Tuesday 11 June 2013
[Mrs Linda Riordan in the Chair]
First World War Commemoration
Motion made, and Question proposed, That the sitting be now adjourned.—(Mark Lancaster.)
It is a great pleasure, Mrs Riordan, to serve under your chairmanship. We are witnessing today a strange reversal of life, in that I am doing a presentation to the Minister, whom I taught some 20 years ago when he was an officer cadet. It will be interesting to see whether he is as critical of me as I perhaps was of him.
May I begin by declaring three interests—not pecuniary ones—that I have in relation to the subject? The first is that for many years I taught military history at the military academy of Sandhurst and at the staff college, and I wrote or edited several books to do with the British Army and the first world war. Secondly, I am one of two parliamentary commissioners representing the House of Commons on the Commonwealth War Graves Commission. Thirdly, I am a member of the Prime Minister’s advisory board on commemorating the first world war.
We cannot get away from the fact that the first world war is a controversial subject. It was controversial at the time. When the Liberal Government decided to declare war on Germany, following the German invasion of Belgium, several Liberal Ministers resigned from the Cabinet. During the war, there were the conscientious objectors, and those, such as Lord Lansdowne, who wanted at different times to reach a peace settlement.
The subject has also been controversial since then. Many veterans felt that they were betrayed. In the 1960s, during the anniversary of the first world war, an enormous debate went on. Films and programmes such as “Oh! What A Lovely War” and “Blackadder Goes Forth” probably have a bigger impact on public perceptions of Britain and the first world war than all the memoirs and history books, and we can see that today.
The Government are in a difficult position, trying to organise a commemoration that reflects the general feeling of the British public, which is that this is something to commemorate in a positive way. It is about not only remembrance and reconciliation but pride. However, looking in the newspapers, I can see that my old friend Max Hastings has written a story asking whether the Government are sucking up to the Germans—“Don’t mention the war!” That is not true.
I happen to be in the historical camp that believes that Britain was right to go to war in 1914, by the end of which we had beaten imperial Germany. Many Germans of the current generation and German historians agree with that. Equally, a whole group of artists and others, including one Labour MP, wrote to The Guardian expressing an opposite view. They believe that this is all about the worst kind of patriotic interpretation of the first world war. We have two different opinions. It is not up to the Government to lay down the law on this, but we will have a discussion over the next five years, and perhaps the younger generation will engage in it.
With the greatest of respect to the hon. Gentleman, I am not here to debate that. It may well be that at some later date we will have a full-scale debate about commemorating the first world war, either through the Backbench Business Committee or in Government time. I am merely giving two interpretations, and I happen to believe that one of them is correct.
My purpose in introducing this short debate today is to reflect the fact that there has been considerable interest in both Houses in the commemoration. Two of my hon. Friends, here today, have already secured short debates on the subject. On 6 March, my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) introduced a debate entitled, “Youth participation: first world war commemorations”, and, on 13 March, my hon. Friend the Member for Folkestone and Hythe (Damian Collins) introduced a debate on the first world war centenary. Folkestone will be one of the commemorative points next August; it was from Folkestone that many tens of thousands of soldiers went by cross-channel steamer to Belgium and France. There have been oral questions and debates in the House of Lords as well.
The Government have outlined a six-year programme of events around the themes of remembrance, youth and education. I do not intend to go into any details, as many colleagues here will be aware of it. The Commonwealth War Graves Commission and the Imperial War museum are central to the commemoration, but I also want to flag up the role of the National Archives, which have hundreds of thousands—if not millions—of documents and photographs relating to the first world war, specifically to the war service of men and women, and a lot of other things such as operational diaries. People now can get easy access to such information.
The importance of the commemoration is not just the fact that the Government are going to set an overview, but that it will be bottom up. It is the work done already over many decades by individuals and local communities who wish to look at the people behind the names, particularly on things such as war memorials. We have a wide range of interest groups such as the Western Front Association and the War Memorials Trust, which have already done very good work—hon. Members will know that from their constituencies.
I apologise for having missed the first sentence or two of the hon. Gentleman’s remarks; I was attending a Delegated Legislation Committee. I am a trustee of the War Memorials Trust and I am pleased to hear him mention its work. In particular, we have the project In Memoriam to ensure that our war memorials are safe and an education programme to ensure that the younger generation understand the matter. I am sure that the hon. Gentleman wants to comment on how important the younger generation is in all this.
The trust does some very good work indeed, and I will come back to it in a minute.
We must take a sensitive and sophisticated approach to the issue. This is about not just the United Kingdom Government and Parliament here, but the devolved Parliament in Scotland, the devolved Assembly in Wales and the devolved Parliament in Northern Ireland.
We also have to take into account the Commonwealth, remembering that in 1914 the British Government declared war on behalf of the empire, and that the participation of the empire is also a sensitive subject. Some 1.6 million men from the Indian sub-continent served in the Indian army—mainly in the middle east, but also in Belgium and France—and tens of thousands of them were killed and injured. The successor states, India, Pakistan and Bangladesh, have ambivalent views about how to commemorate the first world war, not least because many of the soldiers returned to the Indian sub-continent and joined groups that wished to see the end of the Raj.
Finally, there is the international element, which I have briefly touched on. What the Government must do, and I am sure the Minister will comment on this, is integrate what we are doing with what our allies—the French, the Germans, the Turks, the Russians and many other countries—are doing.
It is important to recognise that the commemoration develops over six years and that we need to maintain the momentum. Although the Government have laid down a number of points that we are going to commemorate, such as the death of Nurse Edith Cavell, who was from Norfolk where I was born and live, they also have to consider the legacy. In other words, how do we want this commemoration to be remembered, particularly putting the emphasis on young people? I suggest that we look at things such as education and the strengthening of communities.
For me, the purpose of this short debate is to consider what role Parliament will play in this commemoration and to encourage my fellow parliamentarians to participate in events and advise local communities about them. I fully recognise that many colleagues are already doing that.
I suggest that the parliamentary element should have two themes. The first is to look at the political and constitutional role that Parliament played during the war—in particular, the aspects that resonate today. After all, in 1914 the Liberal Government did not seek Parliament’s permission and have a vote on the declaration of war, which many colleagues will see as having a resonance now. There is the whole business of the key debates that took place here in Parliament. There is also the formation of the two coalitions: the coalition of May 1915, of the Liberals and the Conservatives; and then the Lloyd George coalition of December 1916, which had the Libs under Lloyd George and the Conservatives, with some Labour support.
In addition, there are the elements of legislation that were crucial at the time and that still have a resonance today. The licensing laws that we live with today were brought in at the beginning of the first world war to encourage munitions workers not to get tired and emotional and cut production. The Defence of the Realm Acts brought in massive constraints on civil liberties; the Military Service Acts—in other words, conscription—broke the back of the old Liberal party; and finally the Representation of the People Act 1918 saw for the first time the majority of women, although not all of them, getting the vote.
How does Parliament achieve this commemoration? I suspect that there will be exhibitions, and there will be online information. It is possible that the Speakers of both the Commons and the Lords will arrange a series of lectures and talks. I suggest another idea, which some of my colleagues might think is a little too modern, even for me; it shows that I have a feminine side, of which the loss of my moustache is a further example. The idea is that we could recreate some of the debates I have referred to through the Youth Parliament. Let the Youth Parliament debate the issues that divided the country during the first world war.
It is also conceivable that Parliament could publish a book that would relate to the second element of Parliament and the first world war: the experiences, service and personal losses of Members of both Houses of Parliament—both MPs and peers—and of their staff. I would like to think that we could bring that idea up to date by asking Members of both Houses and their staff to provide information about what happened to their direct ancestors and their families.
Lord Wallace of Saltaire, my hon. Friend, has already started the process in the other House; some Members may have seen a piece that he wrote in The House magazine about four months ago. He discovered some fascinating information about the current generation of peers and peeresses. There are not only direct descendants of Asquith, Haig and Lord Grenfell; there is also the fact, of course, that the House of Lords represents immigrants.
For example, Baroness Henig’s grandfather fought at the battle of Tannenberg on the German side; Lord Dubs’s father was in the Austrian army; and Lord Tugendhat’s father was an Austrian officer on the Italian front. Several members of the Asian community had grandfathers who served in the Indian army during the first world war.
There were also people who never served in the armed forces, and we want to bear that in mind; it is not only the military side that matters. There were the women who were nurses. Lord Prescott said that both his grandfathers continued as miners during the war; effectively, they were in a reserve occupation. There is a lot of interesting work that can be done in that area.
Let us not forget the staff. Work has already been done by the archivists and those on the educational side of Parliament. As an example, I give two small pieces of information. First, it will not surprise Members to know that the majority of Badge Messengers in 1914 were ex-military. The majority of them were either recalled to the colours or—if they were elderly gentlemen—nevertheless went back into uniform to train people. Secondly, they were replaced as messengers in the House of Commons by girl guides. That would have been quite a remarkable change for the 1914 generation.
We should not forget the staff. One member of staff who volunteered was Frederick Silva. He was a waiter in the House of Commons in the refreshment department. He was in the 2nd Battalion, the Rifle Brigade, and was killed in action on 30 September 1917, probably during the third Ypres battle.
Finally, we perhaps want to consider what the impact of the first world war was on the generation in the inter-war and post-war periods; that possibly links in with the intervention made earlier by the hon. Member for Newport West (Paul Flynn). Ramsay MacDonald was vilified because he had not fought during the first world war, but the war experience of Attlee and Macmillan was deep in their souls and resonated in their attitudes to so many things, including social reform and rearmament.
My second theme for this debate, which I will touch on briefly, is to encourage parliamentarians to participate in commemorative events and advise their local communities about them. Many colleagues are already doing that. The Heritage Lottery Fund recently announced that £6 million of funding will be spread over six years, which can be allocated to people who bid either as individuals or as local communities for projects related to heritage. I know that these ideas have been taken up by many parliamentarians. If people visit a few of our colleagues’ websites, they will see that they have flagged that money up.
What more can be done? Colleagues can take an active part in events and consider the specific experience of their own constituency, whether it is in a town, a city or a county. I will briefly give the example not so much of my own constituency of Broadland as of the work that is already being done throughout Norfolk. I have tried to put questions not only to local historians but to the Eastern Daily Press, which is taking a great interest and which I think will participate fully in events. I suggest that Members could relate those questions to any city, county or constituency.
My first question was, “What was Norfolk like in 1914?” It is a very good question for children to ask. Let us cut away all the myths of a golden summer and everything else—what was it like? What were the attitudes, as far as we can tell, of people at that time? We must remember that we are dealing with the first generation of really literate people.
Secondly, what was the impact of men volunteering or being conscripted to the armed forces? There were massive variations. We think of the Kitchener volunteers, but they did not all rush away at first; in Norfolk, they did not go until September or October 1914. Outside the cities, volunteers or conscripts were mainly rural workers and they literally had to get the harvest in. We forget the conscripts. The majority of people serving in the British armed forces by 1918—when we “won” the war—were, in fact, conscripts.
We know that a lot of emphasis will be put on the military experience of soldiers, including their experience of battle and of becoming casualties. However, Members also need to think of the expanding military presence in their locality during world war one; there were training camps and physical defences of one kind or another. We must also consider the experience of women and children, including their loss of a father or a husband—literally, for up to four years, and perhaps permanently. Alternatively, many soldiers returned from the war limbless or suffering from post-traumatic stress, as we would call it now.
We must also consider the impact of refugees and prisoners of war. Norfolk had tens of thousands of Belgian refugees. Also, a lot of German PoWs were working on the land, which is something we always associate with the second world war. There is also the role played by industry and farming. Tens of thousands of women volunteered for work in war industries and on the land. The Women’s Land Army does not date from the second world war—that was when my mother had experience of it—but from the first world war. There was social change, with tens of thousands of young men being billeted in a local area—crime and sex.
There was also politics under the coalition Government. What did it mean in a Member’s locality? How did a Member’s predecessors—if they can be traced—respond to the war, whether they were a Conservative, Labour, Liberal or coalition Liberal? There is also the role of conscientious objectors to consider. Were they badly treated? Were they reflective of their society? The impact of rationing on people must also be considered. Once again, we think of rationing as happening in the second world war.
We must consider hospitals and auxiliary convalescent homes. There was no national health service; there was a limited number of hospitals. In Norfolk, more than 60 schools, private houses and village halls were turned into hospitals, with only local women, who had virtually no experience of nursing, taking things on. That is one of the unsung elements of the first world war that we should commemorate.
Those of us on the east coast suffered the experience of both naval bombardments and air raids. The German navy bombarded ports, such as Great Yarmouth, and a number of towns in Norfolk had air raids. Again, we assume that that happened in the second world war.
The Government have suggested that we name streets after Victoria Cross heroes. It is possible that Harry Daniels, of the Rifle Brigade, a company sergeant-major during the war, who was born in Norfolk and won his VC, may be honoured eventually in his home town of Dereham. Like a lot of working class soldiers in the first world war, he came from a broken family and was a product of the workhouse. We spend a lot of time concentrating on the middle-class poets, but let us not forget the tens of thousands of working men for whom joining the Army was both a food ticket and a way out of social deprivation.
Finally, there is the Armistice and the physical remembrance of the first world war. The hon. Member for Hackney South and Shoreditch (Meg Hillier) is right about looking at war memorials, particularly the people behind the names. A lot of schools are already doing this. Parliament can play an important role in terms of what it wants to remember about the first world war. Many colleagues in both Houses have already started on this work.
I should like to end with a stanza—a short poem—written by somebody who saw the worst and the best of the first world war. We always assume that Rudyard Kipling was the poet of empire. He was an incredibly popular poet at the time and still is today. We think of him glorifying the old British empire and the Raj, but we have to remember, of course, that his only son was killed in 1915 and he was overwhelmed by guilt.
Kipling encouraged his son to join up. When the boy failed because he had bad eyesight, Kipling had a quiet word to make certain that he was commissioned. He never got over that. Kipling played an important role in the remembrance of the Commonwealth War Graves Commission, but he wrote a bitter stanza that has a particular resonance for all of us as politicians. Some hon. Members will know it. “A Dead Statesman”:
“I could not dig; I dared not rob:
Therefore I lied to please the mob.
Now all my lies are proved untrue
And I must face the men I slew.
What tale shall serve me here among
Mine angry and defrauded young?”
This is the first time that I have spoken under your chairmanship, Mrs Riordan, and I am sure that it will be a great pleasure to do so.
It is a delight to be here and to hear the authoritative words of the hon. Member for Broadland (Mr Simpson), who secured this debate. I am slightly alarmed that he has shaved off his moustache. The feminisation of politics has given us many great benefits, but Mrs Thatcher never appointed anyone with facial hair. There is great danger if we start to shave off our facial hair: what male appendages might be under threat next?
The first world war is not an occasion to celebrate. I pay tribute to the hon. Gentleman for soothing out some of the jingoistic overtones in the original speech that suggested that we might celebrate the end of that war. I have a different tale to tell, but it is relevant and true, about a young man who volunteered at the age of 15. He was full of optimism and a great patriot, and went to war believing that it was going to lead to dignity, glory and honour. It did not; it led to disease, degradation, bitterness and early death at the age of 43.
That young man was a machine gunner. The belief on both sides was that machine gunners were never taken prisoner, because they were responsible for killing hundreds and possibly thousands of people. He found himself in a machine gun nest—a foxhole—gravely injured, and the others were dead. That was in April 1918, when the Germans broke through on the Messines ridge. His life was saved. He heard a German patrol coming to him and took out his rosary beads to pray, waiting for the bullet to blow out his brains. He could not get out of the hole, where he was identified as a machine gunner because the machine gun was lying across his body. However, he was not shot. The German officer, and two others, carried him across no man’s land and his life was saved. He was ever grateful to the Germans for the rest of his life.
He went there to serve the cause of his country that he loved and to kill the Hun, who were slaughtering Belgian babies. Other small nations had a different army experience at the time. He returned to civilian life and found that he was on a pension. He could not do what he called a man’s job ever again. In the mid-1930s, his pitiful pension was reduced by an ungrateful Government, who changed the reason for his pension from saying that his ill health was attributed to his war wound to saying that it was aggravated by it, although he went in as a perfectly fit 15-year-old.
The man was my father. Bitterness against war is justified in many of his generation. He was not killed by his wounds, but by his war experience. Two of the stories that he and his brothers told me about the war were that they did not have strawberry jam, but they had alcohol and cigarettes in abundance. He died of lung cancer at 43, because he was hopelessly addicted to tobacco. Others were addicted to alcohol, because of the way that alcohol was cynically used, an element that the hon. Member for Broadland did not recall.
We have to look at that war, which resulted in 16 million dead, with 900,000 British dead. Anyone who believes that is a matter for celebration is deeply wrong. The hon. Gentleman quoted Kipling, a great advocate for glory:
“I lied to please the mob.”
Others lied to please the mob. The lesson that we should take from the first world war, which led to the second world war, inevitably, because of what happened at Versailles, is, how do we understand war in our own age, these days?
There is a debate on Thursday on the Iraq war. It will be fascinating to recall the decisions made in this place in 2003, when because of the wishes of one man, we did not pull out of that war, as the Prime Minister was invited to, but went ahead on the basis of a misunderstanding, or possibly a lie. The consequence for this country was 179 dead. That is a hell of a price to pay for one man’s vanity. If we wish to commemorate the true lessons of that war, I suggest we do something that is now forbidden in this House and read out the names of the current war dead from Iraq and Afghanistan. I have done it twice and it is now forbidden. We are not allowed—it is out of order—to read the names of the war dead. We could not possibly do it for those who died in the first world war, who died in their hundreds of thousands, like cattle, but we can at least honour those who have recently died because of our decisions, taken in this House, on Iraq and Helmand, which have resulted in many other deaths.
The great lesson of the first world war was its abject futility and the way it led to unnecessary suffering and death, without solving any of the problems that existed at the time. I am grateful that there has been a change in the Government’s attitude and that they are talking about commemorating the war’s full horrors. That must be our emphasis and our message to young people. We could go back not only to Kipling, but to the other poets who said that we must not repeat
“The old Lie; Dulce et Decorum est
Pro patria mori.”
Let me make two quick comments before I come to what I wanted to say. First, we all owe my hon. Friend the Member for Broadland (Mr Simpson) a debt for initiating the debate. As he knows, my first grown-up job in politics was as research assistant to Maurice Macmillan, which meant I was privileged to spend quite a lot of time at Birch Grove. In my conversations with Harold Macmillan, there was absolutely no doubt that his approach, and that of other political leaders of the time, to Europe, the Common Market and European politics was in large part based on their experience of having gone through two European wars. For people such as Harold Macmillan, it was not just the fact that they had gone through two European wars, but guilt about the fact that they had actually survived—Harold Macmillan was almost the only person from his Grenadier Guards officer cadet group to survive the great war.
To pick up the point made by the hon. Member for Newport West (Paul Flynn), I think we all have family stories about the great war. I had an uncle—Uncle Bob—who was gassed in the first world war and who won the military medal, but I cannot remember him ever uttering a whole sentence, because for the rest of his life he lived with the fact that he had been gassed.
The point I really want to make follows from that made by the hon. Member for Hackney South and Shoreditch (Meg Hillier), and requires me to put on my hat as Second Church Estates Commissioner. As a result of the first world war, there was a need to demonstrate the huge and understandable grief over the loss of the husbands, fathers, sons, brothers and friends who made up the never-ending casualty list from the front line. There are, therefore, now roughly 36,000 memorials to the dead of the great war, reflecting that unprecedented expression of public grief. Not surprisingly, many of those memorials are in churches or within the curtilage of church buildings.
I hope two things will happen between 2014 and 2018. First, I hope every community—every parish, every town and every village—will look to refurbish or restore its war memorials. The recording of names—often simply in alphabetical order, giving no priority in death, because all are equal in death—is an important memorial, and now is the time to ensure that our war memorials are repaired and restored. Some memorials relate to streets or areas, such as those for the Hull pals and the Accrington pals. Others relate to factories, and one will also find memorials at railway stations. Charles Sargeant Jagger, the uncle of Mick Jagger, designed the great memorial in Paddington station, as well as the gunners memorial at Hyde park corner.
The other thing I hope will happen, which my hon. Friend the Member for Broadland alluded to, is that every community will have an opportunity to research the names and histories of those who died.
Another interesting issue is that a lot of names are missing, because the names were haphazardly collected. The War Memorials Trust does not necessarily fund work on this, but it depends on the circumstances; we have seen some great examples of names being added. I am sure the hon. Gentleman would be interested in work being done in education so that local children could seek out some of the names that should have been added, but which were missed off.
That is a good point. One is already seeing work on that. Clive Aslet produced a very good book called “War Memorial”, which is the story of the sacrifice of one village, Lydford, from 1914 to 2003. There are 23 names on the war memorial, and he goes through the histories of all of them in the book. In the preface, he says:
“What I would really like to do for the Centenary of the First World War in 2014 is to set up a project for each village to find out about its own dead. There is so much you could do and it would be a fantastic national and local resource. This book threw up such a richness of material and it really got me up every morning because I became so utterly absorbed by the story of these people’s lives.”
In my constituency, in the village of Deddington, Michael Allbrook and Robert Forsyth have written a history of the parish at war. When war memorials were erected in the early 1920s, it was sufficient for the inscription to include simply a name and an initial, because everybody knew the person. Men of Deddington died in Belgium, Canada, England, France, Germany, Greece, India, Iraq, Israel, Italy, Malaysia, Sicily, Syria and Turkey, where their graves and official memorials can be found, but their histories are at risk of being lost. The book written by the people of Deddington is a reminder of the lives of those men and of the people they were.
The Heritage Lottery Fund is giving £1 million a year over six years until 2019 to help communities mark the centenary of the first world war. I hope people will look to the war memorials and to the names on them, as well as, in some instances, as the hon. Lady said, to those that are not on them, as a starting point for exploring the history and commemorating the lives of people from their communities who took part in the great war.
When I enlisted in the Sussex Yeomanry in 1970, it had a dinner at the Royal Pavilion in Brighton every year before Remembrance day. In 1970, there were still two tables of 1914-18 veterans. When I, as a young man, asked them what made them leave their farms in Sussex—most had never left their farms before going to war—they simply said, “We went to defend our farms.” Edward Thomas was asked why he went to war, and he picked up a sod of English earth and said, “I went to fight for this.” Every one of the people on a war memorial has a story: they were a person; they had a life. I hope that, in commemorating the first world war over the next four years, we will take the opportunity to recall and commemorate the individual lives of every one of those who fell.
Order. At the moment, I do not intend to impose a time limit. If Members can be disciplined in their speeches, I will be able to call all those who want to speak. I will then call the Front Benchers at 10.40 am. If time starts running short, however, I will impose a time limit, with the kind permission of Mr Speaker.
It is a pleasure to speak on this issue. I congratulate the hon. Member for Broadland (Mr Simpson) on bringing it before us for consideration and on the passionate and balanced way he presented his case.
We in Northern Ireland have a close link with our serving personnel. We have a strong history of service, particularly in my constituency. In Northern Ireland, there was no need for conscription, because my forefathers and all those who joined up were volunteers. Those who served chose to do so, and they were proud to do so. We remain proud of the part they played.
Some people might question the relevance of continuing celebrations when there are no veterans of the first world war left, but we learned a great lesson from that war, and it is a lesson that we must never forget. We must ensure that we teach our children our history and instil in them an understanding of what makes them who they are and a pride that they, and we, are British.
We in Northern Ireland all intend to be involved—at least the Unionist MPs, and we will try to persuade some of the other MPs—in introducing into primary schools an educational pack, which will provide some of the facts about the first world war and try to create in children’s minds the importance of the occasion. Through that, we also hope to build upon community relations.
One of the great things that has come out through our peace process has been the recognition of service from both sides of the community, and service from the Republic of Ireland and Northern Ireland. One thing we wish to do, and will try to do within the commemorations, is to have a twinning type of arrangement between communities in Northern Ireland and communities in the Republic of Ireland. Importantly, that will also build relations.
I want quickly to mention the Bowtown community group association in my constituency, which, alongside other groups in the area, has been actively involved in promoting the importance of the first world war. There are things that we can do as MPs—as elected representatives—with schools and communities, north and south together in the island of Ireland. That is something we will try to build on.
When I think of the first world war, my thoughts automatically turn to the Somme, and in my constituency office opposite our flag is a beautiful framed picture of the Somme, which I think we are proud to see every day. As mayor of Ards borough in a previous life—21 years ago—I had occasion to go to the Somme and visit the battlefields, and I highly commend such a visit because it gives a real flavour of what happened in the first world war and the sacrifice that there was. Many of the gravestones there were of people who were 16. Many of the Ulstermen who joined told lies about their age, saying that they were 18 or 19 when they were 15 or 16—some were even 14. Perhaps there was not as tight a control as there should have been on birth certificates at the time. Those people also sacrificed themselves, and we should always be mindful of that.
We are perhaps proudest of our fight at the Somme, during which the bravery and courage of the Ulstermen has become the stuff of legends. Of nine Victoria Crosses given to British forces in that battle, four were awarded to the 36th Ulster Division. Captain Wilfred Spender of the division’s HQ staff after the battle of the Somme was quoted in the press as saying:
“I am not an Ulsterman but yesterday, the 1st. July, as I followed their amazing attack, I felt that I would rather be an Ulsterman than anything else in the world”.
The final sentences of Captain Wilfred Spender’s account furthered his viewpoint, one that was politically correct at that time for Unionists:
“The Ulster Division has lost more than half the men who attacked and, in doing so, has sacrificed itself for the Empire which has treated them none too well. The much derided Ulster Volunteer Force has won a name which equals any in history. Their devotion, which no doubt has helped the advance elsewhere, deserved the gratitude of the British Empire. It is due to the memory of these brave fellows that their beloved Province shall be fairly treated.”
Those who gave their lives on 1 July at the Somme were volunteers on behalf of the empire, and that is something we must commemorate.
Just on the edge of my constituency we have the Somme centre, which was built specifically to recall the sacrifices of the first world war and to commemorate the fact that—the Minister will be aware of this—the people from the 36th Ulster Division trained within a mile of the centre before they went to the Somme. The Thiepval tower is important, and the Somme centre plays an important role for us. It re-creates the trenches and has many historical artefacts. People can today live the sound, the noise, the horror, the courage and the sacrifice that took place, through what they have at the centre. I believe that it commemorates those things in a great way.
That service to crown and country strongly lives on, and that is the point on which I want to end. Today, 100 years on, the sacrifice of the first world war is still important, for us as parliamentarians and for our soldiers who are out in the field. Every one of us knows soldiers who have given their lives. In my constituency, I am always minded of Channing Day, who died in Afghanistan last year. Badges were sold in her name for Combat Stress—they sold out very quickly, and the next batch is now on sale.
We take pride in doing the right thing, and the right thing is to remember and honour those who fought in the war. The young men who had no idea what they were marching into, the young women who picked up the slack at home and worked the fields and factories, the families who mourned and the new Great Britain that arose after the war, are all reasons to commemorate the first world war in a right and proper way.
As we now look to a century since the war began, it is the right time to ensure that we commemorate in such a fashion that honours our fallen and inspires our children to realise how hard won the fight for freedom truly was. We can never afford to be complacent. I wholeheartedly believe that parliamentarians and Parliament as a whole should be taking the lead in the commemorations. We have a lot to do over the next few years, and we look forward to the process.
It is a pleasure to serve under your chairmanship, Mrs Riordan. I will try to be brief. I congratulate my hon. Friend the Member for Broadland (Mr Simpson) on his wide-ranging, informative and certainly thought-provoking contribution. I was attracted to participating in the debate because it refers specifically to how Parliament commemorates world war one.
When I sit in the main Commons Chamber, I always listen with razor-like attention to my colleagues’ eloquent and devastating rhetoric and argument. Rarely does my attention wander, but if my eyes occasionally stray upwards—I hope they do not do so often—they spot the crests that surround the Chamber. I wonder how often we notice that they are there, and how often we think about what they represent, or, more importantly, about the stories of the people that lie behind them. When I am rushing to a Committee meeting or a dining room and I scurry through the Lower Waiting Hall, I do not tend to stop by the book of remembrance, which is often concealed by a policeman. Therein alone is treasure trove of stories. How often, as I dash off to Millbank through Members’ Entrance, do my eyes look up to the war memorial there, and the names on it?
As Members of the House, it is vital that part of our commemoration is of Members themselves and, indeed, of staff, who lost their lives. What links this debate with the Minister’s previous focus is last year’s Olympics. I recall some excellent exhibitions in the House on the connection between the House and the Olympics, on great Olympians who were also Members of the House. A book was even published, which detailed their lives and their contributions. I sincerely hope that Parliament comes up with something similar, to allow us an insight into the lives of Members and staff who lost their lives. My hon. Friend the Member for Broadland gave the example of the waiter in the restaurant.
My second observation draws partly on what the hon. Member for Newport West (Paul Flynn) said about the legacy of world war one. It is all too easy to think that the legacy issue ended in 1939, but I argue that every time we stand up and discuss Syria in the House we are doing so as a consequence of the 1916 Sykes-Picot agreement, which demarcated the middle east and created an explosive cocktail that rumbles on to this day. I believe that the legacy is in the here and now, and I suspect that it has affected many of the great decisions that have been made in this Parliament down the years, including on pioneering social legislation, and the attitudes towards appeasement and what occurred in the lead-up to world war two.
Possibly the most important thing we can do in Parliament to commemorate world war one is not just to base the contributions we stand up to make in the Chamber on the here and now, on what we have read in today’s or yesterday’s newspapers—the fish and chip wrappers of tomorrow; we should also be open to the long perspectives, and at each moment of our lives be open to thinking about what brought us here and the wider issues we are debating. If we do that, our contributions might be more meaningful than they all too often are and my attention might not stray to the many crests that surround the Chamber and could instead be focused more intently on what other Members are saying.
It is great to follow my colleague and friend from Lancashire, my hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard).
I congratulate my hon. Friend the Member for Broadland (Mr Simpson) on introducing the debate. Like him, I declare an interest. I was a teacher of history for 37 years, but I reassure hon. Members that I could not find my teaching notes last night, so they are saved from that. I will address some of the challenges that have been laid out today.
The legacy of the first world war is not only war memorials, although they are important. In the Fleetwood part of my constituency, we have a memorial park that was built following the war. The friends of the memorial park, and their chairman Les Fletcher, have bid for a grant to get the whole park, including its gates, restored, which may be an opportunity.
Westfield war memorial village in Lancaster was constructed for disabled soldiers with funds raised from private money. If Members look at the official books on Westfield war memorial village, which still houses 189 residents, they might be amused to learn that, apparently, despite the money having been raised, the building of the village, shops and workplaces for disabled ex-soldiers was hindered by the Government, the Ministry of Labour and the trade unions. The village is still shining with people still living there. There are similar things in every constituency.
Like my hon. Friend the Member for Blackpool North and Cleveleys, when I watched the Iraq war—I was not then a Member of this place—I used to scream at the television, “Will these people please read some history?” or “Has anyone picked up the books and actually looked at the background?” Obviously, a standard comment is that people do not learn from history, but they could at least be informed about it.
My hon. Friend mentioned Syria, and I would also pinpoint Bosnia, where the whole shebang happened; it is where the archduke was assassinated. When people stand on that spot in Sarajevo, they think, “What has changed in Bosnia since then?” Four years ago, I met the grand mufti, the senior Muslim cleric, and his first words in the big mosque in Sarajevo were, “This mosque is the Emperor mosque. It was rebuilt by Emperor Franz Joseph, and the last time this country was run properly and efficiently was by the Habsburgs.” I have some sympathy with that. There are national and European lessons that we may need to address during this long centenary.
My other point, again to follow the challenge of my hon. Friend the Member for Broadland, is on the diversity of the troops who went to war. In the words of Baroness Warsi:
“Our boys weren’t just Tommies—they were Tariqs and Tajinders”.
When people go to the war graves, as I did a few months ago, they see the numbers; 140,000 troops from the Indian empire fought on the western front. When people see the Sikh memorials, the Jewish and Christian graves and the Muslim graves facing Mecca, they have respect for the Commonwealth War Graves Commission, which is still reburying people. That is just amazing. Only a few months ago, I saw in the village of Hollebeke the graves of six Chinese people who died as part of the Chinese Labour Corps; a huge wreath had been laid by the Chinese Government.
The centenary we are commemorating has many national and international levels. In our own country, given the diversity and the challenges that it is creating at the moment, we have to bring in every part of Britain’s new communities because they were involved in the first world war; 1.2 million people from the Indian empire fought across Africa, the western front and the middle east.
I found a quote from a Muslim soldier when I was looking at some letters out there—I do not know how one reads it in one sense. He was writing back to his family in the then undivided India, and he put in the letter:
“What better occasion than this to show the loyalty of my family to the British Government?”
What a lesson that is to us today, given what we face. Many Members of Parliament for constituencies that perhaps lack the diversity of our major cities can still ensure that when we are in schools to talk about the first world war and when we are at the memorials, people know that a vast range of soldiers and workers from across the old British empire supported this country and saw us through to the end. That is a lesson that we need to be punching out there, and it is a lesson for all of us today. It still rides strongly and gives us a purpose as Members of Parliament.
It is a pleasure to serve under your chairmanship, Mrs Riordan, and it is a pleasure to follow the fascinating contributions of the Members who have spoken in this debate. I particularly congratulate my hon. Friend the Member for Broadland (Mr Simpson) on securing this debate and on his fascinating introduction.
We are surrounded by the first world war in the Palace of Westminster, in every community in the country and in Whitehall, which is dominated by the Cenotaph. People cannot escape from the first world war, and in remembering it as we draw closer to the centenary of its outbreak we must remember, as many hon. Members have pointed out in this debate, the incredible change it brought to the lives of almost everyone in the country. We must remember that the first world war touched their lives, and the political consequences of that war affect our lives today, too. We must remember that it was of a scale unimaginable to people before the war. We must remember the stories that came from the war in the history books, the poems and the diaries, which tell of a conflict that cannot be recognised in terms of warfare today. The lives and experiences of the people who went through it are almost impossible for people in a contemporary setting to imagine.
Philip Sassoon, who was Member of Parliament for Hythe during the first world war, visited the site of the battle of Waterloo in 1920. His recollection was that it was “Lilliputian” compared with the western front and that the battle of Waterloo, great and defining as it was, had more in common with the battles of ancient Greece than it had with Neuve-Chapelle or the battle of the Somme. The first world war was something totally new and of an incredible order.
The first world war affected fighting men from across the world who came to Britain to fight on behalf of the empire as British subjects under the King. We must, therefore, consider not only what the significant sites of the first world war meant to the whole country, but to the broader fighting community across the world. My interest has been drawn specifically to the Step Short project in Folkestone, of which I have been chairman for the past six years and which commemorates the role the town played during the first world war.
As my hon. Friend the Member for Broadland mentioned, it was not tens of thousands of men who came through Folkestone during the first world war but tens of millions. Nearly 10 million men came through Folkestone, which was the main port of embarkation to the western front not just for British soldiers but for soldiers from across the world who came to serve. That can be seen marked in the graves at Shorncliffe military cemetery, which is one of the Commonwealth war graves, stationed next to Shorncliffe barracks just outside Folkestone, which was home to tens of thousands of Canadian servicemen. The graves of members of the Chinese Labour Corps who died in the first world war can also be found there. Folkestone, similar to Norfolk, was also home to tens of thousands of Belgian émigrés who came to Britain to escape the advancing German army in the early days of the war in the summer of 1914, so it has an international significance, too.
For me, the important thing about Folkestone is that it touches the experiences of probably almost every fighting family in the country. At some point, their ancestor was in Folkestone during the war, and it is a site that can mean something to people across the country as they consider the centenary of the first world war.
The House of Commons must consider an appropriate way to recognise the sacrifices of families across the country during the war. We must consider where we can create places in the United Kingdom for them to go to try to gain some insight on the life and experience of their ancestors. That is why there is still an incredible, enduring interest in the first world war battlefields in western Europe. The tour operators say that more people make the journeys now than for decades. On any night at the Menin gate at Ypres, one can see large numbers of people gathering to stand and hear the “Last Post” played. Schoolchildren still make battlefield tours of the great cemeteries, such as Tyne Cot and the memorial at Thiepval, to understand what went on.
We should create more opportunities within this country for people to visit similar sites with broad significance. In Folkestone, we have embraced that idea by creating a memorial walk tracing the last steps of the men as they marched from the town down to the harbour where the boats waited to take them to France, and we are raising money to create a new memorial arch to stand over that route, or close to the site where a memorial arch was put up between the wars to mark the silver jubilee of King George V and the coronation of King George VI. It bore the simple message “In our rejoicing, we still remember them.” The road down which the men marched was rededicated after the war as the road of remembrance. As other hon. Members have mentioned, there are physical war memorials listing the names of men who fought, but there are also other memorials that recognise the symbolism of and people’s emotional attachment to significant sites in this country during the first world war.
In Folkestone, as my hon. Friend the Member for Broadland mentioned, we also have air raid sites. The first major air raid on the civilian population carried out by German aircraft in this country was at Folkestone in 1917, on Tontine street. It killed 71 people out of a clear blue sky. There were no air raid sirens and no warnings; it was not something that anyone expected. Many people lived through it, and many have family members who were victims of that attack. The site in Tontine street means something to them.
We can help create memorials, and we can support events as Members of the House of Commons. Folkestone seeks to do so by creating a new memorial arch and a memorial march commemorating the journey to war on the anniversary of the start of the war next August. On 4 August 2014, a series of centenaries will start that will run through the period of the first world war, touching the anniversaries of the major conflicts and battles and building up to the centenary of the armistice.
The major museums are doing a great deal of work to support the first world war centenary, particularly the Imperial War museum, which is creating online resources that anyone in the country can use to pass on the stories of people in their community. I also thank the National Army museum, which has agreed to bring part of its first world war collection out of London to Folkestone for 10 months in 2014-15 while its galleries are being refurbished, and to create an exhibition with the people of Folkestone to tell part of the story of the town during the war, as well as the story of men as they made the journey to war.
I thank my hon. Friend the Member for Broadland for securing this debate. It is the third debate on the first world war centenary in which I have participated during the past couple of years; I am sure that there will be many more opportunities to discuss it as we get closer to that time. It will be an important series of anniversaries and commemorations, starting on 4 August next year, and will mean a great deal to people across the country.
I did not originally intend to take part in this debate. I pay tribute to my hon. Friend the Member for Broadland (Mr Simpson), who had the initiative to secure it and who introduced it with his customary gravitas and with information that he doubtless learned during his time at Sandhurst and elsewhere. This has been an absolutely fascinating debate. I have been prompted to take part in it because I have distinguished two themes that I think will be reflected in discussions of the first world war across the nation.
The first was ably outlined by the hon. Member for Newport West (Paul Flynn), to whom I pay tribute. He has made clear his opposition to war and his hatred of it on so many occasions over many years in this place, and he has done so extremely convincingly and with great passion. I might surprise him by saying that I agree with him absolutely. All war is hell. There is no question about it. All war is a disgrace, and it should not occur. How human beings ever thought it up in the first place is hard to imagine. Whether we are talking about people killed in warfare, those who are injured or maimed or those with mental illness as a result, it is an absolute blot on humanity that such things occur. I entirely endorse his hatred of it.
Equally, I agree with the hon. Member for Newport West that most wars occur for all the wrong reasons. We in this place and our ancestors for over 1,000 years have got all wars wrong. Even recent wars, without entering into recent politics, have occurred for all the wrong reasons. They have been ill thought through. As was said about the first world war, lions have been led by donkeys.
Although we should not renege on or stray from that clear theme, it is entirely separate from the one that we have been discussing here, which is how we commemorate those who gave their lives and so much else for their nation. The motto of my own regiment, the Honourable Artillery Company, is “Arma pacis fulcra”, or “Arms are the balance of peace”. Those young boys marched out of the gates of Armoury house in the City of London because they were told to do so by their officers, who were told to do so by the Government. They did so for King and country. They did not set off from Armoury house saying, “I wonder whether this war is right, wrong or indifferent”; they set off because they were acting under orders.
The same applies, incidentally, to those people who have stood on the high street of Royal Wootton Bassett in my constituency on 427 separate occasions during the last few years to pay tribute to the dead bodies returning from Afghanistan and Iraq. The people of Wootton Bassett were not saying that they approved or disapproved of the wars in Iraq or Afghanistan; they had no views on those wars. They took the view that this was not the occasion to enter into the politics of it. They knew that it was right to pay their respects to the soldiers who had given their lives in those wars.
I am grateful. I understand what the hon. Gentleman is saying, although he might find that modern historians are a little kinder to the allied leadership in the run-up to the war than he suggested. As well as the horror and the courage that will be recognised during the national commemoration of the first world war and its outbreak, it is right that Parliament address the complexities of the politics both inside Parliament and inside Government. It was a first and, for the Liberal party, a traumatic experience of coalition politics.
I am grateful to the hon. Gentleman, but I suspect that I absolutely disagree with him. There have been wars for the past 1,000 years, going back to the battle of Sherston in my constituency in 917, when King Athelstan fought off King Canute. Is it right that we in Parliament should consider whether Athelstan was right or wrong to fight that battle with Canute in 917? Of course not. Equally, we should not reinvent the causes of the first world war. That is not a matter for us; it is a matter for historians. We in Parliament must look to the present and the future. Reinventing the thought behind the first world war is not our job at all.
First, again, I agree strongly with the hon. Member for Newport West that all wars are bad. Of course there are lessons to be learned; we are considering whether to sell arms to Syria. We should remember that all wars are bad. Secondly, we should also remember that all wars are badly thought out; that applies today as before. Thirdly, the purpose of today’s debate, leaving aside all the politics and history, is that it is right that we in this place should say to the people to whom we give instructions, “You are doing the right thing. We respect and honour what you do, and we honour the fact that you have given your lives, livelihoods and very often your health or your mental welfare under order from us. It is right that we should pay you respect for doing so.”
I enjoy the occasions when, twice a year, each brigade returning from Afghanistan enters Carriage Gates and we as a Parliament pay our respects to those soldiers. We are not involving them in politics or asking them to endorse our views on Afghanistan; we are thanking them for all that they have done in Afghanistan as soldiers under our orders. That is what we must do with regard to the first world war. Those boys, and a few girls, gave their lives, their livelihoods and their health. We must thank, respect and honour them for what they did for us.
It is a great pleasure to serve under your chairmanship, Mrs Riordan. I congratulate the hon. Member for Broadland (Mr Simpson) on securing this important debate, and I thank him for the work that he does as a member of the world war one centenary advisory board. I do not think that I had the benefit of his teaching when I was at Sandhurst, although I could be wrong. I agree that Parliament can play an important role and that as parliamentarians, we all have an important role to play in encouraging and supporting activities in our constituencies. I know from my constituency that there is huge interest in the commemoration.
There have been a number of thoughtful contributions to the debate. My hon. Friend the Member for Newport West (Paul Flynn) and the hon. Members for Lancaster and Fleetwood (Eric Ollerenshaw), for Banbury (Sir Tony Baldry), for Strangford (Jim Shannon), for Blackpool North and Cleveleys (Paul Maynard), for Folkestone and Hythe (Damian Collins) and for North Wiltshire (Mr Gray) have all spoken with passion and authority. They spoke with different emphases, but they all agreed that it is important for Parliament to play a leading role in the commemoration. The numbers present to support the debate are a welcome sight, and confirm my belief that the issue brings us together and is one on which we should be united.
I pay tribute to the Under-Secretary of State for Defence, the hon. Member for South West Wiltshire (Dr Murrison), in his role as the Prime Minister’s special representative, for his dedication to the task of assuring an appropriate commemoration. I hope that he will not mind me saying—something that always comes with a degree of qualification—that, for this work, he is a round peg in a round hole. He and the Minister present in the Chamber know, I am sure, that the Opposition will work closely with the Government on the commemoration. We are united in the view that it is important and that it must be done in the right way.
In order to inform the work that we do in this place, it is worth reflecting that most people appreciate the scale of the loss of life in the first world war, although it is still difficult to comprehend. They know something of the 750,000 British soldiers who died, or the 1.5 million who returned home injured, and they might have heard of the 20,000 British soldiers killed on the first day of the Somme or recall Wilfred Owen’s imagery of choking soldiers drowning in a sea of chlorine gas. Sacrifice on such a scale must always be remembered. It must be commemorated.
In Parliament, however, it is important that we remember the first world war for more than the industrialisation of death that followed in its wake. The role of Government and of Parliament therefore is to ensure that the commemoration of the centenary is respectful, thoughtful and reflective, without of course in any way glorifying the nature of the war and the appalling human sacrifice that took place. This is a commemoration, not a celebration.
The first world war was a hugely significant moment in history, important for Britain economically, politically and socially. It was a cause, directly or indirectly, of all the major events of the 20th century. At home, the first world war changed much for Britain, and our reliance on Commonwealth countries for soldiers as well as materials led to a desire for greater independence by nations who no longer wished to be subordinate to the empire. The war also changed the terms of the relationship between England and the other constituent parts of the United Kingdom.
Britain was changed politically and socially for ever. Politically, the end of the war triggered a flight to extremes. Socially, the war gave rise to the lost generation; so many men of marriageable age died that 50% of women remained single in 1931, and 35% of them did not marry while of childbearing age. The conscription of so many men during the war, however, led to an opportunity for women in the workplace, and the importance of that change cannot be underestimated. The other great social change to come from the first world war was of course suffrage. Before the war, neither working men nor women had a vote. The sacrifice of men of all classes, combined with the movement of women into the working world and the campaigns of the suffragists and suffragettes, compelled politicians to change that situation. We should also reflect on that in this place.
The importance of the first world war cannot be counted simply in terms of battlefield casualties or military innovation. There is no doubt about that. From its influence and its timing, it is the single most significant event of the 20th century. As such, it is something we must remember, we must commemorate, we must learn from and we must educate our children about. The centenary is an excellent opportunity to teach younger people about the first world war in a direct and age-appropriate way and to initiate informed discussion about our country and our history. I very much agree with the suggestion of the hon. Member for Broadland that we should invite the Youth Parliament to come to this place and debate those important issues.
As other Members have noted, the Imperial War museum will play a pivotal role in the commemoration and will be opening groundbreaking new galleries at its London site, as well as at its Manchester site. Those efforts will reach a wider audience than ever before and create a legacy for future generations that will hopefully revitalise the way we teach the history of the first world war. In addition to the £9 million already donated, the Heritage Lottery Fund will give £6 million to projects marking the centenary. It provides funds to help local areas and communities explore their history and heritage and to understand the war’s impact on their communities. The lottery money will be crucial to helping local communities in their important commemoration events. Many other organisations will be involved, from the Royal British Legion to the Woodland Trust and many more besides.
There is huge interest around the country in ensuring that in every hamlet, village, town and city—in every corner—we make the most of this national and international period of commemoration. Members throughout the House will take an active part in activities in their constituencies, but above all we must take the opportunity to remember, because only through remembering and through keeping the first world war in the national consciousness will we truly understand its impact on British society and, in so doing, understand what it means to be British. Parliament will seek to play an appropriate role, in conjunction with many others, to ensure that the centenary of the first world war is commemorated in a way that is thoughtful, respectful and befitting of such an important event in our history.
Thank you for chairing the debate, Mrs Riordan. In responding, rather than reading through my prepared speech, I will try to pick up on the various contributions made by hon. Members, commenting on them as appropriate.
The best place to start is by thanking my hon. Friend the Member for Broadland (Mr Simpson), not only for his typically erudite and thoughtful contribution this morning, but for all the work he has already done in and around the commemoration as a member of the advisory group and as a commissioner of the Commonwealth War Graves Commission.
I also give my hon. Friend a probably long-overdue thank you for all the hours of his life he spent trying to educate me when I was in my 20s; he was kind to say it was 20 years ago, but in all honesty I fear it was 20 years plus VAT. As I have got older, I have begun to feel increasingly that if there were a period in my life that I could revisit, it would be then, because understanding the lessons of history allows us to make much better judgments about the present. I wish that I had sat in my hon. Friend’s lectures less exhausted by the various other activities that marked the day at Sandhurst, and better able to listen to the many words of wisdom that he offered then, as he has this morning.
My hon. Friend is absolutely right to talk about the role of the National Archives. The process of discovery that can be facilitated by it for individuals, families and communities will be a key part of the period of remembrance. He could not be more right about the role of our allies in other Commonwealth countries. To be honest, that had not really dawned on me until a visit to Australia, when I was looking at tourism and sporting links post-2012. I took some time out to go around the national war memorial in Canberra, which I was shown by Dr Brendan Nelson. It is engaged in completely revitalising and renewing its galleries, as we are in this country.
I had not realised the extent to which the first world war marked the moment when Australia came together as a nation for the first time. For Australians, the centenary of the war—Gallipoli, in particular—is an extraordinarily important national moment of remembrance and of nationhood. If that is true for Australia, it is true for many other places around the world.
Ensuring that such work is properly co-ordinated and dealt with appropriately is key to the success of commemoration. The body that my hon. Friend is associated with, the Commonwealth War Graves Commission, is central to delivery. My hon. Friend is also right to talk about the effect on the House. The idea of some form of book is excellent, and I hope that he will pursue it with Mr Speaker.
I think back to my hon. Friend’s excellent history of General Percival and the fall of Singapore. It brilliantly brought out the human element of that entire tragedy; something like that, which draws together the experiences of parliamentarians and Members of the House and which we could all read and learn from, would be a fantastic contribution. He is absolutely right to encourage parliamentarians to become involved and to lead this event. I could not agree more with everything he said and I thank him for his contribution.
The hon. Member for Newport West (Paul Flynn) told the powerful story of his father and his post-war fate. The story is tragic and there is no other answer. I assure the hon. Gentleman that the Government’s approach is not to celebrate the war, but to enable a great act of remembrance. No Government of any colour in this country hand down an authorised version of history. We should put the facts before people to educate them and then allow them to remember the event in a way that is fit for them. The hon. Gentleman will have a contribution to make to that like everyone else.
My hon. Friend the Member for Banbury (Sir Tony Baldry) spoke about war memorials and his work as the Second Church Estates Commissioner. The issue of war memorials has worried me for many years. In my county, they were put up next to what were then quite small roads, but have now turned into major A roads. Memorials have suffered natural degradation from heavy lorries passing them on the way to Folkestone and other ports of embarkation, and in some places people may want to move them to a place that is more appropriate for acts of remembrance. I think that will be a key part of the commemorations.
I very much enjoyed my hon. Friend’s story about the Sussex Yeomanry. Perhaps I may tell him gently, having joined the armed forces 10 years after him, that one of the great events of the year was always the second world war reunion at Combermere barracks. A young officer could sit at the feet of people who had taken bridges during the second world war by stripping doors off houses and laying them across the fabric of the bridges to get armoured cars across them to secure the other side. Understanding such stories is key.
The hon. Member for Strangford (Jim Shannon) is always modest about the fact that he served in the Ulster Defence Regiment; I did not realise that until I looked him up in connection with legislation with which we were both involved. I pay tribute to him as a former soldier—particularly that form of service. Any of us who served in Northern Ireland know that soldiering in one’s own community and going back to one’s own home at night still under threat was a very different experience from that of those of us who came to the Province and at least went back to a secure force base afterwards.
I am sure that the hon. Gentleman will play an ongoing role in remembering the UDR’s considerable contribution during the troubles. As much as or perhaps even more than other places in the country, Northern Ireland is synonymous with the public service inherent in service in the armed forces. The war was a key period in Northern Ireland’s history and I am delighted that the hon. Gentleman, with his background, will be on hand to lead and help with the period of remembrance.
My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) talked about the role played by MPs. Some years ago, I tried to buy a sword that came up for auction at Bonhams. It was supposed to have been the property of the first Member of Parliament to have died in the first world war. I may be on dangerous ground and I will check this story, but I think his name was Edward Boyd. One of his descendants—I think it was his grandson—played a considerable role in Northern Irish politics thereafter. Edward Boyd had been in the armed services in the 1880s and served in the South African campaign. He left the armed services and was elected to Parliament in 1910. He rejoined at the start of the first world war but was wiped out in a matter of minutes. He survived for only five or 10 minutes in the first campaign in which he took part. I will ensure that I research his story more closely.
My hon. Friend the Member for Lancaster and Fleetwood (Eric Ollerenshaw), another historian who gave us the benefit of that dimension, spoke absolutely correctly about the link between international communities—the Commonwealth, which played such an important part—and existing local communities in this country. He is absolutely right that it will be a powerful moment throughout communities in this country when people link with their forebears and engage in an act of remembrance.
My hon. Friend the Member for Folkestone and Hythe (Damian Collins) referred to the Step Short project, and we have been here before. I cannot move in Kent without talking about it, and I notice that it has started to appear on national briefing sheets, so he has done a splendid job in bringing it to everyone’s attention. It is a remarkable that 10 million soldiers embarked for the front through Folkestone.
I was amused by my hon. Friend’s remark about Philip Sassoon, one of his predecessors, and his comment that the battle of Waterloo was like many battles of ancient Greece. When I had returned from the first Gulf war, someone deconstructed the tank tactics there and they were remarkably similar to those employed by Hannibal with elephants at the battle of Cannae thousands of years before. There is an indication that in military affairs everything changes and nothing changes much.
My hon. Friend made a powerful point about the role of museums and particularly the National Army museum. I have always thought that we underestimate the role of local museums, and my hon. Friend the Member for Broadland touched on the importance of local communities’ remembrance. Local museums throughout the country will put on first world war-centric exhibitions that will allow people to discover what their communities were like at the outbreak of war. They will play an important role in that.
My hon. Friend the Member for North Wiltshire (Mr Gray), who is also a former soldier, talked about the importance of respect and of honouring those who served in the armed forces as a result of decisions made here. That is a key part of the educational role.
I thank the hon. Member for Barnsley Central (Dan Jarvis), who speaks for the Opposition and is also a former soldier, for his confirmation of the Opposition’s support and his commitment to ensure that the remembrance takes place in the right way. He talked about the importance of that. Since becoming involved, I have become aware from some people I have spoken to of a slight concern that there is no central theme. If there is one, it is not celebration—I hope that that puts the hon. Gentleman’s mind at rest—but remembrance. That is exactly what this is about, and historically it is what Remembrance Sunday has been about. “Remembrance” is the word that sums it up.
The Government have laid out three themes for the commemoration: remembrance, youth and education. Two strands that have come through clearly this morning are remembrance and the important concept of service. The Government’s role is to identify and lead the key national acts of remembrance, but after that to provide a framework so that local communities—I put Parliament in that bracket—can find ways of remembering the anniversary that are appropriate for them.
I am sure that the phrase “to allow a thousand flowers to bloom underneath it” is correct. Some excellent suggestions have been made today and I hope that for all of us it will be the start of a period of exploration and discovery that leads to an appropriate act of remembrance of this great national event.
It is a pleasure to serve under your chairmanship for the first time, Mrs Riordan. Interestingly, this debate follows one about the first world war. The Minister came into the Chamber just after what was said about how we remember our past and how that is very important for our future.
The purpose of the debate is to call on the United Kingdom Government officially to recognise a dreadful and tragic part of Ukraine’s history as genocide. I have met the Ukrainian community in Derby, who are still distressed that we have never recognised the Ukrainian holodomor as genocide, even though other countries have, including some in the Commonwealth.
The Ukrainian holodomor refers most specifically to the brutal, artificial famine imposed on the Ukrainian people in 1932 and 1933 by Stalin’s regime. In its broadest sense, the holodomor refers to the Ukrainian genocide that began in 1929 with massive waves of deadly deportations of Ukraine’s prospering farmers, as well as the deportation and execution of its religious, academic and cultural leaders, which culminated in the devastating forced famine that killed millions of innocent men, women and children. Between 1932 and 1933, a man-made famine raged through Ukraine and Kuban, resulting in the deaths of between 7 million and 12 million people, mainly Ukrainians, and it was instigated by the Soviet leader, Joseph Stalin.
There are of course deniers of the holodomor, as there are those who deny the existence of the holocaust. In fact, there is a division of opinion in Ukraine on the number who died—from 2 million or 3 million up to 12 million—but they agree that it was a man-made famine directed at Ukrainians in Ukraine and Kuban, and that it meets the criteria for the definition of genocide in the 1948 UN convention. It is hardly surprising that there is some confusion about the holodomor, because it is poorly documented, the records were manipulated and those who conducted the census were executed.
The main goal of the artificial famine was to break the spirit of Ukrainian farmers and force them into collectivism. It was used as an effective tool to break the resistance of Ukrainian culture. Moscow perceived it as a threat to Russo-centric Soviet rule, and therefore acted brutally and sadistically to crush cultural resistance. The goal of the artificial famine was to ethnically cleanse Ukrainians from vast areas.
In 1932, Stalin increased the basic grain procurement quota for Ukraine by 44%, knowing that such an extraordinarily high quota would result in a grain shortage and the inability of Ukrainian peasants to feed themselves. Such a goal would not have been achievable had the communists not already ruined the nation’s productivity by eliminating the best farmers.
That year, not a single village was able to meet the impossible quota, which far exceeded Ukraine’s best output in previous years. Soviet law was quite clear that no grain could be given to feed the peasants until the quota was met. Stalin then issued one of the cruellest orders of his career: if quotas were not met, all grain was to be confiscated. As one Soviet author wrote much later:
“All the grain without exception was requisitioned for the fulfilment of the Plan, including that set aside for sowing, fodder, and even that previously issued to the kolkhozniki”—
the collectivised peasants—
“as payment for their work.”
The authorisation included seizure of all food from all households, and any home that did not turn over all its grain was accused of hoarding state property.
With the aid of military troops, USSR Government secret police and the USSR law enforcement agency, Communist party officials moved against peasants who might have been hiding grain from the Soviet Government. Of course, to try to avoid starvation, nearly every family attempted to conceal food, as we would expect: if people’s children were dying, they would not want to let their children die, never mind themselves. Experience soon made the brigades proficient at detecting even the cleverest hiding places. The result was mass starvation that took millions of lives during the terrible winter of 1932-33. Food was nearly impossible to find anywhere. Unable to get food, many ate whatever passed for it—weeds, leaves, tree bark and insects; some were lucky enough to be able to live on small woodland animals.
In August 1932, the Communist party of the USSR passed a law mandating the death penalty for theft of social property. Watchtowers were built and were manned by trigger-happy young communists. Thousands of peasants were shot for attempting to take a handful of grain or a few beets from the kolkhozes to feed their starving families.
To put that into perspective, at the height of the genocide, Ukrainians died at a rate of 25,000 per day, and nearly one in four rural Ukrainians perished as a direct result. At the same time, the Soviet Union dumped 1.7 million tonnes of grain on western markets. Nearly a fifth of a tonne of grain was exported for each person who died of starvation, and more than 3 million children born in 1932 and 1933 died of starvation.
Many peasants attempted to reach Ukraine’s cities, such as Kiev, where factory workers were still allowed a little pay and food. However, in December 1932, the communists introduced internal passports. That made it impossible for a villager to get a city job without the party’s permission, which was almost universally denied. The internal passport system was implemented to restrict the movements of Ukrainian peasants so that they could not travel in search of food. Ukrainian grain was collected and stored in grain elevators guarded by military and secret police units, while Ukrainians starved in the immediate area. That Moscow-instigated action was a deliberate act of genocide against the Ukrainian peasants.
Peasants hoped to get to Poland, Romania or even Russia, where there was no famine, but emigration was strictly forbidden. Ukrainian train stations were swamped with the starving who hoped to sneak aboard a train or to beg in the hope that a passenger on a passing train might throw them a bread crust. They were repelled by guards, who found themselves faced with the problem of removing the countless corpses of those who had starved and which littered the stations.
As I said, at the famine’s height, 25,000 people died per day. As the winter of 1932-33 wore on, Ukraine became a panorama of horror. The roadsides were filled with the corpses of those who had died seeking food. The bodies, many of which snow concealed until the spring thaw, were unceremoniously dumped into mass graves by the communists. Many others died of starvation in their homes, with some choosing to end the process by suicide, commonly by hanging—if they had the strength to do it. One American correspondent reported:
“The bodies of some were reduced to skeletons, with their skin hanging grayish-yellow and loose over their bones. Their faces looked like rubber masks with large, bulging, immobile eyes. Their necks seemed to have shrunk onto their shoulders. The look in their eyes was glassy, heralding their approaching death.”
The worst paradox is that much of the confiscated grain was exported to the west, and large portions were simply dumped in the sea or allowed to rot by the Soviets. For example, a huge supply of grain lay decaying under guard at a station in Poltava province. Passing it in a train, an American correspondent saw
“huge pyramids of grain, piled high, and smoking from internal combustion.”
In the Lubotino region, thousands of tonnes of confiscated potatoes were allowed to rot, surrounded by barbed wire.
News of this act of brutality was got out to the west, including to Germany in observations from its consulate in Kharkiv, and to Britain by various journalists, such as Gareth Jones—I have just heard that a book about him is to be published imminently—and Malcolm Muggeridge, who never forgot what he saw. In Canada and the United States, the Ukrainian community explained what was happening.
The genocide continued for several years with further destruction of Ukraine’s political leadership, resettlement of its depopulated areas with other ethnic groups, blatant public denial of famine and prosecution of those who dared to speak of it publicly. It was the official policy of the Soviet Union to deny the existence of a famine and therefore to refuse any outside assistance. Anyone claiming that there was in fact a famine was accused of spreading anti-Soviet propaganda. Inside the Soviet Union, a person could be arrested for even using the words “famine”, “hunger” or “starvation” in a sentence.
The holodomor was kept out of official history until 1991, when Ukraine—a country of 47 million people—finally won its independence. As James Perloff wrote:
“The Holodomor stands as a permanent warning of what happens when unlimited state power destroys God-given rights. A cursory review of America’s Bill of Rights demonstrates that virtually every right mentioned was trampled on by Stalin in Ukraine. Yet although the dictator used every means to eradicate the people’s will, the national spirit lived on unbreakably, until Ukraine gained its independence.”
I thank my hon. Friend for securing this important debate. There is a vibrant Ukrainian community in Huddersfield and Colne Valley, and I celebrated Christmas with them in January earlier this year. Four years ago, following an exhibition on the holodomor in the Kalyna community centre in Huddersfield, Kirklees council, my local council, voted to accept that the holodomor was genocide. Does my hon. Friend agree that it is now time for the United Kingdom to recognise formally that these horrific events were in fact genocide?
Yes, and I thank my hon. Friend for intervening with that point. That is exactly what I hope the Minister will be able to say in his response to the debate, because innocent people who have come to this country and are contributing to society in Britain in a very positive way deserve recognition of their horrific past.
Ukraine’s Government are now asking the United Nations to recognise the disaster as an act of genocide. In recent years, the then Ukrainian President, Viktor Yushchenko, ordered the release of old KGB records on the famine. With that information, it has become very apparent that the famine was a deliberate act of genocide—a method to ethnically cleanse Ukrainians from the territories of Ukraine and parts of Russia. At first, only several thousand documents were released. Another batch of 25,000 documents is in the process of being declassified. As more and more documents are released, this event in Ukrainian history has taken on a very ominous tone.
On 28 November 2006, the Parliament of Ukraine—the Verkhovna Rada—passed a law defining the holodomor as a deliberate act of genocide. Since then, many nations have recognised that the holodomor was an act of genocide against the Ukrainian people. Those nations include Australia, Brazil, Canada, Colombia, Estonia, Ecuador, Georgia, Hungary, Latvia, Lithuania, Mexico, Paraguay, Peru, Poland and the United States. Other countries have made a holodomor declaration. They include Argentina, the Czech Republic, Chile, the Slovak Republic, Spain and the Balearic islands, and the Vatican.
Russia is still in complete denial that the event occurred and that it was a deliberate act. In fact, in Russia, it was made illegal to commemorate the event. The success of using food as a weapon to control, punish and eliminate a people was first used by Soviet communists. Since then, it has become a standard tool in the arsenal of communist regimes to control, punish and eliminate people and it has been used by such regimes as China, North Korea, Ethiopia, Cambodia and Zimbabwe.
I am asking the Minister to investigate seriously the issue of the Ukrainian holodomor, which I have raised today. It is time for the UK to follow the example of the countries that I have mentioned—many from the Commonwealth—and set the history record straight once and for all. We have a large Ukrainian community in this country, and I believe that we owe it to them to recognise the extermination of millions of their ancestors who, through no fault of their own, suffered an horrific time. It can be defined only as genocide. That community would be extremely grateful to the Government if they were to change their mind and redefine the holodomor as the genocide that it feels like to so many people. This is not about politics, reparations or blame, but about basic human morality and respect for life.
I am grateful to my hon. Friend the Member for Mid Derbyshire (Pauline Latham) for her success in securing this debate and for the way in which she made her case. She did so with a commitment, eloquence and passion that did justice to the gravity of the appalling events that we are debating.
To say that the famine that culminated in 1932 and 1933 was a terrible tragedy is to underestimate the sheer brutality and inhumanity of what took place. I think that my hon. Friend would be the first to agree that the anecdotes and illustrations on which she drew in her speech can give us only the briefest glimpse of an horrific picture that was the daily experience of suffering among people in Ukraine during that time. The numbers of people who were involved and who suffered are staggering. Across vast swathes of what was then the Soviet Union—notably in Ukraine, but also as far west as Moldova and eastwards into Kazakhstan—millions of people starved to death because of the policies of their own Government.
It is a cause for some heart searching in the western world that for decades this tragedy was often overlooked or ignored. Worse, it was in some quarters denied, even among some who had pretentions to serious scholarship. Of course, countless people inside and outside Ukraine have fought to keep alive the memory of those who died in this atrocity and to raise awareness of the holodomor, but probably in the west it was pioneering historians of their time, such as Robert Conquest, who first drew attention to what had happened. I still remember reading as a schoolboy the first volume of Alexander Solzhenitsyn’s “The Gulag Archipelago” and finding there his account of the famine set in its broader context of policies of persecution, policies sometimes of slaughter, that were directed by Lenin and Stalin against the peoples over whom they ruled. What the efforts of those historians and of those many people inside and outside Ukraine have achieved is that people across the world continue to remember those who were lost and reflect today on the warning from history that the famine clearly provides.
There is no question, in the Government’s view, but that the famine took place as a result of Stalin and the actions of his Government. It was a man-made tragedy. It is clear, too, that it was within modern Ukraine where the terrible consequences of those actions were most heavily borne. On the question whether Ukraine was specifically targeted, whether this was a campaign directed by Stalin against any manifestation of Ukrainian nationhood, that is certainly widely believed, although it is not without controversy inside Ukraine, but it is also true that other parts of the then Soviet Union were gravely affected by the famine. In Kazakhstan, for example, the death toll as a proportion of the local population was higher than that in Ukraine. Areas of rural Russia were also affected; innocent people died there, too.
However, it is also clear that the Soviet regime felt deep hostility towards any manifestation of Ukrainian nationalism and it must have known that policies targeting the agricultural regions of the Soviet Union would have a disproportionate effect on Ukraine. The fact that, during the famine, Stalin closed the eastern border of Ukraine to prevent starving peasants from entering Russia in search of food is perhaps one of the strongest indications that his policy was, at least in part, motivated by a hostility towards Ukraine as a nation, with an identity, tradition and culture of its own. I think that no reasonable man or woman today would deny the horror, the atrocity, that was the holodomor.
My hon. Friend the Member for Mid Derbyshire asks whether the Government will recognise the holodomor formally as a genocide. Given the history of the holodomor, I can well understand the depth and strength of feeling in favour of doing that and why some Parliaments around the world have already done so. As the House knows, there is still a debate among historians and others on the question of recognition of the holodomor as genocide. Genocide has a defined status in international law, following the 1948 UN genocide convention. The holodomor predates the establishment of the concept of genocide in international law and the convention was not drafted to apply retrospectively.
Government policy is that recognition of genocides should be a matter for judicial decision, bearing in mind the terms of the convention and the consequences for individuals and Governments that can follow from the designation of their actions as genocide. It should be for judges, rather than Governments or non-judicial bodies, to make a designation of genocide. Recognition decisions should be based on a credible judicial process, and the courts are best placed to judge what are essentially criminal matters. The British Government have not proactively designated any atrocities as genocide. Those we have recognised—the holocaust, the 1994 killings in Rwanda and the 1995 massacre at Srebrenica—are all cases in which judicial bodies had judged the outrages to be genocide, in line with the definition in international law.
We have made clear, and will continue to make clear, our abiding horror at what happened in Ukraine in the 1930s. Every year, the Ukrainian Government host a formal ceremony of commemoration in Kiev. They invite foreign ambassadors, and our ambassador normally represents the UK at that event. To mark the 75th anniversary of the holodomor in 2008, their Royal Highnesses the Duke of York and Princess Eugenie travelled to Kiev, took part in the ceremony and laid wreathes at the Kiev memorial to the victims of the holodomor.
I give my hon. Friend and the House the undertaking that we will not forget or overlook what happened. It is important for all of us that Governments and peoples throughout Europe continue to learn the lessons from what happened in Ukraine and elsewhere in eastern Europe in those years, to ensure that no one is again tempted towards policies that could have such an appalling effect on innocent men, women and children. We will look for other opportunities to demonstrate our solidarity with the people of Ukraine. We will mark with them the opportunity to mourn those who suffered or lost their lives during the holodomor and recall the importance of remembrance of the atrocity for the new generations growing to adulthood today. Nothing should diminish the horror or magnitude of the events in Ukraine and elsewhere in the Soviet Union in the 1930s. Man-made policies, a brutal dictatorship and a pitiless ideology led to the deaths of many millions of innocent people. That is something that the world cannot and should never forget.
SMEs (Public Sector Procurement)
[Mr Philip Hollobone in the Chair]
In one moment I shall call the first speaker in the debate. I can confidently predict that after Mr Irranca-Davies has made his opening speech, I will not be setting a time limit. The next speakers will be Andrew Bingham and Iain McKenzie, and we will then see who else turns up. I shall, however, call the Front-Bench spokespeople at no later than 3.30 pm, and perhaps sooner.
I admire your confidence, Mr Hollobone; I have been known to wax eloquent for days, but on this occasion I will be happy to allow others to contribute as well.
This is a welcome opportunity to debate an important subject. There is cross-party interest in ensuring that procurement works far better for small and medium-sized enterprises than it has done in the past. The Government here are doing work on that, and I will refer to some of the innovative and pioneering work of the Welsh Government. I also want to deal with some of the myths about why we cannot do more—not least, those about the European Union.
I know that props are not allowed in this or any other parliamentary Chamber, but I have in front of me an exposé from Farmers Weekly, which ran a good campaign called “Get Better, Get British”. We know that over many years, if not decades, British farmers have been asked, often quite rightly, to invest heavily in the highest standards of animal welfare, environmental measures and so on, but doing that brings costs. In the UK, we now have British buying standards, and the question is this: how do we translate those standards in food produce into being represented by SMEs that can supply to local government, the NHS, the Ministry of Defence and others? That does not seem to be happening.
If I may, I will briefly plug the Farmers Weekly “Get Better, Get British” campaign, which identified that one in 10 NHS hospital trusts sources 50% or less of its food from Britain. The campaign also points out that the cost of feeding a patient varies between £14.40 and £2.11 per day across trusts. Most people would think, “We can see how you could use good ingredients and get good nutritional standards by spending £14.40, sourcing, where the standards are appropriate, locally and regionally from British farmers.”
However, hospital spending on food goes down to as low as £2.11 per day. Most people would struggle to explain not simply the divergence in the figures but how the nutrient value can be achieved with that little money, and how there can be procurement for SMEs within the locality and the region. The NHS trusts at the lower end of the spend range would be performing a magic trick if they were pulling that off.
In addition, according to the campaign, 93% of NHS trusts do not carry out any traceability checks on their food. We know that, despite what I said earlier about British standards within food—the British buying standards and so on, of which the Government are a keen proponent—the standards do not apply to hospitals and NHS trusts. Hospital food does not have to meet British farm-assured standards, for example, that are signalled by the Red Tractor logo that everyone knows and in which many trust. That is a practical illustration of the job of work that has to be done. I am focusing on food in this debate, but we could go right across the spectrum—many producer organisations are SMEs. SMEs are where the bulk of our employment, innovation and entrepreneurship is, and they need a fair opportunity to get into procurement.
Often, the argument has been that we cannot specify British products—or products from Cornwall, Devon, Wales or wherever—because we have to play by the EU and World Trade Organisation rules, but a lot of Welsh Government work over a number of years has shown clearly that that argument is unjustified.
Excellent work is being done by not only the Welsh Government but leading-edge people in Bangor university. Dermot Cahill leads on a procurement project at Bangor, which considers the legality of the issues and the technical implementation of more innovative approaches. He will point clearly to the fact that EU law is far more flexible than it is often given credit for. Something like 80% of procurement contracts fall outside EU legislation anyway, as far as their size and shape is concerned, so the excuse that we are bound by EU regulations when tendering contracts does not seem to apply to eight out of 10 of those contracts.
The Public Services (Social Value) Act 2012 is often held up as a reason why we have difficulty in applying local and regional procurement, particularly with SMEs, but although neither the Act nor EU law is pertinent here—perhaps the Minister can confirm that—the latter is often directly blamed.
The McClelland review in Wales produced a groundbreaking report. It found, on the basis of the best available legal advice and technical interpretations, that there was no evidence that EU law obligations were inhibiting procurement reform. We must remember, of course, that EU law itself promotes transparency, and that is something that is lacking at the moment. I do not say that to criticise the Government but to highlight the point that we have come to: despite everything I have just said, all of which is legally grounded within the McClelland report and the work of legal experts in academia in Wales and elsewhere, the UK is the highest user, at 55%, of the restricted procedure.
We know from experience that many other EU countries use an open procedure, which makes procurement opportunities far more visible to SMEs and allows them much more participation within tendering competitions and bids.
Does my hon. Friend feel, as I do, that the McClelland report, which has also been used in Scotland, shone a light on procurement practices that were very much set in the past and brought procurement up to date sooner rather than later?
I agree with my hon. Friend. We seem to have a legacy of mythology about why we cannot do things with procurement for SMEs, and those myths are used as the excuse not to do anything.
We first need to shatter some of the myths, and then say to those who work in procurement departments, “There is no excuse. We will encourage, support, offer guidance and put in place, when necessary, light-touch regulatory approaches, but you need to get on and design procurement contracts in a way that will encourage the highest level of competition—not simply between four or five big companies—and put the information out there that there is a competition going on.”
Far too often, procurement contracts are simply not well publicised and promoted, so it is no surprise that local food producers, haulage companies, building contractors and so on have no idea that procurement is going on. How will they get the business if there is no proper promotion?
My hon. Friend the Member for Inverclyde (Mr McKenzie) is absolutely right. Through the McClelland report and its application in different devolved jurisdictions, we are seeing a different way forward. First, we need absolutely to shatter the mythology, and then to say, “Let’s all work together to devise a way in which we can open the market up”. By so doing, we are not creating unfair competition; we are increasing competition. We are not levelling the field to promote just local farmers or food producers; we are saying, “You should be aware of the tendering processes coming up in your local school, the fire service and so on, and we will design the contracts in a way that allows you to go for them, just as anyone else can.” We first need to open the door, to allow them to do just that.
I do not claim to be an expert in the field, but strong consensus is now building in the devolved Administrations and elsewhere about the way forward. Some of that relates to inadequate feedback, or its complete absence, from public procurers to those who want to bid. SMEs might bid for something and not be successful, and that is the end of it—they are not told where they have gone wrong, what their weaknesses are and how they might improve.
It is no surprise, given the cost and resource intensity of putting some bids together, that many SMEs say, “Well, that was a waste of our time. We don’t know where we went wrong. We aren’t going to do that again.” Big corporations, whether in the food sector or elsewhere, have units and departments specifically to do procurement and they can take off the shelf the computer model of their recent bids and put in a lot of effort. An SME might be a local haulage company with 20 people working for it, of which one, in addition to their other jobs, is told, “Have a try for this one. We’ve finally heard about a contract coming up, so have a go for it.” However, they hear nothing back, so they receive no guidance. That is simply wrong.
Many tender documents for procurement are inadequate: some are too large or too extensive, to the point that it is no wonder that SMEs do not apply—they identify that the profit margin could be the same as the cost of devising the bid. Why would they bother to go for it?
The issue is often to do with the fact that some of the bonds or liabilities required are absolutely beyond the reach of SMEs. It is fair enough if there is a reason for having large financial guarantees, but some contracts are relatively small and the procurement could easily be intelligently devised so that hurdles—liabilities and bonds—were far lower. That would encourage more SMEs to apply. It is not rocket science, but it does require procurement officers and departments at all levels—central Government, local government and all agencies—to have the necessary will and capabilities, which I shall touch on in a moment.
Inappropriate use of frameworks can amount to market exclusion. Frameworks—long-enduring ones with four-year-long contract applications, for instance—are sometimes there for a good purpose, but once they are won the process is over. Long frameworks are normally linked to large, onerous contract documents of immense detail and complexity, and they are sometimes not the right way forward, particularly if we want to encourage more SMEs to take part in the bidding process.
There is a flip side: the more we go for frameworks, the more we are likely to minimise the number of those wanting to tender and possibly to encourage cartel operation. If there are only four, five or six large players in any particular sector that can bid through a framework document over several years, with all the complexity involved, that is likely to lead to their taking the opportunity for cartel behaviour. I have to stress that I will not, under parliamentary privilege, lay any direct accusations before the House. [Interruption.] Not today.
How do we get through some of these things? I will use the example of the Welsh Government. There are good local examples of local authorities, such as Camden and others, doing really innovative work on procurement by applying ideas about increasing transparency and extending the offer to more SMEs, but the example of the Welsh Government is instructive and, as a Welsh MP, I know it well. I am not saying that the Minister must do what the Welsh Government say and follow their example—although sometimes that is not a bad thing—but simply that they are carving out a method that is in its early days, but is legally and technically sound and already seems to be having significant effects in opening the market to SMEs in procurement at all levels in Wales.
In the Welsh Government’s policy statement on procurement in December, based on the McClelland review, they set out the principles against which the Welsh public sector—including the NHS, education, fire and rescue, local authorities and any bodies sponsored by the Welsh Government—should carry out procurement. It was made in recognition of the fact that the value of Welsh public sector procurement is approximately £4.3 billion a year, which is almost a third of the overall Welsh public sector budget. We can see what an impact it would have locally and regionally if we could encourage SMEs to take part, with a multiplier effect not only through the supply chain, but in the wider communities where the money goes.
Jane Hutt, the Minister responsible, said in the policy statement:
“We must use innovative, evidence based, approaches to procurement to support the design and delivery of efficient and effective public services”—
yes, let us make them efficient and effective, with value for money, and so on—
“and to optimise the added value that is delivered to the economy and communities of Wales.”
Why have we argued that we cannot say those things about procurement, when the Welsh Minister, with the support of the Counsel General for Wales in the Welsh Government, can make such a statement? That statement can be followed through in procurement practices at all levels, and we need not hide from it. We must be open, transparent and competitive with anybody who wants to bid in such processes, but we can gear our policies towards supporting our own communities.
On added value, the Minister said that the Welsh Government
“will utilise public procurement creatively as a strategic tool to deliver economic benefit to the people and communities of Wales through employment, training and supply-chain opportunities.”
That will be part and parcel of the procurement approach and design. As Jane Hutt said, it supports other strategies, such as tackling poverty in communities and economic regeneration.
On the back of the exhaustive work done by the Welsh Government, the statement makes it clear that not only are the approaches legally sound, but they are tried and tested, and proven to work. In the December policy statement, Jane Hutt said:
“There are no reasons or excuses why all organisations cannot fully adopt them and there must be no delay in so doing.”
Let me explain the principles of the Welsh public procurement policy that she is asking organisations to adopt. The first principle is strategic:
“Procurement should be recognised and managed as a strategic corporate function that organises and understands expenditure; influencing early planning and service design and involved in decision making to support delivery of overarching objectives.”
That will be set out as the strategy.
The next is professionally resourced procurement, which is that
“procurement expenditure should be subject to an appropriate level of professional involvement and influence”.
That relates to one of the big criticisms of procurement, which is absolutely true. Accountancy and many other disciplines are careers that people aim to go into and design themselves for: they want to do the levels of continuing professional development and to pick up chartered institute qualifications. There are good procurement officers, but all too often people fall into procurement inadvertently and get minimal resources to do it.
The issue of minimal resources is fascinating because, as the Minister will know, good analysis has been done of procurement departments by looking at the correlation between the number of people dedicated to procurement in a local authority, fire services and so on and the number of SMEs that are successful in bidding. There is a direct correlation between the number of people—not only the number, but their expertise—working on procurement in a local authority, a fire service or the NHS and the degree of success in getting bids to SMEs. Why? Because those people take more time and more care for detail intelligently to design procurement contracts so that they are suitable for SMEs to bid for, so that they are not onerous and do not include huge barriers of complexity, finance and bureaucracy, and so that the pre-qualifying operation does not look like a tender bid.
On professionally resourced procurement, the policy statement continues that it should adopt
“the initial benchmark of a minimum of one procurement professional per £10m of expenditure.”
The Welsh Government have actually set it down and said that because there is a direct correlation, they demand of all their organisations that they move towards adequate resourcing, because they know that it benefits SMEs.
On the economic, social and environmental impact, the Welsh Government will use sustainable risk assessment and take account of the long-term impact on the combination of benefits of sustainability and community. If I turn to community benefits, they specifically say that
“delivery of added value through Community Benefits policy must be an integral consideration in procurement.”
On open accessible competition, the Welsh Government say:
“Public bodies should adopt risk based proportionate approaches to procurement”.
That is the thrust of what I am saying today. We have got into a dilemma with large, off the shelf risk averse procurement contracts: either very few people are doing them or people are specifically rewarded for driving down costs on what they were awarded last year, instead of being rewarded for the wider social and community benefits that also flow from procurement bids. We are allowed to reward on that basis, so why are we not doing it more? We need open accessible competition and
“risk-based proportionate approaches to procurement to ensure that contract opportunities are open to all and smaller local suppliers.”
On a simplified standard process, the Welsh Government say:
“Procurement processes should be open and transparent and based on standard approaches and use of common systems that appropriately minimise complexity, costs, timescales and requirements for suppliers.”
One thing that is specifically pushed is e-procurement. Rather than submitting 20 versions of highly complex, onerous, expensive documentation that has to go to different people for consideration, it is a lot easier for SMEs to do it in a simplified way, by e-procurement. The Welsh Government are pushing hard on that and will expect their agencies, providers and local authorities to move towards it at a rate of knots.
The Welsh Government talk about collaboration among SMEs, so that SMEs can come together locally and bid, and advise them how to do it. There are so many ways in which we can take these things forward, including the supplier qualification information database—SQuID—innovation. I will not go on and on.
The essence of my argument is that we can no longer hide behind the idea that because of EU rules or World Trade Organisation rules, we should not be devising intelligently appropriate procurement bid documentation that works for SMEs. I say that unashamedly because I am all in favour of open and transparent competition for anybody who wants to bid into the system, but the way we have traditionally done it has favoured very few small players. There is a real issue of investment, both financially and in guidance on the expertise of procurement departments. We should force the pace of change with local authorities, the NHS, fire services and Government agencies to go down that line to ensure that we deliver the maximum benefit for our local and regional SMEs.
What we are trying to do is level the playing field. It frustrates me, because I am tired of employers coming to me and saying, “Why is it that I always end up just picking up the crumbs from larger contracts? Even though I am a pretty reasonably sized medium-sized firm, I have not got the expertise or the time to bid for some of these massive contracts. The only ones bidding are the likes of Laing O’Rourke and Carillion. Why do I have to be a subcontractor for them?” Things are starting to change in Wales, and it is happening on a good sound legal basis. I am interested to hear what the UK Government are doing and what they are learning from Scotland and Wales and from places such as Camden local authority in London so that they can do more and do it more quickly. There is a way forward. Let us stop making excuses and drive ahead for the social, economic and community benefits of our own areas and of UK plc.
It is a pleasure, Mr Hollobone, to serve under your chairmanship. I congratulate the hon. Member for Ogmore (Huw Irranca-Davies) on securing this very important debate. He spoke with great passion and I agree with many of the points that he made.
I ran a very small business for many years and know how hard it is to procure contracts with public sector organisations. When dealing with private sector businesses, I used to find that the public sector had three questions. “Can you supply the goods? What is the price? Is the quality of the product good enough?” Indeed if any of us were buying something for ourselves, whether a three-piece suite or a new carpet, those would be the three questions we would ask. However, I understand that when considering public sector procurement, life is not quite as simplistic as that; there are other significant issues to be addressed. Moreover, as a public body dealing with public money, there are certain other considerations that should be taken into account. Ostensibly, though, they should be looking for the same thing: a good reliable service or product that is properly produced at a competitive price and has a robust after-sales back-up service.
Let us stand up for the public sector. Small businesses derive one advantage from dealing with a public sector organisation—as I can vouch from experience—and that is security of payment. I have lost count of the number of times over the 25 years that I was in business when private customers delayed payment, were slow in payment or, even worse, went into liquidation or receivership owing my business money. Sometimes they owed me very small amounts. Thankfully, it was only on a few occasions that I was owed large amounts. At this point I could veer off into the issue of phoenix companies, but I am sure that you, Mr Hollobone, would soon call me to heel.
We are talking about SMEs, which can employ 100 employees, but I also want to bat for the micro-businesses with five or six employees. When a public sector body sends an inquiry to a small business, that SME knows that its money will be safe, which is important. My late father used to say, “It is not sold until it is paid for, son.” An order from a local authority was almost as good as getting cash in the bank. When the public body comes knocking, it should be a cause for hope and perhaps even celebration for a small business; they have an inquiry from a responsible public authority that they know they will be paid for and from which they can hopefully make a reasonable profit. However, in reality, for the people I have spoken to, that is not the case. I know of businesses that have actually ignored public sector inquiries on the basis that they are not worth the effort the business has to put in to get the work. I understand the amount of rigour that has to be undergone for some huge infrastructure contract, but let us be honest, a company the size of Laing O’Rourke has the capacity and resources to deal with all that stuff. I am talking about the SMEs that do not have such resources.
From my experience, when a small company gets an inquiry from a public sector body, it comes bound up in a lot of bureaucratic red tape. The small business owner, which is what I was, looks at it and considers what they have to do even to put a price in. When they work that out and look at the value of the contract, they find that by the time they have fulfilled all the bureaucratic criteria, the profit is so small that it is not worth doing. Some people might say, “So what? There are plenty of other companies that will do it.” That is not the point. The big companies might do it, and the hon. Gentleman made some good points in that regard, but is it necessarily achieving the best result for the taxpayer? I do not believe that it is. Although I do not want to alienate the large companies in my constituency, I have to say that many small and micro-businesses run lean and tight ships.
I have been listening carefully to the debate, although I arrived late, for which I apologise. One point of great relevance is about missed opportunities. A large number of small businesses have quite useful inventions and new technologies that do not always see the light of day. They apply to the national health service or to some other large public sector organisation and the simple process of getting them on to the table for negotiation is impossible. Let us think too of the lost opportunities in new inventions and new engineering ideas.
My hon. Friend makes a good point, and I will come to something along those lines in a moment.
As I was saying, many small and micro-businesses run tight ships—they are hyper-efficient. Consequently, they can offer products and services at much reduced prices, and every bit equal in quality. However, all the bureaucratic muddle and red tape is not only depriving small businesses of the opportunity to supply but means that public sector bodies are paying more money for the services they procure. The process is costing public sector bodies more twice over. First, someone in the public body must administer all the paperwork, with all the forms having to be read, checked and all the rest of it, so that creates a higher cost for procurement. Secondly, because the public sector bodies are ruling out—shall we say?—more competitive companies by their system, they are also paying more for the products they procure. In many respects, the public sector is paying more for goods; I hate to use the phrase, “paying through the nose”, but it is paying a premium because of its own processes.
About 18 months ago, I held a small business event in my constituency to help my local small enterprises deal with local authorities and other big public bodies, to try to break down some of the bureaucratic barriers that the public sector bodies put in their way; to be honest, sometimes they do so unwittingly. In total, 85 local companies came along to that event, and they all came with a very similar tale. They all mentioned the dreaded pre-qualification questionnaire, or PQQ, which seems to be the bane of every small business person’s life. As the hon. Member for Ogmore said, public sector bodies seem to have a system whereby they say, “This is the procurement package we use, whether the contract is worth billions, millions, thousands or tens of pounds.” It just seems to be the same process and it seems like a sledgehammer to crack a nut.
In discussing the PQQs, I will change the names, because I want to protect both the innocent and the guilty. I have one PQQ here, which is 64 pages long. It was given to me by a local small supplier. I will not say what the company does, because that would give a clue, but we will work on the theory that it supplies wallpaper, because that fits. Obviously, I do not want to disclose the company owner’s details, because it is not fair on him. He tendered for a fairly modest contract with a public sector organisation, which will also remain nameless. He sent me a PQQ that is 20 pages long and asks for information such as cash-flow forecasts. It also asks for a bank letter outlining the company’s current cash and credit position. I am sure that the bank would supply that information, but from my experience of dealing with banks I would say that it will probably charge him.
Looking at the level of detail of the contract, I see that there is an extra cost. It does not matter about all the paperwork and all the rest of it; the company owner has got a bill from his bank. The public sector body wants details of his company’s equal opportunities policy, its health and safety policy and it even asks him to
“describe your organisation’s current workforce development and training programme”.
The company is a micro-business that employs three or four people, supplying goods—as I say, we will go with wallpaper—and it has to supply all that information. I read the form with incredulity; I have even torn the page off, so that the cameras in Westminster Hall cannot pick up who sent it to the company owner. I could go on at great length, and given that we have the time I could actually read the whole of a 64-page PQQ I have, because I could get it all in before the debate finishes. In fact, I was thinking that there are people who collect different things, and we should have a name for people who collect PQQs, because I could be one of them.
I hope that my hon. Friend will excuse me for quickly intervening. I am sure that he is right to want to protect those involved, but anyone watching this debate and regretting that they cannot pick up the details on camera might like—if they know the details—to go to the Mystery Shopper page on the Cabinet Office website, which I will discuss in my response to the debate, and before the end of the debate we can “shop in” some bad practice.
Perhaps so, but I have promised not to give out any names and with the greatest of respect to the Minister she does not vote for me and those people do, so I do not want to upset the applecart from that point of view.
As I say, the PQQ that I referred to is just 20 pages long; there are some that are much longer. I have seen some that are 64 pages, and more. If someone was procuring, for example, High Speed 2, I could understand that process, but for buying some wallpaper it is absolutely ridiculous. I could give the House numerous examples from my own experience. I remember tendering to supply power tools to a local authority. I lost the contract and I am not bitter about it because it was 20 years ago—well, I am not very bitter about it. I lost it by a very small amount of money. However, what was not factored in was the fact that the local authority I was tendering to, which was very close to my premises, wanted an option to pick up and take away tools. I lost the contract, but I lost it to a supplier 70 miles away. Because my headline price was a little higher than they had quoted, I did not get the contract, but I thought, “Well, how much is it going to cost for the vans for the authority to go to and fro 70 miles to pick up odd bits and bobs for the next two years?” It was then that I started to see the difficulties and—shall we say?—shortcomings in dealing with local authorities.
Not many years before I was elected, we had a campaign in Glossop in my constituency to restore some park gates, which were a big thing in Glossop. I instigated the campaign, I raised the money, I put in for the planning permission and I managed to get a local company to make the gates. The local authority at the time put up what I think it called an “interpretation board”. The chap putting it up said to me, “How much did the gates cost?” I told him and he said, “Crikey. The interpretation board cost more than that.” That made me think, “Hang on a minute, who’s buying smart here?”, and I think that “buying smart” is the phrase we should use.
From my experience, I do not think that the public sector does “buy smart”. I think that the Government are trying to get to grips with the problem and they are doing some good things, but from what I see across a wide range of public sector bodies there seems to be too much focus on the process and not on the outcome. As a former small business man myself, that drives me mad. The process is absolutely ridiculous: it costs the authority more to administer; it costs the suppliers more to fill in all the paperwork; and it is just a form-filling culture. That culture does not exist in the private sector—small businesses do not send forms round, tick them and all the rest of it.
Somehow we have to drive that practice out of the public sector. I know that we cannot get rid of all of it but we really need to clamp down on it, because our small businesses, as I have often said, are the engine room of the country, employing a huge percentage of our work force, and we need to give them every chance to supply big public sector organisations for all their different contracts, be they for pens and paper clips or for roads and railways. We need to give our small businesses a fair chance, because they will put people in employment, and all the community benefits will keep spinning through our local communities.
What public procurement should be about is buying the right goods or services at the right price and the right time, and getting the best value for money for the taxpayer. The evidence I have seen is that there is still a long, long way to go with public sector organisations to make that happen.
It is indeed a pleasure, Mr Hollobone, to serve under your chairmanship today.
I start by congratulating my hon. Friend the Member for Ogmore (Huw Irranca-Davies) on securing this very important debate. He spoke on this subject with passion, enthusiasm and knowledge. I could not agree more with what he said, to the point that I fear I may just repeat his speech with a Scottish accent. Without doubt, the importance of small and medium-sized enterprises across the UK cannot be overstated. SMEs are the backbone of the British economy and we need to ensure that both central Government and local government do everything they can to help them through the procurement tendering process to secure contracts.
SMEs employ more than 14 million people and have a combined turnover of £1,500 billion, which accounts for some 47% of private sector employment and about 34% of turnover. Importantly for a local economy, 83p of every £1 spent with a local business will go back into that local economy.
Those are just some of the statistics about SMEs. They are vital to the economic well-being of Britain and vital to employment opportunities. They are the driving force of our economy and they deserve their fair share of public sector procurement. Small businesses are struggling to survive in these challenging economic times, so it is essential that they have every opportunity to win Government contracts or to become part of the supply chain to local and national Government.
Public procurement spend is significant even in these challenging times. Public sector bodies, including central Government, the armed forces and the NHS, spend around £220 billion a year on goods and services—everything from stationery and office furniture to medical equipment and catering services. Despite that, however, public procurement is an underused tool when it comes to keeping trade local. Nearly three quarters of SMEs rarely or never bid for government work, and more than three quarters of SMEs believe that there are barriers to awareness of government opportunities. Many say that lengthy and complex pre-qualification questionnaires disadvantage smaller businesses. The playing field has been stacked against SMEs trying to win public sector contracts. To many SMEs, public procurement seems to have been deliberately designed so that they do not succeed.
More than half of SMEs feel that the process of tendering for Government contracts requires more time and resources than their business can allow for. Some 50% of SMEs find it significantly more difficult to deliver to Government agencies than to the private sector, mainly because of the additional formalities required by public sector clients. SMEs say over and over again that the bureaucracy needs to be simplified to help them bid for public sector contracts and especially low-value contracts.
The majority of SMEs are relatively unaware of where to look for opportunities, and they believe it is too time-consuming to try to find out about them. In addition, they do not bid, because they feel they are unable to compete with larger suppliers. One in five SMEs believes it is unsuccessful in a bid because it is unable to offer better value for money than other suppliers.
One member of the Federation of Small Businesses said:
“Local authorities are the bureaucratic mind at work, busily inventing disproportionately complicated procedures.”
Does that not sound familiar?
Could the Minister look at the following points—she will be glad to hear that the list is not overly lengthy—to improve SMEs’ prospects of securing Government contracts? First, could access to public contracts and pre-qualification questionnaires not be simplified? Secondly, could there not be education seminars on how to tender for contracts, especially through e-procurement? Thirdly, there could be much better access to information about public sector procurement opportunities for SMEs. More needs to be done to improve channels of information, so that small businesses know what contracts are up for tender.
Government buyers need to develop business associations with local SMEs and to set up standard contracts of terms and conditions before inviting companies to tender for released contracts. That will, of course, entail a separation of duties, in that those who source would not be those who evaluate tenders and place contracts. There also needs to be a focus on building an integrated supply chain, in which there are no weak links, and on applying green procurement to keep that supply chain as short and as local as possible.
Where possible, e-procurement should be used to enable SMEs quickly and economically to bid for contracts. The Government also need to target and improve contract monitoring for performance if business associations are to continue and to be justified. In addition, the Government must prove best value by having multiple bids that are evaluated against clear contract weighting.
What of the spend of local authorities? The procurement spend of many councils is significant, averaging £185 million for each local authority. Nationally, that is billions of pounds per year. On the basis of the rather limited figures available, however, less than 50% of that spend goes to SMEs. A significant proportion of councils do not record the size or location of the businesses they spend with, and that should be rectified.
Cost savings are overwhelmingly the biggest driver of procurement policy, outweighing other factors, such as the quality of goods and services, and economic development. That is understandable, given the constraints on local government, but it is, none the less, regrettable, because cost should not always be the most significant factor in awarding a contract, and savings can also be made through quality.
If you will allow me, Mr Hollobone, I will describe what has been taking shape in Scotland over the past couple of years. There has been a total redesigning of the procurement process, which has embraced private, cutting-edge procurement practices to bring about the maximum savings. I hope that will banish the days of off-the-shelf, catalogue procurement.
Some years ago, Scotland Excel was developed, bringing together the combined spend of the 32 local authorities in Scotland. More to the point, it updated and standardised procurement practices, which was necessary if local government was to deal with these challenging times and bring about the savings required in their spend. Many SMEs have been successful in gaining contracts through this collaborative buying consortium. Many other areas of the UK employ buying consortiums; they have had many successes, and they have many good practices they could and should share across the country.
I apologise to the hon. Member for Ogmore (Huw Irranca-Davies) for being rather late for the debate. The hon. Member for Inverclyde (Mr McKenzie) is making an important point. About 75% of procurement in Scotland is sourced in Scotland, but only about 50% of procurement in Wales is sourced in Wales. What are the major lessons Wales could learn from Scotland?
They are working jointly, and the McClelland report has been shared by both Administrations. As I said, it shone a light on procurement practices in local and national Government and updated them, bringing in many good, cutting-edge practices. It is recognised that if we devolve procurement to a local level, the supply chain can be improved and can be kept as short as possible. I should also mention the green procurement card, which is used across Europe to justify a local spend.
Can SMEs do anything to improve their situation? Yes, they can. They can prepare before bidding for contracts. They should know their strengths and highlight them in any bid. They can become aware of appropriate opportunities and select the right ones. They can engage with their clients, discussing their requirements if they are unsure about them.
SMEs can also use their clients’ chosen method to deal with those clients. If that is online, they should learn how to load to the bid portal and about what limitations the portal has in terms of the size of the tender document and the time it takes to load. SMEs should not miss a bid by running over the deadline because their data was slow to upload.
SMEs should also fully meet their clients’ needs and know what matters most in their hierarchy of weighting. Finally, they should combine expertise with innovation, and explain themselves clearly if any new practices or processes are involved on their side of the supply chain.
We should always remember that awarding to local SMEs has many rewards: it builds local businesses, with many becoming subcontractors to the initial contract winner; it creates local employment opportunities and secures employment locally; and moneys spent locally tend to circulate locally, supporting other businesses and jobs. To conclude, SMEs are important, and they will always be important to our economy.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Ogmore (Huw Irranca-Davies) on securing the debate. My only sadness is that a debate of such magnitude and gravitas does not have a much wider audience and that more Members could not be here. However, it is good to see that the Welsh are in a majority today, with four Members here, along with another Member from the Celtic fringe. We will look closely at what the Minister has to say.
There is the hon. Member for Pudsey (Stuart Andrew) behind the Minister. He is a sleeper; we sent him on reconnaissance to Pudsey. Come back to Wrexham!
When we talk about the role of businesses in the economy, we are often talking about small and medium-sized enterprises. Let us not forget that half of private sector turnover is accounted for by SMEs. In Wales, the public sector spends approximately £4.3 billion per annum through procurement, which accounts for more than a third of the overall Welsh public sector budget. That includes everything from stationery, paper clips and office furniture to medical equipment. In my constituency, up in Croespenmaen, we have Abingdon Flooring, which supplies furnishings for MOD properties.
What is more, the public sector is the largest user of services and goods from the private and voluntary sectors in Wales. The scale of public sector procurement in Wales and across Britain means that it is the biggest driver of economic growth and the biggest lever the Government can use. No one, on either side of the House, can fail to recognise the importance of public sector procurement.
I remember going to a seminar with Lord Sugar, when he talked about green industry. He said that is okay having wind farms, but they need steel: where are we procuring that? My frustration about procurement is that everyone knows its importance; but, for all the companies that come to me and tell me that they are trying to procure for something, there are hoops to jump through. It gets to the point where they are frustrated and give up on the process.
I read recently that the Prime Minister’s enterprise adviser David Young said he was not convinced that the value of SMEs was being fully exploited across the public sector. It worries me that it seems from a Cabinet Office report that the target of 25% of all government contracts has been quietly dropped. Indeed, from some statements from the civil service it seems that the 25% target is not a target but an aspiration. I agree with the Government that that target could be a catalyst to achieve change in the economy; but that must be driven from Whitehall, and be more than an aspiration. It must be measurable, constant and universally accepted. Also, which businesses does it apply to? Is it for larger businesses or for small and medium-sized business? Are micro-businesses included as well? I do not believe there is anyone who does not see SMEs as job creators. The SMEs of today will be the major companies of the future.
What the debate comes down to essentially is this: we will cut the welfare bill and bring down the deficit only through people in jobs paying taxes. The only way we shall achieve that is by encouraging SMEs and other businesses to have the confidence to create jobs.
My hon. Friend makes a valid point about the strategic importance to SMEs of procurement. Does he agree that there are practical things we can work through? Will he pay tribute to Bangor university, which is working with SMEs and the Welsh Government to, for example, reduce 50-page contract tendering documents to as few as 10 pages? We can see that those things can be done, and will create jobs through SMEs.
I agree, and there was a discussion about that this morning in another place.
From my constituency experience of micro-businesses, such as painters and decorators, they make their money from painting council houses, school buildings and hospitals; but they must jump through rings of fire to get through the procurement process. I pay tribute to the work that Bangor university and the Welsh Government are doing to reduce the paperwork that SMEs must go through. That paperwork turns them away from a vital source of income, because of the complexity of the system.
I was interested when my hon. Friend the Member for Ogmore mentioned procurement examples in the food sector, and I want to touch on another example of best practice, which I am pleased to say comes from my constituency. It concerns the defence and security industry, which is a massive industry for us. We are lucky in Islwyn that we have General Dynamics UK, which moved there specifically because of a Ministry of Defence contract. It has access to markets and cutting-edge technology that can be used by small businesses. I am delighted that the EDGE UK facility is in Oakdale at the moment. It does an incredible amount of work with SMEs, helping them to get access to defence and security markets nationally and internationally. Not only that, but its modus operandi protects the intellectual property of the SME and ensures buy-in from all sides, offering clear benefits to both parties. If the Minister wants to see an example of innovation in the procurement process, she has an open invitation to come to Islwyn and to Oakdale. I shall be happy to show her round; I think she will find it is a beautiful constituency.
Anyone who has dealt with SMEs will say how important it is for them to work with larger companies, retain their intellectual property and win new business in the market. EDGE UK is appreciated by the customers of General Dynamics UK, including the Ministry of Defence, as it helps those with a niche capability from SMEs who usually cannot get access to the customer. Through EDGE UK General Dynamics works with an average of 50 SMEs a year, constantly seeking out and reviewing innovative developments. I know from speaking with people from General Dynamics that it is always keen to attend business events, to expand awareness of EDGE UK through the SME community, and to invite new SMEs to talk about ways they can engage with a company through EDGE UK. I remind all those with small businesses, if any of them are watching the debate—hopefully on television on a Sunday morning—that they have an open invitation to get involved with EDGE UK, and to get access to its innovation and capability. It is fantastic.
Not every SME can work with General Dynamics, of course. Products may need maturing. EDGE UK provides support to such SMEs, to help them identify avenues for funding that will help them develop their technologies. Those include, for example, the Centre for Defence Enterprise, the Technology Strategy Board, and the various business funding streams available from the Welsh Government. We cannot talk about SMEs and procurement in the public sector without looking at examples such as EDGE UK and seeing what we can learn and apply. For every General Dynamics success story and every EDGE UK there is someone in Wales, or somewhere in Britain—perhaps a micro-business employing five people, such as a painter and decorator—who is desperate to get hold of a contract: to paint a council house or school building. That is because those are what I like to term Bank of England contracts—they will not fall apart under someone’s feet, and they will not walk away: the business owner knows they will get the money at the end of the day. When there are businesses that pay their bills late, access to contracts of that kind is vital.
I find it frustrating that, as my hon. Friend the Member for Ogmore mentioned in an intervention, people have to wade through 50 pages of tendering documents. The time and money that goes into public contracts makes it harder and harder for small and micro-businesses to tender for them. The process costs money that is precious to them, and they become caught in a vicious cycle. They have no money for the tender, but they need to tender to make money. The fact that the Government are willing to promote the tendering process, but allow companies to get stuck in a system where they cannot get hold of contracts, is a bit of a hare-brained scheme. On a recent visit to Axiom Manufacturing Services, a successful manufacturer in my constituency, the frustration of the situation was pointed out to me. First, no help is provided with filling in the contracts: the business does not know what is being looked for in the tender. Secondly, feedback is rarely given to those who are unsuccessful, so it is not possible to move on and improve processes the next time.
To return to the 25% aspiration, let me say that now is the time for a coherent Government plan. Since I entered the House I have often heard the accusation that all the Opposition do is oppose everything, but I want to set out concrete plans, and I hope the Minister will listen to five points. First, there should be agreement by Government that procurement will be used as an engine of economic growth. I do not mean central Government but all levels of government, including councils and the NHS. Secondly, a border line should be established and we need to set a target in stone. If 25% is too high, and is just an aspiration, we need to bring the target down; but we need to begin achieving targets, and they need to be measurable.
Thirdly—and I must return to the example of General Dynamics UK and EDGE UK for this—every company with more than a certain number of employees, in receipt of a Government contract, needs to produce a training plan and an apprenticeship scheme, to enable young people to get on the ladder, so that skills and training will improve. That cannot be put in place at zero cost.
Fourthly, we should take a leaf from the book of General Dynamics UK and use procurement to encourage innovation, allowing bidders to come up with new, fresh ideas. That should be in the tendering process. My fifth point relates to what I said before about Axiom. There is a need for help from public bodies, for contracts to be designed in a way that allows SMEs to compete. We need standard contracts across the board. We also need a helpline or someone in Government, in the Department for Business, Innovation and Skills; at Axiom I discussed bringing troubleshooters in. There is a need for a crack team that can be called free and told, “I need help to fill this contract in.” The Government could send it on.
Those would be innovative processes. However, we must remember that, without Government will, a limited number of suppliers will still reinforce their market share, stifle competition and keep prices high. Government will and action are needed, and I hope that we see that today.
It is a pleasure to serve under your chairmanship, Mr Hollobone. I congratulate my hon. Friend the Member for Ogmore (Huw Irranca-Davies) on securing this debate on an important issue that does not attract the attention it deserves. As my hon. Friend the Member for Islwyn (Chris Evans) said, hon. Members from all parties are aware of the importance of this issue and it would have been fitting if more had attended this debate. However, important points have been made by hon. Members from both sides of the House. My hon. Friend the Member for Islwyn said that there was a Celtic emphasis to the contributions. This is a cross-party, national issue.
Contributions, particularly from my hon. Friends the Members for Islwyn and for Inverclyde (Mr McKenzie), and the passionate opening remarks made by my hon. Friend the Member for Ogmore, emphasised the importance of procurement for small and medium-sized enterprises and their importance to our economy.
This has been a remarkably non-partisan debate and I hope that that will not change too much as I make some remarks on behalf of the official Opposition. If there is one thing that all hon. Members agree on, it is that small and medium-sized enterprises are the lifeblood of our economy and should be supported. They account for 99.9% of all private sector businesses in the UK, 59.1% of private sector employment and almost half of private sector turnover.
As has been said, given the economic challenges that we face, encouraging small and medium-sized enterprises must be a focal point for Government policy as we seek to find growth again. In short, they are critical to our economic recovery. Yet still the proportion of public spend on dynamic small and medium-sized enterprises is far too low. As the UK’s biggest single consumer, government must do more to support SMEs across the country.
In February 2011, the Prime Minister and the Minister for the Cabinet Office and Paymaster General, the right hon. Member for Horsham (Mr Maude), outlined Government procurement reforms at a conference for SME suppliers, where the famous pledge was made that
“25% of all government contracts”
“awarded to small and medium-sized enterprises”.
Regrettably, that 25% target did not last long. It has been downgraded, rather like our credit rating, and is now merely an aspiration. Last month, the Prime Minister’s enterprise adviser, Lord Young, said that he was
“not convinced that the value of SMEs is being fully exploited across the whole public sector.”
I think that we can all agree with him.
I am sure that the Minister will tell us that procurement figures for SMEs are up. The Government do not have a particularly good record on statistics, but it is still depressing to hear the Minister for the Cabinet Office say that most Departments do not know their spend on SMEs and that therefore people “cannot trust the numbers”.
Mark Taylor, the former co-chair of a panel set up to advise the Minister for the Cabinet Office on SME procurement, has accused the Government of “recounting” their procurement SME figures. He said that Government contracts to SMEs were “drying up”, that things were “going backwards” and that SMEs were
“finding it more difficult to do business with Government.”
Perhaps a way forward is to replicate the Welsh Government’s approach. They are now asking all their local authorities, the NHS and any procurers to carry out regular procurement fitness checks, including monitoring how many contracts are going out to SMEs.
My hon. Friend raises an excellent point that I hoped to make later. It is useful to see concrete examples of where that is being done successfully, but the measurement and understanding of procurement practices and, most importantly, what the outcomes are, particularly for SMEs, is a key way of improving the situation.
What is being done to measure SME procurement in Government? What is the Minister doing, specifically, to stop things going backwards? Will she confirm that only two Departments have increased SME procurement spend to any significant degree and that one of those—the Ministry of Justice—only achieved that by including providers of legal aid?
Will the Minister say what concrete action has been taken to increase the proportion of spending with SMEs? Fine words are all very well, but we want to know what is actually being done to address this issue, which everyone agrees is critical. Speeches and leaning on Departments can only go so far. We have all read reports of bloody battles going on between Departments and the Treasury over spending envelopes in the next Budget. There is a huge pressure on Departments to use their buying power to cut costs and, unfortunately, that tends to be through ever-larger contracts.
The Government have spoken many fine words of encouragement to social enterprises, without delivering. Most social enterprises are SMEs. The message that I get from social enterprises—I recently held workshops in Newcastle and London—is that often, how Government contracts are bundled makes it impossible for them to bid. That is, as we have heard, a general concern among SMEs. Will the Minister explain what specific actions have been taken, and what actions are planned, to unbundle as many contracts as possible, to level the playing field for smaller enterprises?
Support through direct procurement is not the only way to support SMEs. The previous Labour Government introduced the innovative small business research initiative programme to drive innovation through procurement. The SBRI allows small businesses to bid for contracts to provide innovative solutions to procurement problems, supporting innovation and small businesses at the same time.
We in the official Opposition had been calling for some time for the programme to be expanded, so we were glad when the expansion was agreed to by the Treasury. This is good news for innovative SMEs. However, a recent survey by the Federation of Small Businesses found that nearly 40% of small firms felt that they were being “sidelined” by the Government because of their persistent belief that bigger firms are better. What are the Government doing to address that?
I turn briefly to the Government’s Contracts Finder, which I am sure the Minister will address. The value of contracts published on the website each month is still very small compared with the £15 billion total value of Government procurement contracts that are outsourced each month. Does the Minister agree that more needs to be done to ensure that contracts are put on the Contracts Finder system? What is happening on that?
What are Ministers doing to ensure that local authorities are properly engaged with Contracts Finder? What work are they doing with councils to improve their procurement from SMEs? We have heard of a number of examples from local authorities across England and Wales that are being very innovative in that respect, and I would like the Minister to say whether she is studying what is happening in our local authorities.
There are a number of rivalries between cities in the north-east, particularly between Newcastle and Sunderland, but as we subsume them within a combined local authority, I am pleased to say that I can hold up Sunderland city council as an example of innovative and successful work in procurement.
Indeed, only last night, at the Federation of Small Businesses reception, Sunderland city council was praised for its intensive engagement with the FSB and local suppliers before implementing the Buy Sunderland First system for quotations below the tender threshold and the North East Procurement Organisation portal for all opportunities above the threshold. Consequently, spend with north-east businesses now accounts for more than 68% of all third-party spend by Sunderland city council. What other examples would the Minister like to hold up for us of ways in which local authorities are successfully engaging with small businesses?
I have asked a number of questions of the Minister. My hon. Friend the Member for Ogmore has raised a number of important points, and my hon. Friends the Members for Islwyn and for Inverclyde have made a number of suggestions. I draw my remarks to a close by saying to the Minister that, although we have seen some small steps forward, the Government’s approach lacks the required urgency. Whether on procurement or bank lending, Ministers across Government are failing SMEs.
Responding to a recent National Audit Office report on improving Government procurement, the head of the CBI said:
“Two and a half years after the Government committed to centralising public procurement, individual departments are still too often doing their own thing. We need to see strong leadership from the Cabinet Office to drive a culture shift across…Whitehall”.
Such complacency is all too common among Ministers. The CBI survey report recently stated:
“Across the board the rate of reform requires more urgency. The lack of progress on turning sound policy into actual change is not only damaging to government and costly to the taxpayer, but it also stunts growth.”
Will the Minister now take action to ensure that permanent secretaries prioritise and buy into that? Will they visibly start to split major contracts into smaller chunks? Will they take steps to record the success or failure of those policies?
Successfully changing the mindset on procurement so that we use and support our SMEs more effectively is an issue that unites the whole House, so will we see decisive Government action so that our ambitions can be realised?
I am grateful to the hon. Member for Ogmore (Huw Irranca-Davies) for initiating this debate on such an important subject and for setting us off so passionately. As has been echoing around the Chamber this afternoon, we share a passion for the same thing: seeing excellent procurement that serves the customer—in this case, the taxpayer—and promotes growth. I am confident that every Member here supports those aims and that my remarks will outline the action merited by that.
From the outset, the Government have fully recognised the vital role that SMEs play in helping us achieve the best possible value for money—in some cases for reasons of cost and in others for reasons of innovation, a theme that has also rightly reverberated around the Chamber—when we buy goods and services for the citizen, such as school, hospital or prison meals, wallpaper or any other goods or services.
In the minutes remaining, I will take the hon. Gentleman’s invitation to shatter some myths. Let us do that together this afternoon, because he is absolutely right in laying down his support for the theme and in his desire to see increased awareness of what is available for SMEs, of the ways in which they can grab it and of the ways in which we can hold procurers to account.
I will start by addressing the goal that, by the end of this Parliament, 25% of direct and indirect Government procurement by value should go to SMEs. Although I want to move on to some content that I know will be of great help to every Member when talking to their constituents, I first need to make an overtly political point. I am sad to say that we had to take the bold step of setting a 25% aspiration because before that, under the previous Government, no effort was made to measure such things. The lecture I have just received from the Opposition Front-Bench spokesman is more than a little rich in that context. Even a member of the previous Government has had the dignity to look ahead and say what we need to do better for SMEs, and I am afraid that I do not think the Opposition Front-Bench spokesman is hitting the same heights.
After a lot of hard work in 2010, we found out that SME procurement in 2009-10 amounted to 6.5% of all procurement, or £3.1 billion—a shamefully low figure given that 95% or more of private sector businesses in the UK are microfirms, or companies with fewer than 10 employees. We recognised that something had to be done to remove the barriers facing many companies when bidding for Government contracts, and we have gone a long way towards removing those barriers. I will work through a couple of points that will help Members to express that to their constituents, which is one important thing we can do to send the message outwards.
Over the past three years, we have increased accessibility and transparency, identified and addressed poor procurement practice and provided practical assistance to help SMEs. I will start with accessibility and transparency. We have made contracts smaller and broken them up under various headings. Some of the finest examples of that can be found in information and communications technology, where historically Governments have been subject to procurement disasters. We have instead deliberately gone out to approach SMEs for Government ICT needs and have had some good successes. We have also set up Contracts Finder to increase accessibility; it is a one-stop shop to enable suppliers to find procurement and subcontracting opportunities. They can also find tender documents and contracts online, all free of charge. I urge anyone listening to or reading this debate to look at that.
People will also find online and accessible pipelines of what the Government are looking to procure under a range of topics. All those kinds of thing help would-be suppliers to know what we are looking for. As I said in my opening remarks, we believe in procurement for growth, and we believe strongly that pipelines can help in that endeavour by explaining to industry what this very large customer, the Government, are looking for over time.
In the dynamic marketplace, companies can register without cost to provide quick quotes for low-value Government contracts below £100,000. That enables them to bid and compete at minimal cost alongside larger suppliers. I recognise the points made this afternoon about the cost of bidding. We are doing something about that. On the other side of the deal, what does that give customers—Departments and the taxpayers whom they represent? It gives us cost-effective access to pre-registered Government suppliers and allows bids to be issued and responded to electronically, which again makes the procurement process quicker and more effective.
On the theme of transparency, I also note that we have established a Crown representative for SMEs, which I know will be of great interest to the hon. Member for Islwyn (Chris Evans), who wanted to know where SMEs could turn for help. There is a Crown representative in Government especially for the purpose of giving SMEs a voice at the table. That is vital, and we have done it. We have also set up an SME panel to provide a regular forum for SMEs to raise the issues that concern them most and hold our feet to the fire. I assure the hon. Gentleman that the SMEs on that panel do so. I have been there, and I have enjoyed meeting the panel very much.
Moving on to tackling poor procurement practice, we have heard a couple of good examples in this debate, particularly from my hon. Friend the Member for High Peak (Andrew Bingham), who spoke about a wallpaper supplier in his constituency. I will start with that example. It is a great shame that he and his constituents felt the need for anonymity in that example. I understand entirely, but we would all like to live in a world where they did not receive bad service and did not feel the need to hide it for fear of reprisals.
We have introduced a mystery shopper service that will be familiar to anyone who has seen such a thing in supermarkets or reputable businesses throughout the private sector. It allows poor procurement service to be identified and acted on. If a supplier encounters poor procurement practice, such as the overly bureaucratic pre-qualification questionnaire in my hon. Friend’s example, or unreasonable selection criteria, as in other examples, they can refer it anonymously to the mystery shopper service, so that we can investigate it on their behalf.
I encourage and urge all constituency Members to push that information out to SMEs or anybody bidding in their constituency for Government work. It is the only way that one by one, piece by piece, we can tackle that kind of bad practice. It allows us to identify the broader themes that we can perhaps tackle more systematically, but it also allows us to put right individual cases where something has gone wrong.
I suspect that I do not have time to do that topic justice and that you would not wish me to go there, Mr Hollobone. However, if the hon. Gentleman thinks that it is bad practice, he or anybody else ought to enter it into the mystery shopper and see what comes out the other end. We regularly publish the outcomes of mystery shopper investigations on the gov.uk website, and I am sure that the hon. Gentleman will find it easy to use.
By 31 May this year, we had received 425 mystery shopper cases. Of those that we have closed, a great majority have had a positive outcome. Once again, I encourage all Members to ensure that their constituents are aware of it.
Briefly, and in case the Minister does not touch on these two issues, what are the UK Government doing in terms of the threshold for advertising on the web? The Welsh Government have moved to advertising any contract of more than £25,000 on the web. Also, what are the UK Government doing to reduce the insurance and turnover thresholds to break down more barriers for SMEs?
On the first question, all central Government contracts of more than £10,000 must be advertised on Contracts Finder; I am sure that those who have their smartphones out will find it a helpful source of information. The second question brings me to a point that I shall make later. We need to leave some areas of professional competence for the contractors themselves. It may be under the headings that the hon. Gentleman mentioned. There are instances in which a particular contractor will need to find particular characteristics that suit their procurement.
I turn to a couple of other points that have been made. Hon. Members have asked for there to be ways of giving feedback to unsuccessful bidders. We have used the mystery shopper to provide that in some cases; I am interested in how we can encourage it as a far wider practice. I will also give an example of the move away from frameworks, another point made earlier. In some cases, it can be an instance of poor procurement practice when frameworks are used inappropriately. They can certainly be a blunt instrument. I point hon. Members to the example of the G-Cloud, a way that we are procuring for IT across Government that has done away with frameworks entirely. There are many more such examples.
PQQs, or pre-qualification questionnaires, are undoubtedly a burden to small and medium-sized businesses. To address that, we have eliminated their use in 15 of 17 Departments for all central Government procurements under the EU threshold of £100,000. The two Departments still using PQQs are doing so only for security reasons.
I am terribly sorry, but I need to finish some points before I run out of time. For procurements that still require a PQQ, we have introduced a much simpler standard set of questions that reduces the burden on suppliers.
On late payment, we recognise that being paid promptly is vital to enabling SMEs to manage their cash flows. Again, we have addressed that by making Government a fair payment champion. We have a policy of paying 80% of undisputed invoices within five days and ensuring that prime contractors also pay suppliers in tier 2 within 30 days. We expect our suppliers to follow that example.
My hon. Friend the Member for High Peak briefly mentioned the fact that Government can end up paying through the nose for procurement. I make the point in passing that we are one of the best clients going. I think that the hon. Member for Islwyn said that, actually, we have some of the best credit available as a Government purchaser. We can take advantage of that and get results for the taxpayer, which is crucial because that is whom we are procuring for, as well as shaping the market. I suggest that fair payment is a way in which we can do that.
I turn to a couple of other points about assistance to SMEs. Hon. Members have spoken about the small business research initiative, under which we have provided more opportunities within Government for SMEs. To address a further point made by the hon. Member for Islwyn, we have also produced a series of “top tips” videos that help SMEs and voluntary organisations pitch for Government business. Again, he should get out his smartphone right now and find out how good those videos are.
On how the measures are giving results, I should say that direct spend with SMEs across Government has increased from the paltry 6.5% when we took office to 10% in 2011-12. We will shortly announce, two years on, the results of our efforts in that area. SMEs have also benefited from a further 6% in indirect spend through the supply chain in 2011-12, meaning that spend with SMEs across Government has increased steadily since 2010.
Looking ahead, we must keep up the pressure on Departments. The hon. Member for Newcastle upon Tyne Central (Chi Onwurah) will be delighted to know that I am personally scrutinising plans from Departments to increase their spend with SMEs and sharing them with the Prime Minister throughout. We have appointed SME champions to do so at ministerial and official levels in all Departments.
Hon. Members will also be pleased to know that we are working closely with the Department for Business, Innovation and Skills to ensure that unified advice is available to SMEs. To conclude, we are aware of the recommendations in Lord Young’s work, and I want to do more to support growth with SMEs throughout the public sector.
I am pleased to be able to appear under your chairmanship this afternoon, Mr Hollobone.
The debate came about because, on Report, I tabled amendments to the Energy Bill on the Government’s new proposals to help consumers with their energy bills. Unfortunately, my amendments were not discussed due to lack of time, but there are serious issues relating to the new powers and to prepayment meters in particular.
Under what was new clause 13, powers would be taken to allow the regulator to require
“licence holders to change the domestic tariffs or other terms of domestic supply contracts so as to reduce the costs to their domestic customers for supplies of gas or electricity.”
However, what was then subsection (3)(e) provides
“for requiring a licence holder to change the domestic tariff or other supply contract terms on which it supplies gas or electricity to a domestic customer by—
(i) switching to a different domestic tariff or different supply contract terms, unless the customer objects, or
(ii) offering the customer, or inviting the customer to switch to, a different domestic tariff or different supply contract terms.”
My problem is with sub-paragraph (ii).
I fully appreciate that the Minister may argue that consumers should be given the maximum amount of choice and should be empowered to make their own decisions, but the plain fact of the matter is that, as we all know and as is remarked on in the regulatory impact assessment of the Bill, there is a huge amount of inertia among energy consumers, in particular those who remained with their former monopoly supplier after privatisation. If the provision in the Bill remains as it is, there is a real danger that companies might take the second option and make an offer to the consumer. We are then faced with the issue of what form that offer might take.
We already receive a huge amount of paper from our energy providers. As well as bills, we get special offers and offers to take on maintenance of domestic appliances, drains, pipes, electrics and whatever else. We also get invitations to take up different ways to pay our bills, especially if the providers have not yet signed us up to a direct debit; once we have direct debits, they make regular attempts to increase the amount we are paying by direct debit—amounts that sometimes bear no relation to how much energy we actually use. Now, too, we get annual and regular energy statements. That is all useful, but how many of our constituents really take the time to go through that mountain of information, and how many just put it in the recycling bin with all the other junk mail?
The first option, however, is straightforward: if consumers are on a contract or supply terms that are not the best, they can be automatically transferred to a better deal, unless they make the specific decision not to do so. That seems to have a better chance of fulfilling the Prime Minister’s promise to ensure that every customer is on the lowest tariff. Of course, the situation would have to be monitored, to ensure that the energy company is indeed offering the lowest tariff, but that can be addressed by Ofgem and to an extent by the provisions of subsection (5) of what was the new clause. I am interested to hear what Ministers have to say about that point.
My other concern and the main point of today’s debate is how that relates specifically to some of the poorest in our society who have to rely on prepayment meters. If someone is on a direct debit tariff, that may be fine, but if they are on a prepayment meter, for example, they will still be stuck on a higher tariff, since those tariffs are generally higher than the ones that would be available to someone who is paying by direct debit. If the Government are truly intent on ensuring that everyone has the lowest possible bill, they need to ensure that the requirement not only applies within the type of contract that the customers already have, but allows them to move to a cheaper type of contract.
There are particular problems with prepayment meters. It has always seemed to be slightly perverse that this is one of the few examples in which consumers end up paying much more by paying cash in advance.
I congratulate the hon. Gentleman on bringing this important matter before the House for consideration. I have been dealing with a number of constituents who have had similar problems with the tariffs for, for example, oil. Does he think that other options might be necessary, not only for oil but for gas, so that people can switch, whatever the fuel that provides their heating? If we do not enable that, fuel poverty will continue to grow.
The hon. Gentleman makes a valid point. I have often talked about oil, though it might be outwith the terms of today’s debate, but I take his point, which is very true.
The issue of prepayment meters is important. Citizens Advice Scotland issued a report on energy recently, showing that citizens advice bureaux had dealt with 7,400 people with 9,500 different energy issues in 2011-12; of those, 83% related to difficulties with paying or debt. The report stated that
“the cases highlighted by bureaux regarding difficulty paying are most commonly with regards to prepayment meters recouping an unaffordable amount for arrears every time the consumer tops up.”
The problem with prepayment meters is not only that the tariff tends to be higher—to be fair, things are better than they used to be, and many companies now fix at the standard tariff, although this is higher than the tariffs that can be achieved on, for example, direct debit—but that many, though not all, of those on prepayment meters are put on them because they have a debt, and part of that debt is recouped every time the consumer tops up the meter. The costs of installation can also be added to the debt, meaning that consumers are pushed further into debt.
Meters tend to be used when a consumer is already struggling. The perverse effect is that if people are already struggling to keep up with payments on the cheapest tariff, such as an online one paid by direct debit, should they fall into difficulties—perhaps they lose their job or become ill, or for any of a vast number of reasons—they end up being put on an even more expensive tariff, which simply deepens their difficulties.
I congratulate the hon. Gentleman on making a fine point. Does he agree that, with prepayment meters, we now have the grotesque example of people cutting themselves off by not paying beforehand, rather than waiting for the fuel companies to cut them off?
The hon. Gentleman makes an excellent point, and I shall come on to discuss that issue shortly.
The report from the Scottish CAB cites the case of a single parent with two children who loses £7 towards arrears every time she puts £10 in the meter, and the £3 left is entirely insufficient to heat her home. What chance has she of ever getting out of the cycle of debt, or even of keeping her home warm?
When the debate was announced, Barnardo’s got in touch with me and mentioned the problem, expressing its concerns that the Government’s plans to simplify the charging system will still allow fuel companies to charge higher prices for those who pay for their electricity and gas through prepayment meters rather than through direct debit. Barnardo’s quoted research showing that vulnerable households in or on the margins of poverty are forced to pay through their energy bills an extra £1.1 billion a year above those on high incomes. A key reason for that is that such households often have to opt for a higher-cost payment method.
Interestingly, the energy companies often argue that the costs of providing and servicing prepayment meters are higher than for other payment methods, but Barnardo’s cites the example of what it refers to as the “reasonable cost” of the Northern Ireland keypad, which shows that prepayment meters do not necessarily have to involve a large premium. I am not familiar with the Northern Ireland system, but the Minister might want to investigate it.
The hon. Gentleman and I discussed this matter before and, if anyone heard my phone going, that was a text coming through to confirm the issue: the administrative costs in Northern Ireland are less, which is why it is cheaper than on the mainland. If the keypad system in Northern Ireland can be cheaper, perhaps that needs to be looked at.
I thank the hon. Gentleman for that clarification. Ofgem should certainly be looking at that matter, and perhaps the Minister will encourage it along that route.
Barnardo’s also makes the point that the reason that many people use such meters is that they do not have access to a bank account to take advantage of direct debit payment. That is undeniably true, but it is also true that it is almost impossible for many people in such situations to get a bank account, since, frankly, the main banks are not interested, and many of them now seem to be moving to charging for current accounts, which is hardly likely to help. Barnardo’s calls upon the Government to extend the Post Office card account to allow payment of bills by direct debit, which I understand was promised in the coalition agreement. I appreciate that this may be outwith the Minister’s remit today, but that could be considered when introducing the universal credit.
Prepayment meters also have the problem of self-disconnection, as the hon. Member for Arfon (Hywel Williams) said. If people cannot afford to heat their homes, they simply do not put money in the meter. There is no active disconnection by the energy company, but the end effect is the same. That applies not just in Scotland but throughout the UK. The hon. Gentleman raised the issue in relation to Wales, but Stratford-on-Avon and district citizens advice bureau has contacted me about it. It takes issue with the term “self-disconnection”, making the valid point that it implies an element of choice. It also makes the point that in a harsh winter the loss of power to homes is national news—even during the spring this year it was national news—yet the plight of prepayment meter users, who must endure a regular loss of supply in both summer and winter because they cannot afford to buy credit, goes largely unnoticed.
Stratford-on-Avon and district citizens advice bureau told me that it has worked with other citizens advice bureaux and other organisations in its area to conduct a survey of prepayment users. It found that, as I have said, the exclusion of people from the best deals is clearly part of the problem, but it also noted that a worrying number of people do not understand how they are charged when they have such a meter. Those who move into a property where there is already a prepayment meter inherit an unfair system. They may quickly get into difficulties through no fault of their own and they often cannot afford to change the system they inherit.
Citizens Advice Scotland also raised that point and noted that many consumers are caught unawares by standing charges, so debt may accumulate in periods when they are using very little energy and impact upon them when they start to use it again in the winter months. It quotes the case of a client who is having 70% of each payment taken to meet those charges. Surely it is high time that action was taken to end such charges.
Citizens Advice Scotland adds that when consumers are in receipt of benefits, energy suppliers should recognise that they face additional payment difficulties and take action to support them, especially given the significant ongoing changes in the benefit system. In particular, suppliers should monitor usage, particularly among prepayment consumers, and take proactive action if there is evidence of self disconnection. I have been contacted by the StepChange debt charity, which has pointed out that an increasing number of over-60s are in fuel poverty because of rising prices, and that that number is substantially higher than in other age groups.
Citizens Advice recommended that prepayment meters should be fixed at the supplier’s cheapest tariff. I fully support that and urge the Minister to take it up with the energy companies and, if necessary, introduce amendments to the Energy Bill in the other place to make it happen. He did not accept my amendments when they were offered to him, but I will not take offence if he introduces his own. That would help to ensure that customers who have difficulty paying for energy and use prepayment meters as a budgeting tool are not penalised for doing so, and that customers with arrears are not pushed further into debt by the additional costs of installing a prepayment meter and of paying a higher tariff.
I would go even further. I sought in my amendments to put a cap on the amount of any payment into the meter that can be used to meet accumulated debt. I suggested 20%, but in the example I quoted earlier 70% was being taken and we should agree that 70% is totally unacceptable in such circumstances.
When alluding briefly to my amendments last Monday, the Minister’s colleague, the Minister of State, Department for Business, Innovation and Skills, the right hon. Member for Sevenoaks (Michael Fallon), said that he was not in favour of a specific percentage because that could mean that people would continue to pay towards the debt over the summer months when they use little gas. However, as I said, because of the operation of standing charges on prepayment meters, debts continue to increase over that period whether energy is being used or not, so that argument does not hold water. He also stated that it would take a long time for a family to get out of debt. The problem with that approach is that people on low incomes cannot ever get to the stage of being able to heat their homes properly, leading to ever greater difficulty.
It may take much longer to pay off the debt, but it is surely better to accept that in an age of ever-increasing energy bills—few of us believe that they will fall significantly in the foreseeable future—we must make a much greater effort to help those who are in genuine difficulties, and accept that when people have got into difficulties the arrears simply must be paid off over a much longer period. It is imperative to ensure that people can heat their homes and cook their food, and are not subject to having no energy because they cannot afford to put credit on the meter.
Will the Minister consider whether that is a sensible way of dealing with an increasing problem? If he followed up some of my suggestions, it might help the Prime Minister to fulfil his promise to ensure that everyone is put on the lowest tariff.
I congratulate the hon. Member for Angus (Mr Weir) on securing this debate on fuel poverty and the use of prepayment meters. He is an acknowledged champion in this place of the fuel-poor, and from my time on the Select Committee on Environmental Audit I know of his personal commitment and professional expertise. Whenever he speaks on the subject, we listen carefully and thoughtfully even if we do not always agree. I reassure him that the coalition Government are committed to helping hard-working families and consumers with the rising cost of living. We recognise that the rising cost of energy is currently one of the biggest worries for householders.
The modest fall in the number of households living in fuel poverty was confirmed in April. The latest figures show that in 2011, 4.5 million households in the UK were in fuel poverty. That was a slight decrease from 4.75 million in 2010, which saw the first fall in the number of fuel-poor since 2004. Throughout the last Parliament and for a couple of years before, there was an inexorable increase in the number of fuel-poor. Despite the modest falls, encouraging as they are, there is absolutely no room for complacency. The figure is still far too high and we are honest enough to realise that some of the problem is beyond the Government’s control. The steady growth in the number was driven primarily by increases in the wholesale price of gas. There is a direct correlation not between the sympathy that the Government of the day feel for the fuel-poor and the rhetoric they employ, but between the wholesale cost of gas and the price of energy that people must pay. We must do more to decouple that link and to cushion consumers from the international gas markets.
I do not disagree with what the Minister has said so far. He is correct about what is driving rising fuel prices, but does that not make it imperative that the Government adopt the little things I suggested to ameliorate the situation? It is all very well talking about wholesale gas prices, but it is the people at the sharp end who are suffering them. My suggestions would not solve the problem, but they would ameliorate the situation for those vulnerable people.
The hon. Gentleman made several points that I hope to cover, but I want to set out the framework and the context in which we must operate. Of the 3.2 million fuel-poor households in England in 2011, around 20% paid for their electricity and 24% paid for their gas with prepayment meters. Many hon. Members and certainly members of the public will be surprised that the figure is so low, because there is often an assumption that “fuel-poor” and “prepayment meter” are synonymous. In fact, only a relatively small number of the fuel-poor—20%—are on prepayment meters. Prepayment meters enable customers to monitor and control their energy expenditure in a direct and immediate way and, as a last resort, they can be a valuable alternative to disconnection for non-payment of bills.
Where prepayment meters are installed to recover a debt, that element of a customer’s payment must be set at a level that takes into account their ability to pay. The hon. Gentleman rightly says that there must be an equitable balance in such situations between debt repayment and the real ongoing needs of a household to cook, to heat the home to a safe level and to light the premises, particularly where there are children, or elderly or vulnerable people. It is understandable that he seeks a cap for weekly payments. Customers in debt repay a fixed amount at fixed intervals—for example, weekly. The amount repaid is calculated for each customer based on their personal circumstances and their ability to pay. He asked what would happen if their circumstances changed. In those cases, customers should talk to their supplier about the change and how it may impact on their ability to repay debt.
I recognise that a percentage repayment, such as 20% of the amount spent, may feel fairer, and that fixed payments can be a blunt instrument, but there are two sides to the coin. There is a risk that setting a percentage limit may create a floor rather than a ceiling. It may encourage suppliers to use the limit as the automatic default position rather than, as they do now, individualised payment plans, which are surely in everyone’s interest.
The hon. Gentleman makes the valid point that in some cases customers may feel that they are set an inappropriately high debt recovery level. If that is the case, they need to speak to their supplier. If that does not satisfy them, they should speak to Ofgem or the energy saving advice service, which is run by the Government, for further advice on what to do.
Does the Minister not accept that if Citizens Advice Scotland is coming across rates of 70%, where £7 in every £10 goes towards paying down the arrears, something is seriously wrong? It is not just one case; Citizens Advice Scotland cites several. That cannot be right.
I agree with the hon. Gentleman that it does not seem right, but I am not aware that it is the norm; it is the exception and if he is aware of such cases, I encourage him to take them up. I want to know more about the individual circumstances of the household and how the debt built up to such a level. We cannot have a situation where we ignore moral hazard and certain households do not feel an obligation to repay debt, because that penalises and is unfair to those on low incomes who struggle to pay their electricity and heating bills on time. We simply cannot give away heating when their next-door neighbours are struggling hard to do the right thing and pay the bills. There is a balance of fairness to be met.
In an intervention, I made a point about the administrative costs of the keypad system in Northern Ireland. It is cheaper than the system on the UK mainland in England and Wales. Is the Minister prepared to consider that system? If we could reduce administrative costs, it would be a factor in the saving for the consumer.
I would be more than willing to do that. Perhaps the hon. Gentleman will be kind enough to write to me with his particular proposal, or the example he thinks best illuminates the case. Prepayment meters obviously have a cost. Ofgem estimates that it costs £88 more than paying by direct debit. If there is a cheaper alternative model for prepayment meters in Northern Ireland, I, for one, would be extremely interested in looking at it.
The hon. Member for Angus mentioned the Prime Minister’s commitment to put everyone on the best deal, but that deal must be cost-reflective. As I said, it costs more to put people on prepayment meters. Ultimately, with only 20% of the fuel-poor, roughly speaking, on prepayment meters, we should not see them as a good thing. In an ideal world, no one would be on a prepayment meter. We do not want to create such an attractive situation that more people opt to go to a prepayment meter.
One of the exciting developments in technology is the advent of smart meters, which will considerably change the ability of consumers to interact with suppliers and will enable suppliers to have a much better relationship with consumers. Consumers will be empowered to make better choices of tariff and how they pay. Obviously, it will be a while before the whole country has smart meters, but we are determined that our smart meter programme should cover the entire country by the end of the decade. Clearly, that leaves some time and we cannot ignore what happens in the meantime.
In many cases, prepayment meters are installed to recover a debt. That element of a customer’s payment must be set at a level that takes into account their ability to pay. That is a point of universal agreement. Prepayment meters also enable customers to monitor and control their energy expenditure, and smart meters will play a valuable additional role.
I will be very brief. Understandably, the Minister has so far talked about the individual consumer. Does he commend the Welsh Assembly for including a specific fuel poverty reduction target in their campaign to reduce poverty in general in Wales by 2020? Would that be a course of action for his Government?
We do not just have a target; we have a legally binding obligation to deal with fuel poverty. In common with many other people, I have a slight degree of target fatigue, because targets do not get rid of fuel poverty: action, policy and committing to take measures and following them through get rid of fuel poverty. I am slightly sceptical that setting more targets is a good way of addressing something. The previous Government had a target, and fuel poverty relentlessly rose during the last Parliament. We need a Government who are committed to real solutions in the real world, and that is the hallmark of this coalition.
Given the levels of concern over the payment method, I am pleased that 80% of the fuel-poor do not pay for their energy via prepayment meters, and I do not want those households to find themselves subsidising others, either intentionally or unintentionally. The coalition shares the concerns of the hon. Member for Angus about the remaining 20% of the fuel-poor who pay for their energy through prepayment meters.
Since 2010, most suppliers have chosen to equalise their prepayment tariffs with standard credit prices, which is a major step forward. In the current system, licence conditions require suppliers to take into account the consumer’s ability to repay when setting instalments to repay gas and/or electricity debt. That allows consumers or their advocates to come to an individual agreement with suppliers that fits their circumstances.
Clear communication is the key to compliance. An assessment of a customer’s ability to repay a debt should be verified through direct customer contact or through a third party, such as the citizens advice bureaux, which do such brilliant work. It is clearly important that consumers know how much they are repaying each week and when the debt will be repaid. The average level of debt owed by dual fuel consumers in 2011 was £728, so a family with an average level of debt agreeing to repay the debt at £5 a week on top of their consumption would know that the debt would be cleared within two years and eight months. Fuel poverty and a customer’s ability to pay their energy costs are among my Department’s top concerns.
Gangmasters Licensing Authority (Civil Fines)
It is a pleasure to serve under your chairmanship, Mr Hollobone.
This time last year, on 20 June 2012, I held a debate on the Gangmasters Licensing Authority, and the then Minister, my right hon. Friend the Member for South East Cambridgeshire (Sir James Paice), who is my constituency neighbour, assured the House that he had
“a package of proposed changes to the GLA, including…looking at the scope to use civil penalties.”
Indeed, he very kindly went on to say that I was right in calling for the ability to fine gangmasters. He said that the GLA board had “very few enforcement weapons” and that we needed
“a tier of measures for it to utilise.”—[Official Report, 20 June 2012; Vol. 546, c. 276WH.]
It therefore may surprise the House and you, Mr Hollobone, to learn that despite the Minister’s saying that that analysis was right, the Department’s own consultation now specifically excludes the tier of measures to which my right hon. Friend was referring.
We should remind ourselves of what is at stake. I am very pleased to see my hon. Friend the Member for Morecambe and Lunesdale (David Morris) in his place. He will know that the GLA was set up in 2004 after the tragedy of the Morecambe bay cockle pickers disaster. He has spoken most effectively in bringing these issues to the attention of the House previously. We are talking about legislation that is directed at protecting the most vulnerable people in society and particularly those working in the agricultural sector. In many cases, they are a long way from home, have difficulties with the language and are fearful of authority. They are therefore vulnerable people who do need protecting.
It is remarkable that the consultation brought forward by the Department seems to be excluding the measure that the Minister, in response to my debate last year, said was an important tool that was lacking and needed to be included. It may be helpful if I set out why I think that the Department has got itself into this situation. I think that it is in large measure down to another ministerial statement. We all like cross-departmental working, and it is very good that the Department is taking note of ministerial statements elsewhere. The Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon), quite rightly articulated concerns about red tape. That is a concern that many hon. Members share. My right hon. Friend therefore set out a new test: it was a general rule that new powers to fine should not apply to firms with fewer than 250 people. There was good logic to bringing in that measure, but it was a general rule; it was not absolute. This Minister may want to clarify the position with his officials. Obviously, the measure has been signed off by Ministers, but there almost seems to be a bit of gold-plating whereby what is a general rule has been applied in absolute terms.
Of course, most gangmasters do not employ more than 250 people. Indeed, if they did, the existing powers would be confined just to those above 250, but we do not do that for the criminal powers, so is it not illogical that for criminal powers we say that they apply to the gangmaster population as a whole, yet for civil powers, where one assumes a lower test, we raise the bar and say that they apply only to gangmasters with more than 250 people working for them? That is at odds not only with what the Minister said to me this time last year in response to my debate, but with the existing legislation under which the Department is acting. It is also—dare I say it?—at odds with common sense, because if we look at the use of criminal powers, we see that it is clearly not working.
Let us take, for example, two recent cases in Northern Ireland. In those cases, the fines imposed on the gangmasters acting illegally and making large sums of money—often, gangmasters are not paying tax, and quite often they are linked to other crime, such as prostitution and counterfeiting—were just £500 apiece. I think that most hon. Members would accept that the profits that those gangmasters had made far exceeded the fines that were imposed by the courts. We have a strange situation in which we have criminal powers, which the GLA rarely uses. If a gangmaster is unlucky enough to be caught, they know that the fine is likely to be less than the profits that they have made. They know that, on most occasions, witnesses are very fearful of coming forward and therefore the number of prosecutions is very low. Last year, for example, there were just 15 prosecutions against gangmasters.
Let us put that in context. We currently have under way—I am very grateful to my right hon. Friend the Home Secretary for the support that she has given—an operation in the fens, which my hon. Friend the Member for Peterborough (Mr Jackson) will be familiar with, Operation Pheasant. So far, it has raided 80 homes and it has a number of live inquiries, but it is finding the most horrendous issues. We had a case recently in Whittlesey in which migrant labour was living in a house and there was CCTV not just on the front and back doors but in the inside rooms in order that the gangmaster could control his labour force. We have had other cases of people living in a garage with an open sewer.
This is an issue not just for the vulnerable in communities such as mine and that of my hon. Friend the Member for Peterborough but for the local residents, because where there are high concentrations of houses in multiple occupation, there is antisocial behaviour. It is very difficult for people to stay in the house, so they tend to go out and street-drink. When they street-drink, we get urination on people’s front doors. I cited some particularly unpleasant and disturbing cases in the debate last year. I will not detain hon. Members by rerunning those, but it is very clear that there are issues of antisocial behaviour and legitimate concerns for the local population that flow back to our unwillingness to tackle gangmasters.
Therefore, I suggest to the House that the key way in which we should be tackling gangmasters is by hitting them in the area that they are most concerned about. That is in their pocket; it is through fines. That is the way in which we will change their behaviour, so I find it remarkable that the consultation from the GLA is excluding a tool that the Minister last year said was important, is gold-plating a legitimate concern of the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks, and applying that in a bizarre and arbitrary way and is failing to address the legitimate concerns about antisocial behaviour with enforcement, because the criminal tools that are used are not working. They are rarely applied. The fact that there were just 15 prosecutions clearly shows that they are not working. Then when there are prosecutions, the level of the fine is derisory.
I say to this Minister that I find the situation quite disappointing. I, as a Member of Parliament, articulate real concerns about things affecting my constituency. The Home Secretary acts on those concerns with Operation Pheasant. We have good support from Cambridgeshire police—in the debate last night, I paid tribute to Inspector Sissons and the work that he is doing. I am keen that my local council do more, and I have been in active discussions to ensure that it uses its powers. I am very sympathetic about the difficulties of resourcing that the GLA has. We all know that the last Government left us with a huge level of debt. Although I believe that the GLA should be far better resourced—I think that that would be a good use of the Department’s budget—I am very sympathetic about the difficulties that the Department faces because of what was inherited. But surely the answer, if we have a problem in trying to resource it more, is to make it easier to prosecute—to make it easier to impose fines, because it is the fines that will change the behaviour of the gangmasters.
We are not talking about all gangmasters; there are perfectly respectable gangmasters, but we know that there are illegal gangmasters and heartbreaking abuses taking place in my constituency and the constituencies of hon. Members across the fens. Unwarranted pressure is being placed on local residents, who often have to bear the consequences of the antisocial behaviour that flows from the concentration of houses in multiple occupation and the lack of enforcement against illegal gangmasters, who often misleadingly attract people from overseas. Illegal gangmasters will go to Lithuania for example and say, “Come to the fens. You have a guaranteed job and guaranteed accommodation.” When the workers arrive, there is often only one, two or three days’ work before they exhaust their savings, are in debt and the gangmasters have control.
There are real issues and they were raised last year. Other Departments have gripped the problem and acted. The Minister for Housing, my hon. Friend the Member for Hertford and Stortford (Mr Prisk) is organising a workshop in the fens, in Wisbech, for councils, so that we can share best practice. Other Departments are acting, but the Department of the Minister who is here today is not. Not only is it not acting, but it is ignoring the assurances that I felt were given to me last year, in my interpretation of what the then Minister, my right hon. Friend the Member for South East Cambridgeshire said. In bringing this debate before the House again, I hope that the Minister here today will look again at his consultation and at whether the powers it equips the GLA with are adequate. If he wants to take this opportunity to announce additional resource for the fens, I will be delighted, but if he is not going to do that, what exactly is he going to do?
My hon. Friend is making a powerful and fluent case. I pay tribute to his great campaigning work on illegal gangmasters. Does he agree that time is of the essence? The imperative is to do something soon, due to the free movement directive and the likely immigration of Romanians and Bulgarians next year. The Home Secretary has said how important reducing pull factors is, and measures on gangmasters would be part of that portfolio of policies, so the urgency is very much apparent.
My neighbour and hon. Friend is right; there is urgency. I am sure that he shares my frustration for that reason. A number of us have been raising concerns for some time. I secured a debate on gangmasters last year. I raised concerns in the main Chamber. I have been to see the Home Secretary on a number of occasions. The police inspector came to see Lin Homer, the top official of HMRC, with me last year. For cross-departmental government to work, DEFRA needs to come to the party and get involved and the purpose of today’s debate is to draw the consultation before the Minister more firmly to his attention. I think that the ministerial statement of the Minister of State, Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks, has been misinterpreted.
I hope that the Minister here today can reassure us, but if not, ultimately I hope that he can address the concern of my hon. Friend the Member for Peterborough: what will the Minister’s Department do through the GLA to effect change on the ground? If we are to maintain community cohesion, the GLA matters. To address the antisocial behaviour that flows from the consequences and criminal actions of illegal gangmasters, the GLA must be part of the action taken. I therefore hope that the Minister can reassure the House that the comments of his predecessor, my right hon. Friend the Member for South East Cambridgeshire, will form part of the consultation and the response to tackle illegal gangmasters operating in the fens.
It is a pleasure to serve under your chairmanship this afternoon, Mr Hollobone. I congratulate the hon. Member for North East Cambridgeshire (Stephen Barclay) on securing the debate. I am pleased to see his colleagues, the hon. Members for Peterborough (Mr Jackson) and for Morecambe and Lunesdale (David Morris) here. I know that they share a common concern about the operation of gangmasters in their constituencies.
It is important that I open by saying how significant the operation of the Gangmasters Licensing Authority is. We need it to work for precisely the reasons that the hon. Member for North East Cambridgeshire set out: to ensure that very vulnerable people are not exploited by criminals—let us be clear, they are criminals—who wish to use the opportunities that arise from people coming from overseas and finding themselves in a vulnerable situation.
I would like to respond to the points that the hon. Gentleman made, but also to say a few words about the proposed improvements to the operation of the GLA, which has done and continues to do a great deal of valuable work, which most people recognise, to protect and enforce the rights of vulnerable workers. Many reviews over recent years, including the farming regulation task force and forestry regulation task force, have looked at the GLA’s work, and there is general recognition among stakeholders that it has been effective in improving working conditions in the regulated sectors.
In recognising the highly valuable work the GLA has done, the reviews have also shown that there is room for improvement, so there is an opportunity to make the GLA a modern enforcement agency that better targets criminal activities, while applying a light touch elsewhere. That is one of the thrusts of the work we have done. Part of the consultation that is happening at the moment is about how we can take our foot off the pedal in areas where it is not needed, to concentrate resources on the areas that the hon. Gentleman has drawn to the attention of the House.
Through the employment theme of the red tape challenge, the continuing need for the GLA’s work was endorsed, alongside the need to bring forward measures to ensure that it can become more focused on the worst excesses of worker exploitation in the sectors it regulates. As the hon. Gentleman said, my predecessor, the right hon. Member for South East Cambridgeshire (Sir James Paice), announced, via a written statement to Parliament a year ago, the range of reforms that would come forward.
The GLA will increase joint working with other agencies involved in stamping out serious organised crime activities, including human trafficking, money laundering, tax evasion and other serious organised crimes. To enable that increased focus on the serious criminal elements in the supply of labour to the food and food processing sector, the GLA will modify its processes and deploy its resources in a way that relieves the burden of regulation from highly compliant businesses, but targets criminals through improved intelligence gathering.
In Carnforth in my constituency, the Morecambe bay hybrid fishery order is being drafted at the moment. Can the Minister assist the legislation to go through quicker? It will enable the licensing and policing of the bay for shellfish farmers and harvesters and cockle pickers.
I am not sure that I am in a position to help with what is presumably private legislation, in that it is independent of Government processes, but I have heard what the hon. Gentleman has said. Having such an order in place would clearly benefit his constituents, which is why he has raised it today. I do not blame him for doing so.
Before that intervention, I was suggesting that in areas where the experience of GLA enforcement over the years has shown that there is less need for regulation, we can safely remove those currently licensed activities from the scope of regulation and redeploy the resources elsewhere. My Department launched a public consultation in April this year on proposed reforms to GLA operations, as the hon. Member for North East Cambridgeshire said. That consultation includes proposals to exclude some activities that currently require a licence from the scope of licensing, where evidence suggests that there is a low risk of exploitation of workers. That proposal would remove about 150 businesses from licensing, saving those businesses about £60,000 and enabling GLA resources to be deployed elsewhere to tackle serious abuses.
Changes are proposed to the size and constitution of the GLA board, to make it smaller and better able to provide clear strategic direction for the organisation. The consultation also looks at the scope to introduce civil penalties—exactly the point that the hon. Member for North East Cambridgeshire made—into the range of enforcement tools that the GLA has available.
The GLA is a designated regulator under the Regulatory Enforcement and Sanctions Act 2008—the so-called RES Act—which permits the use of civil penalties as an alternative to prosecution in certain circumstances. The point that the hon. Gentleman made, and he quite properly set out exactly why this is an obstacle for us, is that the sectors that the GLA regulates are overwhelmingly made up of small and medium-sized enterprises.
The scope for use of civil sanctions in the RES Act is constrained by Government policy in that area, and I recognise immediately that what the hon. Gentleman is asking me to do is to challenge another Department’s policy. I think that is implicit in what he says, but for the benefit of the record I want to state that Government policy in that area was clearly set out in a written statement to Parliament last November, by the Department for Business, Innovation and Skills Minister, my right hon. Friend the Member for Sevenoaks (Michael Fallon).
That statement made it clear that, in general, SMEs should not be subject to monetary fines because of the risk of smaller companies feeling less equipped to challenge the basis for such fines. That is very clear Government policy and if I wished to engage in a dialogue with my right hon. Friend the Member for Sevenoaks on the issue, we would need to establish why this matter should be the exception to that rule.
The crux of the matter is in two of the words that the Minister just said: “in general”. My colleagues on the Government Benches very much support the statement made by my right hon. Friend the Member for Sevenoaks. We understand the difficulties of the red tape, but it is this “in general”. What we are saying is that in this instance there is a distinction between the criminality of gangmasters operating against vulnerable people—the raids are revealing some horrendous and immoral issues—and the small business owner suffering from red tape. It is that distinction that I ask the Minister to take away, from a cross-departmental point of view, and take up with colleagues.
Of course I understand what the hon. Gentleman says, and I understand why he is bringing the matter forward in the context of his constituency interest, but I have to say that where there is criminality I believe that criminal sanctions should apply. I want to make it absolutely clear that, if the evidence is there, there should not be the slightest hesitation in bringing a criminal action. The question of civil sanctions is, in a sense, a reserve position for situations in which a criminal prosecution is inappropriate.
The Minister is generous in giving way a second time. The facts speak for themselves—only 15 prosecutions. For criminal prosecutions a higher standard of evidence is required, and they are therefore more difficult. They take longer and are more expensive, and we are talking about an organisation with resource constraints.
For the measure to work, the Minister needs the resource. Perhaps I can take him back to his earlier remarks. Yes, in the consultation we are reducing the board—frankly, big deal; it is pretty irrelevant—but how many investigators from the GLA are covering Cambridgeshire, Norfolk and Lincolnshire? The figures I had, off the record, were very small. Will the Minister share the figures with the House?
I am grateful to the hon. Gentleman. I do not have the figures with me and will, therefore, happily write to him to set out the position.
I will, in fact, go further than that. I am due in East Anglia tomorrow and I plan to meet with the GLA to discuss exactly how it operates and how we can help it to operate, so it seems entirely appropriate that we look at the resourcing issues. It is not small beer to redirect resources from areas where they are deployed to no great benefit because they are being used to license people who have not the slightest intention of breaking the law, and have the track record to show that they do not. It seems entirely appropriate to redirect the resource to deal with the bad guys, against whom we need to collect evidence.
I take the point about the difference between criminal and civil standards of proof. That is, of course, a factor, but let me be absolutely clear: I want more criminal prosecutions. I want to see more people brought before a court for their abuses and I want them then to suffer the further penalty, where appropriate, of proceeds of crime restitution, so that we get back the money that the gangmasters have acquired through illicit means. We also need to make it plain that they are not wanted in our agricultural industry. We must deal with them effectively.
I do not quarrel at all with the hon. Gentleman’s point, but I want to ensure that we do this right, and I am working within an overall Government policy that is resistant to the view that civil sanctions are the appropriate means of dealing with small and medium-sized businesses. That is my difficulty. It is not an insurmountable difficulty, but I need to persuade others in Government of the case.
Some provisions of the RES Act might be useful to the operation of the GLA. We have invited views from stakeholders on the usefulness of the measures, and the public consultation by the Department for Environment, Food and Rural Affairs remains open until 21 June. I therefore invite the hon. Gentleman, and others who feel strongly about the matter, to ensure that their views are fed into that consultation process. When we respond to the consultation in due course, it will be helpful for us clearly to understand, from colleagues who represent areas where many labourers work in such schemes, what the problems are and how we should best deal with them.
As I said, I am very happy to look at the matter in the round and to recognise the strength of the arguments, but I come back to my basic premise, from which I will not resile: the key change will be to redirect resources as the GLA is asking us to. That seems to make sense, but obviously we must wait for the consultation process to end to see whether others agree that we should redirect resources in the key areas of serious offences and organised crime.
The GLA itself has been at the forefront of the reform programme, and last week published its three-year strategy for protecting vulnerable workers, which emphasises an intelligence-led, risk-based approach, working closely in partnership with other agencies. The hon. Gentleman will know that the GLA is active in many parts of the country, including in the constituencies of the hon. Gentlemen here today: North East Cambridgeshire, Morecambe and Lunesdale, and Peterborough.
The hon. Member for North East Cambridgeshire mentioned Operation Pheasant, a multi-agency taskforce set up to tackle ongoing worker issues in the area. Three people have been arrested on suspicion of human trafficking offences in Wisbech, and a diverse team of agencies has been assembled to assist with the operation, with partners including Her Majesty’s Revenue and Customs, the Home Office, trading standards, Fenland district council and Cambridgeshire fire and rescue.
I want to know more about the matter at first hand, which is one of the reasons why I am going to East Anglia tomorrow to talk directly to GLA officers and partner agencies involved in the joint operation. If they tell me that there are clear areas in which we have still not dealt effectively with the issues they want us to address, the hon. Gentleman can be assured that I will act on that and take their advice in developing Government policy.
I believe that the package of reforms that we are taking forward with the GLA will make the authority better able to protect vulnerable workers, while easing burdens on the majority of businesses, which are compliant and law-abiding. I am very grateful to the hon. Gentleman for having given us the opportunity to discuss this extremely important issue.