Written Ministerial Statements
Tuesday 21 June 2011
Business, Innovation and Skills
I am today publishing a consultation on proposals to reform the landscape of consumer institutions. A copy of the consultation document has been placed in the Libraries of both Houses and will be available on the BIS website.
The Government’s objective in pursuing and implementing consumer policy is to empower consumers to make wise decisions when purchasing goods and services. Empowered consumers embrace new products and services and demand choice, thereby stimulating competition and innovation from traders as well as high standards of consumer care. It is the investment and quest for efficiency which drives innovation and growth in the economy. Consumer empowerment is therefore a vital part of the Government’s growth agenda as well as a key element of its broader citizen empowerment mission. (The Department has also led the development of a cross-Government empowerment strategy which was published in April as part of the growth review.)
In this context, the consultation document sets out proposed reforms to the UK’s consumer institutions (the scope of the consultation excludes those institutions focused solely on financial services or on public services such as health). These reforms are designed to strengthen the front line for consumer empowerment and protection while cutting down the complexity, confusion and duplication that accompanies the proliferation of bodies.
The proposals set out in the consultation document have been guided by the following objectives:
Reducing complexity of the consumer landscape—At present, there is a plethora of publicly funded bodies involved in consumer advice, representation and enforcement. Not all of these enjoy wide public recognition, and it may not be obvious to consumers where they should go to get the advice or redress they need. The Government therefore want to simplify and streamline the institutional landscape.
Strengthening the effectiveness of consumer enforcement—Effective enforcement of the law is essential to protect consumers from rogue traders and unfair market practices. A recent National Audit Office (NAO) report has identified the costs to consumers, and hence the economy, of sharp practices as £6.6 billion. At present, responsibilities for enforcement are split between local trading standards and the Office of Fair Trading (OFT). Trading standards face particular challenges as a result of reduced local authority spending, while the NAO has pointed to problems of overlap and lack of co-ordination between trading standards and the OFT. The Government therefore want to clarify responsibilities and ensure better use of limited enforcement resources through more effective leadership and integration of effort around the country.
More cost-efficient delivery, closer to the consumer front line—Ensuring the cost-effectiveness of consumer advice, representation and enforcement is increasingly critical as public resources become more constrained. Streamlining bodies and maximising the benefits to be achieved by linking national activity to local intelligence and front-line delivery of advice and enforcement is one of the ways in which this can be achieved.
In order to achieve these objectives I am proposing that responsibility in future for each aspect of consumer advice, representation and enforcement should be clear and should rest principally with one of three key institutions:
The Citizens Advice Service comprising Citizens Advice and Citizens Advice Scotland. The Government propose that almost all central Government funding for consumer information, advice, advocacy and education (except on consumer finance) will transfer to Citizens Advice which enjoys high recognition and trust among the public as well as a track record of effective advocacy. The Citizens Advice Service would become the key consumer advocate for the Government.
Trading Standards comprising Local Authority Trading Standards Services (LATSS), the Trading Standards Institute (TSI), the Association of Chief Trading Standards Officers (ACTSO) and the support infrastructure offered by the Local Government Group. The Government propose to deploy national Government funding to facilitate a more integrated approach to national and cross-boundary threats. This activity would be more effectively co-ordinated at national level by chief trading standards officers to ensure that enforcement gaps do not arise and that activity overall is better targeted.
The proposed new Competition and Markets Authority to be created by merging the OFT and the Competition Commission, will play a key role in ensuring that markets are operating fairly and in the interests of consumers. It will have powers to investigate markets in which there are or may be structural problems and to use competition or consumer law to resolve these.
The first two of these groups have high public awareness and trust levels. Their activities reach very large numbers of consumers in practical ways.
The consultation proposes: transferring the functions of consumer focus to the Citizens Advice Service; transferring most of the consumer enforcement functions from the Office of Fair Trading (OFT) to Local Authority Trading Standards Services; and transferring the OFT’s information, education and advice functions (including the consumer direct helpline) to the Citizens Advice Service.
As a consequence of transferring its functions, consumer focus would be abolished; it is listed in schedule 1 of the Public Bodies Bill currently in the House of Commons.
Consumer policy is reserved but a number of the proposals in relation to trading standards may be applied differently in Scotland as responsibility for local authorities is devolved. BIS has produced this consultation following discussions with devolved Administrations and taking account of their views.
Deputy Prime Minister
City Status Competition (Dumfries)
In the written ministerial statement I made on 16 June 2011, Official Report, column 74WS, Dumfries was listed as having entered the competition for city status. The documentation sent to the Cabinet Office clearly stated that the bid had been submitted by Dumfries and Galloway council, a statement that was accepted in good faith. It has since become apparent that the bid was not submitted by the council. As all applications for the civic honours competition must be submitted by the relevant local authority, the application will not be considered further as part of the competition.
Energy and Climate Change
Fukushima (Interim Report)
I have today responded to the three recommendations for Government contained in the chief nuclear inspector’s interim report on events at the Fukushima nuclear site in Japan.
I welcome the findings and recommendations in Dr Weightman’s interim report and commend him and his team for the important work that they have undertaken so far in pulling together information and lessons from the events in Japan.
In the response the Government undertake to:
continue to work with international partners in the G8, G20 and IAEA to ensure that information is shared in a timely and open manner in the event of any future global nuclear event;
carry out a review of the Japanese response to the events at Fukushima and identify any lessons for UK emergency planning by the end of 2011; and
review the UK’s own national nuclear emergency arrangements to ensure that they are as robust as possible and can deal effectively with prolonged nuclear incidents, and update guidance before the chief nuclear inspector’s final report.
Copies of the Government’s response have been placed in Libraries of both Houses.
Environment, Food and Rural Affairs
Fruit and Vegetable Exceptional Support Scheme
On 10 June 2011, Official Report, column 49WS, I informed the House about the disruption of the EU fruit and vegetables market and the impact on growers of the consequences of the E. coli outbreak in Germany, including a fall in consumer confidence and the import ban on EU produce imposed by countries including Russia. I told the House of discussions in the Agriculture and Fisheries Council on 7 June of exceptional measures to address the situation and support growers, and of proposals put to the EU Fruit and Vegetables Management Committee.
On 14 June, the Management Committee agreed a European Commission proposal which came into effect on 18 June and I wish to inform the House that we have launched a scheme to implement the resultant measure in the United Kingdom. The scheme is being run by the Rural Payments Agency (RPA) and it is open for applications now. The EC measure is time limited and it is important that those affected by it are aware that the scheme will be in place only until Thursday 30 June.
The main features of the scheme are as follows:
It provides aid for the withdrawal of produce from the market, non-harvesting and green harvesting (meaning premature harvesting for disposal) of specified produce, the markets for which have been most affected.
It is open both to producer organisations (POs) and to producers who are not members of a PO, who may make arrangements with a PO or failing that, apply direct to the RPA and be registered with them.
The specified crops are tomatoes, lettuce and endives, cucumbers, sweet peppers and courgettes.
In the UK, it applies to withdrawal and harvesting operations notified to the RPA between the 18 June and 30 June 2011.
Maximum rates of aid for each crop are set out in the regulation, representing about half the normal market price for such produce in June.
The producer notifies the RPA in advance of the intention to withdraw produce so that an inspection can take place to verify quantities, compliance with standards etc., and agree an approved disposal route.
Applications for aid must be lodged with the RPA by 6pm on 30 June.
RPA will notify the EC on 18 July of the quantities of produce withdrawn in the UK.
The EC will calculate the total of applications across the EU. If the aid would exceed the scheme budget of €210million, it will set a reduction coefficient to be applied to all claims.
Payments to producers must be made by 15 October 2011, but the first payments are planned to commence late in July.
Full guidance is available on the RPA website, together with the notification form for growers to use as part of the procedures.
The scheme differs from the proposal described in my earlier statement in respect of the inclusion of endives and support for green harvesting. Beyond those details, however, it is important to note that that the EU measure we have agreed is no longer based on a possible first-come, first-served basis, but provides for claims for aid to be treated equitably across all member states. It is not possible at this stage to judge whether the scheme will reach the budget ceiling but if it did, any reduction would be applied at the same rate to all claims. Moreover, as I set out above, the scheme we are implementing will also be open to all growers whether or not they are a member of a producer organisation.
I welcome the measure as a contribution to restoring the normal operation of the market and bringing to an end a situation in which UK growers, at the peak of their season for these crops, are facing huge commercial challenges and financial threats not related to the competitiveness or quality of their produce but as a consequence of a crisis for which they cannot be blamed. The E. coli outbreak hit consumer confidence and reduced demand and led to the imposition of trade barriers by Russia and other countries, with the damaging consequences for our wholesale markets in particular which I have described to the House. It is unfortunate that despite accurate reports that an agreement had been made to lift the Russian ban, this was subject to a certification process, which has yet to be agreed, so de facto the ban remains in place.
While the newly launched scheme does not address all the aspirations that have been raised, in particular, for full retrospective compensation for losses nor measures for the wider supply chain, I believe that it does represent practical and substantial help for growers and a viable route to reduce and undo the disruption to markets, by, for example, reducing the flow into our wholesale markets of surplus produce from other member states, as well as the immediate impacts here.
The contribution by EU taxpayers via funds which were already part of the European agriculture guarantee fund (common agricultural policy) existing budget, will thus help to restore the functioning of the market.
My understanding is that UK consumers have continued to support UK produce and I hope they will continue to do so. We will continue to work with growers and their organisations to deliver the benefits intended by this scheme and to move the industry on to a more stable situation in which quality and competitiveness will deliver the success it deserves.
Foreign and Commonwealth Office
Private Military and Security Companies
On 9 March 2011, I announced that, following a bidding process, the Government would be entering further discussions with Aerospace Defence and Security (ADS) to determine the next steps for ensuring the implementation of a robust code and monitoring regime for UK-based private military and security companies (PMSCs).
I can now confirm that following further consultations, ADS have been appointed the Government’s partner in developing and implementing UK national standards for PMSCs. ADS have established a special interest group, the security in complex environments group (SCEG), which will support the Government in the transparent regulation of companies which operate in this sector. Membership of the SCEG is open to all UK-based PMSCs who have signed the international code of conduct on regulation for private security providers.
We are in the forefront of countries working to establish national standards derived from the international code which was signed in Geneva in November 2010. One hundred and twenty-five PMSCs, of which 45 are UK-based, have now signed up to the international code and more are in the process of joining. At an international level, the UK, along with the Swiss, US and Australian Governments is now working with NGO and industry partners according to a published work plan to establish a mechanism to monitor compliance with the code. Each stage of the work plan is open to public consultation and can be accessed through the international code of conduct’s website: www.icoc-psp.org. There will be no duplication between UK national and international standards.
The UK Government will use their leverage as a key buyer of PMSC services to promote compliance with the international code and to encourage other PMSC clients to do likewise.
Winterbourne View Private Hospital
I promised to update the House about ongoing activity in relation to Winterbourne View private hospital.
The House will wish to be aware that steps to assure the welfare of patients at Winterbourne View are progressing well. Commissioners are arranging alternative placements. Most patients have now been moved and the remainder will leave Winterboume View shortly following a full review of each individual’s needs. There will be no new admissions to this hospital and enforcement action is being taken by the Care Quality Commission (CQC).
The multi-agency safeguarding process led by South Gloucestershire council is well under way. There is a range of advocacy arrangements in place and Castlebeck Care report that it has commissioned advocacy services for all patients in its care. Support is being considered on an individual basis at Winterbourne View through a multi-agency care planning process and independent advocacy.
The House will know that Castlebeck Care, South Gloucestershire council, the NHS and CQC have initiated investigations into their procedures and actions. The Department of Health will review the results of these and I will report back to Parliament at the completion of that review.
CQC expects to complete its investigation of all Castlebeck Care’s registered services by 1 July. Additionally CQC has started an internal audit and a human resources investigation, which will be finalised shortly. CQC will inspect rigorously a sample of hospitals for people with learning disabilities.
Following these inspections CQC is also exploring how it might do a wider review of the different models of learning disability provision. CQC is being advised on this work by a stakeholder group and will share the proposals on its planning and methodology with the Department of Health and Ministers as soon as possible.
CQC will also conduct an organisational review of actions which will look at the implications of events at Winterbourne View for the way in which CQC operates.
The South West strategic health authority is consulting the Department of Health on proposed terms of reference for its work to co-ordinate serious untoward incident investigations for all the English patients in Winterbourne View. This will investigate the NHS processes that operated in relation to the organisation of the care of patients treated in Winterbourne View.
Castlebeck Care has commissioned PricewaterhouseCoopers to undertake an independent review of all its provision, and Debra Moore Associates to undertake a clinical review of its services.
South Gloucestershire council has appointed Margaret Flynn, chair of the Lancashire safeguarding adults board, to chair the serious case review, which will take evidence from all the agencies involved. The indicative time scale is four to six months.
I have today placed in the Library the terms of reference for the Department of Health’s review. The review will receive independent advice from a range of experts in the field.
EHRC (Annual Report and Accounts)
I am today laying before Parliament the Equality and Human Rights Commission’s 2009-10 annual report and accounts. Copies will be available in the Vote Office.
Sentencing Reform/Legal Aid
Today I will lay before Parliament the Government’s responses to two important consultations on the future of the justice system—“Breaking the cycle: effective punishment, rehabilitation and sentencing of offenders”, which was launched on 7 December 2010 and “Proposals for the Reform of Legal Aid in England and Wales”, which was launched on 15 November 2010. I am also introducing the Legal Aid, Sentencing and Punishment of Offenders Bill to give effect to those measures requiring primary legislation. I will be making an oral statement this afternoon.
Protecting the public from crime, ensuring those who break the law face the consequences, and providing swift, cost-effective and fair access to justice are fundamental responsibilities of the state towards its citizens. Yet the last 13 years of Government have left a justice system in urgent need of reform.
In the area of criminal justice, a tidal wave of criminal justice legislation has left the system in crisis: neither punishing offenders properly for the crimes they have committed, nor giving adequate protection to the law-abiding public.
In civil justice, we have a system burdened by spiralling costs, slow court procedures, unnecessary litigation, and too limited an awareness of alternatives to court—all of which add to a fear of a compensation culture. In particular, our current system of legal aid too often encourages people to bring their problems before the courts, even when they are not the right place to provide good solutions and sometimes for litigation that people paying out of their own pocket would not have pursued.
The package of reforms I am bringing forward today aims to reform radically our justice system to focus it on fundamental priorities.
Punishment, rehabilitation and sentencing of offenders
Within a year of leaving jail, half of prisoners (49%) are reconvicted of further crimes, creating new victims and harm to society. While they are behind bars prisoners face hours of enforced idleness, free from the discipline of hard work. Underpinning these problems are widespread drug and alcohol abuse, and poor mental health. The previous Government’s responses have left a dysfunctional cycle of persistent crime, inadequate punishment and failed rehabilitation. Over 20 Criminal Justice Bills in 13 years created an unworkable sentencing framework and a statute book littered with over-prescriptive law that undermined the expertise of professionals.
The consultation set out wide-ranging plans to deliver tougher punishment, to introduce a rehabilitation revolution to prevent offenders committing further crime, and to ensure that the sentencing framework is sensible and workable. The Government have listened carefully to the points raised in more than 1,200 submissions and are seeking to take forward measures under five themes, including:
Creating a working week in prison of up to 40 hours instead of enforced idleness.
Introducing tougher, properly enforced community punishments. This includes: allowing courts to impose longer curfews; enabling courts to ban overseas travel; and properly enforced financial penalties, including seizing assets from those who do not pay.
Introducing a mandatory custodial sentence for knife possession in aggravated circumstances.
Creating more ways in which offenders make reparation. We will begin by implementing the Prisoners’ Earnings Act 1996 and legislating to extend our powers to deduct and use money earned by prisoners to support victims; and
Overhauling unpaid work obligations so that offenders work longer hours, carrying out purposeful, unpaid activity that benefits their local community.
Getting more offenders off drugs and alcohol for good, by piloting an initial five drug recovery wings and by cracking down on the use of illicit drugs in prison. The MoJ will also work closely with the Department of Health to tackle inappropriate use of prison to house low-risk individuals with mental illness.
Extending the use of payment by results to cut reoffending, with services delivered by the voluntary, independent and public sectors. Already, at HMP Doncaster the provider, Serco, will pay back 10% of the contract price unless they reduce reoffending by 5% points from current levels. In July six new pilots will begin in areas including Greater Manchester and London.
Opening up justice so that the public has a clearer view of how the system is working for them.
Creating a more proportionate justice system, focusing resources where they will be most effective, including creating a clear national framework for the use of out of court disposals, reforming the use of remand, and reducing the number of foreign national offenders. We will also conduct an urgent review of the indeterminate sentence of imprisonment for public protection with a view to replacing the current IPP regime with a much tougher determinate sentencing framework.
Clarifying the law on self-defence.
Alongside these measures, there should be no misunderstanding about things the Government have never proposed and are not doing. Contrary to some reports, the Government have never proposed targets to reduce the number of prison places, abolish short sentences or the mandatory life sentence.
What all the proposals we are taking forward amount to is a clear break by the Government from the mistakes of the past. By implementing this bold but realistic package of reforms, we are seeking to deliver a system which effectively punishes the guilty while substantially improving the national scandal of our reoffending rates. They should also reduce costs and improve delivery. This is a new, more intelligent course for the criminal justice system and one that we anticipate will make a tangible difference to addressing crime and helping victims in England and Wales.
Reform of legal aid
We are also committed to overhauling our system of civil justice, including through an independent review of family justice, wider access to alternatives to court, measures to streamline civil justice, a criminal justice system efficiency programme and improvements to the “no win, no fee” conditional fee regime. The overall aim is a fundamental shift in the justice system towards greater effectiveness and efficiency—and a move away from the sorry situation in which the average citizen dreads recourse to the law.
Legal aid reform is a crucial element of this wide-ranging agenda. The current system of support too often encourages people to bring their problems before courts. In addition, legal aid has expanded into areas far beyond its original scope. It is now among the most expensive systems in the world, second only to Northern Ireland, costing over £2 billion a year, or £39 per head of population compared with £8 per head in New Zealand, a country with a broadly similar legal system, and as low as £5 per head in some EU countries. In the current fiscal climate, this is simply unsustainable.
The proposals in the consultation set out to address these problems by: ensuring access to public funding in those cases that most require it; encouraging early resolution of disputes instead of unnecessary conflict; and improving affordability and value for money for the taxpayer.
Our plans attracted more than 5,000 submissions. Following careful consideration, today’s response makes some significant changes in matters of detail, but seeks to take forward the substance of most of the reforms published in November, including:
Retaining routine availability of legal aid for cases where people’s life or liberty is at stake, where they are at risk of serious physical harm, or immediate loss of their home, or where their children may be taken into care. Following consultation, we are strengthening specific provisions to ensure availability in private family cases for victims of domestic violence, for children at risk of abuse or abduction and for special educational needs cases.
Pressing ahead with introducing a more targeted civil and family scheme. Prioritising critical areas means making clear choices about availability elsewhere. Legal aid will no longer routinely be available for most private family law cases, clinical negligence, employment, immigration, some debt and housing issues, some education cases, and welfare benefits.
People will instead use alternative, less adversarial means of resolving their problems (notably, in divorce cases, where the taxpayer will still fund mediation). Fundamental rights to access to justice will be protected through retention of certain areas of law within scope and a new exceptional funding scheme for excluded cases.
In sum, the Government intend to implement the substance of the legal aid reform package, refined in specific places. This constitutes an extensive set of very bold reforms, the overall effect of which should be to achieve significant savings while protecting fundamental rights of access to justice.