House of Commons
Wednesday 5 September 2012
The House met at half-past Eleven o’clock
[Mr Speaker in the Chair]
Oral Answers to Questions
The Minister for the Cabinet Office was asked—
Lobbying White Paper
1. What recent discussions he has had with the Deputy Prime Minister on the lobbying White Paper. (118531)
The Deputy Prime Minister has recused himself from any involvement with the question of lobbying due to a possible conflict of interest with his wife’s activities, and therefore I have not had any discussions with him whatsoever about this subject.
Will the Minister explain why the Government have failed to bring forward any proposals for a statutory register of lobbyists? It seems that the public want one, the lobbying industry wants one and the Government promised one.
Yes, I will explain why we are where we are. The hon. Lady would, I am sure, share my view that it is important when issuing a consultation to pay some attention to the responses received. When we issued the consultation with a set of proposals for a statutory register, an enormous number of responses were received. We are going through them, considering them extremely carefully. The Select Committee on Public Administration also reported on the matter—it was a weighty and serious report—and had a great number of things to say. We are also considering those, and when we have finished that consideration, we will come forward with new proposals.
Does my right hon. Friend agree that there is a real risk in that although a request for a register of paid lobbyists is perfectly reasonable, we must not throw the baby out with the bathwater when all sorts of charities, voluntary organisations, trade unions and others who “lobby” perfectly legitimately are not paid lobbyists and should not be included?
My hon. Friend makes an important observation. One issue that came up in the course of the consultation, which many consultees and indeed the Select Committee commented on, is the question of scope. The Government’s initial proposals did not include any reference to lobbyists that were “in house”—the ones to which my hon. Friend refers—whether they be charities, businesses, social enterprises or whatever. Some respondents suggested that the scope should be wider. This is clearly something that needs to be considered, and my hon. Friend’s point is well taken.
Yesterday’s reshuffle saw the entry into the Cabinet of every single Tory MP who had sat on the advisory board of the disgraced Atlantic Bridge lobbying organisation. Examples like this leave the Government open to the accusation that they are dragging their feet on regulating the industry because of inappropriately close relationships with lobbyists. This is damaging to the House and to democracy itself. Following the departure from his Department of the Minister responsible for regulating lobbying, will the Minister immediately bring forward legislation to regulate this matter once and for all?
I certainly do not want to get into any partisan repartee across the Dispatch Box on a matter that ought to command considerable cross-party agreement and support. I am grateful to the hon. Gentleman for the remarks he has made on the record in the past about supporting the principle of regulating lobbying. I should, however, point out that his party was in government for a very long period during the whole of which issues were raised about this subject and at no time did that Government issue a paper or consult on it, or move towards serious regulation of it. If he feels that this should have been done immediately, the question arises of why it was not done from 1997 onwards. To help him, the answer is, of course, that it is an extremely complicated and difficult subject, which is why the Select Committee and respondents to the consultation had many things to say. I hope that the hon. Gentleman will, on mature reflection, agree that we should consider this in an unpartisan spirit and try to get it right.
Whitehall Spending Controls
2. How much money was saved as a result of his Department’s cross-Whitehall spending controls in 2012. (118532)
To deal with the enormous budget deficit that the coalition Government inherited from the Labour party opposite, in the days after the general election in May 2010 we introduced tough new spending controls. In the year to March 2012, those controls helped to save the taxpayer no less than £5.5 billion, on top of the £3.75 billion that we saved the year before.
I congratulate my right hon. Friend on those figures and ask him whether he agrees that this shows just how wasteful spending was under the previous Government.
I am afraid that that is the case. It was open to the Leader of the Opposition, when he sat in my position in the Cabinet Office, to introduce the same kind of controls, but it is very unglamorous hard work; one needs to get into the detail. It is a pity that he did not do it; if he had done, we would not be in quite the fiscal mess that the coalition Government inherited two years ago.
The Minister has previously made great play of the contracts finder website as an indication of cross-Whitehall spending. Before the summer recess, I tabled a series of questions to all Government Departments about the level of spending on contracts with Atos and Atos Healthcare. It turns out that despite the claim that all the information is on the website, a significant number of contracts with Atos across Whitehall are not on it. Will the Minister review the website to ensure that it is absolutely accurate?
I must start by saying that we inherited a complete lack of transparency about Government contracts. It was impossible for potential suppliers to the Government to find out what contracts were available. We are gradually reaching a stage at which more and more contracts will be made available transparently, but provisions relating to confidentiality are built into many of the contracts with suppliers that we inherited. We will seek to avoid that in future, but I think the hon. Gentleman will find that many of the Atos contracts stem from the time when his own party was in government.
14. I welcome the savings that my right hon. Friend has already found, but what more can he do to reduce the burden of excess in Whitehall which has existed over the last few years and which was fostered by the Labour party? (118545)
The longer we stick at this task, the more possibilities of saving yet more money we will find. It is important to protect spending on the front-line services on which the public depend, and we will continue to do that. I am delighted to welcome my hon. Friend the Member for Norwich North (Miss Smith) to her post: she will give huge support to me in my role of seeking out wasteful spending and driving efficiency through central Government.
Trade Union Facility Time
3. What his policy is on the provision of trade union facility time across the civil service. (118533)
Unions can play a positive role in the modern workplace. [Interruption.] On the subject of paying, it is nice to know who is paying that lot on the Labour Benches.
However, the Government believe that taxpayer-funded facility time arrangements in the civil service should reflect good practice across the private and public sectors. That is why I launched a consultation to review facility time, and will ensure that future arrangements are subject to rigorous controls and monitoring.
Can my right hon. Friend tell me what arrangements for the monitoring of union facilities and activities were in place when he entered Government in 2010, and how much they were costing?
The arrangements for the monitoring of facility time were very mixed indeed, and in most cases almost non-existent. It has taken a long time—many months—to tease out of Whitehall the data on how much is being spent and how much facility time there is. We estimate that the cost to the taxpayer of facility time for trade unions in the civil service alone is between £33 million and £36 million a year. That is too much, which is why we are consulting on how it can be significantly reduced and controlled.
When measuring the costs, the Minister should take account of not just the cost of the time to the taxpayer, but the benefit of the work done by trade unions throughout the civil service. How will he estimate the cost of what he is doing in terms of benefit?
I am confident that our consultation will tease out the benefits. I absolutely accept that the trade union duty to support union members in employment disputes can have a benefit, and for that reason we are not suggesting that all facility time should be removed; indeed, it would not be lawful for us to do so. However, the amount is excessive. It has been allowed to creep up over time, and it now needs to be reduced and controlled for the future.
Non-departmental Public Bodies
4. What recent progress his Department has made on its programme to abolish and reform non-departmental public bodies. (118534)
7. How many non-departmental public bodies his Department has abolished to date. (118537)
This Government have undertaken the biggest programme of quango reforms in a generation to increase accountability, cut duplication and reduce costs. We have already reduced the number of public bodies by about 200, and by 2015 the overall number will be down by a third.
I welcome my hon. Friend to her new position and wish her well. What help and support have the Opposition given on the quango reform programme?
That is a very appropriate question, because Government spending on quangos doubled under Labour, and by 2015 this Government will save the taxpayer a total of more than £2.6 billion, which is more than £150 per working household. It tells us all we need to know about Labour that it voted against those measures.
Does my hon. Friend agree that the growth of the quango state under the last Government significantly reduced accountability to the taxpayer, and that many of these organisations had overpaid chief executives and overly smart offices, greatly increasing the cost to the public purse?
I agree. The range of responsibilities handed to those bodies and the amount of taxpayers’ money they received was at an all-time high under the previous Government, and they were clearly irresponsible for doing that. This Government are restoring accountability for public services.
11. On this Government’s quest to have a bonfire of the quangos, will the Minister confirm that the Health and Social Care Act 2012 will create more quangos than the Public Bodies Act 2011 abolished? (118542)
The Department of Health is reducing the number of quangos, not increasing them.
On behalf of my party, may I congratulate the hon. Lady on being appointed to her new position?
Every Government and every Parliament have promised to do what her Government have promised to do on non-departmental public bodies. Will she abide by the judgment of the people in two years’ time, close to the end of this Parliament, in respect of how many of these NDPBs have fallen by the wayside?
The hon. Gentleman raises a vital point. More than half the quangos in government will be reformed. There will be no return to the old ways of working. He is right, too, that we need to be accountable in this process, which is why we are instituting triennial reviews and other measures in order to ensure we keep on this path.
National Citizen Service Pilots
5. What recent assessment he has made of the second round of National Citizen Service pilots. (118535)
In its first year, the National Citizen Service achieved customer satisfaction ratings of 95% and a benefit-to-cost ratio of 2:1, with approximately three times more young people going through the programme this year. We expect to build on that, and we will be publishing an independent evaluation next year.
I thank the Minister for that answer. Last week I took part in a “Dragon’s Den”-type session for young people to pitch social action projects, which was organised by the Challenge Network and took place at the ACE centre in Nelson in my constituency. Does my hon. Friend share my admiration for organisations such as the Challenge Network, who get young people involved in projects that can make a real difference in their communities?
Yes, I do. I congratulate the Challenge Network and others who are helping to deliver what is an outstanding programme. I continue to be amazed that so much can be done in just three weeks in building young people’s confidence and skills, and in giving them a chance to make a positive difference in their communities.
Does the Minister share my concern at the report by the Education Committee which found that, based on the cost per head of the 2011 pilot, it will cost a total of £355 million each year to provide a universal offer for the NCS, and that, even allowing for economies of scale, that cost may well outstrip the entire annual spending by local authorities on youth services, which totalled £350 million in 2009-10?
I simply encourage the hon. Lady to visit an NCS project. I think she will see that the projects are outstandingly popular with the young people who are taking part, and that although people in the youth sector are understandably frustrated at cuts elsewhere, they are beginning to recognise that the NCS is an enormously positive asset in terms of developing the young people of this country.
Voluntary Sector Funding
6. What estimate he has made of the total reduction in funding to the voluntary sector in 2011-12. (118536)
9. What estimate he has made of the total reduction in funding to the voluntary sector in 2011-12. (118540)
Data from the Charity Commission suggest that the gross income of registered charities grew in 2011, but we all know that the sector is going through a very difficult period. We are putting in place plans to help it through this very difficult transition period, and to open up new funding opportunities over the medium term.
In the north-east, funding reductions are forcing 48% of voluntary sector organisations to close services and 28% to reduce the number of beneficiaries they support. What impact does the Minister think such losses will have on the Government’s plans to increase the role of the voluntary sector in delivering public services?
I share the hon. Lady’s concern and that is why we have pressed the point, from the Prime Minister down, to local authorities that they should try to avoid making disproportionate cuts to the voluntary sector and why we have put in place funds to help manage the transition. I have to say to her that for the Labour party to keep talking about cuts to the voluntary sector without recognising why those cuts were necessary in the first place, and without recognising that Labour councils are doing some of the heaviest cutting while saying absolutely nothing about the future of the sector, is fooling no one and disappointing many.
In County Durham, the local authority has had to reduce its grass-cutting service because of the reductions in its grant, so I rang the local Community Service Volunteers, thinking that that might be something it could take on. It said that it could not, because it did not know whether it will have core funding after the new year. Does the Minister not understand that far from creating a big society, he is destroying the society we have?
We are investing in the infrastructure that supports the voluntary sector, with some £30 million already invested through the transforming local infrastructure fund. Yet again, I draw the hon. Lady’s attention to the fact that that cut to that grant has not come from the centre but from the local authority, which is accountable for that decision.
Will the Minister join me in thanking the 70,000 volunteers who took part in the London Olympics? What steps will be taken to ensure that we build on that volunteering legacy?
Anyone lucky enough to have gone to the Olympic games or the Paralympics will know just what an important role the volunteers played in making them an enormous success. My hon. Friend is right that we clearly have a big opportunity to build on that, which is why we have committed another £40 million for the social action fund to back exciting new campaigns to inspire volunteers, such as “Join In”, which inspired a quarter of a million people to get involved with their local sports clubs in August.
I congratulate my hon. Friend on bringing forward new proposals to support the voluntary sector, but will he join me in condemning Labour-run councils that are cutting the voluntary sector, decimating services and then blaming the Government?
My hon. Friend and neighbour from Harrow makes a good point. Locally, we have the contrast between Conservative-run Hillingdon council, which is increasing its investment in the front-line voluntary sector, and Labour-controlled Harrow next door, where that investment is being reduced.
Ministers’ huge cuts in funding for charities mean that volunteer centres across England are losing, on average, 25% of their income, according to Volunteering England. With so many Olympic and Paralympic volunteers wanting to continue to volunteer after the games are finished, why are Ministers so determined to make it so hard for them to do so?
We are not. The hon. Gentleman has never let facts get in the way of shameless opposition and he has not disappointed today. We are investing in the infrastructure to support and inspire volunteers, with £30 million for the transforming local infrastructure fund. We are doing our bit from the centre, but the point I would make to local authorities across the country is that they should recognise the value of the volunteers in their community and not cut the investment in the local infrastructure that supports them.
Codes of Conduct
8. What plans he has for the (a) ministerial and (b) civil service code of conduct. (118538)
The ministerial code and civil service code set out the standards of conduct expected of Ministers and civil servants. They are published for the House and were last published in May 2010.
I am grateful to the Minister for that response, but does he concede that a review of both codes is necessary to ensure that Ministers cannot hide behind civil servants when failures occur and, most importantly, that senior civil servants do not avoid scrutiny by using political independence as a camouflage for frustrating Government policy?
The hon. Gentleman asks an important question. Clause 1 of the ministerial code makes it abundantly clear that no Minister can hide behind anything as
“Ministers have a duty to Parliament to account, and to be held to account, for the policies, decisions and actions of their departments and agencies”.
My right hon. Friend the Minister for the Cabinet Office and Paymaster General has recently issued the first steps in the civil service reform programme, which seek to enlarge the area of accountability for senior civil servants to include direct accountability both for the quality of their policy advice and for its implementation.
Does the Minister agree that it is for the Prime Minister to decide whether to initiate an investigation of an alleged breach of the ministerial code and that it is for Parliament to hold him to account?
Yes, I entirely agree with my hon. Friend. Indeed, that system has served us well and is, I believe, accepted by the independent adviser on ministers interests.
T1. If he will make a statement on his departmental responsibilities. (118546)
My responsibilities as Minister for the Cabinet Office are for the public sector efficiency and reform group, civil service issues, industrial relations strategy in the public sector, Government transparency, civil contingencies, cyber-security and civil society. [Interruption.]
Order. There is far too much noise in the Chamber, which is very discourteous to the Minister and to the Member. I want to hear Jenny Chapman.
In Darlington, post offices are seen as vital community hubs. Will the Minister update the House on his discussions with the Department for Business, Innovation and Skills on how better to exploit the community value they offer?
I have had a number of discussions about that with the BIS Minister who has responsibility for post offices, and we are doing what we can to encourage the post office network to be, as much as it can, a front office for a number of Government services. We think that is a valuable function.
T4. The Minister will be aware that Unison has instructed its members to secure as much paid or facility time as possible for union activity, including campaigning. Will he confirm that not a penny of taxpayers’ money will go to subsidise such trade union activity? (118549)
There is a distinction between trade union duties, which are to do with genuine representation of employee rights, and trade union activities, which are not. There is no legal obligation to provide paid time off for trade union activities, which is why we are consulting on the reduction or elimination of that.
Further to the answer given to my hon. Friend the Member for Darlington (Jenny Chapman), in recent weeks the Minister will have received a number of letters regarding the future of the post office network and the importance of Government services and their expansion. Will he endorse the campaign by the National Federation of SubPostmasters and, as the campaign slogan says, help make it happen?
I have had discussions with the federation of postmasters and we are very alert indeed to the desirability of more business being available, but the federation understands that there is a need for Post Office Ltd to improve its activities and productivity. I know that that is under way.
T5. Over the summer, I had the pleasure of hosting a visit by a group of young people as part of the National Citizen Service, organised by the Challenge Network in the black country, which was a fantastic success. Will the Minister outline his plans for the further roll-out of the NCS next year? (118550)
We are ambitious to expand the NCS because it is such an outstandingly positive opportunity for young people. The aim is to make it available to 90,000 teenagers in 2014.
T2. Reshuffles are always a busy time. Does the Cabinet Office have any specific plans to ensure that Cabinet Office staff do not have communication difficulties with the overwhelmingly male, rich and white Cabinet who have just been appointed? (118547)
Cabinet Office staff have no difficulties of any kind whatever.
T6. Last week, I was privileged to see the hard work of the NCS volunteers at the New Scene centre in Chester. However, a number of the young people were from over the border in Wales. While they were delighted to be able to do their NCS activities in England, they were disappointed that they were not able to do them in their own communities. Will the Minister join me in calling for the Welsh Assembly Government to introduce a national citizen service in Wales next year? (118551)
I thank my hon. Friend for getting so actively engaged with the NCS this summer. I am delighted that Northern Ireland teenagers will be involved in the pilots this autumn, and we have extended the offer to the Welsh Assembly. I hope he can help us to get a positive response to that.
T3. Earlier this year, Ministers announced the closure of the Driver and Vehicle Licensing Agency office in my constituency, which was widely used by small local motor traders to get their vehicle licences. Will the Minister confirm that he is having discussions, and urging colleagues in BIS to have discussions, with the motor trade about whether the Post Office might pick up that slack? (118548)
The public can already carry out a number of functions and transactions relating to the DVLA through the post office network, and the DVLA has one of the best online applications for renewing car tax, but we are looking, with my right hon. Friend the Secretary of State for Transport, at how it can be further modernised to improve service and save more money.
T8. In July 2011 the Department for Work and Pensions introduced a new standard contract that encouraged its suppliers to hire 5% of their work force as apprentices. A year later, more than 2,000 apprenticeships have been created, at no extra cost to the Government. Is the Minister aware that rolling that out across Whitehall will create thousands of new apprenticeships? (118553)
My hon. Friend makes a good and valid point. This Government have a proud record on creating apprenticeships. Our position is not to put a blanket condition on Departments, but to encourage them to take an innovative approach, such as the one he mentions in the Department for Work and Pensions.
The Prime Minister was asked—
Q1. If he will list his official engagements for Wednesday 5 September. (118556)
I am sure that the whole House will wish to join me in paying tribute to the servicemen who have fallen since the House last met: Lieutenant Andrew Chesterman of 3rd Battalion the Rifles, Lance Corporal Matthew Smith of 26 Engineer Regiment and Guardsman Jamie Shadrake of 1st Battalion the Grenadier Guards. We send our deepest condolences to their colleagues, friends and loved ones. Their courageous and selfless service to our country will never be forgotten.
Before listing my engagements, I would like to say on behalf of the Government, and I hope the whole House, a word about the huge success this summer of the Olympic and Paralympic games. I want to send all our congratulations on the superb performance of Britain’s athletes and Paralympians. I want to say a huge thank you to the volunteers who put such a smiling face on the games and a large well done to all the organisers. I think that they made the entire country proud and, as they promised, they have indeed inspired a generation.
This morning I had meetings with ministerial colleagues and others, and in addition to my duties in this House I shall have further such meetings later today.
Is the Prime Minister aware that his Cabinet reshuffle of his B team has not raised a ripple with the general public? On the other hand, those loud boos that greeted the Chancellor of the Exchequer will haunt the posh boys for ever. Why does The Prime Minister not be a man, do the decent thing and call a general election?
It is very good to see the hon. Gentleman back in such good form. I am sorry that when I was forming my Government of all the talents I could not find him on my speed dial, but I have done something that new Labour never managed: I have taken a miner and put him in the Cabinet, and he is running the railways. I thought the hon. Gentleman would appreciate that. [Interruption.]
Order. The House must calm down.
Mr Speaker, you will be aware that the Deputy Prime Minister and the Liberal Democrats reneged on a promise to deliver boundary changes in exchange for a referendum on the alternative vote. If the Deputy Prime Minister goes to the Prime Minister and says that he will deliver boundary changes in exchange for state funding of political parties, what will the Prime Minister’s answer be?
I am not in favour of extending state funding. I think that it is very important that all political parties work hard to attract members and donations. Frankly, when we get those donations we pay credit to people for funding political parties, which is in the public interest.
Let me join the Prime Minister in paying tribute to Lieutenant Andrew Chesterman of 3rd Battalion the Rifles, Lance Corporal Matthew Smith of 26 Engineer Regiment and Guardsman Jamie Shadrake of 1st Battalion the Grenadier Guards. They all died serving our country. Their sacrifice will never be forgotten, and our thoughts are with their families and friends.
I also want to join the Prime Minister in paying tribute to everyone involved in the Olympic and Paralympic games—our athletes, our fantastic volunteers and indeed the whole country, which united in support of team GB. It showed our country at its best, it brought Britain together and we should all be proud of the achievement.
After two and a half years in government, the Prime Minister returned from his summer break and told the nation that he now realised it was time to “cut through the dither”. Who did he have in mind?
The right hon. Gentleman has had all summer to think of a question. Is that really the best he can do?
Let me explain to the right hon. Gentleman what this reshuffle is all about. It is not that there are two economic Departments in our country, the Treasury and Business; I want every single Department to be about the economy. I want the Transport Department building roads; I want the Communities Department building houses; I want the Culture Department rolling out broadband; and I want the Agriculture Department backing British food. This is a Government who mean business, and we have got the team to deliver it.
The Prime Minister mentions the reshuffle; it is good, of course, to see the Chancellor still in his place. I have to say to the Prime Minister that he has come up with an ingenious solution to the problem of his part-time Chancellor: he has appointed another one—the former Justice Secretary, the right hon. and learned Member for Rushcliffe (Mr Clarke). It is a job share; we will see how they get on.
I do not know whether the Prime Minister remembers, but a year ago he published his national infrastructure plan alongside the autumn statement. He said at the time of that plan that it was an
“all-out mission to unblock the system”.
Can he tell us, one year on, how many of the roadbuilding projects announced in that plan have actually started?
First, I am glad that the right hon. Gentleman mentioned the issue of Chancellors, because I have got my first choice as Chancellor, while he has got his third choice as shadow Chancellor. Apparently, he still has to bring in the coffee every morning—that is how assertive and butch the Leader of the Opposition really is.
The right hon. Gentleman asks about infrastructure. If we look at what is planned by this Government, we see that between 2010 and 2015 we will be investing £250 billion in infrastructure. That compares with just £113 billion between 2005 and 2010. That shows that he has absolutely not got a clue.
The difference between the shadow Chancellor and the Chancellor is that the shadow Chancellor was right about the economy and the Chancellor was wrong. I have to say that the Paralympic crowd spoke for Britain.
However, it is another Prime Minister’s questions, we are back and, characteristically, the Prime Minister does not answer my question. The answer is that none of the roadbuilding programmes announced in his grand infrastructure plan has started.
Let us look at another grand claim the Prime Minister made. In March, he published his housing strategy. He said:
“our housing strategy is beginning to get Britain building again.”
Before he starts talking up his next announcement about housing, let us look at the effect of the last one. Can he tell us how many houses have started to be built since his announcement?
Housing starts are up 30% since 2009, which was the lowest rate of house building since the 1920s. That is what the right hon. Gentleman’s Government left. He praised his shadow Chancellor to the gunnels, but let us remember that it was the shadow Chancellor who landed us in this mess. Who was the City Minister when the City went bust? The shadow Chancellor. Who was the man who gave us the biggest budget deficit in the developed world? The shadow Chancellor. That is what that team has delivered and that is why the British people will never trust them again.
I think that sometimes the right hon. Gentleman forgets that he has been Prime Minister for two and a half years. He has got to defend his record, and he cannot defend his record. Again, he did not answer my question. I asked him about what had happened to housing starts since he made his announcement. The reality is that housing starts have fallen since then. They are 24% lower than they were a year ago and lower than they were at the time of the last Labour Government. Another grand claim has not materialised.
Now, let us talk about planning. In March, after 18 months of consultation, the Prime Minister hailed his flagship planning policy and said that it was the biggest revolution in 60 years. But on Sunday he said that he was “frustrated” by the system and the
“hoops we have to jump through”
and that he wanted to change it again. How is he so incompetent that he brings in a flagship planning Bill, calls it a revolution, and then six months later says that it is not fit for purpose?
The national planning statement that we inherited from Labour was over 1,000 pages; it is now down to just 52 pages. We have radically simplified the planning system—something that the right hon. Gentleman should be praising rather than attacking. He might want to notice that today the World Economic Forum has come out and said that for the first time in a decade, instead of Britain going down the world competitiveness ratings, we are back in the top 10 and rising. Let me read what it said:
“The United Kingdom…continues to make up lost ground in the rankings this year”—
lost ground that happened under the last Labour Government. There is a reason for that—it is because this Government are cutting regulation, cutting corporate tax, taking people out of tax, getting our businesses moving right across our country, investing in the regional growth fund, and delivering more apprenticeships than any previous Government. That is what we are delivering; what has he done over the summer? Where are the policies on welfare? Nothing. Where are the policies on education? Nothing. Where is the great plan for our economy? His only answer to a debt crisis is to spend more, borrow more, and put up the debt.
Back to the bunker after that one, I am afraid. I think the crimson tide is back as well.
Over the past two and a half years we have seen announcements on infrastructure—failed; announcements on housing—failed; announcements on planning—failed. What is the reason for this economic failure? The reason is that the Prime Minister’s fundamental economic approach is wrong. After the summer we now know that in his whole two and a half years as Prime Minister the British economy has not grown at all. So why does he not admit it? The real problem is this: plan A has spectacularly failed.
Let me tell the right hon. Gentleman what is actually happening in our economy, which is that we are seeing the private sector growing and expanding. There are 900,000 more people employed in the private sector than there were two years ago. We are now a net exporter of cars and motor vehicles for the first time since the 1970s. We are seeing the fastest rate of business creation that we have seen for decades. That is what is happening. Our economy is rebalancing. There is growth in the private sector. Our exports to China are up 72%, to India up 94%, and to Russia up over 100%. That is what is happening. It is a hard road, it is a difficult road, but we will stick to that road because we will deliver for the British economy.
We are in the longest double-dip recession since the second world war. How out of touch does this Prime Minister sound? [Interruption.] I have to say to the Tory Members of Parliament that they can go to their constituents and start trying to blame everyone else, but they have been in government for two and a half years. It has happened on their watch.
We saw a reshuffle yesterday. The Prime Minister brought back the right hon. Member for Yeovil (Mr Laws), who had been sacked; he promoted the Culture Secretary, who should have been sacked; and he left in place the part-time Chancellor, who the whole country knows should be sacked. It is the same old faces and the same old policies—a no-change reshuffle. If the Prime Minister really wants to cut through the dither, there is no place like home.
The big difference in British politics is that I do not want to move my Chancellor; the right hon. Gentleman cannot move his shadow Chancellor. The fact is that in spite of all the economic difficulty this is a strong and united Government, and in spite of all the opportunity this is a weak and divided Opposition. [Interruption.]
There is going to be more, and it is going to be from a knight—Sir Malcolm Bruce.
Thank you, Mr Speaker. I wonder whether the Prime Minister has seen today that PricewaterhouseCoopers has produced a report saying that Aberdeen needs to recruit 120,000 skilled people in the next 10 years if we are to deliver our capacity in the global energy economy. Will the Government take steps to ensure that an energy academy and the necessary support infrastructure for training are put in place so that we can deliver growth for the United Kingdom?
My hon. Friend raises a very important point, which is that the growth of the economy around Aberdeen, obviously linked to North sea oil, has been extremely successful. I want to see that continue to expand and I will listen very carefully to what he says and look at what the British Government can do to help provide that extra capacity, which I have seen for myself.
Q2. Will the Prime Minister confirm that we learned over the summer that the UK borrowed £9.3 billion more in the first four months of this year than it did in the corresponding period last year? (118557)
We have cut the budget deficit by a quarter in two years but, obviously, it is immensely challenging to get the deficit down. I note that Labour’s answer to getting the deficit down is to borrow more—to borrow an extra £200 billion. The one way you cannot get borrowing down is to put borrowing up.
Q3. My constituents were delighted when BMW announced the investment of £250 million to increase Mini production and called its Oxford plant the heart and home of this great British success story. Does the Prime Minister agree that this kind of inward investment is vital to kick-start the economy and that we must do more to prioritise policies to make the UK more attractive to investors? (118558)
My hon. Friend and I have neighbouring constituencies and many constituents who work at BMW at the old Cowley works. It is very good news that BMW is investing another £250 million in that plant on top of the £500 million announced last year. That is safeguarding over 5,000 jobs in the Oxford, Swindon and Hams Hall plants. It is part of a huge recovery story for the British motor manufacturing industry. We are now net exporters. That has not happened since the 1970s and it is a huge credit to Jaguar Land Rover, Nissan, Toyota, BMW—to all those companies that are investing in and choosing Britain. They are not choosing Britain because of the weather; they are choosing Britain because we have cut corporation tax, because we are investing in apprenticeships, because we are investing in the infrastructure that they need, and because they know that this is a country open to business.
Poor Wirral families face the indignity of food banks, and Save the Children is launching its first ever public campaign for British children. What is the Prime Minister doing to help?
What we are doing is making sure that we target help on the poorest families in our country, which is what we have done through the tax credit system. At the same time, we should praise all the voluntary and big society efforts to help the poorest families in our country.
Q4. Will my right hon. Friend join me in paying tribute to the 23 million people in our country who work with such commitment in the private sector—the sector that generates the wealth that this country so desperately needs? Will he also welcome, as I do, the fact that under this Government we now have more people employed in the private sector than at any time in our history? (118559)
The point my hon. Friend makes is very important. If you look at the figures and include all of the financial sector, you will see that there are more people employed in the private sector today in Britain than at any time in our history. [Interruption.] Oh, the shadow Chancellor says that that is because we are in recession. It is because companies are choosing to employ people and the private sector is getting larger, which is good news. Employment is up 201,000 this quarter; unemployment is down 46,000 this quarter; the claimant count has fallen; the rate of unemployment is down; youth unemployment is down—I would have thought that the whole House would welcome those figures.
Q5. Last Sunday the Prime Minister told us that there should be no more excuses for failure. Given that his policies have produced the longest double-dip recession since the war, with output down, borrowing up and a collapse in consumer confidence, is his failure to apologise because he does not take his own advice, or because he considers that a record of astounding success? (118560)
This comes from an hon. Lady who served in a Government who, after 13 years, delivered us the longest and deepest recession since the war and who gave us the biggest budget deficit of virtually any country in the developed world. Of course, it takes time to get yourself out of a hole as deep as the one that was dug by the shadow Chancellor and the leader of the Opposition.
Q6. Over the summer, Jaguar Land Rover announced the creation of 1,100 additional jobs at its Castle Bromwich plant. That is in addition to the 750 jobs that it is creating in my constituency of South Staffordshire. Does my right hon. Friend agree that there is a stark contrast between the rhetoric of the last Labour Government about reviving the automotive industry, and the actions and delivery of this Government? (118561)
My hon. Friend is absolutely right. In the past two years, Jaguar Land Rover has hired an extra 8,000 new workers. That is a massive success story for the west midlands and for a great British brand. It is also, let us say so, a big success story of massive inward investment from the Indian parent company. We should praise all those things and recognise that we have to do even more to make Britain a really business-friendly country, with low rates of regulation, low rates of tax and lots of support for apprenticeships and infrastructure. That is what we are delivering, and we will continue to do so.
Q7. Hundreds of young people from outside Europe chose London Metropolitan university, confident in British higher education. The Prime Minister needs to tackle visa fraud, but will he lift the threat to deport students who have paid their fees and complied fully with all the rules? Why is he so damaging the standing of British universities around the world? (118562)
I know that the right hon. Gentleman speaks with considerable experience and wants to speak up on behalf of his constituency. Having looked at this case and at the action that the Border Agency has taken, it seems to me that there were some real abuses. I want Britain to be open to students. Let us be clear: anyone who can speak English and who has a university place is able to come here and study at our universities, but the Minister for Immigration has rightly been very hard in closing down bogus colleges and in ensuring that action is taken when good universities, like this one, are not meeting the rules. That must be right if we are to control immigration.
Is my right hon. Friend the Prime Minister aware that in Watford in the last quarter of 2012, for which the numbers have just come out, 327 new companies were incorporated? That is a record and is way beyond anything in history. I think he will agree that that shows that the Government’s policy of encouraging private enterprise is succeeding.
My hon. Friend makes an important point. As I understand it, 2011 saw the fastest rate of new business creation of any year in decades. That is what our economy requires. It takes time and patience, because we need a massive rebalancing away from the public sector and towards the private sector, and we need other industries, not just finance and retail, to succeed. We want to see business regeneration right across our country. That rebalancing takes time and is difficult, but it is the only long-term way out of the economic difficulties that we were left by the Labour party.
Q8. The Prime Minister is right to celebrate the most extraordinary Paralympics, which we are seeing at the moment, and the exceptional achievements of Team GB within those games. What, then, does he say to Baroness Grey-Thompson and the other Paralympians who warned this week that his decision to cut disability living allowance will prevent disabled people from participating in sport and threaten the legacy of the London games? (118563)
The message that I would give to everyone in ParalympicsGB—which is, of course, a separate team from Team GB—is a huge congratulations on their massive success at the games. It has been truly inspiring to see on television or in person, which I have had the privilege of doing, the absolutely packed stadiums for the Paralympics. That is not something that everyone expected, but it says a lot about our country and our people, and is great for the Paralympics.
To answer the hon. Gentleman’s question directly, we are not cutting the money that is going into supporting disability. We are reforming the system by replacing disability living allowance with the personal independence payment. That is all about recognising people’s needs. It has been worked up very carefully with the disability lobby and I think that it will be an improvement on the current system.
Q9. The Prime Minister is well aware of the lack of capacity at Britain’s airports. In seeking to resolve that problem, will he consider the opportunity presented by regional airports, such as those in Birmingham, which could help to rebalance the economy? (118565)
My hon. Friend makes a very good point about regional airports. Let me be very frank about this: these very large infrastructure projects are extremely difficult for individual Governments to take on and deliver. What we need to do is build a process that will hopefully have cross-party support, so that we can look carefully at the issue and deliver changes that will address the problems of capacity that we will have in future years and the issue of the UK’s hub status. I hope to make an announcement about that in the coming days, but it is important that we work across party lines, because this will not happen unless parties sign up to a process that can deliver.
I just wonder whether I can cut through the waffle that the Prime Minister gave us in answer to the question about disability living allowance. The reality is that 600,000 disabled people will lose an extra cost benefit. Instead of just giving warm words to disabled people in this country, why does he not take aside his immovable Secretary of State for Work and Pensions and say to him that it is time we thought again on this one?
The move from disability living allowance to personal independence payments has been an exercise of huge consultation with the disability lobbies to try to ensure that we get this right. The fact is, there are hundreds of thousands of people on DLA who have never had a recheck since they started to take on that benefit, and many others—I know this as a parent who filled out the form myself—who have to fill out reams of answers to questions without the proper medical check that would actually get them the benefit quicker. We are moving from an old system that is out of date to a new system that will actually help disabled people.
Q10. Selective dorsal rhizotomy is the name of an operation that allows children with spastic cerebral palsy, like my constituent Holly Davies, to leave their wheelchair behind and walk independently. It has been carried out successfully thousands of times in the United States but is available only privately in the UK as the National Institute for Health and Clinical Excellence refuses to allow the operation on the NHS. Will the Prime Minister look at the situation and help me, and the families across the country who are currently raising money for their children to have the operation, to get NICE to change its mind? (118567)
I will certainly look closely at that. I quite understand, as a parent of a very disabled child who had cerebral palsy, that if there was anything that a parent could do to get their child out of the wheelchair, they would want that to happen. I have looked at this case, and NICE actually says that the operation is a treatment option for some children and young people, but it cautions against the potentially serious complications, because it is an irreversible operation with risks involved. However, I will look at the matter very carefully and see whether there is anything more that NICE should consider.
Q11. Whenever the Prime Minister is faced with industrial dispute in this country, he always advises the trade unions to go for reconciliation and arbitration. In the interests of fairness, will he speak to his new Health Secretary and ask him to involve himself in the dispute at Northumbria Healthcare NHS Trust, to ask its board to do what the union is asking for and refer the dispute to the NHS Staff Council for resolution? (118568)
The new Health Secretary will have been listening carefully to that, and I am sure he will be able to discuss the matter with the hon. Gentleman.
It is very important that motorists have the right to renew their car tax at the post office. Not everybody has internet access. The Driver and Vehicle Licensing Agency contract is up for renewal soon. Will the Prime Minister please ensure that the contract stays with the Post Office?
My hon. Friend makes an important point, particularly as he represents a very far-flung rural constituency with people living across a number of different islands. I am sure the Business Secretary will have been listening carefully to what he says, although the Government can make a limited amount of interference in such contracts.
Q12. Does the Prime Minister have full confidence in his police and crime commissioner in Hampshire? (118570)
What I would say about the police and crime commissioners is that we have not yet had the elections. We are going to have elections in November, and this is a very good opportunity to broadcast from this House what an important set of elections those are. I want to see a new form of accountability coming through in our police forces, and this is an excellent reform. I am sure that many people want to turn out and vote, hopefully for their local Conservative candidate.
Over the summer, a number of communities across Brigg and Google, including Swinefleet and Crowle, suffered flooding, in part because our drainage dykes are not cleared out as drainage boards fear prosecution under conservation of habitats legislation. Will the Prime Minister meet his new Environment Secretary and take away that threat of prosecution, so that drainage dykes that were built and dug to protect property can do their job?
As someone who represents a constituency that has frequently been subject to very bad flooding, I know how many frustrations there can be in local communities when things that need to be done do not get done quickly enough. Sometimes that is the fault of different agencies, sometimes that of landowners, sometimes that of local authorities. All sorts of issues have to be crunched through, but I am sure that the Environment Secretary will have listened closely to what my hon. Friend said.
Will the Prime Minister confirm, with no ifs or buts, that there will be no third runway at Heathrow airport while he leads his party?
Let me say clearly that, while I believe that we need to establish a form of review that will bring parties together and make a decision about airport capacity, I will not break my manifesto pledge.
A letter from and meeting with the Secretary of State for Defence has confirmed that the 2nd Battalion the Royal Regiment of Fusiliers is the only battalion that should not have been cut on military grounds. What did for 2RF was the additional criterion that regimental losses be capped at one battalion, thus saving more poorly recruited Scottish battalions ahead of a Scottish referendum. Will the Prime Minister kindly meet me and other MPs from across the House to discuss the issue?
I am happy to arrange a meeting between my hon. Friend, the Defence Secretary and other interested Members. It is right for the Army to change in its structure—not in its overall size; with 82,000 regular soldiers and 30,000 territorials, the Army’s overall size will not change. It was and is difficult to do that in a way that respects regimental traditions, cap badges and issues that I know are very dear to a number of hon. Members. However, it is important that we do that across the United Kingdom. That is what the Government set out to do, but I am happy to arrange that meeting.
Point of Order
On a point of order, Mr Speaker. May I raise, with some embarrassment, something that I believe is a genuine point of order? It concerns recording the names and paying tribute to those who have fallen in Afghanistan. You may have noticed, Mr Speaker, that 13 pages of the Notices of Motions paper list the names of those who sacrificed their lives in Afghanistan. Under the recent rules of the House, it is impossible to read out that list in the House. It would now take a long time—about 30 minutes—to record, with decent pauses between the names, the entire list of 425 brave soldiers who have given their lives. Could we consider, on at least one occasion of the year, paying our tribute in that way so that we can see, by hearing each name, the true cost of a war that has become a mission impossible?
The hon. Gentleman has raised a serious point that warrants serious consideration. I hope he will understand that, rather than give a knee-jerk response now, I say to him that I have heard and that I will respond to him in writing.
Pre-Paid Meters (Level of Debt)
Motion for leave to bring in a Bill (Standing Order No. 23)
I beg to move,
That leave be given to bring in a Bill to require the Secretary of State to raise the level of debt below which pre-paid meter customers may change their energy supplier; and for connected purposes.
I raised this issue in Parliament before through an oral question to the Secretary of State for Energy and Climate Change on 26 January 2012 at column 401 of Hansard, and again in a written question on 1 May 2012 at column 1506W. On the first occasion, the right hon. Gentleman said that he would ask Ofgem to look at the matter in detail, and on the latter, he said that it was to be dealt with by Ofgem. In the interests of hundreds of thousands of energy customers, I am presenting the Bill today to get some actual movement.
Through raising the level of debt at which pre-paid meter customers may change their energy supplier from £200 to £350, around 200,000 customers could escape crippling energy tariffs. It is a tiny change, but it would make a huge difference. I have mentioned time and again how the cartel-like big six have too much power. By trapping disadvantaged customers into extortionate tariffs, they are proving once again that they need to be shown what it means to be fair and responsible.
The profits of the big six energy companies have gone up almost a third since 2008, and payouts to shareholders increased across the board an incredible sixfold since 1999 in the case of Centrica, which owns British Gas. This is the time for it, and others, to give something back.
If each of those 200,000 customers were to save a maximum of £138 a year, it would cost energy companies a combined £27.5 million. That sounds like a lot until we realise that last year, British Gas alone made 12 times that amount in profit. Furthermore, the money saved by those 200,000 people would be spent on paying back debts to energy companies, so it is not that bad. I have spoken with Ofgem about this matter. It agrees with me in principle, although as usual it moves at snail’s pace. I would like to see it move quicker on this simple solution to the debt of hundreds of thousands of people. Let us work together to get a fair deal for prepayment customers.
In January 2010, Ofgem changed its policy so that customers with a debt of £200 or less were able to switch energy supplier as long as the new supplier was willing to take on that debt, which in most instances was the case. More people were able to take advantage of greater savings to be made by switching supplier, which meant that they could pay off their arrears more easily, cutting short a spiral of mounting debt. The £200 debt level worked then, but we could and should do more now.
More than 1.5 million electricity and gas customers are currently in debt, and almost 1 million of those can switch supplier to get a better deal on their energy tariff. The Bill would add 200,000 people to that figure and ensure a fairer system. Importantly, those 200,000 people are among the most disadvantaged in our society, and chose a prepayment meter as a way of responsibly managing their weekly budget. About a quarter of prepayment meter customers are thought to be fuel poor, and they are disproportionately represented in the social housing rented sector. People are three times more likely to be in debt if their income is in the lowest quintile, and it is evident that the 200,000 people I have mentioned are among those struggling to pay rising food and housing costs, and, of course, energy bills.
According to Which?, 84% of people are worried about their energy bills. Consumers spend one week a year worrying about their finances, and people with less debt are often happier. What do our outdated regulations do? They add extra worry to people who are already concerned about job security and a double-dip recession. There are examples of people fiddling their meters to try and reduce their energy bills, and the number of people doing that has risen 30% since 2007. I do not say that that is right—it is not and there is a price to be paid—but I understand why they are doing it.
I am even more concerned about people who reduce their energy usage in order to save money to pay off their debt. The number of pensioners dying from cold has nearly doubled in five years. Last winter, Save the Children found that half of all families planned to turn the heating off for longer to keep their bills down, leading to problems such as children in cold homes being twice as likely to suffer from respiratory problems. I would not be surprised if some people are cutting down their energy use in order to pay off their debt, which is completely unacceptable. We can tackle the problem by giving 200,000 people the freedom to make their debt more manageable by switching to a cheaper tariff or company.
Some people are very badly affected by their debt, and it is sad that it is so easy for them to get into such a position. For example, they may not have been identified as vulnerable by energy companies, and been placed on a prepayment meter after racking up hundreds of pounds of debt while struggling to pay astronomical energy bills on a credit meter. Energy companies need to take responsibility for such confusions and mistakes, and allow people to switch suppliers to help them pay off their debts.
For my more business-friendly opponents and colleagues, I will also outline the benefits of this proposal to the energy companies themselves. As it stands, £478 million is owed to energy companies, and by making it easier for a large proportion of customers to pay that back, energy companies can recoup their losses. uSwitch estimates that pre-paid meter customers could save £138 a year just by switching, so a £350 debt could be paid off in just over two years without them making any sacrifices. Both customers and energy companies would be better off; it would be a win-win situation.
Those are arguments for increasing the debt level, but why should we increase it from £200 to £350? First, the £100 limit was increased to £200 in 2010 to reflect higher energy bills and debt levels, but times have changed. Energy bills have increased by 140% in eight years and by 20% in the last two years. They have risen seven times faster than household income and continue to rise. SSE announced a price hike of 9% on 22 August, despite a 7.7% rise in its pre-tax profits over the past year. I am sure there are more price rises to follow and that history will repeat itself: when one company raises its prices, the others are never far behind. The average amount of debt is now around £350. That is the average and not the maximum. In the past two years, severe cuts have led to a double-dip recession, making it even harder for those involved. Ofgem agrees that the level is currently too low, but we need to speed up the process.
Secondly, £200 is not what it used to be. Its value has decreased by more than 10% since the level was set. It would not buy an iPhone or a BlackBerry or any of the company phones that the energy company executives walk around with. It would not buy a return ticket to EDF’s global headquarters in Paris, E.ON’s global headquarters in Düsseldorf or Scottish Power’s global headquarters in Bilbao, and yet for energy customers in debt who are unable to switch their tariff, paying the money back can be demanding and tiring. If we can agree on that, we will have the chance to make a small change to an outdated regulation that will make a huge difference to hundreds of thousands of people. Those are the people we need to help most, because they are vulnerable to debt and in fuel poverty.
I have taken the lead with help from my supporters and colleagues. All who work on energy issues have made such efforts at some point or another. This should be a lesson to Ofgem. Its job is to look at these issues and ensure customers have a fair deal. As I said, I began asking this question back in January. If Ofgem had sorted the problem out at that time, I would not be standing here today. I could have stopped at that point and left the matter with Ofgem, but the sad fact is that I did not feel I could leave Ofgem to get on with dealing with it quickly. I am therefore introducing the Bill to ensure that the debt level is changed before the winter, before other people die because of their energy costs.
Question put and agreed to.
That John Robertson, Mr Tim Yeo, Albert Owen, Laura Sandys, Dr Alan Whitehead, David Simpson, Mr Mike Weir, Jim Sheridan, Mr Alan Reid, Cathy Jamieson, Ian Lavery and Sir Robert Smith present the Bill.
John Robertson accordingly presented the Bill.
Bill read the First time; to be read a Second time on Friday 18 January 2013, and to be printed (Bill 65).
On a point of order, Mr Speaker—you do not have to smile.
In 1624, as I am sure you are aware, the House decided that no Member could resign their seat. In 1680, we decided that we would invent the legal fiction that a Member appointed to an office of profit under the Crown is deemed to have resigned their seat. At the beginning of August this year, Mrs Louise Mensch— I make no criticism of her whatever—believed she had resigned her seat, but was not appointed to an office of profit under the Crown for a further three and a half weeks. Consequently, she described herself as a “resigned MP”, but was none the less a Member of Parliament, because a Member has not resigned their seat until the Chancellor appoints them to the office.
I raise this matter as a point of order because there is an important matter of precedent here. I am not aware of any time in the past when there has been such a delay, other than in 1842 when the Government refused for party political purposes to appoint a Member so as not to allow a by-election.
Will you, Mr Speaker, therefore reinforce to the Chancellor that it is important to appoint a Member the moment they seek to resign their seat through such an appointment?
I think it is a matter for further consideration and, on the occasions that this issue has been raised, if not in quite the same terms, I have suggested to Members concerned about it—I recall the hon. Member for Walsall North (Mr Winnick) expressing his discontent with the status quo—that it could be considered by the Procedure Committee. That is one possibility, but it certainly warrants further discussion. I note what the Minister of State, Department for Transport, has said with reference to 1963, and I feel sure that he is right.
And why am I wrong?
I did not say that the hon. Gentleman was wrong—he should not look for an argument!
[5th Allotted Day]
I beg to move,
That this House believes that the rising cost of rail travel is adding to the financial pressures facing many households; and calls on the Government to restore the one per cent above inflation cap on annual fare rises for 2013 and 2014, and to ban train operators from increasing fares beyond that strict limit.
I begin by congratulating the right hon. Member for Derbyshire Dales (Mr McLoughlin) on his appointment as Secretary of State. He returns to a Department he left some 20 years ago—time flies—after serving for three years as the Minister with responsibility for aviation and shipping. Only three years thereafter—I hope not as a result of his experience—he took a 17-year vow of silence in the Government and Opposition Whips Offices, from which he emerges today, probably blinking into the light. I think I speak for the whole House when I say that we are all very keen to hear what he has to say. He is the third Secretary of State for Transport I have faced since taking up my role in opposition. I hope for his sake he lasts a little longer than his predecessors and I wish him well in the role.
I also welcome his new all-male team—of course, that is a matter for the Prime Minister, not the Ministers he appointed—including the Minister of State, Department for Transport, the right hon. Member for Chelmsford (Mr Burns), and the Under-Secretary of State for Transport, the hon. Member for Wimbledon (Stephen Hammond). Another Under-Secretary of State for Transport, the hon. Member for Lewes (Norman Baker), of course provides the continuity in the Department—something that he probably never thought he would do.
We are debating an Opposition motion, but there need be no disagreement in the House today. I hope that all right hon. and hon. Members, including Ministers, will feel able to support the motion in the Lobby later this afternoon. It is a straightforward motion with a simple proposition—that the rising cost of rail travel is now adding to the financial pressures facing many households. That is a fact, and I would hope that we will see agreement at least on that. It is something that we are all hearing from our constituents. I also hope that we can agree on a second basic proposition—that the level by which rail fares increase should not simply be left to the private train companies to determine. It is why we have the system of regulated and unregulated fares, with those tickets on which most people rely, including day returns and season tickets, having their annual increase capped.
There has always been cross-party agreement that there is a role for Government in the setting of fare levels and it is right that we retain the ability to protect our constituents from a profit-driven free-for-all on fare rises. The reality, however, is that the so-called cap on annual fare rises, even for regulated fares, is not a cap at all. So when the Chancellor stands up, as he does, and says that fares will not rise by more than 1% above inflation—or whatever percentage it might be—he cannot actually deliver that commitment at ticket offices across the country, because the cap is an average and train companies have the flexibility, as they like to call it, to increase fares by up to 5% above the so-called cap.
In January, just two months after the Chancellor had promised a 1% above-inflation cap on fare rises, what did commuters find when they went to buy their tickets? They found fare rises not of 1% above inflation but of up to 11% above inflation, because the train companies had exercised their flexibility to add up to another 5% on to some fares. That is what our constituents across the country face again in the coming new year—fare rises of up to 11%. We are kidding ourselves, therefore, if we think that what we are debating is whether the cap should be RPI plus 1 or RPI plus 3, because the train companies can game it to their advantage. That is why our motion proposes that if we are to have a cap on regulated fare rises—we believe that there should be one, and I think the Government do too—it should be a real cap.
Given the hon. Lady’s concern about the impact of fare rises on families, will she join me in congratulating FirstGroup on its successful tender for the west coast rail franchise, given that it is committed to reducing by 15% the cost of a standard anytime return journey? Is this not a demonstration of an effective tender process by this Government?
Many questions have arisen from the announcement in the recess about the west coast main line. The hon. Gentleman is right to highlight that the winning bidder—we must remember that legal action is ongoing, so we are restricted in what we can say—has made that commitment, but issues have been raised over the deliverability and reality of the assumptions behind the winning bid. Those issues have been raised not only by some of the losing bidders but by other experts in the industry.
Given what my hon. Friend has said, does she understand my concern and that of many of my constituents about what might happen to the east coast main line franchise when it comes up for reconsideration? Does she agree that there is a strong case at least for considering keeping the east coast main line in the public sector, so that there is not this pressure on requiring payback in profits and payback for the Government, which was clearly one of the issues in the west coast franchise?
I agree that there is a strong case for having a public sector comparator, at least when looking at franchising. That is how the current system operates.
Will my hon. Friend take it from me, as a Yorkshire Member, that these are extremely important issues? I am pleased that we have a Yorkshire MP as the new Transport Secretary—that is some consolation—but the east coast and west coast lines are vital to economic regeneration in Yorkshire and the north west. If we do not get it right, we will starve UK businesses in the regions.
My hon. Friend makes a strong point, even if his definition of Yorkshire is larger than everybody else’s. As somebody who was born in Bridlington, however, I understand that Yorkshire can be larger than one might think from looking at a map.
Does the hon. Lady not share my concern that under the previous Government, First Capital Connect, which runs the Bedford to St Pancras line, was obliged, because of its supported status, to claw back from the public? Imposing a cap now would put it in breach of its franchise. There were such obligations, entered into by the previous Government, on many of the franchises.
The hon. Lady makes a strong point. I agree that varying the fare cap on the basis of specific local investment promises in the rail network, which is what lies behind that issue, is not how we should set rail fares. Let us be clear, however: the Government are proposing a 3% above-inflation fare rise for the whole country, regardless of whether any additional investment is planned locally. Today’s motion, if supported across the House, would impose a clear national cap of 1% above inflation, so I hope that she will consider joining us in the Lobby to support it.
I very much support Labour’s motion, although it is a bit timid. Given that privatisation has left us with a costly, fragmented and dysfunctional railway, and given that increasing evidence shows that reuniting railways under public ownership could save us up to £1 billion a year, would the hon. Lady not agree to go further and bring all the railways back into public ownership?
At this stage, that would go well beyond the motion before the House, but I hear what the hon. Lady says. Given that she is now no longer the leader of the Green party, however, I wonder whether it is Green party policy—no doubt we will find out in due course.
The motion calls for an increase of RPI plus 1 for fares. I am sure that the hon. Lady knows that the Scottish National party is the only governing party in these islands that has not raised regulated rail fares. Would she be so kind as to congratulate the SNP Government, who are practising what the Labour party preaches?
I am disappointed by that intervention.
One always has to balance rises with the issue of affordability on the basis of the public finances, but there ought to be agreement around the House that inflation plus 1 is a realistic way forward in this Parliament.
No, I have taken several interventions and I want to make progress; otherwise I will take up the entire debate with my opening speech, which is not what Members want.
If train companies were banned from increasing fares any more than the strict limit set by the Government, we could then have a political debate about what is the affordable level for that cap, rightly taking into account the state of the public finances, but that decision would at least be more transparent and enforced. My noble Friend Lord Adonis, when he was Transport Secretary, took such a step and banned train companies from increasing regulated fares beyond the cap set by the Government. He has been very clear about this in oral and written evidence to the Transport Committee. [Interruption.] The right hon. Gentleman for Ch, Ch—
I knew it began with a “Ch”—that might be a way to remember it in the future. The right hon. Gentleman has not taken too long to get back into the habit of heckling from the Front Bench—perhaps he never got out of it in his role at the Department of Health.
My noble Friend Lord Adonis has made it clear in oral and written evidence to the Transport Committee, and on many other occasions, that he fully intended the ban on train companies flexing the fare cap to continue into subsequent years. That would be perfectly possible. I have said on many occasions that the previous Government should have taken action earlier, but the fact is that when times got tough they acted, but when times got tougher still this Government chose to give back to the train companies the right to fiddle the fare cap.
Will the hon. Lady give way?
What is the consequence? It is that the Government and the House do not have the ability to enforce the cap on fare rises they think they have approved. I therefore hope that we can all agree today that the cap should be precisely that—a cap, a maximum allowable increase.
Our motion also calls on the Government again to reverse their decision to increase the cap from RPI plus 1 to RPI plus 3 for 2013-14. This should not be a contentious proposal, and I hope that Members on both sides of the House will feel able to support it. I know that it is slightly devalued today, but Government Members might like to look back at the commitment they made in the coalition agreement:
“We are committed to fair pricing for rail travel”.
It simply is not credible to square that pledge with the decision taken to increase the annual cap on fares from RPI plus 1 to RPI plus 3.
Let us be clear who is benefiting from these excessive fare rises: the private train companies. I urge the new Secretary of State to ask his civil servants for a copy of a very good report—on his Department’s spending settlement and its progress in implementing it—recently published by the National Audit Office. It warns that the Department for Transport has failed to demonstrate that higher fares translate into payments back to taxpayers:
“There is a risk that the benefit of the resulting increase in passenger revenues will not be passed on to taxpayers fully, but will also result in increased train operating company profits.”
So there we have it. We know who benefits from fare rises: the private train companies.
Will the hon. Lady give way?
I am seeking to make some progress. If there is time, I will give way a little later.
I know that some hon. Members may think, “All well and good: these private companies should be able to make these very large profits for running our rail services.” However, I wonder whether Government Members have been keeping track of who has actually run our rail services since privatisation. For example, the Chiltern and CrossCountry franchises are run by subsidiaries of Deutsche Bahn, the German state railway. Southeastern, London Midland, TransPennine and Southern are all run in partnership with subsidiaries of SNCF, the French state railway, while Greater Anglia and Northern rail services are run by a subsidiary of Ned Rail, the Dutch state railway. Let us be clear: the ability of so-called private train companies to hike fares beyond the cap does not just mean additional profit, as the National Audit Office has warned; it means additional dividends from those profits going back to the state railways of France, Germany and the Netherlands. The consequence is that fares on their domestic rail networks are, on average, a third lower than those on ours.
Will the hon. Lady give way?
I will give way again in due course, but not at present.
I know that Government Members—those who are not serial rebels, and the Secretary of State knows who they are—may still want to ensure that they are in line with their Chancellor’s position on this issue. Let me therefore remind the House what the Chancellor himself said on the level of fare rises in last year’s autumn statement, when he performed one of his many post-Budget U-turns and bowed to pressure, not just from this side of the House, but from his own MPs, as well as rail passengers up and down the country. He said:
“RPI plus 3% is too much. The Government will fund a reduction in the increase to RPI plus 1%. This will apply across national rail regulated fares, across the London tube and on London buses. It will help the millions of people who use our trains.”—[Official Report, 29 November 2011; Vol. 536, c. 810.]
The real question today is: what has changed? Why is a 3% above inflation increase acceptable this year, when it was, in the Chancellor’s words, “too much” last year?
Is not the timeliness of today’s debate emphasised by the analysis of fares in the south-east conducted by the Campaign for Better Transport? Its chief executive, Stephen Joseph, pointed out just last month that commuters in the south-east routinely spend up to 15% of their salary on getting to work in London and that unless there is a change in fare policy by the Government, the cost of journeys to work is likely to rise by some £1,000 when fares next go up?
My hon. Friend makes an important point. We are all now hearing from constituents who are paying out significant parts of their salary in the mere effort to get to and from work. There comes a point when, with other pressures, it is not acceptable for fares to rise at the level that the Government are contemplating.
If the hon. Lady is so concerned about the profits and extra money going into the pockets of foreign rail companies, why does the motion not suggest no increase above inflation?
The hon. Gentleman is right that there is a choice to be made about where to pitch the figure for RPI plus or minus whatever it is. Today’s motion is based on our current policy as it is—something I think the Government could agree with—which retains credibility in terms of deficit reduction, but which would also bring significant relief—[Laughter.] I do not know why Liberal Democrat Members are laughing. Despite their alleged policy to cut rail fares, they have voted repeatedly in this Parliament for Budgets, autumn statements and comprehensive spending review measures that increase rail fares by RPI plus 3%, so we are not going to take any lessons from them about how to implement policy on rail fares.
Will the hon. Lady give way on that point?
No, I will not.
Why is a 3% above inflation increase acceptable this year, when it was, in the Chancellor’s words, “too much” last year?
The hon. Lady asks why an RPI plus 3% increase might be acceptable, but this Government have not increased any rail fares yet by RPI plus 3%. The only RPI plus 3% increase happened on the Southeastern franchise under the last Labour Government, because we were used as guinea pigs.
The hon. Gentleman is simply wrong about that. RPI plus 3% was cut last year to RPI plus 1%, but the year before it was RPI plus 3%, so what he says is simply inaccurate.
If anything, pressures on household budgets have increased in the past year. Families are finding it even harder to make ends meet, get through the month and pay all the bills. We are in a double-dip recession made in Downing street. More than 1 million young people remain out of work. Energy, food and fuel prices are all up, adding to the pressures facing our constituents. The rate of inflation—the RPI figure that will be used to calculate January’s fare rises—went up to 3.2% in July. With flex, the formula for January’s fare rises, as it stands, is 3.2% plus 3% plus 5%, which means fare rises of up to 11.2%. We should get rid of flex, but we should also—as the Chancellor said less than a year ago—set the cap at 1% above inflation.
I know that the Secretary of State has been appointed to change some of the policies pursued by his predecessor—at least that is what the newspapers say. However, I hope that on this issue he will agree with the right hon. Member for Putney (Justine Greening), who told the Financial Times last month:
“I am keen to see what we can do to keep fares down to something affordable. I will be looking at whether there is a way of doing this in the autumn.”
She added that
“she did not know if the Treasury would make funds available to do this,”
“If you don’t ask, you don’t get, so I’ll make sure to ask.”
If the Secretary of State has not already done so, I hope that he will be asking the Chancellor to agree to the lower cap on fares, because as his predecessor rightly said, “If you don’t ask, you don’t get.”
Will the shadow Secretary of State clarify whether she accepts that her Government were wrong to impose RPI plus 3% on Southeastern, when the rest of the country had RPI plus 1%? That meant that from the Medway towns to London there was an increase of over 33%. Does she accept that that was wrong?
I am not sure that the hon. Gentleman listened to what I said earlier, but I have already said that I did not think it was right to tie such increases into specific improvements on specific lines, which is what happened in that case, and I have said that before. Perhaps if he listens a little more carefully, he will not have to intervene. I said that I did not think that was right, but the current Government—
Will the hon. Lady give way?
I am in the middle of answering the hon. Member for Gillingham and Rainham (Rehman Chishti).
The current Government are proposing an across-the-board increase of RPI plus 3% on everyone, whether or not there is any improvement in investment or any increase in service. At a time like this, when people’s incomes are being squeezed badly, it is not easy for them to cope with that. We should not continue with those levels of increases.
I will give way to the hon. Member for Cambridge (Dr Huppert), because he is clearly very keen.
I thank the shadow Secretary of State for finally giving way—it has taken some effort. While she is in the mood for apologising for errors made under the last Government, will she apologise for the fact that rail fares went up in cash terms by 66% in that time? That had a huge impact on people across the entire country and made fares completely unaffordable for many people.
The hon. Gentleman, who purports to be the transport spokesman for the Liberal Democrats, even though the Liberal Democrats have a Transport Minister in the Government—the Under-Secretary of State for Transport, the hon. Member for Lewes—is going round the country saying that his party is in favour of cutting fares, when he and his hon. and right hon. Friends are voting for Government measures that increase them. If he starts to apologise for some of that, I am sure we can sit down and talk about mutual apologies that may or may not be possible.
I will not give way to the hon. Gentleman again.
As the Secretary of State’s predecessor rightly said, “If you don’t ask, you don’t get.” That is the first thing that he can do in his first Cabinet meeting—well, not his first, but his first in this role. [Interruption.] Oh yes, the Chief Whip attended, but this time he will be able to vote, if there are any votes—there are occasionally votes at Cabinet, although perhaps not in this one.
We now know that many Government Members agree with us on this issue, because they have been busy telling their local newspapers that the fare rises are too high. The hon. Member—soon to be the right hon. Member—for Sevenoaks (Michael Fallon), who is now the Minister of State at the Department for Business, Innovation and Skills and who is, we are told, even now parked in a tank on the lawn of the Business Secretary, has gone so far as to present a petition to the House on the issue. He writes on his website:
“At a time of rising energy bills, and high inflation more generally, many of my constituents are having to make painful savings in their household budgets. Southeastern need to understand this and reduce the size of the rail fare increase”.
Our motion today would not only prevent train companies from imposing the eye-watering fare rises that the Business Minister rightly opposes; it would also cap his constituents’ fare rises at 1% above inflation.
The hon. Member for Harlow (Robert Halfon) has told his local newspaper:
“Harlow people are already struggling to make ends meet against a backdrop of rising petrol prices and wage freezes…They cannot be expected to pay massive rises in rail fares on top.”
The hon. Member for Chatham and Aylesford (Tracey Crouch) told her local paper:
“At a time when household budgets are stretched, the Government and Southeastern have a responsibility to ensure the cost of rail travel remains affordable. I will continue to make representations on behalf of my constituents”.
Good for her! Her neighbour, the hon. Member for Rochester and Strood (Mark Reckless), has said:
“What I have found with prices going up this fast is that many of my constituents have to get up at 5 am or 6 am to take a coach to London because they cannot afford to take the train whereas others have been priced out completely because they are spending almost all their take-home pay on a season ticket. I just think that is counter-productive. I think it is a question of fairness to people who are working hard and just doing their best.”
I agree with all those hon. Members’ representations.
I should also like to quote one or two Liberal Democrats. It will not be a great shock to the House to learn that many Lib Dem MPs have been sending out press releases to their local papers opposing their own Government—we all know that they do that. The hon. Member for Leeds North West (Greg Mulholland), who is not in his place, has said:
“I am very concerned at the proposed fare rises…At a time when the cost of living remains a big issue it’s not acceptable to ask rail users to pick up extra costs”.
The hon. Member for Manchester, Withington (Mr Leech) has actually claimed credit for last year’s U-turn, saying:
“I hope George Osborne and the Treasury will cut the train commuter some slack in the upcoming budget...Last year, Nick Clegg and Danny Alexander negotiated a RPI+1% fare rise for 2012, much lower than planned by some Conservatives. I hope they will do at least as much this budget.”
That is not very collegiate, but it is rather typical. I must not leave out the hon. Member for Cambridge, because he gets upset if I do. I can reassure the House that he has also spoken out, in his rather confusing role as co-chair of the Lib Dem transport committee. He has assured his local paper:
“I wrote to the Secretary of State for Transport earlier this summer to remind her of Liberal Democrat policy, and highlight our opposition to the RPI+3% rate.”
Putting out a press release is one thing—and it can be useful—but I hope that Members will follow their words up with action this afternoon and vote for this very straightforward motion, which proposes that the cap on annual fare rises should go back to the 1% above inflation cap that existed before the last election—which even the Chancellor conceded was right last year when he performed a U-turn—and that we should strictly enforce that cap, it being the will of the House, and not allow private train companies to add up to another 5% on to some fares. The result would be clear. Instead of 11.2% being the highest possible fare increase in January, no fare would rise by more than 1% above inflation. That would benefit our constituents considerably.
If we do not act, passengers are likely to face three years of double-digit fare rises on some routes, and many ticket prices will have risen by a third during this Parliament. We have reached a point at which increasing numbers of households are paying more on their season ticket just to get to work than on their mortgage or rent payments. For too long, Governments have let the train companies get away with treating passengers in a way that would not be permitted in other industries.
Will the hon. Lady give way?
I am just coming to the end of my remarks; I think I have spoken for an appropriate length of time.
Today, we in this House have a chance to say, on behalf of our constituents, that enough is enough. I urge the House to put aside party differences and vote for the motion. It is something that we all agree on. Let us deliver for our constituents the guarantee that their rail fares will not rise by more than a strict annual cap of 1% above inflation.
Before I address the motion, I would just like to tell the House what a great honour and privilege it is to return to the Dispatch Box in a proper speaking role after some 18 years, although I have to say to the hon. Member for Garston and Halewood (Maria Eagle) that I had not expected to be making my first speech as Transport Secretary quite so soon. When the Opposition Chief Whip informed me on Monday evening that there was to be a transport debate today, I thought that this would be either an opportunity or a great problem. I shall not decide which until I have sat down. I thank the hon. Lady for her warm welcome. I shall certainly consider some of the points that she raised in her speech, but I might need to take a little more time to do that, rather than responding to them all immediately this afternoon.
Will the Secretary of State give way?
I am going to regret this!
I, too, congratulate the right hon. Gentleman on his new post. As he knows, I have always thought of him as the General von Klinkerhoffen of the Government—but only in that he is much nicer than his party allegiance. May I add one thing to the list of things he should worry about? It is that we often think of commuters as wealthy people going from the commuter districts outside London to their jobs in banks, yet many in my constituency are people who are on the minimum wage. For them, the £5.10 or £5.20 a day that it would cost them to go to work can sometimes be prohibitive. Will he work closely with the Department for Work and Pensions to ensure that such people have a real opportunity to work?
I thank the hon. Gentleman for his intervention. I well accept that a lot of people who commute are on very low wages, and that their transport costs account for a very large part of their income. We do need to bear that in mind. The hon. Gentleman is, however, supporting a motion today that would remove the flexibility of the rail companies to adjust rail fares, which is something that the Welsh Assembly—which his own party runs—is not prepared to do.
May I too congratulate my right hon. Friend and welcome him to his new post? He was a much-respected Chief Whip, and I am sure that he will perform this task very well. Was he not surprised that the hon. Member for Garston and Halewood (Maria Eagle) managed to get through her whole speech without making a single reference to Sir Roy McNulty’s report? It was as though his review had never taken place. An important part of the equation is surely the cost of the railway system, and Sir Roy’s independent report found that the system that we inherited from the last Government was so inefficient and expensive that we would have to reduce its costs by 40% to run a service comparable to those in France, Germany and Holland that the hon. Lady seemed to be disparaging.
I am grateful to my hon. Friend. I intend to come to that point later in my speech, as he can well imagine.
It is a great privilege to serve as a Secretary of State in this Government, and it is a task that I am incredibly proud to perform. I should like to take this opportunity to pay tribute to the diligence and skill of my predecessor, my right hon. Friend the Member for Putney (Justine Greening). She gave the go-ahead for the high-speed rail link—a new national rail network that will be crucial for keeping Britain moving and vital for growing our economy.
As a regular rail user myself, I know how concerned people are about rail fares. That is a fact that I fully understand and take seriously, but to do justice to this debate, it is vital to grasp the wider challenges that the Government face if we are to make our railways more efficient, more effective and more affordable. From day one in office, our priority has been to tackle the fiscal deficit that we inherited, and to put in place measures to rebalance our economy, get people back to work and boost growth.
The railways have, and will continue to have, a crucial role to play in that process. Not only do they provide the arteries through which the lifeblood of commerce flows, connecting key cities and markets, and linking communities with jobs but they receive a significant amount of funding from the state—more than £3 billion a year. It was absolutely clear when the coalition came to power in 2010 that the level of taxpayer and fare payer support for the railways had soared under the last Government, yet passengers had seen little reward for that investment. In short, the railways were providing poor value for money. We did not inherit just a budget deficit; we also inherited an infrastructure deficit—one that, left unaddressed, would mean a long-term drag on our economy. This infrastructure deficit was particularly acute on the railways.
The Secretary of State mentioned that he was a regular rail user—I presume on the west coast main line, with which he will be familiar in any event. He said that the money invested by the last Labour Government did not lead to any obvious benefits for passengers. How does he think the investment in the west coast main line was paid for?
I am talking about the overall structure. My train service is East Midlands Trains, not the west coast main line. I look forward to gaining more knowledge of many more railway lines in due course.
Will the right hon. Gentleman give way?
I congratulate the right hon. Gentleman on his move to the Department for Transport. Does he believe that his rail journey improved or got worse between 1997 and 2012?
I shall come on to some of the things we are going to do to improve the railway line that I use, which were announced before I became Secretary of State. I am very pleased about them, one of which is electrification. The last Government had a particularly poor record on that. There was a change in the franchise owners during the period of the last Government and certain changes were made to the service on that line.
Soaring demand meant that our ageing rail network was struggling to cope. There are now many more people travelling on the railways than at any time since 1929, but on a much smaller system. What does that mean? It means more overcrowding, more standing on trains, and rail consumers demanding a better service. We had to find a way to invest in the railway to support the economic recovery and to deliver the quality of service that passengers have the right to expect. That was the reality we faced, and we are meeting it head on by investing in the biggest rail modernisation programme since the Victorian era, while at the same time reforming the railways and reducing costs.
Does the right hon. Gentleman accept that during this Parliament and this spending review period, his Government have cut investment in the rail industry? Yes, they have announced a lot of investment for the next Parliament, in control period 5, which will go ahead some time in the future, but in this Parliament investment and infrastructure have been cut.
I was just coming on to say that this July, we announced £16 billion of public support for the existing rail network between 2014 and 2019—I expect 2014 to be during this particular Parliament—which will support over £9 billion of enhancements, meaning more services, more seats and more capacity, especially for commuters to our largest cities. The tap cannot simply be turned on as far as the rail industry is concerned. Passengers will also benefit from the completion of the northern hub in Manchester, £240 million of investment in capacity and connection improvements on the east coast main line, and a further £300 million for high-value, small-scale schemes in other parts of the country.
We are delivering a rolling programme of rail electrification on the Great Western main line to Swansea, on the valley lines into Cardiff and on the trans-Pennine route connecting Liverpool, Manchester, Leeds and York. We are creating a new “electric spine” for freight and passenger services stretching from the south coast to the east and west midlands and south Yorkshire.
I congratulate the Secretary of State on his new post. How confident is he that during this Parliament this Government will be able to electrify more of the railways than the nine miles that were managed in three previous Parliaments?
The hon. Gentleman must not underestimate the achievements of the last Government. He said that they electrified nine miles, but he is wrong; they electrified 13 miles, and I shall come to that a little later in my speech. I shall also come on to announce the electrification that we intend to carry out.
I offer many congratulations to my right hon. Friend on his new and challenging post. Does he share my amazement that Labour Members ignore the fact that Thameslink 2000, which serves my constituency, was kept on the buffers for seven years while they dithered, thereby denying the infrastructure improvements of extended platforms and longer trains, which would have made a huge difference to commuters yet have gone ahead only recently?
My hon. Friend is a tremendous advocate for the many commuters in her constituency who rely on this service. I hope they have already seen some improvements and will see further improvements as time goes on.
Electrification will not only deliver new fleets of cleaner and more environmentally friendly trains but will reduce the long-term costs of running the railways. The hon. Member for Cambridge (Dr Huppert) was just a little ahead in the timing of his question; the next part of my speech will put the record straight. I always try to be accurate. While in 13 years the previous Government electrified just 10 miles of railway—I got the figure wrong, too!—between Crewe and Kidsgrove, which is an important part of the railway network but not too widespread, we have set out plans for over 850 miles of electrification and investment of over £1 billion. It does not stop there, as we have approved a £4.5 billion contract to build a new generation of inter-city trains at a purpose-built factory in County Durham, creating 730 skilled jobs and a further 200 during construction. We are procuring around 1,200 new railway carriages for the Thameslink line and, with Transport for London, we are working on the procurement of new trains for Crossrail.
There is a lot more to do, but let me be clear. We are able to fund this massive programme to build a railway fit for the 21st century only because we have taken tough but correct decisions to cut spending elsewhere, redirecting our resources to boost growth and to get our economy moving. Of course, when it comes to resources, when we invest in our rail network, fare revenues are crucial in helping to fund the massive upgrade programme we are delivering. In fact, the previous Government set out plans to increase the share of rail funding paid by passengers. The alternative for us in 2010 would have been to slash investment. This would have been the wrong answer for the long-term economic future of this country and, indeed, for rail users themselves.
I join others in welcoming the right hon. Gentleman to his post. He talks about the passenger paying, but I could have a week in Benidorm with £80 spending money for the cost of my return travel between Wigan and Euston. One of the right hon. Gentleman’s predecessors, the right hon. Member for Runnymede and Weybridge (Mr Hammond), said he thought that the railways were already a rich man’s toy. Does the Secretary of State agree with that? If not, how is he going to enable ordinary people to use the railways—or should they just go to Benidorm instead?
It sounds as if the hon. Lady knows more about Benidorm than I do. I think there are a number of anomalies in ticket fares. I see them on the train service I use, in that it can cost £170 to use one train, but a train 20 minutes later is a lot cheaper. We need seriously to try to address a number of these problems and to look at how the fares and fare structures used by the rail industry are implemented. I do not accept that everything is fine and fair. In certain areas, consumers have strong cases to make; we should look at them, and I will do so.
Will my right hon. Friend give way?
Yes, I give way to a member of the Transport Select Committee.
I, too, congratulate my right hon. Friend. He makes an important point about reviewing the whole ticketing strategy. His predecessor announced a consultation on reviewing ticketing, and one proposal that will directly benefit my constituents is a plan to introduce a discounted ticket for passengers who travel frequently but not often enough to warrant a season ticket. There are proposals like this that will cut the cost of using the railways for many of our constituents.
I look forward to working closely with my hon. Friend and to discussing that issue with him.
I am sure that I shall like my right hon. Friend better in his new role than in his last.
The shadow Secretary of State was kind enough to quote accurately comments that I made to my local newspaper reflecting my constituents’ concern about rail fare increases. I said that I would continue to make representations on the matter. Rather than succumbing to the political opportunism displayed by the Opposition, who imposed RPI plus 3% uniquely on Southeastern commuters, will my right hon. Friend meet me, and fellow Kent Members, to engage in a substantive conversation about rail fares and services for our constituents?
I should be delighted to meet my hon. Friend and the colleagues whom she wishes to bring to see me. As I have said, a huge number of people rely on commuting, particularly in areas such as Kent, and that is very expensive for them. I shall be more than happy to arrange a meeting in the not-too-distant future.
Will the Secretary of State give way?
I am slightly conscious of the time.