to create the most competitive tax system in the G20, to make the UK the best place in Europe to do business, to encourage investment and exports, and to create the most flexible and educated work force in Britain.

I am sure the hon. Lady is good at figures. She will know that her party started the Scottish elections with a 10-point lead, and that today it has an 18-point deficit. That is good work with figures.

Can the Minister tell us what part of the plan for growth is behind the bright idea of his colleague the Chief Secretary to the Treasury to impose a massive increase in taxation on the oil and gas industry, jeopardising investment and up to 50,000 jobs?

The hon. Gentleman would have some credibility in asking that question had he not repeatedly raised in the Chamber the issue of the costs of petrol and fuel oil in his constituency. It is clear that the Chancellor and the Chief Secretary got the balance right in the Budget between the taxation of the oil industry and the taxation of the motorist. If the hon. Gentleman wants to tell his constituents that they should be paying 6p a litre more on their fuel, he is welcome to do so.


8. What steps the Government is taking to reduce the level of unemployment in Scotland; and if he will make a statement. (53563)

Unemployment has fallen steadily since August 2010 and employment has increased in the same period. This is a welcome sign. Supporting companies to create and sustain jobs and helping people into work are key priorities for the Government. On 19 May I am hosting a seminar in north Ayrshire, in the constituency of the hon. Member for Central Ayrshire (Mr Donohoe), on youth unemployment, and my right hon. Friend the Secretary of State for Work and Pensions will join me at this important event.

I look forward to our meeting on 19 May. On a another matter concerning unemployment, does the Secretary of State think that the separation of Scotland from the rest of the UK would help or hinder employment prospects for people in Scotland?

It would be an absolute disaster for Scotland to separate from the rest of the United Kingdom. It is interesting that even the Scottish National party appears to recognise that, because it is not campaigning very hard on the subject.

In the Secretary of State’s answer to my hon. Friend the Member for Glasgow North (Ann McKechin), our Front-Bench spokesperson, he recognised that youth unemployment continues to rise in Scotland. When does he believe that his actions will begin to bring it down to an acceptable level?

In response to the question from the hon. Member for Glasgow North (Ann McKechin), I said that youth unemployment had been a problem for a good long period across the United Kingdom, including under the previous Government during periods of growth. The Prime Minister, the Work and Pensions Secretary, I and everybody else recognise the need to bring it down, which is why we are meeting to discuss the core issues behind the problem, and why, through the Get Britain Working programme and the Work programme, which we have discussed already, we are introducing measures to get young and old alike off the unemployment register and back into productive work.

When will the penny eventually drop for the coalition Government? Last week in response to the Scottish Affairs Committee report on the computer games industry, the Government said that there is no case for tax incentives for the computer games industry, which is very important to this country. That was rather callous coming a week after another computer games company in my constituency went bust. Will the Government accept the blatantly obvious fact that if we want companies to set up in this country, we have to offer incentives at least comparable to those offered by our competitors overseas?

First, may I again recognise the hon. Gentleman’s consistent efforts on behalf of the computer games industry? I recognise the importance of the industry not just to Dundee and Scotland, but to the UK as a whole. As he knows—and as I hope the response to the Select Committee’s report reinforces—we have considered very carefully the incentives we need to offer not just to the computer games industry, but to a whole range of sectors in Scotland and across the country. It is our judgment that to get ourselves away from the danger zone we were in last May, it is important to tackle the deficit and to get ourselves on the path to growth. We have done that in successive Budgets setting out plans to reduce corporation tax, to keep interest levels low, to reduce the national insurance burden and to set out important new targets for banks and their lending to small businesses. That applies to the computer industry sector as much as to any others. Once again I will be happy to meet him to discuss the matter, if he would like.

Unemployment in Kintyre will be greatly reduced if the community group’s bid to buy the former air base at Machrihanish goes ahead. I thank the Secretary of State for meeting the community group recently. I have written to him with a list of outstanding issues that are still to be resolved. I ask that Scotland Office Ministers continue to work with Defence Ministers and the community group to resolve those outstanding issues as quickly as possible, so that the buy-out can go ahead, with exciting prospects for the Kintyre economy.

Again, I pay tribute to my hon. Friend’s sterling efforts on this issue. I also welcomed the opportunity to meet representatives from the Machrihanish group a few months ago. I recognise that there are still issues that the group wishes to see resolved, and that these involve ongoing discussion with the Ministry of Defence. I will ensure that my right hon. and hon. Friends in the Ministry of Defence are aware of the details of my hon. Friend’s concerns, and that he receives a response to them.

Banking Failure

7. Whether his Department and the Treasury have assessed the potential effect of banking failure on the economy of an independent Scotland. (53562)

Banks and other financial institutions are vital to the functioning of the economy. Although no specific work has been commissioned on the banking bail-out in Scotland, a 2010 National Audit Office report states that the total amount at stake is currently £512 billion. As of December 2010, £124 billion in cash had been invested in Government financial interventions. Based on NAO data, the Scottish Parliament Information Centre, SPICe, has estimated that the Royal Bank of Scotland and the Lloyds Banking Group were provided with £470 billion. SPICe also calculated that this figure was three times the annual Scottish GDP, and that the total UK Government intervention of £751 billion was equivalent to just over half of UK GDP.

Do those figures not show that, like Iceland and Ireland, a separate Scotland would simply not have been able to survive the international banking crisis on its own? Is it not the case that Scotland’s economy will always be better off inside, rather than outside, the United Kingdom?

I could not agree more with my hon. Friend. It is interesting that as we enter the Scottish Parliament election period, the Scottish National party appears to have forgotten its proclamation about the arc of prosperity and Scotland’s wish to join the economies of Ireland and Iceland. The First Minister, Alex Salmond, also appears to have forgotten saying in the 2007 campaign:

“We are pledging a light-touch regulation suitable to a Scottish financial sector with its outstanding reputation for probity, as opposed to one like that in the UK, which absorbs huge amounts of management time in ‘gold-plated’ regulation.”

That response shows that what has characterised the Scottish election campaign is that positivity wins over negativity. Will the right hon. Gentleman at least acknowledge and recognise that the failure of those so-called Scottish banks was down to UK regulation?

I do not think that the hon. Gentleman was listening to my last response. His leader, Alex Salmond, previously described the UK regulation as “gold-plated” and, at the previous Scottish elections, offered the voters “light-touch regulation”. This is the same Alex Salmond who said that the banking crisis was down to “spivs and speculators”.

One of the most pernicious effects of the banking failure in Scotland at the moment is the withdrawal by nationalised banks at short notice of funding for small businesses, such as TDI Ltd in my constituency. What will the Minister do to hold the moneylenders’ feet to the fire and get Project Merlin properly adhered to?

The Secretary of State and I are in regular contact with the banks operating in Scotland to ensure that Merlin goes forward as envisaged. We are also willing to take up individual cases such as the one that my hon. Friend mentions, which, if he refers it to us, we will refer directly to the banks in question. [Interruption.]

Order. There are far too many private conversations taking place in the Chamber. It is very discourteous, and I am sure that the House wishes to hear Mr Greg Hands.

Thank you, Mr Speaker. Will the Minister join me in welcoming the report by the Independent Commission on Banking, under Sir John Vickers, and will he remind the House who, in the last Parliament, awarded Sir Fred Goodwin a knighthood for services to banking?

My hon. Friend’s interventions at Scottish questions are always welcome. He is quite right to suggest that it was the Labour Government who not only awarded Sir Fred Goodwin his knighthood but involved him in virtually every other initiative that they pursued in Scotland. The Vickers report is to be welcomed in Scotland, as it is elsewhere in the United Kingdom.

Election Timing

11. What progress he has made on measures to prevent the coincidence of elections to the House of Commons and to the Scottish Parliament in May 2015. (53566)

Government amendments to the Fixed-term Parliaments Bill deferring the 2015 Scottish Parliament elections until 5 May 2016 were agreed by the other place on 29 March.

In addition to outlining those measures, will my right hon. Friend update the House on progress towards the establishment of the commission to examine the West Lothian question, on its membership and on when we might expect to see its conclusions and recommendations?

As my hon. Friend knows, the coalition’s programme for government promised to establish a commission to consider the West Lothian question. A commission will be established this year to consider it, and the Government are committed to addressing the issue. We are continuing to give careful consideration to the timing, composition, scope and remit of the commission. It will need to take into account our proposals for reform of the House of Lords to create a wholly or mainly elected second Chamber, the changes in how this House does its business, and amendments to the devolution regimes such as those in the Scotland Bill, which is now before the House.

Renewable Energy

12. What discussions he has had with ministerial colleagues on the potential for renewable energy generation in Scotland. (53567)

I have regular discussions with ministerial colleagues on a wide range of energy-related issues. Scotland has a growing reputation as a world leader in renewable energy, and we will continue to work with industry and the Scottish Government to develop these opportunities.

I thank the Secretary of State for that reply. Last month, six Scottish wind farms were paid a total of £900,000 to stop producing energy because the grid could not absorb it. What will the Government do to strengthen grid capacity and improve energy storage so that that kind of waste does not happen, and so that Scotland can properly harness its vast resources of marine, hydro and wind energy?

First, may I highlight the fact that, under the complex energy management arrangements for the grid, arrangements have to be made from time to time to ensure that we can stop or increase energy production? Through those arrangements, payments are made for stopping and increasing production; that is understood. The Government have set out an ambitious programme for energy reform through our energy market reform proposals. The consultation on that programme was recently concluded, and my right hon. Friend the Secretary of State for Energy and Climate Change intends to publish a White Paper on the subject in the near future. Through that, and through other measures such as the transmission grid charges review, we will seek to ensure that we have the capacity and capability to exploit the renewable energy potential not only of Scotland but of the whole United Kingdom. Our other initiatives relating to the green investment bank and the offer to the Scottish Government to release the fossil fuel surplus are indicative of our intention to play a full part in the renewables revolution.

What meaningful discussions has the Secretary of State had with the Scottish Government on this vital issue? [Interruption.]

I am afraid that I did not hear the hon. Gentleman’s question. I wonder whether he could repeat it.

I was asking the Secretary of State what meaningful discussions he had had with the Scottish Government on this vital issue.

There have been regular and ongoing discussions with the previous Scottish Government on these issues. I have to record great disappointment that despite our offer to release the fossil fuel surplus—something that eluded the previous Government—they were not keen to take it up. I hope that the new Government elected tomorrow, with Liberal Democrats at the core of it, will take up that very positive measure.

The Secretary of State may know that the Energy and Climate Change Committee has had meetings with investors in the renewables sector in which concerns have been raised that long-term capital investments are involved, and that if the price of carbon were to change in investors’ favour, future Governments might introduce a windfall tax to compensate electricity consumers. Will my right hon. Friend reinforce the point made in the debate on Treasury matters last night that the Government want to engage with the oil and gas industry to ensure that any concerns about the stability of the tax regime can be dealt with, so that we can have a constructive engagement with the aim of maximising investment in all energy futures for this country?

My hon. Friend makes an important point. I followed his contribution and that of my right hon. Friend the Member for Gordon (Malcolm Bruce) last night with great interest. As my hon. Friend the Economic Secretary to the Treasury pointed out, their thoughtful and constructive contribution to the debate was very worth while. We are properly engaged with the oil and gas sector, as we will be with the renewables sector, to ensure that we can put in place long-term sustainable tax regimes and other arrangements that will help to boost those important parts of the British economy.

Prime Minister

The Prime Minister was asked—


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

The abolition of council tax, the scrapping of student debt, the £2,000 endowment for first-time home buyers and, of course, the referendum on separatism were all promises made by the Scottish National party prior to the last Scottish elections, all of which were never kept. Will the Prime Minister inform me, the House and the country whether certain political commentators are correct when they say that he would prefer to see the separatists returned in Edinburgh for one reason only—to avoid a Labour victory?

I am happy to confirm that what I would like to see in Scotland is the greatest possible showing for Annabel Goldie, who has led the Conservatives with such distinction. I do not think I want to intrude on the private grief between Labour and the SNP, but one thing I will say: whatever the outcome of that election, I, for one, will always stand four-square behind the United Kingdom.

Is the Prime Minister aware of the significant fires raging in Swinley forest in my Bracknell constituency? I am sure he would like to join me in congratulating the fire and police services on the sterling work that is being done, and hope he will guarantee that the Government will be there if any requests are made by those services.

I certainly join my hon. Friend in praising the fire and other services taking part in this difficult endeavour. As he knows, there are well tried and tested procedures to make sure that central Government stand behind local government when there are excessive costs. I will happily write to my hon. Friend about that issue.

Will the Prime Minister tell us how many experienced police officers are being forcibly retired as a result of his 20% cuts to police budgets?

The decisions about police officer numbers will depend on the decisions made by chief constables in individual parts of the country. The point is that we can see in case after case that there are far too many police officers in back-office jobs, doing paperwork and carrying out corporate development work who should be on the front line. Responsible chief constables are getting those officers out on the front line to fight crime—and crime is falling under this Government.

I do not know whether the Prime Minister does not know the answer to the question or whether he chooses not to answer it. Let me tell him the answer: 2,100 experienced police officers with more than 30 years’ experience are being forcibly retired. Let us take the case of former beat officer, Martin Heard, who was forced to retire from Wolverhampton police. He is now being asked to come back to the force as a volunteer special constable—unpaid—to fill the gaps left by the cuts. What does the Prime Minister have to say to Martin Heard?

What is absolutely clear is that what we are getting from the Labour party is complete and utter hypocrisy. We know at the time of the last election that Labour was specifically asked, and I quote the interview:

“Can you guarantee if you form the next government that police numbers won’t fall?”

The Home Affairs spokesman at the time, the right hon. Member for Kingston upon Hull West and Hessle (Alan Johnson), said “No”, he could not guarantee that. The question is not whether the budget should be reduced—of course it has to be—but who is going to cut the paperwork, who is going to get rid of the bureaucracy, who is going to trust the local managers to make sure we get police on the front line. Those are steps we are taking; those are steps his Government never took.

He is the guy who came along and said that cuts not of 12% but of 20% were necessary for efficiency savings in the police budget. It is his choice; why does he not defend it? Perhaps one reason people are so angry is that a year ago the Prime Minister said on the eve of the election:

“Any cabinet minister who comes to me…and says ‘Here are my plans’ and they involve frontline reductions, they’ll be sent”

packing. What does he say to the Home Secretary about cases such as that of Martin Heard—or has he just broken another promise?

What the Home Secretary is doing is what police leaders up and down the country are doing: trying to get more police on the beat. In my own force in the Thames valley, that is exactly what is happening.

When it comes to defending front-line services, is it not time that the right hon. Gentleman talked to Labour local authorities such as Manchester city council, which, although the average cut in local government spending power is just 4.5%, is cutting services by 25%? Are not Labour local authorities playing politics with people’s jobs?

The Prime Minister knows that he cannot defend his broken promises on policing. Let us talk about the other broken promises led by the Deputy Prime Minister. We know that the majority of universities are proposing to charge tuition fees of £9,000 a year. Can the Prime Minister tell us how many of them he expects to have their proposed fees cut by the Office for Fair Access?

That decision will depend on the Office for Fair Access.

The right hon. Gentleman talks about broken promises. The fact is that it was the last Government who introduced tuition fees and top-up fees—but we have a new doctrine on the leader of the Labour party’s attitude to the last Government, which he announced in an interview with The Sun. He said:

“I am not going to defend what happened in the past just because I happen to have been in the last Government.”

Presumably we should not listen to him now just because he happens to be the Leader of the Opposition.

Once again, the Prime Minister has not answered the question. We know from the Office for Fair Access that it is not going to cut the fees of the universities. The assistant director said at the weekend:

“We are not a free pricing regulator: that is not our role...we wouldn’t say to an institution we would only allow a fee of ‘X’ or ‘Y’.”

Will not the Prime Minister admit that on top of a broken promise not to raise tuition fees and a broken promise that £9,000 would be the exception, he is now breaking another promise on the capping of excessive fees?

The fact is that we will have to wait until July, when the access regulator—[Interruption.] Let me make this point to the right hon. Gentleman. Degrees have not suddenly started to cost £7,000, £8,000 or £9,000. Degrees have always cost that much. The question is, who will pay for them? We say that successful graduates earning more than £21,000 a year should pay for them rather than taxpayers, many of whom do not go to university.

I have to say this to the right hon. Gentleman. He made a promise: a promise that he would have a fully costed alternative to our fees programme by the end of the last year. Where is it? Another broken promise!

That is what we have come to expect from this Prime Minister. He is hazy on the facts, and unable to give a straight answer to a straight question. I know how the Energy Secretary must have felt in Cabinet yesterday. Remember what was said a year ago about two parties working

“Together in the national interest”?

Now what do we have? We have two parties threatening to sue each other in their own interests. That is what has changed in the last year.

What the public are saying, in relation to police cuts, tuition fees and the NHS, is “This is not what we voted for.” Given that the Government have broken so many of the promises that they made a year ago, how can the public believe anything that they say at the elections tomorrow?

Even the jokes have been bad this week. The fact is that what this coalition Government have done over the past year is freeze council tax, cap immigration, lift a million people out of income tax, introduce a pupil premium, link the pension back to earnings, cut corporation tax, and set up more academies in 10 months than the last Government set up in 10 years. At the council elections tomorrow, people should remember the mess that Labour left us in, and resolve not to let Labour do to their councils what it did to our country. [Interruption.]

Order. The Minister for Children is under no obligation to behave like a child. It is not required.

Q2. Does the Prime Minister agree with the comment of Lord Glasman, special adviser to the Leader of the Opposition, that the last Government lied to the British people about the extent of immigration? (53893)

My hon. Friend raises an important point, which is that the last Government did not tell it straight to people about what was happening on immigration and that it has fallen to this Government to take the steps to get the numbers under control. Indeed, Lord Glasman said something that I have said many times, which is that under the last Government there was

“very hard rhetoric combined with a very loose policy”

and that was the worst approach of all.

Does the Prime Minister share my profound anxiety about the recommendation of the advocate-general to the European Court of Justice for a European-wide ban on the patenting of stem cell research based on human embryos? Does he agree that were such a ban to be confirmed by the ECJ, it would have profoundly damaging effects on our science base and our pharmaceutical industries? Is he able to say what contingency plans the Government are putting in place to minimise the effect of any such ban?

The right hon. Gentleman makes an important point, and I thank him for giving me some notice of this issue. The point I would make is that this House and the House of Lords have had extensive debates to arrive at the policy that we have. I believe that it is right to try to maintain the UK as a world leader in stem cell research. Under European law, uses of human embryos for industrial or commercial purposes are exempted from patent protection. As I understand it, the legal opinion of the advocate-general at the ECJ on the scope of this exemption is advisory and does not bind the Court. As such, the opinion currently has no impact on British researchers, but we should keep this position under review.

Q4. Several manufacturing businesses in Staffordshire, including Alstom in my constituency, have recently committed to significant investments and are increasing their work force. What measures does my right hon. Friend believe are necessary to ensure that the welcome growth in manufacturing in the UK continues for the long term? (53895)

My hon. Friend makes an important point, which is that we do want growth in manufacturing, which is very strong at the moment and has been over the past year, to be maintained. I well remember visiting the Alstom plant, although I was slightly less successful in winning Stafford than he was at the last election. Such plants will benefit from our policies of cutting taxes, boosting apprenticeships, investing in capital projects and doing everything we can as a Government and as a country to support our export industries and sell Britain around the world.

On 25 June last year, speaking on the Ark Royal, the Prime Minister told our armed forces that he would enshrine the military covenant in law. Why is he watering down that commitment to a useless referencing?

I do not believe for a minute that that is what is being done. What is going to happen is that we are going to clearly reference the covenant in law and then the covenant will be published and debated in this House every year. It is vital that we are able to update and improve it every year, because our military personnel face so many changing circumstances. We are looking across government at all the things we can do, for example, on health care, on education, and on things such as council tax for soldiers serving overseas—these are many of the things that the last Government failed to do—to look after our armed service personnel.

Q5. Later this month, Edward Lister, the Conservative leader of Wandsworth council for nearly 20 years, moves on to be the chief of staff to the Mayor of London. Will the Prime Minister join me in paying tribute to him for his leadership in consistently delivering the UK’s lowest average council tax along with top-rated front-line services? Will the Prime Minister urge more councils to follow suit? (53896)

I thank my hon. Friend for her question. It gives me the opportunity not only to praise Edward Lister, who has done a fantastic job over many years, but to pay tribute to Sir Simon Milton, who occupied that position and is admired on all sides of the House for the work he did at Westminster and then at the Mayor’s office. What Wandsworth has shown over many years is that it is possible to combine low taxes with good services if all the time you are trying to improve efficiencies. That is what councils up and down our country should be focused on, particularly in a year when we have to make spending reductions.

One of Scottish Labour’s key manifesto commitments is the First Foot initiative, which will help thousands of first-time buyers to get a foot on the property ladder. What is this Prime Minister doing to help this generation of home buyers, who are crippled by unemployment, student debt and rising living costs, and therefore cannot save a deposit for a House?

The proposal in Scotland sounds quite like our proposal in the Budget for Firstbuy, which will help tens of thousands of young people to get on the property ladder by helping them with the deposit that many families find it extremely difficult to raise. There is a real worry in our country that the age of the first-time buyer is getting older and older, and that many families are finding that unless they have family help behind them they simply cannot get on the housing ladder. We must ensure that that is not the case and Firstbuy is a very good proposal that we are introducing in England. I will be interested to see what happens in Scotland.

Q6. Conservative-run Cheshire West and Chester council is saving millions by cutting waste, boosting efficiency and selling surplus property to help protect front-line services. Meanwhile, in next-door Labour-run Halton, the council is cutting back on bin collections and road maintenance instead. What does my right hon. Friend think can be done to help councils reach fair and sensible decisions? (53897)

I would encourage all councils to look at costs that can be cut that are not on the front line. Many Conservative councils are sharing chief executives with their neighbouring councils and cutting councillors’ allowances and chief executive pay. There are too many examples, particularly in Labour councils, of chief executives being paid far too much and of not nearly enough attention being paid to cut the back-office costs so we can keep the services going.

The Government are cutting the police and Birmingham city council is cutting care to the elderly and disabled. There is dismay in my constituency that high-need, high-unemployment Birmingham is being hit far harder than the leafy shires such as Surrey. Will the Prime Minister therefore answer the question put to me by my constituents—why have the Tories got it in for Birmingham?

A coalition between Conservatives and Liberal Democrats has been doing a great job for Birmingham, ensuring that council tax is kept down, investing in housing and ensuring that there are good public services. Many of the things we have done, such as the regional growth fund, are targeted at areas such as Birmingham. The hon. Gentleman should go back to his constituents, and after he has apologised to them for the fact he was the winner of an all-woman shortlist he should tell them that coalition government between Conservatives and Liberal Democrats is working at Westminster and working well in Birmingham.

Q7. In 2005, the previous Labour Government agreed to hand back part of the UK’s EU rebate at a cost to UK taxpayers of £9.4 billion over the lifetime of this Parliament. Has my right hon. Friend seen any evidence of what precisely was obtained in return for that remarkable generosity? (53898)

My hon. Friend makes an important point. Part of the rebate was given up and it was not given up for any proper promise in return. We were told that there would be a promise of real reform of the common agricultural policy and that did not appear. That shows me that we have to be incredibly tough in the budget negotiations this year and next so that when we go into the financial framework for the next seven or eight years we ensure that we keep the costs of this organisation under control.

Q9. The Government’s savage cuts are set to destroy some half a million jobs in the public sector and, according to PricewaterhouseCoopers, a similar number in the private sector. With thousands more on the dole, paying no taxes and dependent on benefits, the deficit will increase rather than reduce. As sure as night follows day, we will see a collapse in the housing market, a collapse in support for the Tories and a return to Labour government. Will the Prime Minister enjoy saying goodbye to most of his colleagues and sitting on this side of the House? (53900)

I thought the hon. Gentleman was from Luton, but he sounds like he is from fairy dairy land. Let me remind him that compared with this time last year 400,000 more people are in jobs in the private sector. That is what has happened through our getting the deficit under control, getting the economy growing and ensuring that we deal with the mess we were left by the Opposition.

Q10. Is my right hon. Friend aware that Conservative-run Central Bedfordshire council has been rated as the highest performing council of all its statistical neighbours by PricewaterhouseCoopers for value for money, effectiveness and service delivery? Is this not the type of example that we should encourage more councils to follow? (53901)

My hon. Friend is absolutely right. Well-run councils that ensure they are cutting back-office costs can provide good services. When one looks at the figures, one can see that those Conservative councils are not just costing less for a band D property but doing better on measures such as recycling and other service delivery. It is simply not true to say that by cutting costs councils harm services. They have to be effective at keeping their costs down to provide good services.

Q11. Next Wednesday, the Hardest Hit campaign will be lobbying MPs in Parliament through constituents of ours with severe disabilities and chronic illnesses who are bearing the brunt of this Government’s attack on welfare benefits and public services. Will the Prime Minister have the courage to meet some of those campaigners face to face next week so that he can hear from them at first hand about the devastating impact that this callous and uncaring Government are having on their lives? (53902)

I make two points to the hon. Lady. First, the most important line of defence to help people with severe disabilities and severe need is the national health service and it is this Government who are putting more money into the national health service—£11.5 billion extra. That money would not have been available if we had a Labour Government; we know that because we can see Labour cutting £1 billion off the NHS in Wales. In terms of reforming benefits, I thought we had the support of the Labour party to reform benefits to make sure they are helping those who need the help most.

Q12. Last week, I joined 170 other Huddersfield Town fans in cycling from Huddersfield to Brighton to raise £200,000 for the Yorkshire air ambulance. Will the Prime Minister join me in praising Huddersfield Town for raising that money and will he also look into why the air ambulance has to pay VAT on its fuel although the Royal National Lifeboat Institution—another emergency charity service—does not? (53903)

First, I would like to congratulate my hon. Friend on his bicycling feat, as well as all those who took part from Huddersfield Town. I also pay tribute to our air ambulance crews across the country, who do an amazing and brilliant job. I have looked specifically at this issue. As he probably knows, the EU VAT directive does make an exemption for lifeboats, but there is no equivalent provision for supplies used by other charities and we are not able to change that. However, we are able to do more for charities, as we did in the Budget, including with the inheritance tax exemption, which I think is going to make a huge difference for charities up and down our country. I hope that he will do everything he can to encourage them to make use of that.

Q13. Child poverty is a cancer that means that children in our society go to bed hungry in homes that their parents cannot afford to heat. The Prime Minister will be aware of the recent Organisation for Economic Co-operation and Development report that says that the great progress that was made has now stalled and that the numbers are once again due to go up. If the Prime Minister agrees with me, as I think he will, that this is a moral imperative for any Government, will he tell the House what he will do now to change policy and make sure that our innocent children will not be the victims of Government cuts? (53904)

I do believe it is a moral imperative and I have looked at the OECD report carefully, which does show that things stalled under the previous Government in recent years. What I would say is that despite having had to take difficult decisions in the Budget we did make sure that there has been no increase in child poverty as a result of the Budget. I think it is time, frankly, for a more mature, cross-party debate on how we can make sure that we get people out of poverty rather than just looking at the transfer of money between rich and poor. That is why we are looking at things such as the pupil premium, free nursery education for deprived two-year-olds and making sure that Sure Start is working properly, because it is all those things that will help children out of poverty in a more sustainable way.

Q14. This week, the three top-rated councils of Hammersmith and Fulham, Kensington and Chelsea and Westminster are discussing extending their combined services to save £35 million a year while still improving front-line services. What can the Prime Minister do to encourage this approach rather than that of Labour-run Hounslow, which is closing day care centres, squeezing parks maintenance and cutting mental health services in a slash-and-burn approach? (53905)

I think this is a very important point and I hope that councils up and down the country will look at it. Three large councils are coming together and saving £35 million because they are sharing back-office services, executive teams and so on. Frankly, if they can do it, as large councils that have big responsibilities, many other councils should be doing it in London and elsewhere. Until we see that happening, I do not think it is realistic to say that it is necessary for councils to cut front-line services.

More than 100 years ago, Parliament legislated to make sure that local authorities provided allotments. Healthy local food is a very good part of good British values. Why therefore are the Prime Minister’s Government scrapping the obligation on local authorities to provide allotments?

I was as concerned as the hon. Gentleman when I read that report. I immediately checked, and found that that is not the case. It is extremely important that allotments are made available. Many Members will find that when they ask about that in their constituencies there are massive queues for allotments, as many people want to grow their own vegetables and food and understand more about where food comes from. It is a great movement, and it has my full support.

Q15. The chief executive of Conservative-run Fylde borough council has taken a 5% pay cut, whereas Labour-run Blackburn has cut services to young and vulnerable people while increasing its reserve to £12.7 million. What can the Prime Minister do to encourage councils to behave more responsibly like Conservative-run Fylde? (53906)

One of the most important things that we can do is make all that information available. This Government have massively increased transparency. Every council in the country has to declare its spending on any item over £500, and people have found that useful in seeing how much council executives are paid, how much councillors are paid, and making sure that they bear down on those costs. I commend what is happening in Fylde, and it is a matter of great regret that there is still one council—Labour-controlled Nottingham—that will not make that information available.

Given that private borrowing was falling at the last election why, according to the Office for Budget Responsibility, do the Government plan to ramp it up by half a trillion pounds to a total of more than £2 trillion by 2015?

What the Government are doing is getting control of Government borrowing—that was the real crisis at the last election. It is an important point to make, particularly on a day when we read about Portugal going for an enormous bail-out. It is worth reminding ourselves that today we have a bigger budget deficit than Portugal. The reason we are not in Portugal’s position is that we took action in two brave Budgets and a spending round to clear up the mess left by the right hon. Gentleman’s hon. Friends.

I am sure, Mr Speaker, that you and the Prime Minister have enjoyed the good weather, especially last Friday, the day of the royal wedding, and perhaps visited tourist hot spots such as Southwold and Aldeburgh. Just down the road from those hot spots, farmers might be about to suffer a drought, and are genuinely concerned about the lack of rain, as their ability to abstract water may be limited. Will the Prime Minister meet me to discuss those genuine concerns about restricting water for our farmers?

I am happy to meet my hon. Friend. Everyone has been enjoying the recent weather, and it was fantastic that the weather was so good for the royal wedding. However, farmers face real issues because, at a time of year when they expect a lot of rain, they have had virtually none.

With the strong likelihood that the Lib Dems will come off worst in tomorrow’s local elections, and hopefully the rejection of the alternative vote in the referendum, what political words of comfort will the Prime Minister have for his by then beleaguered deputy on Friday?

Of course, we do not agree about the future of our electoral system. We are having a referendum and a debate about it, but the reason for having a coalition Government coming together and sorting out this country’s problems in the national interest is as good an argument today as it was a year ago, when we came into government to clear up the mess made by the Opposition.

In the light of the success of the royal wedding for public diplomacy, does the Prime Minister believe that it reinforces the importance of a different narrative for the diamond jubilee from the Olympics, in terms of what it can do for Britain’s international reputation?

We have a fantastic opportunity next year to show all faces of Britain, both modern and traditional. We are going to celebrate the jubilee, and I think that people will want to celebrate the incredible public service that Her Majesty the Queen has given over many years as an absolutely amazing model public servant. People will also want to celebrate the Olympics as a celebration of sport and all that is best about Britain. The royal wedding, as the Major of London said, was in many ways a dry run for how we handle some of those events, and everyone in the country has a lot to look forward to next year.

Many of my constituents in Wirral worry about the quality of care that older people, especially those with dementia, receive in hospital. How does the Prime Minister think that his now paused, top-down reorganisation of the NHS will help to make sure that older people are looked after with real dignity?

One of the aims of the changes that we are making to the NHS must be better to link the national health service, social service provision, local authorities and how we look after the elderly. All of us have seen too many cases in hospital where people who should be in residential or nursing care or being looked after at home are stuck in a large district general hospital or in a community hospital, when they should be getting alternative pathways of care. That is what the whole change should be about. What I am finding as I go round the country listening to doctors, nurses and clinicians is that we must make sure we take the opportunity to get this absolutely right. That is what the reforms should be all about.

In last year’s general election in Essex 49% of the votes cast went to the Conservatives, but 95% of the seats went to Conservative MPs. It was an outcome that would embarrass Robert Mugabe. Apart from the fact that Essex is now a Labour-free zone, does the Prime Minister think that that result was fair?

My hon. Friend tempts me into debate. In Colchester everyone had one vote, it was counted once and he won. I congratulate him. In other parts of Essex everyone had one vote, they were all counted once and many of my hon. Friends won. But for all that he brings to the House, what the Liberal Democrats lack in number, he makes up in stature as a Member of Parliament for Essex.