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Written Statements

Volume 534: debated on Thursday 3 November 2011

Written Ministerial Statements

Thursday 3 November 2011

Education

Education Capital

I would like to update the House on my Department’s work to address the shortage in pupil places being experienced by some local authorities, and reduce the level of prescription and unnecessary guidance which are a feature of the school premises regulations and hamper the development of new schools.

I would also like to inform members of my final decisions on the Building Schools for the Future (BSF) programme in the six authorities which mounted judicial reviews.

In July, I announced that an extra £500 million would be made available, this year, to local authorities experiencing the greatest need in managing shortfalls in providing pupil places. This additional funding has been made available from efficiencies and savings identified in BSF projects that are continuing.

I can announce today that over 100 local authorities will receive a share of the funding. The allocations have been calculated using figures provided to the Department for Education by local authorities through the 2011 School Capacity and Forecast Information returns. By using the most up-to-date information available we are making sure the savings identified are being targeted to local authorities experiencing the most severe need.

I understand the economic situation means difficult choices need to be made about how to direct funding but I urge local authorities to target resources at managing the shortfalls in pupil places wherever they are most needed, and taking into account the views of parents. This is especially pertinent in light of the data released last week by the Office for National Statistics (ONS) showing that previous projections for population growth were underestimated and by 2020 there will be around 21% more primary age children than in 2010.

Today’s extra funding means that in 2011-12, a total of £1.3 billion will have been allocated to fund additional school places. The Government already announced an allocation of £800 million funding in December 2010, twice the previous annual level of support. The nature of this funding, (capital grant which is not ring fenced) the nature of the projects it will fund, (mainly small primary school projects) and the readiness of local authorities to get projects under way, means that this money will be spent efficiently. Further, I expect much of it to benefit small and medium-sized enterprises and to stimulate local economic activity across the country.

I would like to reassure those local authorities whose needs were not as severe as others—and which, therefore, did not receive a share of this extra £500 million—that future capital allocations for basic need and maintenance pressures will be announced later in the year.

I am also launching a 12-week consultation on the revision of school premises regulations. The consultation document sets out how the Government intend to deregulate and end the confusion and unnecessary bureaucracy surrounding the current requirements. A copy of the consultation document will be placed in the Libraries of both Houses.

I am proposing to make the requirements for independent and maintained schools identical and to reduce the overall number of regulations. Some regulations are duplicated in other pieces of legislation or are simply unnecessary and I propose to remove these regulations completely. I also think that other regulations can be simplified to remove unnecessary bureaucracy and make requirements proportionate, without reducing the quality of buildings. I would welcome views on my proposals, further details of which can be found on the Department for Education’s website.

Finally, today I am announcing my decision on the schools that are subject to the BSF judicial review proceedings, brought by Luton borough council; Nottingham city council; Waltham Forest London borough council; Newham London borough council; Kent county council; and Sandwell metropolitan borough council.

I announced what I was minded to do in July and have received further representations from each of the claimant authorities. I considered these carefully but I am not persuaded that I should depart from the decision which I announced I was minded to take. My final decision is, therefore, not to fund the schools in the claim but, instead, to fund, in capital grant, the value of the claimant authorities’ proven contractual liabilities.

Further information on all aspects of today’s announcements, including a complete list of local authorities receiving extra funding for shortfalls in pupil places, can be found on the Department for Education’s website at www.education.gov.uk.

Environment, Food and Rural Affairs

Farming Regulation Task Force Report

I am pleased to announce that the Government published the interim response to the farming regulation taskforce report today.

I established the taskforce in June 2010, asking its members to advise the Government on a new approach to regulation in England, from the point of view of a farmer or food processor, and on how best to achieve a risk-based system of enforcement while maintaining high environmental, welfare and safety standards. Following an extensive review, the taskforce published its report on 17 May 2011.

The taskforce made over 200 recommendations, covering the full range of the regulatory landscape that affects farming. The key messages are that DEFRA, its agencies and delivery partners need to establish an entirely new approach to regulation, strengthen ties with the farming and food processing industry and work in partnership to achieve outcomes, and move to a risk-based approach to regulation, rewarding good practice with less frequent inspection.

The report was bold and ambitious. Government will also be bold and ambitious in finding solutions. I am pleased to announce that the interim response is very positive about our progress to date. It sets out a narrative of the work that is being done, and highlights examples of how the Department and its delivery agents have already started to apply the principles the taskforce set out. We are particularly keen to take forward the principle of earned recognition and to make progress on simplifying and integrating environmental messages for farmers and we are working in partnership with delivery bodies and industry organisations to develop these ideas. I intend to respond positively to as many of the recommendations as possible and will give full details of this, setting out a clear agenda for implementation, in our final response, which is due to be published in the new year.

The interim response is now available on the DEFRA website: www.defra.gov.uk

Thames Tunnel

On 7 September 2010, I outlined in a written statement, Official Report, column 9WS the Government’s support for Thames Water’s plans for a tunnel to reduce the amount of untreated waste water being discharged into the River Thames. I presented an estimate of the costs and impact on customers’ bills, which I said we would continue to scrutinise with Ofwat to ensure value for money. I said DEFRA would update the 2007 impact assessment and that I was minded to consider development consent for the tunnel under the regime for nationally significant infrastructure projects established by the Planning Act 2008.

My statement today reaffirms the Government’s support for Thames Water’s plans and reports on progress we have made since my last update. In particular, it provides an updated estimate for the overall cost and the likely completion date for a project of this size and complexity.

The need to upgrade the sewerage system in London which in places is running out of capacity even in dry weather, and for a solution to the resulting environmental challenges in the Thames Tideway remains persuasive. I will today place in the Libraries of both Houses a paper “Creating a River Thames fit for our future” summarising the strategic and economic case for the Thames tunnel. This builds on the impact assessment produced in 2007. It explains why we continue to believe that a tunnel represents the preferred solution for dealing with the untreated sewage that is polluting the River Thames.

Last year I reported the project costs for the Thames tunnel as £3.6 billion at 2008 prices. This was the cost of the project reported at what is known as the P80 level—that is, there is an 80% probability the project costs will be less than this figure based on probability modelling of cost risks. This figure excluded financing costs. Since then development of the construction plans has continued, more allowance has been made for a later completion date and in response to the first phase of public consultation by Thames Water, greater use of brown-field sites and river transport have been allowed for. The cost base has also been updated to 2011 prices and on this basis the estimates for the project costs are now £4.1 billion. They include £0.9 billion of risk allowance and optimism bias. These estimates have been examined by independent advisers on behalf of Ofwat and confirmed to reflect best practice in the industry. At this stage some uncertainties remain and the estimates will continue to be refined going forward.

Last year I also reported that the estimated average peak impact on annual customer bills was likely to be £60 to £65 in 2008 prices. This figure was based on the then estimate of project costs plus modelling of likely financing costs. Since then, in addition to the revised project cost outlined above, Thames Water has with Ofwat and my Department, made progress in developing the delivery route, risk management processes, and likely financing costs. They have also developed the modelling of the likely impacts on customer bills. This gives a central range for an average maximum annual customer bill impact of £70 to £80 at 2011 prices. The considerably uncertainty in this range reflects the impact that financing costs will have on bills and the difficulty in estimating these for a project of this nature and duration. Relatively small changes in the cost of capital for the project could have a significant impact on bills.

I understand the concern that Thames Water customers may have over this increase in their bills. DEFRA, with Ofwat, IUK, EA and Treasury, has been working closely with Thames Water to ensure that the engineering costs are minimised through value engineering, and that the project is delivered efficiently with a structure and financing mechanism that delivers value for money for customers. We will continue to do this and to ensure that there are no better value solutions that meet the need.

Financing a tunnel of this size at a cost that is value for money for customers is a challenge. The Government believe that the private sector can and should finance this project but accept that there are some risks that are not likely to be borne by the private sector at an acceptable cost. It is willing in principle to provide contingent financial support for exceptional project risks where this offers best value for money for customers and taxpayers. However, I will want to be assured that when offering this contingent support taxpayers interests remain a top priority and that the taxpayer is appropriately protected by measures that minimise the likelihood and impact of these exceptional risks.

On planning, we have completed a 12-week public consultation on proposed secondary legislation (Section 14 Order) which would classify proposed major sewer projects such as the Thames tunnel as nationally significant infrastructure projects (NSIPs). We are currently analysing responses. It will then undergo parliamentary scrutiny and an affirmative approval process. Following such approval, I would anticipate that a Section 14 Order could come into effect in the spring of 2012.

We have revised the draft waste water national policy statement in the light of responses to the public consultation and recommendations from the EFRA Committee. The NPS is to be used by the Infrastructure Planning Commission, or its successor, to guide its examination of development consent applications for waste water projects of national significance. We anticipate that the NPS will be laid before Parliament for approval later this year.

I am very conscious of the impact construction of the tunnel will have on local communities. Thames Water completed their first phase of consultation on the preferred route earlier this year and have amended some of their proposals in response. Tomorrow they launch the phase 2 consultation, which will be further opportunity for people to let their views be known. This consultation is with a view to submitting a planning application to the Infrastructure Planning Commission (or its successor body) in autumn 2012 and construction starting by 2016.

The initial time line for completion of the tunnel was 2020. However, as the parties have worked through the issues relating to planning, financing, procurement and regulation of the project it has become clear while construction time remains at six years, the 2020 date is unrealistic. On the basis of what is now known, and depending on the choices made as we go forward, completion of the construction of the tunnel is now expected to be between 2022 and 2023. We continue with Thames Water to explore how we can minimise the overall time scale.

I propose to provide a further update when we have agreed a delivery route with Thames Water and before they apply for development consent in the second half of 2012.

UK Forestry Standard

I informed the House in February, Official Report, column 791W, that I expected the revised edition of the UK Forestry Standard to be published later this year.

I am delighted to say that we have published the new Standard and its suite of supporting guidelines today. Copies are available on the Forestry Commission’s website at: www.forestry.gov.uk/ukfs.

The documents, prepared by the Forestry Commission and Northern Ireland Forest Service, set out how we must manage our forests in a truly sustainable way. They form the practice code for forest management and detail the conditions that must be met when felling trees, carrying out woodland operations, and receiving grants. They apply to all woodland, irrespective of who owns or manages it.

The Standard ensures that international agreements and conventions on areas such as sustainable forest management, climate change, biodiversity and the protection of water resources are robustly applied here in the UK.

For forest managers, the new Standard encapsulates all the various requirements of sustainable forest management and spells out what they mean in practice. For the first time it includes principles of forest management for carbon benefits, which is a UK Government carbon plan commitment. The UKFS also provides the basis for the new woodland carbon code that gives assurance that woodland projects for carbon capture provide the benefits claimed for them.

For many years the UK has been at the forefront of international moves to protect the world’s forests. The new Standard provides an excellent and up-to-date example of our approach. It is most appropriate that we are doing this in international year of forests.

The Standard will help us strike that vital balance between the economic, social and environmental benefits of forestry. To that end, I am pleased to note the forestry regulation taskforce’s support of the Standard as the cornerstone of long-term sustainable forest management.

I want to thank all the forestry and environmental organisations who have worked with us to bring the Standard together.

Foreign and Commonwealth Office

Kimberley Process (Zimbabwe Diamonds)

On 1 November the Kimberley Process (KP) plenary meeting in Kinshasa reached an agreement to ensure credible and effective safeguards and monitoring of the diamond mines in the Marange region of Zimbabwe. A copy of the agreement has been placed in the Library of the House.

Following almost a year of intensive discussions amongst KP participants, a robust but fair agreement has been reached which only allows exports from mining sites in the Marange region deemed to be compliant with KP standards. Exports from other mining sites can only take place once those sites are judged to be KP compliant by independent experts. This agreement establishes a credible independent monitoring mechanism, including a role for civil society and independent experts, to ensure ongoing compliance with KP standards and to prevent non-compliant Marange diamonds from being traded under the KP. The agreement also commits Zimbabwe to take action to bring all mining in Marange into compliance with the KP.

Allowing rough diamond exports only from KP-compliant mines in Marange ensures that the credibility of the KP is maintained and guards against the risk of non-compliant mines exporting to international markets because of the lack of any agreement. In addition it means that there is some transparency of revenue flows. This will help the Zimbabwean Finance Ministry to collect tax and royalties owed to it, and thereby ensure the financial benefits of the diamond sales can reach the Zimbabwean people.

We will continue to monitor the situation closely and respond appropriately to any future developments. As the agreement makes clear, the KP will constantly review progress towards KP compliance in the Marange region. We urge Zimbabwe to make every effort to overcome the outstanding shortcomings so that next year the KP plenary will be in a position to declare Marange fully compliant with KP minimum standards. If this is not the case, the KP plenary will have to discuss whether to renew the present agreement or alternatively what other measures are appropriate to address any remaining obstacles.

The Kimberley Process remains an important conflict prevention mechanism. This agreement upholds the credibility of the KP and signals the determination of all Kimberley Process participants, including Zimbabwe, to work together to uphold Kimberley Process principles and standards in the future.

Home Department

Terrorism Legislation (Anderson Report)

I am pleased to announce the publication today of the Government’s response to Mr David Anderson QC’s report on the operation in 2010 of the Terrorism Act 2000 and part 1 of the Terrorism Act 2006, which will be laid before the House today.

I am grateful to David Anderson QC for his detailed report and I have considered his recommendations fully. Following consultation within my Department and with other relevant Departments and agencies, I am pleased to lay my response to David Anderson’s recommendations before the House today. Copies will be available in the Vote Office.

Justice and Home Affairs Post-Council Statement

The Justice and Home Affairs Council was held on the 27 and 28 October in Luxembourg. My right hon. Friend, the Secretary of State for Justice, the Scottish Lord Advocate Frank Mulholland and I attended on behalf of the United Kingdom. The following items were discussed:

The Council began in Mixed Committee with Norway, Iceland, Liechtenstein and Switzerland (non-EU Schengen states). The Commission updated on the implementation of the second generation Schengen Information System (SIS II), noting that progress remained in line with the previously agreed Council conclusions. The central system was still expected to go live in the first quarter of 2013. The second milestone test was planned for the second quarter of 2012. The Commission undertook to keep the Council informed.

Next the Commission congratulated member states on the successful rollout of the visa information system (VIS) to north Africa. The UK is not bound by the VIS regulation because it does not participate in the common visa element of the Schengen acquis.

The presidency, supported by the Commission, stressed the importance to local populations of the proposal to extend the local border traffic regulation to the whole of the Kaliningrad region and corresponding Polish oblasts. Insisting it would not create a precedent, they proposed the Council and Commission submit a declaration to the proposal reiterating this. The presidency concluded that a first reading deal could be reached with the European Parliament, whose Committee had accepted the proposal without amendments. The UK is not bound by this legislative proposal since it builds on that part of Schengen in which we do not participate.

The Commission presented its Communication on smart borders, which addressed the possibility of an entry-exit system (EES) and registered traveller programme (RTP) for the Schengen area. Before bringing out legislative proposals next year, they wished to secure the clear support of both member states and the European Parliament on the best way forward. The smart borders package would require time and investment and there were important data protection issues to address. Member states expressed broad support for the communication and highlighted the potential benefits for enhancing internal security, combating organised crime, identifying visa overstayers and reducing border crossing time for regular travellers. However, given the required investment. member states called for a thorough cost-benefit analysis before proceeding. The UK is excluded from these arrangements measures since it builds on that part of Schengen in which we do not participate.

Under AOB, France raised the increasing problem of itinerant crime and called for a debate at the next JHA Council.

The EMCDDA (European Monitoring Centre For Drugs And Drug Addiction) presented the findings from its 2011 annual report on state of the drug problems in Europe, which will be published on the 15 November. Heroin and opiates remained at the heart of the problem. Commissioner Malmström welcomed the report and said that there was a need for further EU action in this area. Commissioner Reding then presented the Commission’s new communication on “Towards a stronger European response to drugs”. It offered a future legislative package and practical action to build a strong framework for combating illicit drugs. The Council also agreed the synthetic drugs pact. The UK welcomed the EMCDDA report and the Commission’s communication. The UK also endorsed the views of delegations who had called for a civil approach to the confiscation of criminal assets and welcomed the presidency’s focus on synthetic drugs, and in particular on precursors used to tackle these drugs.

The Commission provided an update on the negotiations with the United States regarding an EU-US agreement on data protection.

During a discussion on passenger name records (PNR) Commissioner Malmström noted that the European Parliament would vote on the EU-Australia agreement that day. She also reported that discussions with the US had reached an advanced stage, and a political understanding had been reached. Retention periods would be 15 years for terrorism and 10 years for other serious crime, where the latter would apply to crimes punishable by three years under US law. The “push” method would be the norm, but “pull” could be used in very limited cases. There would also be a reference to the EU-US data protection negotiations. The Commission added that on third country transfer they were considering a solution similar to the Australia agreement. The agreement now needed to be transformed into a legal text. They hoped to finalise this in the coming weeks. The UK supported the idea of an EU-US agreement, and was pleased that a political agreement had almost been reached. The UK supported the Commission’s view that security and data protection could both be improved at the same time. PNR data were an absolutely vital tool in the fight against terrorism and organised crime, and we should continue to co-operate with the US for the security of all our citizens.

The presidency invited Greece to update Ministers on progress with the Greek action plan (GAP) on asylum and migration management, on which there were some notable improvements: a reduction in the asylum backlog from 46,000 to 33,000; a rise to an average of 12% in international protection recognition rates and ongoing recruitment of operational staff. The European Asylum Support Office (EASO) referred to their operating plan for Greece, and provided an update on deployment of asylum support teams made up of experts from member states. Frontex gave a brief update on the areas in which they were also supporting the GAP. The conditions in detention centres were very troubling, and the Commission urged the Greek authorities to address the issues at the Greek—Turkish border as a priority. The Commission highlighted that the economic situation in Greece was well understood by member states, but the EU had made significant funding resources available; these resources had to be used. Others agreed. Finally, the Commission stated that co-operation with Turkey was vital, and that agreement with Turkey on readmission would not be forthcoming without a deal on visas and mobility. Greece said that EASO and Frontex, as well as member states, had provided pivotal support but noted that this was not a long term solution and Greece was dedicated to strengthening its own resources.

Discussions on the Greek action plan continued during a closed lunchtime session on wider issues of illegal migration and the impact of visa liberalisation, during which the UK stressed the importance of strong external borders, supporting those who had raised concerns about migration flows from the south-east and across the Mediterranean and about trafficking. A clear focus on upstream migration work in our dialogue with neighbouring regions and countries of origin was essential, while EU action, under the global approach to migration, needed to tackle the key drivers, namely economic instability and political insecurity. The UK also shared the concerns of others about the activities of organised criminal groups in facilitating immigration crime, noting that there were strong links here to the abuse of free movement rights. Forged documents were used to get around the rules and gain access to rights they would otherwise not be entitled to. It was wrong that criminals profited from free movement, while those who upheld its responsibilities suffered.

The presidency summarised the state of play on the asylum package: negotiations on procedures and reception conditions directives continued steadily at expert level; The European Parliament voted for adoption on the qualification directive, solutions for moving forward with Eurodac continued to be scoped; and an early warning and preparedness system continued to develop as a solution to unblocking the negotiations on Dublin. The latter proposal would be discussed in more detail at the forthcoming Strategic Committee on Immigration, Frontiers and Asylum (SCIFA). The Commission congratulated the presidency on the headway being made on the package, and encouraged the Council to continue to look for solutions, while remaining mindful of the views of the European Parliament.

The presidency noted political agreement had been reached on the outstanding issue of correlation tables relating to both the single permit directive and qualifications directive. The UK had not opted into either of these instruments.

The Commission presented their communication on integration of migrants, highlighting the importance of integration and recognising that responsibility for integration rested at a local level. The presidency noted that Council conclusions would be prepared on this issue for the December JHA Council, with work continuing under future presidencies. Cyprus said this would be a priority during its 2012 presidency and informed Ministers that they would organise a conference on integration.

The Commission introduced its communication on co-operation in the area of the JHA within the Eastern Partnership (EaP). Member states noted that clear actions should be in the roadmap which was being developed, co-operation between eastern partners and Eurojust should be further encouraged and the principle of the rule of law was vital to the Eastern Partnership. The presidency announced that on 4 November there would be a conference on the Prague process, which would take forward the Eastern Partnership.

Spain noted that ETA had ceased its campaign of violence. They thanked the EU for its support and noted that the UK had also helped. The Commission was keen to hear views on a possible EU terrorism finance tracking system (TFTS). The main question was whether we needed such a system. The EU counter-terrorism co-ordinator and Europol supported such a system, but it was noted that the EP was divided. Member states noted the need to ensure data protection given the current transfer of bulk data under the EU-US agreement, but expressed concerns about whether the proposal would be cost effective. In addition to the Commissions’ proposals, one delegation wondered if the solution was rather to improve the EU-US agreement. The UK asked for more detail about the added value of the proposals and what the options and costs would look like. The Commission agreed to undertake an impact assessment and consult further with the EP before returning to the Council with proposals.

The justice day began with the Commission introducing its recently published proposal for a directive on minimum criminal offences and penalties for insider dealing and market manipulation. The aim of the proposal is to secure full implementation of legislation on financial services and protection for the financial markets. This directive accompanies a wider Commission proposal for a new regulation, introduced to create a stronger EU framework for tackling insider dealing and market manipulation. The UK noted the presentation.

Next the presidency provided an update on discussions in the Council on the directive on the right of access to a lawyer in criminal proceedings and on the right to communicate upon arrest. This is the third measure on the roadmap to strengthen criminal procedural rights. The UK has not opted into this directive, at the initial stage of the negotiations, because the Government are of the view that the directive as published by the Commission is not proportionate and could have an adverse effect on our ability to investigate and prosecute offences effectively. The presidency reported that progress had been made on many aspects of the instrument, however further discussions are required in the working group in relation to the scope of the instrument and on the admissibility of evidence obtained in breach of or derogation from the rights in the directive. There was no discussion.

The presidency then held a discussion on the draft directive on establishing minimum standards on the rights, support and protection of victims of crime. The UK and other member states supported the presidency’s approach on clarifying the scope of victims’ rights in relation to the role of victims in criminal proceedings and that the vulnerability of victims should be determined on a case by case basis. The presidency expressed the hope that a general approach could be agreed at the December JPIA Council.

The presidency then provided an update on the draft directive on combating sexual abuse and exploitation of children and child pornography. This directive seeks to ensure that criminal activities to sexually exploit children, including misuse of the internet, are more fully covered than in the existing framework decision (2004). They reported that on 27 October the European Parliament had adopted the text agreed by the Council, following agreement between the Council, the European Parliament and the Commission. The UK noted the update.

The presidency and Commission introduced the proposal on an EU common sales law. The Commission confirmed it would be an optional instrument sitting alongside national law that did not harmonise national systems. This was also discussed during the ministerial lunch, the presidency concluded they would analyse the proposal further.

During any other business the presidency informed the Council on the outcomes of the EU-Western Balkans ministerial forum held in Ohrid on 3-4 October and the EU-Russia Ministerial Permanent Partnership Council held in Warsaw on 10-11 October.

The Council also adopted a report on the application of the resolution which establishes the network for legislative cooperation between the ministries of justice of the European Union. The objective of the network is to promote better understanding of the laws of other member states, thus enhancing mutual trust and promoting the application of the principle of mutual recognition.

Police and Crime Commissioners Salaries

I have received the Senior Salaries Review Body report and recommendations on police and crime commissioners pay.

On 20 January 2011 I wrote to the chair of the Senior Salaries Review Body requesting that he consider the role and functions of police and crime commissioners and make an independent recommendation to me as to what the SSRB considers to be a suitable salary, or salary range, for this new office. The report, which today I am placing in the House Library and is available to the general public through the Senior Salary Review Body’s website, sets out clearly the important and powerful role that PCCs will play in delivering policing services from November next year when they will be first elected.

I am grateful for the work undertaken by the SSRB and will reflect on its advice and recommendations. The SSRB has recommended a salary scale for PCCs of £65,000 to £100,000 with each police force area within England and Wales being weighted against this scale. I intend to give this and the other recommendations thorough consideration and report my final decision in due course and in good time to allow potential candidates to be clear on what they can expect their salary to be.

PCCs are established in the Police Reform and Social Responsibility Act 2011 within each force area as powerful individuals, and charged with responsibility for the totality of policing within that area; each force area faces a huge range of policing and social challenges which vary from force area to force area and each PCC will seek to ensure that these challenges are met in the interests of the our local communities.

PCCs will need to be highly motivated, determined to deliver the best for the communities that they serve, and above all be focused on making our communities safe. How PCCs work with and interact with chief constables, police and crime panels and local partners will be crucial to achieving success.

The election of police and crime commissioners will further strengthen the relationship between the public and the police, and allow us to replace bureaucratic accountability to Whitehall with democratic accountability to local communities. As a result the police will have greater freedom and discretion to fight crime as they see fit within a rebalanced and strengthened governance structure. I am keen to ensure that suitable and proportionate remuneration is achieved for such a challenging and rewarding role.

International Development

St Helena

In my statement of 22 July 2010 I confirmed the Government’s willingness to finance an airport for St Helena on condition that:

an acceptable contract price is achieved;

the risk of cost and time overruns after the award of the contract is addressed;

the airport design using engineered material arresting system (EMAS) is approved by air safety support international; and

the St Helena Government undertake to implement the reforms needed to open the island’s economy to inward investment and increased tourism.

I am pleased to announce that these conditions have now been met. A design build and operate (DBO) contract for the St Helena airport will be signed with Basil Read (Pty) Ltd today.

The airport will end five centuries of isolation for this UK overseas territory, which to date has been accessible only by sea. It will provide its British population with the means to build a future which, in the long term, is expected to lead to financial self-sustainability and an end to UK budgetary aid. This vision of a more vibrant, self-sufficient territory would not be possible if we were to provide a replacement ship. Continued sea access as the only way to get to and from St Helena would consign the island to a bleak future of further emigration and economic decline.

The contract will be in the amount of £201.5 million for the design and construction of the airport, with an additional amount of up to £10 million in shared risk contingency, and £35.1 million for 10 years of operation. We are confident that both the negotiated price and the allocation of risk represent value for money for the British taxpayer. In the long run. and including the investment cost, the decision to proceed with the airport is expected to save money for the UK taxpayer.

The contract represents a better deal for the taxpayer than that negotiated in 2008, a saving of more than 20% in real terms, taking into account inflation and the value of the pound.

Transport

Historic Vehicles (MOT Exemption)

The Department for Transport has today published a consultation on a proposal to exempt vehicles of historic interest (vehicles manufactured prior to 1 January 1960) in Great Britain (GB) from the statutory MOT test, as allowed under article 4(2) of the EU Directive 2009/40/EC.

The EU directive of the European Parliament and of the Council, Chapter II, Exceptions, Article 4 states:

“Member States may, after consulting the Commission, exclude from the scope of this Directive, or subject to special provisions, certain vehicles operated or used in exceptional conditions and vehicles which are never, or hardly ever, used on public highways, including vehicles of historic interest which were manufactured before 1 January 1960 or which are temporarily withdrawn from circulation. Member States may, after consulting the Commission, set their own testing standards for vehicles considered to be of historic interest.'”

Sections 45 to 48 of the Road Traffic Act 1988 provide the legislative basis for MOT testing. The purpose of the MOT test is to ensure that cars, other light vehicles (including some light goods vehicles), private buses and motorcycles over a prescribed age are checked at least once a year to see that they comply with key roadworthiness and environmental requirements in the Road Vehicle Construction and Use Regulations 1986 and the Road Vehicle Lighting Regulations 1989 (both as amended).

While it is important to ensure that vehicles are safe to use on the highway, it is also important to ensure that regulations imposed are not excessive. Currently, both the age and the categories of vehicles requiring the MOT test in GB go further than the EU directive on roadworthiness test 2009/40/EC, which only subjects post-1960 registered vehicles to a compulsory roadworthiness test and does not require motorcycles of any age to do a statutory roadworthiness test.

The Government believe that the proposed exemption will reduce regulatory burden on owners of historic vehicles, meet its reducing regulation agenda and the desire to remove unnecessary burdens. It will also bring the age of vehicles requiring the statutory MOT test in line with the Goods Vehicles (Plating and Testing) Regulations 1988, which already exempts unladen pre-1960 manufactured heavy goods vehicles from the roadworthiness test.

Two thirds of pre-1960 licensed vehicles (vehicles manufactured prior to 1 January 1960) are driven less than 500 miles each year. This is significantly less than the 9,000 miles driven on average by all licensed vehicles.

While the pre-1960 licensed vehicles made up about 0.6% of the approximately 35.2 million licensed vehicles in GB in 2010, they were involved in just 0.03% of road casualties and accidents. The pre-1960 licensed vehicles are largely well maintained by their owners. The initial MOT test failure rate for these vehicles in 2009 was less than 10%, while the initial MOT test failure rate for post-1960 licensed vehicles was over 30%.

The purpose of the consultation is to invite views on proposals to exempt vehicles of historic interest from the statutory MOT test in GB. In addition to no change, the consultation offers three options based on vehicle manufactured date—that is, it seeks respondents’ views on whether the Government should exempt from the statutory MOT test pre-1960, pre-1945 or pre-1920 manufactured vehicles.

The consultation also seeks respondents’ views (in all three options) on whether all vehicle categories and vehicles used for commercial purposes should be included in the exemption review.

The consultation will run until 26 January 2012. Copies of the consultation document have been placed on the Library of the House. Further copies are available on the DFT website at: www.dft.gov.uk/consultations/dft-2011-27. Depending on comments received and the Department’s response, amendments may be made to regulations.

Work and Pensions

Personal Independence Payment

Personal independence payment will replace disability living allowance for people of working age from April 2013. The coalition Government are committed to supporting disabled people to lead independent lives and exercise choice and control. Personal independence payment will focus support to those individuals experiencing the greatest barriers to living an independent life, while ensuring the benefit remains sustainable.

Parliamentary approval for resource and capital of £0.65 billion for this new service has been sought in the main estimate 2011-12 for the Department for Work and Pensions. Pending approval of the Welfare Reform Bill, urgent expenditure estimated at £5,014,000 will be met by repayable cash advances from the Contingencies Fund. The advance will be repaid at the earliest opportunity following Royal Assent to the Welfare Reform Bill.

Universal Credit

The Department for Work and Pensions has obtained approval for an advance from the contingencies fund of £46 million to allow for the continued development of IT for universal credit before Royal Assent. This is a second advance; an earlier advance of £18 million was approved for the same purpose in April.

Parliamentary approval for resource and capital of £80 million for this new service has been sought in the main estimate 2011-12 for the Department of Work and Pensions. Pending approval of the Welfare Reform Bill, urgent expenditure estimated at £46 million will be met by repayable cash advances from the Contingencies Fund.

The universal credit programme has successfully completed the second stage of IT delivery on time. This is a major achievement given the demanding timetable and relatively new “agile” way of working. The second advance will allow the programme to continue to work to its current design and development timetable and enable continuity of third-party supplier engagement. This will support an earlier move to the new simplified benefit than could be achieved without it and achieve better value for money by enabling a more rapid take-up of online claims with lower operational delivery costs.

The amount covered by the advance is part of the proposed £2 billion investment in universal credit agreed at the time of the spending review. The advance will be repaid at the earliest opportunity following Royal Assent.