House of Commons
Monday 7 November 2011
The House met at half-past Two o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Secretary of State was asked—
1. What steps she is taking to strengthen the accreditation regime for colleges that admit foreign students. (78437)
Our fundamental reforms of student visas include a rigorous new inspection regime for private colleges. These tough new rules, coupled with robust enforcement action by the UK Border Agency, mean that more than 450 colleges have now lost their right to recruit international students under the points-based system. Only colleges offering a genuine, high-quality education will be able to sponsor international students in future.
I thank my right hon. Friend for her reply and commend her for the work she is doing in this area. Does she agree that the news last week that one in five colleges has lost its sponsor licence status shows that the accreditation scheme set up by her and her Department is working to stop the widespread abuse of the visa system?
My hon. Friend is absolutely right, and what I have announced today is just the start. All private colleges will have to go through that rigorous accreditation system by the end of the year and those that fail the system will no longer be able to bring in international students.
My hon. Friend has mentioned the accreditation scheme for colleges, but of course we are going further in taking action against individual students as well as restricting their rights. We have introduced new rules on English language and we have restricted students’ rights to work and to bring in family members. Next April we will close the post-study work route that has allowed graduates two years’ free access to the labour market here in the UK. We want to make sure that those who come to study are coming genuinely to study and not to work.
We do need to cut out the incentives for people who abuse the student visa route, but there will of course be cases when a mature student wishes to be accompanied by their spouse and children of school age. What are the Government doing to prevent abuse of the system by those who see this as a loophole through which they believe they can bring any number of dependants into this country?
As I indicated in my previous answer, we are taking action against students as well as against colleges. We are restricting the right for students to bring in family members. Only postgraduate students at universities can bring in dependants and we have changed the rules so that only those at universities and public colleges can work while they are studying. That means that we can continue to attract the brightest and best to our academic institutions while ensuring that we get rid of abuse.
I hope that the Home Secretary was not too busy at the weekend to read the report of the Select Committee on Home Affairs that was published on Friday—specifically paragraph 44, which expresses astonishment that the UK Border Agency has been unable to tell us how many students have been deported for breaching their leave and that it does not recognise the term, “bogus college”. Does she not think it extraordinary that the main agency dealing with these matters does not accept a term that she, I and the whole of Parliament have always used to describe such colleges?
I think that what matters is not the term we use but the action we take. That is why action is being taken to ensure that those colleges that have not been offering education to students are no longer able to bring in students and that we get rid of abuse in the student visa system, which has been a problem in this country for far too long.
I support any measures that root out any abuses in the immigration system, but what discussions has the Secretary of State had with universities such as the university of Warwick that have expressed concern about student numbers from abroad because they rely mainly on such students to exist?
Before we put our policy into place, we had significant discussions with representatives from the university sector. We continue to talk to universities about the impact of the student visa system that we have introduced, and that scheme ensures that institutions that are offering a genuine education are able to bring in the brightest and best students, but it is up to them and us to make it clear that students are still able to come and learn at our universities from overseas.
The Government’s approach to gang culture is set out in the “Ending Gang and Youth Violence” report, which I outlined to the House last week. This marks the start of a cross-Government programme of work based on five areas: prevention, pathways out, punishment, partnership working and providing support.
I welcome my right hon. Friend’s commitment to addressing gang and youth crime. Does she agree that the problem cannot be solved by Government alone, but that parents especially and local voluntary and community groups have an important part to play? Will she tell me what is being done to support communities to fight back?
My hon. Friend is absolutely right. It is essential that the Government recognise not only that this issue goes across various Government Departments, but that we need to work with the voluntary and community sector. In February I committed £4 million for the communities against guns, gangs, and knives fund. That is already supporting the work of more than 200 grass-roots projects across England and Wales that are working with young people, their families and local communities. In the report that I presented to Parliament last week I made a commitment that half of the £10 million of funding to tackle gang violence will go to the non-statutory sector.
My hon. Friend makes an important point. Obviously, we are tackling that in a number of ways. First, we have introduced changes in a new knife crime offence, which was introduced in the Legal Aid, Sentencing and Punishment of Offenders Bill last week to tackle it from that end. At the other end we have made money available to the Ben Kinsella fund, and Brooke Kinsella produced a very good report for the Government, going round and identifying projects that work with young people to stop them carrying knives and prevent them from being a danger to others and to themselves.
Everybody wants to see tough action to tackle antisocial behaviour and I welcome what the Home Secretary said a moment ago about the involvement of council, Church and community groups in providing youth services. I have just come from a meeting with young people from Dudley, some of whom are in the Gallery now, and one of them asked me about Dudley council’s decision to cut spending for youth services. Does the Home Secretary think that antisocial behaviour is likely to increase or decrease as a result of cuts to spending on youth services?
What I think is important is that in every local community decisions are taken that are right for that local community about what is going to work. The Home Office and the Government are providing funding to a number of communities throughout the country to ensure that in many cases they can do excellent work with young people to ensure that we can reduce the number of knives that are carried on our streets. This is just the start. Further work will be done to try and counter the gang and youth violence which, sadly, blights too many of our communities.
In August the Prime Minister told me that the Home Secretary would meet social media companies to explore the role of the internet and technology in propagating gang culture. Will the right hon. Lady tell me what the outcome of those meetings was and what action will be taken?
I am happy to do so. I did indeed meet representatives of Twitter, Facebook and BlackBerry. I met them with representatives of the Association of Chief Police Officers and from the Metropolitan police, and we discussed a number of matters—how the police can actively use social media networks, and how the companies can look at their terms and conditions to see when they might take people off the network because they are breaching those terms and conditions. Subsequent meetings have been held on a one-to-one basis between the police and the individual companies.
In discussions with a very senior, experienced officer, one of the issues that he highlighted was the lack of effective communication channels between the police and young people. To what extent does the Home Secretary believe that the ending gang and youth violence teams will be able to pick up and run with that issue?
My right hon. Friend makes an extremely important point. There is some good work being done here in London, for example, with the Safer London Foundation, which is a charity backed by the Metropolitan police. That is an important aspect of the work that I hope the ending gang and youth violence team will be able to encourage at a local community level.
In the 12 months to June 2011, data collected by police forces in England and Wales indicate that 7% of relevant violent offences involved the use of a knife or a sharp instrument.
Knife crime affects every community. In my constituency, following the senseless murder of Leon Jones who was just 21, a group was set up called Dump the Knife—Save a Life. That was young people working with the police and the local community. Can the Minister ensure that funding for such groups will be available in the future, following the announcement of a cut of some 60% in community budgets?
I appreciate the value of groups such as the one the hon. Gentleman describes and am happy to look at it. We have made £18 million of funding available for the next two years to support the police, local agencies and the voluntary sector in tackling knife, gun and gang-related violence, and I would be happy to talk with him about the project.
I am grateful to Ministers for supporting the “Carry a basketball not a blade” initiative in my constituency, but knife crime has risen in London every year since the current Mayor was elected. What more will the Minister do to press the Mayor to get on top of this terrible problem in London?
I agree with the right hon. Gentleman that knife crime is a serious concern, which is why the Government, as my right hon. Friend the Home Secretary has just pointed out, have introduced a new offence of aggravated carrying of a knife. We need to send clear signals and there needs to be effective police action. He knows that the Mayor has been promoting that in London with his knife crime plan, Operation Blade, and we will continue to support those efforts.
Is not the key to cutting knife crime the sending of a clear social message that anyone who commits a crime with a knife or gun will go to prison, actions that this Government have taken, along with the excellent ideas that Brooke Kinsella has come up with?
I agree with my hon. Friend. It is about tough enforcement and sending a clear signal that those who carry knives and use them in a threatening manner will receive a custodial sentence, which we are legislating for, and about the programmes that work with communities to deter people from using knives. That is what Brooke Kinsella’s excellent report focused on.
In the past 10 days alone victims of knife crime have included a poppy seller in Sussex, a father attending a first birthday party in Mitcham and a young man trying to stop a fight in Walthamstow on Friday night. Given the scale of cuts to policing and community safety budgets that the Government are implementing under the Home Secretary’s watch, does she think that knife crime will continue to go up or go down next year?
I share the hon. Lady’s concern about knife crime, which is why we are introducing the measures I have announced on strong enforcement and the important community programmes to deter people from carrying knives, but I notice that her question did not include a single positive proposal for dealing with knife crime, other than the usual Labour party proposal, which is to spend more money.
Police Forces (Collaboration)
I welcome the increasing levels of collaboration between police forces and expect more forces to consider how to work together to bring improvements and save money. The Government provide funding to support regional collaborations to tackle organised crime and have strengthened the duty to collaborate through the Police Reform and Social Responsibility Act 2011.
I thank the Home Secretary for that reply. Does she agree that the collaboration between West Mercia police and Warwickshire police, through their human resources department, produces exactly the kind of saving that can be made without resorting to the compulsory mergers advocated by the previous Government?
Indeed, and I commend my hon. Friend’s police force for the work it is doing in collaboration. Many forces across the country are collaborating in a number of areas. We are able to ensure that we can get the benefits of collaboration without forcing mergers on police forces, which the Labour party tried to do when it was in government.
Thames Valley police is collaborating in various ways with no fewer than six other forces, and the work it is doing with the Hampshire constabulary alone is saving £9 million a year. Does my right hon. Friend agree that that demonstrates that it is perfectly possible for police forces to save money without that having any impact on front-line policing?
My hon. Friend is absolutely correct that that is possible. Thames Valley and Hampshire police are showing that, as are other forces up and down the country. Indeed, in many cases they will not only be saving money, but may be providing a more effective service.
One area where collaboration between forces would be welcome is in dealing with metal theft, which is growing across the country. For example, a business in my constituency lost its industrial process, which meant that it then lost business. What will Ministers do to ensure that collaboration increases and, more importantly, when will they introduce legislation to deal with metal theft?
The hon. Lady has raised a matter of serious concern to a great number of Members, particularly given that we have seen not only the impact on the economy, but the appalling incidence of theft of metal plaques from war memorials, which I am sure has shocked everyone in the House. We are discussing with ACPO and others what legislative changes to the Scrap Metal Dealers Act 1964 might be needed and we are talking with the police about what action can be taken better to identify the rogue dealers in advance of any changes to the legislation.
Nobody will oppose sensible collaborations, but with last week’s report of a 7% rise in theft and a 10% rise in household burglary reported, coupled with a projected loss of 16,000 police officers, it is incumbent on the Secretary of State to tell us the exact total savings from such collaborations nationally and the remaining national funding shortfall after those collaborations have saved some money—if only so that the Minister for Equalities, the hon. Member for Hornsey and Wood Green (Lynne Featherstone), is able to stop her police cuts campaign quickly.
Discussions are taking place between police forces on exactly how much money can be saved by such collaborations, and better approaches to police procurement and to IT, for example, will help to save £380 million. But I am very sorry because it sounds as if yet again the Labour party opposes action to save money while ensuring that the police are able to maintain their services.
Family Migration Route
This Government are determined to bring net migration back to sustainable levels, and to bring a sense of fairness back to our immigration system. That is why we consulted on new measures to prevent the abuse of family migration, to promote integration and to reduce burdens on the taxpayer.
I thank my hon. Friend for that answer. At our party conference the Home Secretary outlined plans to amend the immigration rules better to balance the right to a family life with the wider public interest in controlling immigration. What estimate has the Minister made of the number of immigrants using article 8 of the European convention on human rights to remain in the United Kingdom?
My hon. Friend makes a good point, and the UK Border Agency took a snapshot, reviewing in detail those appeals by foreign criminals against deportation which were determined in October to December last year. There were 551, of which 162 were successful, and of those 99—61%—were allowed on article 8 grounds. That is precisely why we will revise the immigration rules to reinforce the public interest in seeing foreign nationals who are convicted of a criminal offence and those who have breached our immigration laws removed from this country.
Amid the UK Border Agency’s problems with handling asylum cases, will the Minister assure the House that spouses coming to live here in the UK will have to show a commitment to speak and learn English—for their benefit as well as the benefit of society as a whole?
Both those points are right: such an approach is not just for the benefit of the individual; it is absolutely for the benefit of the community that they enter. That is why last November we introduced requirements that spouses and partners must demonstrate a basic knowledge of the English language before they are granted a marriage visa. It is reasonable that anyone intending to live in the UK should understand English so that they can integrate fully and participate fully in life in this country.
Absolutely. The hon. Gentleman knows that my right hon. Friend the Home Secretary is going to make a statement on that matter later, when it can be dealt with in detail, but in his honest moments he will accept that one of the biggest problems—one of the biggest shambles—that this Government inherited was the immigration system that the previous Government left us, and that is what we are getting to grips with now.
(Stratford and Urmston) (Lab): Access to good quality expert advice is important to support legitimate applicants and to ensure that those who should not be here can be advised quickly that they have no case, but constituents report to me that such advice is in increasingly short supply. What steps will the Minister take to ensure that good quality advisers remain in place, particularly following the Government’s cuts to legal aid?
The Government’s cuts to legal aid specifically do not apply to asylum cases, because we accept that genuine asylum seekers will be in need of proper legal advice, but across the House it is agreed that some of the legal advice available in immigration cases, whether asylum or general immigration cases, is frankly substandard. That is why, when looking at our support for the legal aid system, which was yet another public spending regime that ran out of control under the previous Government, we have specifically protected the most vulnerable.
All of us want to try to avoid abuse of all the immigration systems, but does the Minister accept that our high-tech industries in particular rely on key individuals from overseas? It is very important to be able to attract those individuals, and some of these immigration changes risk deterring them from coming here. What steps will he take to ensure that we still get the key international people we need?
I am happy to say to my hon. Friend that we have already taken those steps. Indeed we are bringing down the number of people coming here but, at the same time, we are differentiating more effectively, so that the brightest and the best can continue to come here. That is why we have created the new investors and entrepreneurs visas, which have doubled the number of entrepreneurs who have come into this country over the course of this year, and that is why we have set up the exceptional talent route.
The Government are committed to tackling the corrosive impact of antisocial behaviour. We are ensuring that the police and other agencies have faster more effective powers, that complaints are dealt with more responsibly and that the public have much clearer information about incidents occurring in their local area.
I thank the Minister for his answer, but constituents and local police have raised with me their frustration at the difficulties that local police have in dispersing groups of antisocial individuals, who cause so much misery for their victims by their actions. The Home Office has consulted on giving front-line police the power to direct antisocial individuals and groups away from specific areas, but will the Minister update the House today on whether those proposals will be implemented and, if so, when?
I thank my hon. Friend for her question. I certainly recognise the issues that many communities face from antisocial behaviour and the fact it perhaps was not previously taken as seriously as it should have been. We propose to combine the most effective elements of the various dispersal powers available to the police into a single simpler police power to direct people away from an area where they are committing or are likely to commit antisocial behaviour. We intend to legislate on the new powers at the earliest opportunity.
As the Home Secretary has acknowledged, vandalism, antisocial behaviour and theft from war memorials repulse everybody, particularly in the run-up to Remembrance Sunday. Given that much of that activity is related to the illegal metal trade, why will Ministers not bring forward legislation right away? What is the hold-up?
I welcome the hon. Lady to her position on the Front Bench. I certainly agree with her that the attacks on war memorials in the run-up to Remembrance Sunday are absolutely despicable. I am sure that the whole House will join me in condemning those shocking crimes. The Home Secretary has mentioned a number of steps that the Government are already taking. We are working with the Association of Chief Police Officers to put in place an action plan. Steps are already under way and we are working with other Departments to take further action as well.
Alcohol-related Antisocial Behaviour
The Government are bringing forward a package of measures to ensure that alcohol is no longer the driver of crime and disorder that it has been over the past decade. Measures range from giving more powers to local communities over licensing decisions, to cracking down on those selling alcohol to children and trialling a sobriety scheme to reduce offending. Those provisions are in addition to the introduction of wider measures to address antisocial behaviour.
My hon. Friend has raised a very important point on the whole issue of the irresponsibility of alcohol being sold to children. We have taken steps to double the maximum fine to those who are selling alcohol persistently to under-age children to £20,000, and to increase the powers of the police and local councils to close such premises down permanently. We are working with other Departments, and the Department of Health is leading on an alcohol strategy that will take into account further issues. I am under no illusions about the important role that parents and schools also have, which is why further action is being taken.
Yes. The hon. Gentleman will be aware that the Government have stated clearly their intention to ban below-cost sales, with the first measure being the banning of sales below duty plus VAT. I can confirm to him that those proposals will be implemented on 1 April next year.
I thank my hon. Friend for his typical contribution to these debates. In dealing with issues of alcohol, we need to ensure that we have robust powers to deal with alcohol-related antisocial behaviour, as we are doing. We also need to deal with pricing, which is why we are banning below-cost sales, and with prevention, which is why we will be taking further action in relation to schools, parents and the health service.
Michael Connarty is not here, so I call Mark Hendrick. [Interruption.] Order. It is all very well for the hon. Member for Dudley North (Ian Austin) to say that the right hon. Member for Mid Sussex (Nicholas Soames) wants to ask about the food industry, but the question on the Order Paper is not about the food industry.
Illegal Immigration (Olympics)
I was looking forward to that question as well, Mr Speaker.
The UK Border Agency does not have evidence of an increase in forced labour in the food sector as a result of the forthcoming London 2012 Olympics. However, the agency assesses, remains alert to, and, where appropriate, acts on a wide variety of immigration threats and risks specifically associated with the Olympics.
The Government’s wait-and-see approach is dangerous. When Greece hosted the Olympics in 2004 and Germany held the World cup in 2006, the authorities adopted a forward-thinking strategy that included extra training for police to spot trafficking, and PR campaigns to raise awareness among the public. Will the Government consider adopting a more proactive strategy ahead of the games to ensure that human trafficking does not become part of the London 2012 legacy?
I am very aware of the importance of this issue, and I am happy to assure the hon. Gentleman that a strategy has been in place for some time. For example, the Olympic project team at UKBA has carried out over 8,000 identity assurance checks on contractors and workers on the Olympic site and have arrested 20 people as a result in the current financial year alone. In total, the team have carried out over 60,000 ID assurance checks and made over 300 arrests since 2008. The kind of proactive strategy that the hon. Gentleman wants is very much in operation..
Does my hon. Friend agree that in the Olympic year, the work of the border agency will be of the first importance? Does he agree, since the agency is likely to come in for some stick later on this afternoon, that its individual officers do a remarkable, vital and very important job for this country, and that that needs to be officially recognised?
I completely agree with my right hon. Friend that UKBA officers do a vital job very conscientiously. It is particularly important that they continue to do that and, if possible, to enhance their services in the run-up to the London 2012 Olympics. Part of that will involve ensuring that no abuse occurs in the food industry.
UK Border Agency
Our priority remains to secure the border and to control migration while we help to reduce the public deficit. We expect to have reduced by about 5,200 posts from the start of the review period to around 18,000 by March 2015. We are on track to meet our staff reduction target.
The hon. Lady will know that later this afternoon my right hon. Friend the Home Secretary will make a statement covering the issues that she is interested in. The reductions in staffing are not affecting the front line because we are improving the front line by, for instance, having airline liaison officers overseas. Over the past few years, that has prevented 60,000 people whom we did not want to travel from travelling in the first place. The use of facial recognition technology and e-gates also makes our borders more secure.
As I have just explained to the hon. Member for Edinburgh East (Sheila Gilmore), it is important to have intelligent border controls, to use technology and to put the right people in the right places so that we can keep our borders secure. Those are elements of this Government’s transformation of the UKBA to sort out the shambles that we inherited.
The Minister may not know how many people are being removed from the border force, but I do. The numbers are 886 in this financial year and 1,552 before the next general election. He boasts that he is getting a grip, but this year there have been waits of many hours, EU nationals have been waved through in their hundreds and non-EU nationals have waltzed into the country without so much as a by your leave. We would absolutely adore it if he got a grip. Can he really say, hand on heart, that his cuts have nothing to do with the corners that are being cut with our security?
I am delighted to welcome the hon. Gentleman to his position as shadow Minister for Immigration. I remember fondly when, in government, he talked about the
“huff and puff in many of the tabloid newspapers”—[Official Report, 16 June 2003; Vol. 407, c. 15.]
complaining about immigration. I am sure that he will provide a lot of that in future years. I am sorry, but I have already answered his question. It is the way in which we use people that makes our borders more secure. I suggest that he pauses before he keeps using the phrase about waving people through, because nobody has been waved through the border. However, under the previous Government, as he will hear from the Home Secretary later, people were waved through.
Public Disorder (Tottenham)
My right hon. Friend the Home Secretary has commissioned the chief inspector of constabulary, Sir Denis O’Connor, to undertake an urgent review of public order policing in the five forces most affected by the disorder, which we expect to receive shortly. We will ensure that the lessons from that review are taken forward.
I am surprised that the Minister did not comment on the statement of the Metropolitan police, which said that their policing on the first night of the riots was not good at all. He will recognise the frustration and anger in Tottenham at the scale of the damage to Tottenham High road. What will he and his Department do to encourage other Departments to ensure that my constituency is regenerated?
I am sure that the right hon. Gentleman realises that it is right for us to wait for the report by the independent inspectorate and to take careful note of what it says about the policing that took place. Clearly things did go wrong and we have to learn the lessons. The Government are committed to doing so as, I am sure, are the Metropolitan police. As the Prime Minister has made clear, this is not just about the security response, but about the social response and the preventive measures, which I know the right hon. Gentleman is keen to promote, that can deal with this situation and stop such things happening again.
18. What financial support she is providing to London boroughs to tackle gang-related issues. (78456)
The police, local government and voluntary groups in London currently receive Home Office funding to tackle gang, gun and knife crime as part of the communities against guns, gangs and knives programme, which was announced in February. Further support will be available next year for local areas across the country to implement sustainable approaches to tackling gang violence.
In Hackney, the integrated gangs intervention unit has overseen a major reduction in gang violence. It is funded from the base budget of the council, but that might be more challenging in future years. What work is the Home Secretary doing to ensure that boroughs across London are working together and providing funding for similar initiatives so that we do not see gangs being tackled in one area only for them to bubble up in another?
The hon. Lady has made an important point about the importance of tackling this problem across the board. In talking to the Metropolitan police and in the work that will be done by the ending gang and youth violence team that the Home office is setting up at a local community level, we will incorporate the need to ensure that this work does not simply move gangs on to other parts of London. Funding is being focused on areas where there are particular problems. Hackney is in receipt of several amounts of funding for such projects. I fully take on board the hon. Lady’s point and we will look at it in our further work.
Police Funding Settlement
The spending review settlement for the police is challenging but manageable, and we will not reopen the debate on the overall level of reductions. As part of the provisional settlement process for 2012-13 we will provide provisional allocations for police authorities, which will be subject to consultation before parliamentary approval.
I have explained that we are not in a position to reconsider the four-year funding allocation that has been made, because we have to deal with the deficit. Opposition Members simply do not seem to understand that. The police can make savings in ways that protect front-line services, as we heard earlier, and we are committed to ensuring that that continues to be the case.
In its White Paper, the Home Office said that from 2012-13, the police and crime panels would have the power to trigger a referendum on a policing precept recommended by the police and crime commissioner. When did the Secretary of State decide that that power would be better exercised by herself?
I do not accept the premise of my hon. Friend’s question. I have committed to meeting him to discuss the issue, but we believe it important both that the panel has the power of veto over an excessive precept set by a police and crime commissioner, which has now been legislated for, and that the public have the ability to reject an excessive precept through the referendum lock. That is the subject of separate measures that are before the House in the Localism Bill.
As I have just explained to the House, we have set a challenging but manageable funding settlement for the police service. It is for the chief constable and the police authority in each force to determine the number of police officers that are deployed given the available resources.
The public disorder of August showed us that police numbers count, along with forces throughout the United Kingdom working closely together on major issues. Does not the Minister see therefore how foolish it is to cut more than 16,000 police officers by 2015—the same number that brought order to London during the summer riots?
As I have said, police forces must make savings because we have to deal with the deficit, but they can do so in a way that protects front-line policing. There is no reason why there should be damage to the front line if they drive savings elsewhere. I have pointed out to the House before, and will do so again, that a third of human resources in police forces are not on the front line. Some 25,000 police officers are in back-room jobs. That is where police forces should begin.
We do ensure that, and I understand my hon. Friend’s concern about the issue. I will, in fact, be speaking about rural crime at an Association of Chief Police Officers conference later this week. It is important that we tackle such matters, and they will all be taken into account when we consider the specific allocations for police forces for the third and fourth years of the spending round.
I am sure the Minister would like to join me in welcoming the 500 extra police community support officers pledged by the Welsh Assembly Government. The ones in Gwent are being recruited at the moment. Does he agree that they will be a really valuable help in tackling antisocial behaviour in Welsh communities, unlike the Government’s cuts in front-line policing?
If I can ignore the last part of the hon. Lady’s question, I will say that PCSOs play an important role in helping to ensure that we tackle crime and maintain confidence in communities. Last week the Home Secretary and I, and the shadow Home Secretary and her shadow Ministers, were able to attend the Jane’s Police Review community policing awards, which recognised the role of PCSOs and others, and it is important that we continue to recognise that role.
Police Authority Funding
The police allocation formula is a robust and credible tool for estimating police work load in police force areas. It continues to be used to allocate the majority of central Government funding that goes to police authorities.
The South Wales police force area includes Cardiff, which, as a capital city, has additional civic responsibilities, which obviously mean that the police force incurs ongoing costs. Will the Minister agree to look at that factor and to meet me to consider it further?
I will continue to look at that factor, and am happy to agree to meet my hon. Friend—other hon. and right hon. Members have met me to discuss that issue. I should point out that forces can bid for funds through special grants for events or unforeseen circumstances. That is restricted to expenditure exceeding 1% of a force’s annual budget, but South Wales police has benefited from such awards in the past.
A number of hon. and right hon. Members have referred to reports in the past few days on the UK border force. As the Home Office has already said, a senior official at the UK border force, Brodie Clark, has been suspended for acting without ministerial sanction, but I will make a statement to the House later today.
I welcome the Home Secretary’s decision to instigate an inquiry into border control this summer, which we will discuss shortly, but let me ask her a security question: what is her estimate of the number of people who passed into Britain through our ports and airports this summer under the reduced security and passport regime that the UK Border Agency was operating?
As the right hon. Lady knows, I will make a full statement to the House later this afternoon, and will have a full opportunity to answer her questions then, but I should like to make a few things clear. In the past, under the last Government, some security checks were lifted at times of pressure on the border, including one instance when local managers at Heathrow terminal 3 decided to open controls and no checks were made—not even cursory checks of passports.
To prevent that from happening again and to allow resources to be focused on the highest-risk passengers and journeys, in July I agreed that UKBA could pilot a scheme that would allow border force officials to target intelligence-led checks on higher-risk categories of travellers. We have since discovered that Brodie Clark, the head of the UK border force, authorised the wider relaxation of border controls without ministerial sanction. As I said, I shall make a statement to the House later today and will answer questions on this matter fully then.
The Home Secretary did not answer my question on how many people went through under the reduced security regime, and I am concerned that she does not know. As she will know, previously, both Labour and Conservative Ministers have committed to the roll-out of e-Borders so that proper screening could be available for everyone entering and leaving the country. She seems to be rolling that system back, not forward. When describing the rolling back of checks for EU citizens this summer, a UKBA staff member told me, “We were told not to check children travelling with family groups. That was ridiculous. Supposing a man…had taken them away from their mother and they were wards of court, they would pass through undetected. I have detected many wards of court simply by running them through the warnings index.”
The Home Secretary took the decision to reduce the checks for EU citizens this summer. Why did she do so?
As I have indicated to the right hon. Lady, I shall set out exactly what decisions were taken in my statement to the House later today. I indicated in my first answer to her that we were looking at targeting intelligence-led checks on higher risk categories of travellers. She referred to e-Borders, but this has nothing to do with e-Borders. When we took office, we had to stop the contract with the contractor that the last Labour Government agreed for e-Borders because it was significantly behind schedule in putting it in place.
The crime of child sexual exploitation is utterly appalling and reprehensible, and I well understand why my hon. Friend is raising this issue, given the impact that such incidents have had in Derbyshire. I pay tribute to the work of Derbyshire police through Operation Retriever. I note that their work was recognised at the police review event in the past few days. Awareness-raising is done through the Child Exploitation and Online Protection Centre’s thinkuknow programme, which delivers prevention messages directly into schools and is helping to raise awareness of this issue among parents and young people. The Under-Secretary of State for Education, my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton), who has responsibility for children and families, is developing an action plan to safeguard children and young people from sexual exploitation, which will be published shortly. Raising awareness among parents of this terrible form of abuse will be an important element of that.
T5. South Wales police have an excellent programme for tackling domestic violence, working with local authorities, health authorities and voluntary groups. What new advice and guidance will be issued to them following the statement from the Under-Secretary of State for Justice, the hon. Member for Huntingdon (Mr Djanogly), that the Government did not consider an investigation by the police or the police having been called out as providing sufficient clear objective evidence that domestic violence had occurred? (78466)
We will be asking the, the idea that the police—I am sorry, but I did not hear the question properly. I apologise. Is the hon. Lady asking about the evidence needed to get legal aid for legal advice on domestic violence? I apologise to her. I did not hear the question.
T3. In welcoming the latest departmental developments regarding the police crime mapping website, which my constituents are beginning to learn to use, does the Minister agree that this marks the beginning of a real step-change improvement in police transparency and hopefully accountability to local communities? (78464)
I strongly agree with my hon. Friend. POLICE.uk, our street-level crime mapping website, has received more than 430 million hits since its launch at the beginning of the year, which translates to well over 40 million visits. We are adding new information on crime types and, from next year, justice outcomes. It is an important part of our transparency programme, and it demonstrates that the public want, and make use of, this information.
T7. When does the Home Secretary intend to review the definition of an “air weapon” under the Firearms Act 1968? (78468)
T4. Organised crime costs the British economy £40 billion a year and affects families, businesses and local communities. What action is my hon. Friend the Minister taking to recover criminal assets and the proceeds of crime? (78465)
My hon. Friend has rightly highlighted the issue of criminal finances. We are determined that criminal proceeds will be taken away from those who commit these appalling offences. In total, using powers such as asset denial and by targeting money launderers, the agencies involved denied criminals more than £1 billion last year. However, we want to take further action, which is why we are setting up the National Crime Agency, and we also want to make asset-recovery quicker, more robust and more effective in order to address the point that he rightly highlighted.
T9. I know that the Home Secretary is reluctant to answer any questions on the UK Border Agency in advance of her statement, but does she accept that 18 months into this Government, the decisions taken on Britain’s borders are hers and hers alone, and that she should make no attempt to blame the previous Government for the mess that we see now? (78470)
T6. Please listen carefully; I will say this only once. In the future assessment of police numbers and funding formulae, have any discussions taken place with the Ministry of Defence about the huge cuts in the MOD police? In the case of the Colchester garrison, the last Labour Government managed to cut its 30 officers to three, which has affected the Essex police. (78467)
The Prime Minister promised that all legitimate claims made under the Riot (Damages) Act 1886 following the recent riots would be paid. I understand that a commitment has been made to ensure that the Metropolitan police will see its money, whereas Greater Manchester police authority is still struggling to get an answer from the Home Office. Can the Home Secretary or one of her Ministers give an answer today?
I am happy to answer the hon. Gentleman on that point. We will indeed cover claims made under the Riot (Damages) Act 1886, but as I am sure he will appreciate, it is necessary to check and verify those claims. We have been generous with the definition that we have used, but there is still a necessary process to go through—for example, to identify the exact value of the property lost.
T8. Is the Minister aware that the average fine in 2010 for people caught driving without motor insurance in Lincolnshire was £213, down from £233 in 2008, when the average cost of fully comprehensive motor insurance premiums for my constituents is around £650, having risen on average by 40% in the same two years? Does he agree that such fines do nothing to dissuade potential or existing offenders from driving without insurance? What plans do the Government have to address the situation? (78469)
I am grateful to my hon. Friend for raising this serious issue, about which I want to talk to the Department for Transport. Uninsured driving already raises the cost of premiums for honest motorists to the tune of £30. Individual fines are a matter for magistrates, but it is important that we look at this matter.
Further to the Home Secretary’s reply about the Riot (Damages) Act 1886, if insurance companies are successful in pressing claims for the cost of business interruption, will those costs also be included in the financial settlement?
I do not think that business interruption is being looked at, but I am happy to write to the right hon. Gentleman and set out exactly what we are doing in relation to the Riot (Damages) Act 1886 and what criteria are being followed to ensure that police forces and others are paid the necessary sums.
T10. My constituent Joanne Bryce, whose sister Claire Oldfield-Hampson’s murder was uncovered in Cambridgeshire in December 1998, has worked tirelessly to find out why the case has been so appallingly mishandled by the local constabulary, but she and I have been frustrated at every turn. Will the Policing Minister meet me to discuss the issue with my constituent? (78471)
Yes, of course I will meet my hon. Friend. I appreciate his concern and that of his constituent about the matter; the problem is that the case was investigated by the precursor of the Independent Police Complaints Commission. That is an obstacle, but I will indeed discuss the case with him.
The Home Secretary has recently launched a consultation on the disclosure of previous convictions of serial perpetrators of domestic violence, following the tragic murder of Clare Wood in my constituency and the courageous campaign by her father, Michael Brown. Will the Home Secretary tell me whether there will be early legislation following the consultation to implement the scheme and prevent further tragic deaths like that of Clare Wood?
It is certainly our intention to act as soon as possible on the basis of the consultation. The right hon. Lady will be aware that certain powers are already available to the police to make disclosures to individuals. The consultation will look at whether further powers are necessary. I, too, pay tribute to Michael Brown for the campaign that he is running. He is very brave to do so in the face of such tragic circumstances.
One of the worst forms of antisocial behaviour that my constituents tell me about involves people’s lifestyles and actions having a really detrimental effect on their neighbours’ quality of life. What proposals are the Government bringing forward to help the police and local authorities to deal with this problem?
As my hon. Friend has rightly said, these are local issues that deserve local solutions. There has been a consultation on speeding up the eviction of antisocial tenants; it closes today. The rights of a tenancy bring with them responsibilities, and we will be reflecting on that consultation in due course, once the responses are finalised.
I can assure the hon. Lady that we are always willing to hear from members of staff about any concerns that they might have, and about any proposals for the better operation of the UK Border Agency. Indeed, I was in Turkey only a matter of days ago, listening to those who were making visa decisions in the embassy there, and hearing directly from them their concerns and their ideas for making things better.
Following an illegal encampment of 13 caravans in Harlow town centre at the weekend, Essex police have refused to be the lead agency in removing the trespassers because they are following Association of Chief Police Officers guidelines. Will the Minister confirm that ACPO guidance is no substitute for the police enforcing the law, rather than forcing Harlow council to go through a lengthy court process?
My hon. Friend raises an important issue. First, however, may I commend Essex police for the action that they took alongside Basildon council in the operation at Dale Farm? We are looking at whether we need to give the police extra powers in relation to the clearing of encampments and other incursions on to land. Currently, assuming that the incursion is not stopping the normal life of the community, the landowner has to take legal action. If it is stopping the normal life of the community, the police do have some powers. This matter concerns a great many people, and we are actively looking into it.
With permission, Mr Speaker, I would like to make a statement on last week’s G20 summit. There were three key aspects to the summit. First, agreement on an action plan for growth and jobs, with specific countries agreeing to do specific things in order to maximise overall growth in the world economy. Secondly, the G20 continued with its work to identify and remove some of the key obstacles to growth, including imbalances between surplus and deficit countries, to stop the slide to protectionism, to improve global governance, and to protect the world’s poorest from the current economic problems. Thirdly, there was, of course, the main issue of instability in the eurozone. Let me take each in turn.
First, the action plan for growth and jobs. This includes many of the things that Britain is already doing, from fiscal consolidation and monetary activism to removing the barriers in the way of business and job creation. The G20 recognised yet again the importance of implementing
“clear, credible and specific measures to achieve fiscal consolidation.”
It also clearly identified a group of countries that have the space to borrow for additional discretionary measures. I have to tell any Members of the House who would like to see the UK borrow more that no one was proposing that the UK should be in that group of countries. We are determined to deal with our debts, not to leave them to our children and grandchildren. The need to press on with our plan for fiscal consolidation has now been recognised by the G20, as well as by the International Monetary Fund and the OECD.
Secondly, obstacles to growth. The imbalances that did so much damage in the run-up to 2008 are growing again. This matters, because if we are to maximise global growth and avoid some of the speculative bubbles of the past, countries with a trade surplus need to increase domestic demand and ensure that they keep their markets open, while those with a trade deficit have to undertake structural reforms to improve competitiveness. There was some real progress. For instance, Russia is making changes to its foreign exchange regime, and China agreed to increase its exchange rate flexibility. Both of those are reflected in the communiqué, but more needs to be done.
The greatest mistake that the global economy could make is to enter into a slide towards protectionism. The World Trade Organisation report sets out all the protectionist measures that have been taken in G20 countries over the last year, and they are a cause for concern. So the G20 reaffirmed its pledge not to take protectionist actions, committed again to roll back any new protectionist measures that might have arisen, and reaffirmed its determination to refrain from competitive devaluation of currencies. We also welcomed the fact that Russia, the last G20 country outside the World Trade Organisation, is now set to become a member of the WTO by the end of the year.
On Doha, I have said it is time to look at working with groups of countries in so- called “coalitions of the willing” to drive new trade deals. Together with five other G20 leaders, I wrote to President Sarkozy ahead of the summit to call for new and innovative approaches to trade liberalisation. That is what was agreed in the communiqué.
On improving global governance, I presented a report, which I am placing in the Library today. We secured agreement for the key proposals. First, we agreed that the G20 should continue as an informal, flexible gathering rather than attempting a complete reordering of the system of global governance. What is needed is not new institutions, but political will. Secondly, we agreed that we should make the now established Financial Stability Board a separate legal body to give it the authority and capability that it needs. Thirdly, we agreed that we should strengthen the WTO’s role as the guardian of the world trade system. Further progress was also made on cracking down on tax havens and tax evasion and on having a proper regulatory system for banks to make up for the woeful system that has existed in so many countries, including ours, over the last decade.
On development, Bill Gates gave a presentation suggesting ways of mobilising resources to help the world’s poorest. This included helping some developing countries to help themselves through proper systems for collecting taxes and transparent revenues for natural resources. At the same time, he gave strong support to the UK’s own record on the development agenda.
On the financial transactions tax, I have been clear all along that we are not opposed in principle to such a tax if one could be agreed at the global level, but we will not unilaterally introduce a new financial transactions tax in the UK. Neither will we support its introduction in the European Union unless it is part of a global move. Britain has introduced a bank levy and we are meeting our global agreements on overseas aid. If other countries want to introduce new financial taxes at home, including to raise revenue for development, that is for them to decide. What they should not do is try to hide behind proposals for an EU tax as an excuse for political inaction on meeting targets, whether they be for spending on development or, indeed, climate change.
The current proposals for a financial transactions tax in Europe are so deeply confused that different European countries, and indeed European institutions, have talked about spending the revenues of such a tax in five different ways: on development, on climate change, on social policy, on resolving the banking crisis, and, most recently, as the best way to supplement the EU budget. I have to say that that would be a bit of a stretch even for Robin Hood.
Let me turn, finally, to the problems in the eurozone. It is clearly in our national interest for the eurozone to sort out its problems. As the Chancellor has said, the biggest single boost to the British economy this autumn would be a lasting resolution to the eurozone crisis. That is why Britain has been pressing the eurozone to act—not just at the G20, but for many months. The deal in Brussels 10 days ago was welcome progress, and it reflected the three essential elements that Britain has been calling for: first, reinforcement of the bail-out fund by eurozone countries to create a proper firewall against contagion; secondly, recapitalisation of weak European banks; and, thirdly, a decisive resolution to the unsustainable position of Greece’s debts.
The Euro area countries now need to do everything possible to implement their agreement urgently. Of course, the rest of the world can play a supporting role, but in the end this work has to be done by the eurozone countries themselves. No one else can do it for them. As I have said before, Britain will not contribute to the eurozone bail-out fund—whether that be through the European financial stability facility or a special purpose vehicle. And while the International Monetary Fund may administer a fund, it cannot and will not contribute to it.
The IMF does, however, have a vital role to play in supporting countries right across the world that are in serious economic distress. There are 53 countries currently being supported by the IMF, of which only three—Greece, Ireland and Portugal—are in the eurozone. It is essential for confidence and economic stability that the IMF has the resources it needs. So, at the G20, Britain, the US, China and all the other countries round the table made it clear that we are willing in principle to see an increase in IMF resources to boost global confidence. There was no agreement about the timing, the extent or the exact method through which this could be done. However, Britain stands ready to contribute within limits agreed by this House. Those who propose that we walk away from the IMF, or who oppose even the increase in IMF resources agreed by the last Government, are not acting responsibly or in the best interests of Britain.
It is in our national interest for countries across the world that are in distress to be supported in their efforts to recover. The collapse of our trading partners, whether in the eurozone or not, would have a serious impact on our economy. Businesses would not invest, British jobs would be lost, and families across Britain would be poorer. Through the IMF, we can help other countries in a way that does not affect our own public finances—but let me be clear: it is for the eurozone and the European Central Bank to support the euro, and global action cannot be a substitute for concrete action by the eurozone. The G20 withheld specific IMF commitments at this stage precisely because we wanted to see more concrete action from eurozone countries to make their firewall credible and to stand behind their currency. In short, the world sent a clear message to the eurozone at this summit: “Sort yourselves out and then we will help, not the other way round.”
These are very difficult times for the global economy. The Government are completely focused on one objective: to help Britain to weather the storm and safeguard our economy. Because of the tough decisions that the Government have already taken to get to grips with our deficits, Britain has avoided the worst of this stage of the global debt crisis. In 2008, under the last Government, UK bond yields were about the same as those in Greece; today, although we have the second highest deficit in the EU—second only to Ireland’s—our bond yields are almost the same as those in Germany, and around the lowest that they have been since world war two. That is because we have a credible plan to deal with our debts, and the resolve to see it through. The situation in Italy further emphasises the importance of a credible plan to deal with debts and ensure confidence in the markets more generally.
The eurozone must now do what is necessary, and see through the agreement that it reached in Brussels 10 days ago. Britain, and all our G20 partners, will continue to press for that to happen. I commend my statement to the House.
I thank the Prime Minister for his statement, but I have to say to him—what a complacent statement from an out-of-touch Prime Minister! Anyone listening to him would think that the G20 summit had been a great success, but it was not.
Let me ask the Prime Minister about the three areas in which the summit should have made progress: the eurozone, reform of our banking system, and economic growth. On the eurozone, the Chancellor said in mid-September:
“'The eurozone has six weeks to resolve this political crisis.”
The six weeks are up, but there is no clear solution on financing. How much, from whom, and in what circumstances? None of those questions are being answered. Now we see the crisis in Greece spreading to Italy, and no plans for jobs and growth—just more austerity.
Can the Prime Minister tell us why European and G20 leaders failed to find a solution to the problems of the eurozone? Given that the Chancellor told us from Cannes that he and the Prime Minister were
“right at the heart of the discussions here”,
people will be struck by the Prime Minister’s tone today. Progress that was made at the summit was, of course, down to him—and, as always with this Prime Minister, failure is nothing to do with him.
Does the Prime Minister not now regret that he did not try harder and earlier to engage in the discussions and push for an agreement, rather than standing aside and claiming that Britain was a “safe haven”? If we were indeed at the heart of the discussion, can the Prime Minister say what responsibility he takes for the failure of the eurozone? Given the importance that all this has for Britain, can he tell us specifically what he plans to do in the coming days to secure an agreement?
Let me turn to the funding for the IMF. The Prime Minister said in his press conference on Friday, and again today,
“you can’t ask the IMF or other countries to substitute for the action that needs to be taken within the eurozone itself.”
We agree with that position. The sensible step of increasing resources for the IMF should not be taken to make up for inadequate eurozone action.
The Prime Minister has said that he would not support the direct use of IMF resources to top up the European financial stability facility, but can he also categorically rule out the use of IMF resources indirectly, in parallel, to make up for insufficient funding from the EFSF or the European Central Bank? Can he also square his position that his commitment is within agreed resources with the comment of the managing director of the IMF that there is “no cap…no ceiling” on IMF resources?
Let me turn to the issue of banking reform, and specifically the global financial transactions tax, which we support and believe should be implemented if we can reach agreement in all the major financial centres. It was on the agenda in Cannes, although no real progress was made. I have to say I could not tell from his statement whether the Prime Minister really supports it; after all, “not opposed in principle” is hardly a ringing endorsement. I do not think we should be surprised, because the week before the summit negotiations had even started, the Chancellor was writing to business leaders casting doubt on whether any such mechanism offers an efficient way to raise revenue. So can the Prime Minister tell us whether he actually argued for a global financial transactions tax at the summit, and can he tell us what steps he will be taking in the weeks and months ahead to advance its cause?
Turning to growth, the first substantive paragraph of the communiqué states:
“Since our last meeting, global recovery has weakened, particularly in advanced countries, leaving unemployment at unacceptable levels.”
That is certainly true in this country, where growth has flatlined and unemployment is at a 17-year high. So does the Prime Minister understand why people are so disappointed by the failure of the summit?
The Prime Minister talks about the words in the communiqué about trade and imbalances, but action on trade and imbalances will take years to implement. He also mentions undertakings by various countries who have scope to take action, but it is a very important point in the communiqué that they will be implemented only if
“global economic conditions materially worsen.”
People around the country will be wondering: how much worse do they need to get for action to be taken? He says, by the way, that nobody is arguing for Britain to change course, but the IMF said only last month that if the British economy continues to undershoot, the Chancellor should do just that. How much longer does the country have to wait for him to change course?
After the April 2009 G20 summit the Prime Minister said:
“The glitz and glamour of this week must seem very remote to the small businessman who still can’t secure the credit to stay afloat—or the mother worrying if she’ll be able to keep a roof over her children’s heads.”
The 2009 G20 summit succeeded, and this one failed. For the young person who is unemployed, for the business that has seen demand for its goods disappear, and for the shops that have seen people leaving the high street, this summit achieved precisely nothing. That is why the Prime Minister looks so out of touch when he claims that the summit has made a difference on growth. But is not the real problem this: the Prime Minister does not really believe that we need a global plan for growth? He thinks the answer for the world is collective austerity, just as he used to claim that the answer is austerity at home.
People wanted action from this summit, and they did not get it. Those struggling to find work, seeing their living standards squeezed, asking why the economy is not working for them, deserve better. Is not the truth that this is a do-nothing summit from a deeply complacent Prime Minister, out of touch with the real needs of our economy?
Honestly, I do not know who writes this rubbish! I liked the bit when the right hon. Gentleman quoted my response to the 2009 summit: I have to say that if the 2009 summit was such a success, why did the Labour party vote in the House of Commons against one of its key conclusions—the idea of increasing IMF resources? He talks about regulating banks, with no recognition of the failed regulatory system that he oversaw for a decade. He talks about the eurozone, with no recognition of the fact that Labour had a “national changeover plan” to get the whole of Britain to adopt the euro. Above all, let us be clear: if we had listened to his advice, we would not have been in Cannes discussing a Greek bail-out; we would have been at the IMF discussing a British bail-out.
Let me remind the right hon. Gentleman of the figures. In 2008 Greek and British bond yields were both 4.5%. Since then, in the UK that rate has halved, whereas in Greece it is up by six times. That is because they did not have a credible policy for deficit reduction, and we do.
Let me come back to the issue of the IMF, because what we are seeing from the Labour party is breathtakingly irresponsible. Let us be clear about its position on the IMF, and let us remember that that is an organisation founded by Britain, in which we are a leading shareholder, and also an organisation that rescued us from Labour in the 1970s. Labour’s position is, first, to vote against the increase in resources agreed by the G20 under their own Government. They called it a “triumph” at the time, yet Labour Members trooped through the Lobby in a complete display of opportunism. But it gets worse, because now they are saying that they do not want IMF resources for any eurozone country. Are they saying that they want to take the money from Ireland and Portugal? They would have turned up at the summit, where every country was talking about increasing IMF resources, and said that on no account would Britain support that. How ridiculous. They are saying to eurozone countries, which also contribute to the IMF, “You’re never, ever allowed to seek its assistance.” If they meant that, I would take it seriously—but this is all about politics: they are putting the politics ahead of the economics. We know that that is the case with the shadow Chancellor: he only ever thinks about the politics. The question for the leader of the Labour party today is: are you a bigger politician than that? I am afraid that the answer is no.
Did Chancellor Merkel tell my right hon. Friend why the European Central Bank is not fully discharging its duties as the euro’s lender of last resort? It is not providing massive quantitative easing, not moving towards near-zero interest rates and not urging President Sarkozy to renationalise the leading French banks before the credit crunch closes on France. Chancellor Merkel knows very well that it was not inflation but high unemployment which, in my lifetime, brought down the Weimar republic, and will do the same for the European Union.
My right hon. Friend speaks hugely powerfully about this issue. He is right that we must not allow the IMF to substitute for what the ECB and the other institutions of the European Union need to do; that is vital. It was one of the reasons why, in the end, all the countries of the world that were prepared to see an increase in IMF resources wanted to see more done by the eurozone and by the ECB. I have discussed this with Chancellor Merkel on many occasions. My right hon. Friend will know as well as I do of the huge hold-back that there is in Germany about what a central bank is, and what it should do. But I do believe that, as it says in the communiqué, you have got to have the institutions of the eurozone fully behind the currency in order to save it.
Understandably, the Prime Minister is putting a brave face on what happened last week. On any viewing, the G20 failed to reach its aims on growth, on the imbalances or on the eurozone crisis, which is as bad now as it was a few days ago. I see that there were reports that the G20 is planning to meet again, perhaps as early as in the remaining part of this year or at the beginning of next year. Is that right? If so, would the Prime Minister bear it in mind that in some ways, no summit is better than another failure? The G20 may not be perfect, but it cannot afford another meeting where it singularly fails to come up with the goods.
The right hon. Gentleman is entirely right: meetings that do not have a proper conclusion can often add to the problem rather than solve it. What is required is the political will for eurozone countries to act. I was very clear after the G20 meeting that it had not achieved a breakthrough on the euro—that is absolutely clear. Some progress has been made in terms of establishing the three elements that need to be put in place—the firewall, the recapitalisation and the Greek write-down—but much more has to be done. There may well be a meeting of G20 Finance Ministers, but I agree with the point that the right hon. Gentleman makes: it is progress and resolution of these issues that is required, rather than another meeting.
The European Commission has estimated that implementation of the financial transactions tax would reduce gross domestic product in the euro area by 1.8%. Of course, that would hit the UK disproportionately hard at a time when we need more growth, not less. Does the Prime Minister agree that, of all times, now is not the appropriate moment to consider such a controversial measure?
It is important for people to see the European Commission report on the financial transactions tax, which shows the figures that my hon. Friend talks about, and shows that it would cost jobs. As I have said, if we could achieve global agreement for a tax of that nature there would be a case for it, but it is very hard to see that happening. I think that the focus of politicians in Europe should be to meet the promises they have already made about development rather than to hide behind a financial transactions tax that they know is very unlikely to come into being.
The frustration and impatience that the Prime Minister expressed on Thursday and Friday last week were extremely well merited, and it would be as well if he came here and repeated his concerns about the failure of leadership across Europe at this vital time. In that context, though, is it not a tragedy that when Europe does need a voice for reform—for example, on budgetary policy, which is going to be a major issue in coming years—he has dealt himself out of the game with a focus on the repatriation of powers, which, frankly, is not the issue that is going to make or break the European economy?
I do not agree with the right hon. Gentleman, for this reason: I have managed to assemble a coalition for budgetary restraint in the European Union, and this year Britain, France, Germany and others have all agreed to freeze the EU budget in real terms. I would like to go much further, but I have to say that a freeze in the budget in real terms is not something we have been able to achieve in recent years, and is a breakthrough, so I do not accept the point about looking at rebalancing powers in Europe and fighting for a deal on the budget. We can do both.
Given that the single market, including the City of London, is governed by qualified majority voting, how does the Prime Minister propose to achieve a majority to protect our interests in the context of the fiscal union that he advocates?
First, we need to disconnect the issues that my hon. Friend raises. The issue of the single market and the threat to the City of London and Britain’s financial services is a real threat. We have to work extremely hard to build alliances in the single market and in the European Council to stop directives that would damage our interests. I think it is extremely important that we do that work. Financial services matter hugely to this country, and this is one of the areas that I want to ensure we can better safeguard in future.
I do not support fiscal union. I do not think that Britain ought to join a fiscal union, as I do not think that is the right move for us. However, we have a single currency that is quite dysfunctional, and one way in which it could be made more functional is greater fiscal union. That is a statement of fact rather than our saying that we want in any way to join it: we do not. We want to safeguard the interests of Britain by making sure that the single market works for us.
Is it really in the best long-term interests of this country for the Government consistently to present the United Kingdom as the neighbour from hell with regard to the European Union—not least with regard to the Tobin tax? The issues on which the European Union wishes to spend money are the issues on which the Prime Minister’s constituents and mine, and citizens around the world, wish to see money spent—not least on alleviating suffering in the third world and on climate change. Will he change his mind on this issue?
With great respect to the hon. Lady, this Government—and to an extent the Governments whom she supported—have made and kept promises about things that our constituents care about, such as development and climate change. We are meeting those. As for being a good neighbour, one of the most unneighbourly acts someone could perform when the whole world is looking at growing the resources of the IMF to safeguard the global economy is to walk away from that and vote against it—something that I know that quite a lot of Labour MPs, probably including some on the Front Bench, are rather ashamed of. Such an act would show them to be not only not a good neighbour, but on another planet.
As there is a danger of the euro crisis now spreading to Italy, can the Prime Minister tell me what the leaders of euroland have said they will do by way of buying Italian bonds or offering subsidised loans to Italy to head off the crisis in the market there?
My right hon. Friend asks an important question. It goes back to the question that the Father of the House asked, about the actions of the ECB. The ECB has been intervening in markets and buying bonds of countries that are under pressure. That is what makes it so difficult to understand why some in Europe are so opposed to the ECB being more of a monetary activist, if I could put it that way. The key with Italy—everyone should be careful about speculating about another country—and the point I made in my statement is that Italy must demonstrate that it has a credible fiscal path. That is as much about the confidence of the markets that it will be able to pay its deficit and pay its debts. If it can do that, its interest rates will fall.
The door marked “Exit from the eurozone” is now clearly in view and a number of eurozone states are moving inexorably towards it. Is it not obvious that until those states can recreate their own national currencies and find an appropriate parity for those currencies, they will not recover?
The hon. Gentleman refers principally, I think, to Greece. That is an issue that the Greeks have to decide themselves. They have been offered a deal that writes down their debts and can enable them to stay in the single currency; it is their decision whether to take that road or to take another road. The only thing I would say to Members of the House who are deeply sceptical about a single currency, of whom I am one, is that we should be very careful to recognise that countries leaving a single currency can cause all sorts of knock-on effects and problems for other economies, including our own. We should not see it as some sort of painless easy option for a country to fall out of the euro. It would have very real consequences for other countries, including our own, and we have to think about that in that context.
Given the role that the big banks played by being overstretched and therefore triggering the present financial crisis, can the Prime Minister tell us what progress he made in persuading his colleague countries in the G20 to follow the proposal that we made and that the Vickers commission recommended to break up the banks that are too big to fail, so that in no economy are the big financial institutions able to hold a gun to the state and to the taxpayer?
Obviously, many people will comment on the ultimate failure of the G20 to resolve the eurozone crisis, but the G20 has made good steps forward in areas such as trying to roll back protectionism, and particularly on the issue that the right hon. Gentleman raises about globally significant financial institutions and the impact that they can have. The approach that Vickers recommends is fully in tune with what other G20 countries are recommending.
Does the Prime Minister realise that the British people out there are listening to the sheer effrontery of this British Prime Minister suggesting a growth plan for Greece, Italy, Spain and Portugal, while here at home he sticks rigidly to high inflation and mass unemployment? Hypocrisy by the bucketful!
Does my right hon. Friend agree that one of the biggest single fillips to global growth would be breaking the deadlock over the Doha round? Can he say how confident he is now that the approach of willing coalitions will help make progress on this issue under the Mexican presidency?
I thank my hon. Friend for that question. The point about Doha is that it is not progressing in the way that it was meant to. There is a gridlock between many of the developing countries and, particularly, countries such as America that do not see enough in the round for them. So it seems that the only way forward, if we want to see more global trade deals that are good for all those participating, is to have coalitions of the willing—countries that want to push ahead. That is what has been sanctioned at the G20, and that is what we can now push ahead with.
Greece, Spain and Portugal already are, and Italy probably is, insolvent within the European monetary union. None of these countries is likely to regain its competitiveness while it is part of the single currency. Does the Prime Minister not think it would be better for the IMF to give them extra funds only once they have left the single currency, rather than while they are part of the EMU?
The hon. Lady makes an important point, but it is not necessarily fair to lump all those countries together. Some of them, such as Italy, have huge deficits in terms of the ratio of debt to GDP, but have managed to compete within the single currency, so I am not sure that the way in which she groups those countries together is entirely fair. The important role of the IMF is not to support a currency system, not to support the eurozone, and not to invest into a bail-out fund. The IMF has to be there for countries in distress. That is why everyone in the House supported, for instance, the IMF programme that went into Ireland. The IMF went in as a partner of other countries, but it did go in. If she turns her question round the other way, it would be extraordinary, would it not, to say to eurozone countries, “You are shareholders in the IMF, you contributed to the IMF, but when you’re in distress you can’t get any money from the IMF at all”? That would be an extraordinary position—but it is one that seems to have the support of those on the Labour Front Bench.
Has not the avoidance of a concentration of political and economic power on the continent been a cardinal feature of British foreign policy for 300 years? How then is it in our interests to facilitate the creation of a single fiscal and monetary union that will have enormous power over us, but over which we will have very little influence?
My hon. Friend asks a question with a broad historical sweep. We are suffering at the moment from a single currency that we are not a member of, but that has some serious structural faults. It is in our interests that those faults are resolved, and one way of helping to do that would be to have a greater pooling of fiscal sovereignty among the members of the single currency. I always felt that that was necessary and was going to happen, which is one reason why I never supported the single currency. However, I do not think that we can stick happily with the status quo when the single currency is having a chilling effect on our economy, through the crisis, and not seek some sort of resolution.
A few years ago the President of Yemen was invited to the G20, but the country now has the world’s third highest rate of malnutrition. What additional help can Yemen be given as a result of the G20 meeting? Would the Prime Minister be happy for some of the IMF money he has just given to go to Yemen?
First, we have not yet given any IMF money. There was no agreement on how much should be given, exactly when it should be given or in what way. The world was saying that it stood ready to support the IMF. The IMF has supported countries like Yemen in the past and, as the right hon. Gentleman knows, we have put development aid into Yemen. The biggest challenge in Yemen is the lack of effective governance, and I think that what Bill Gates was talking about—proper systems for raising taxes and for transparency in Government revenues and in revenues from extractive industries and minerals—are the keys to helping such countries along their way.
Back in July the Financial Secretary to the Treasury told a Committee of this House, with regard to IMF obligations:
“We have an agreement to fund up to £20 billion, broadly speaking.”—[Official Report, Second Delegated Legislation Committee, 5 July 2011; c. 9.]
Pretty broad, it turns out. We now hear that the figure is closer to £40 billion. Does my right hon. Friend agree that it is vital to level with the British people, with no weasel words or sophistry, and that Ministers have an obligation to be absolutely straight about what they plan to do with other people’s money?
Let me be absolutely clear about this. There are two sorts of money that the UK provides to the IMF: money through our quota, which is effectively through our shareholding, and money through loans and other arrangements. There have been three votes in this House in the last three years on all the elements of the IMF money. As I have said, if it comes to giving extra support for the IMF, we want to do that within the headroom that has been set.
Are we not really dealing with a sophisticated form of Russian roulette, in which the Prime Minister tells us on the one hand that he does not think that it is right for eurozone countries to have their funding from the IMF cut off, but says on the other hand that at this stage there should be no additional money from the IMF? When will the stage be right for that additional IMF money?
There are 53 IMF programmes around the world, only three of which are in the eurozone, so in part it is a judgment for the IMF about when it needs to replenish its resources. Let me be clear about what needs to happen in the eurozone countries. They have to sort out the problems of the euro: they need that firewall, and it is Europe that effectively has to provide it. They need that recapitalisation and the demonstrable and clear write-down of Greek debts. Those are the things that they have responsibility for. We have responsibility, as an IMF shareholder, for bulking up the IMF finances at the right moment. I do not see that as Russian roulette; it is just very sensible economics and politics.
Can my right hon. Friend tell the House what advice he has received on the consequences of failing to pay our IMF subscriptions, as so irresponsibly advocated by the Opposition?
My hon. Friend makes a very good point. I am not entirely sure what would have happened if we had turned up at the G20 having voted down the deal from the London G20 on increasing the IMF resources. First of all, we would have declined to implement one of the key findings of the last G20, and then we would have turned up and said that we were not prepared to see any increase in IMF funding for anything else. Britain would have been completely isolated and left out. The reason why the Opposition are talking about this is that it is all about the politics and nothing to do with the economics, and they know it.
(Dundee East) (SNP): The Prime Minister said that the UK would not fund the EFSF, but it remains one of the eurozone’s most powerful tools, and there are two new powers proposed for it—to insure newly issued sovereign debt, and to spin out investment trusts to buy that debt. Do the Prime Minister and his Government believe that those powers will be enough to leverage the EFSF up to the €1 trillion or so required to give it the firepower that it needs?
There are still real difficulties with that. The EFSF and the idea of a special purpose vehicle were set out at the eurozone meeting 10 days ago, but the problem is that since then we have not seen enough detail on how exactly those funds would work and how they would be levered up. You need—I have used “bazooka” before—a bazooka big enough to convince people that you will not have to use it, and that is what the eurozone needs to do, but it has not yet completed that work.
One of the few advantages of the ERM was that you were able to get out of it, but one of the issues with the euro is that there is not a mechanism, properly and legally, for leaving it. If a country wanted to leave the euro, of course it could, but in the end this is an issue for the Greeks. They have to decide: do they accept the deal on the table that cuts their debt, and stay in the euro, or do they take a different path? The point I have been making is that they have to make up their mind for the rest of the world to move on.
Was there any discussion at the G20 about the unaccountable power of the rating agencies to decide the future of national economies, or about the massive profits being made on short-term loans out of the poverty and austerity of Greece, Portugal, Spain and Ireland—any discussion about control over the banking system, rather than bowing down to it?
There were concerns expressed, and they are frequently expressed, about the role of the ratings agencies and the way they are regulated. Sometimes, they come from politicians who have had a particularly rough time with the ratings agencies, but it is very important that we use organisations such as the Financial Stability Board to make sure that we get the answers right, rather than do it according to political fiat.
My hon. Friend makes an important point, but that is quite a difficult ask, because there is of course important ongoing work on contingency plans, but the more we discuss and speculate on the nature of another country’s currency and economy, the more we could damage their interests. So, I will think carefully about what he says, but it might be difficult to air some of those issues in public.
The Prime Minister knows that the IMF currently gives 32.4 billion special drawing rights—about £32 billion—to the eurozone to prop it up, so how can he justify giving more British taxpayers’ money to the eurozone via the IMF when there are people starving in Africa and people cannot pay their heating bills in Britain?
No country has ever lost money lending it to the IMF. The IMF is, in a globalised world, a vital institution for supporting countries that get into deep economic distress, and, if we were to walk away from it and just to allow trading partners—in the eurozone or outside—to collapse with no one to help them, that would mean British jobs lost and British businesses going bust. It might give you a five-second soundbite on the news in order to try to give you some political advantage, but it would be completely irresponsible.
I agree with my right hon. Friend that Greece’s remaining in the eurozone is a matter for the Greek Government, and that there is no free hit for the break-up of the euro, but will he take time to read the Centre for Economics and Business Research paper, which points out that, for Europe as a whole and the United Kingdom in particular, our economy will be growing faster in two years’ time if the euro breaks up than it will if we try to keep the currency going?
I have seen reports of the piece of work that my hon. Friend speaks about, and perhaps I will have time this evening to read it at greater leisure. We can look at the economic experts and what they say, but there is quite a strong consensus that the consequences of a country falling out of a single currency zone, where banks and businesses are very interrelated, are very serious for all the members concerned. As I say, if it happens, we will have contingency plans in place and we will have to manage them as best we can, but no one—however sceptical they are about the euro—should think there is an easy way for a country to leave.
Now that the Greeks will have a new Government who will ratify the 26-27 October agreements, and as the Group of Twenty is an informal grouping, would it not be appropriate, where there is agreement, for the group’s Finance Ministers to get together to help the European financial stability fund put together its firewall under the Sarkozy presidency?
The G20 Finance Ministers might have to meet again, but, as I said in answer to the right hon. Member for Edinburgh South West (Mr Darling), only if a new set of arrangements is being put in place. Part of the problem in Europe is that, so often, meetings are scheduled without proper thought about what the outcome will be—about what will be achieved. That has been one of the things that have caused a huge amount of market turbulence over recent months.
Figures out today show that EU productivity is falling at its fastest rate since 2009. The only big economy to record an expansion in output per worker is the UK. Why does the Prime Minister think that the United Kingdom can borrow at a 0.5% interest rate for one year’s money, compared with 4.7% for Spain and 6.3% for Italy?
My hon. Friend makes an important point. First, in getting greater competitiveness across Europe, this is the most important thing that Europe could be doing right now: completing the single market, completing the market in energy, completing the market in services and making sure our economies are competitive. The point he makes about t