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Commons Chamber

Volume 583: debated on Tuesday 24 June 2014

House of Commons

Tuesday 24 June 2014

The House met at half-past Eleven o’clock

Prayers

[Mr Speaker in the Chair]

Oral Answers to Questions

Treasury

The Chancellor of the Exchequer was asked—

Employment Figures

There are more people in work than ever before, with the latest figures showing the fastest increase in employment since records began. Today we have the very welcome news that Abu Dhabi will be investing £1 billion in building new houses in Manchester. That is a step towards it becoming the northern powerhouse I want to see, and it is a £1 billion vote of confidence in our long-term economic plan.

Between 2003 and 2008 the Labour Government did create jobs, but unfortunately less than 10% of them benefited British citizens. Since this Government have come to power, through our skills, immigration and welfare policies over three-quarters of the 1.4 million new jobs have benefited British citizens. Is that not a long-term economic plan of which to be proud?

My hon. Friend is absolutely right, and I pay tribute to his contribution in making sure that the jobs that are being created in this recovery are jobs that British people have the skills and incentives to take. It is heartening that three-quarters of these jobs are going to UK citizens, as opposed to the truly staggering record of the last Government, when less than a quarter were taken by British citizens.

Is my right hon. Friend aware that there has been a 59.5% fall in the number of jobseeker’s allowance claimants in Warwick and Leamington since April 2010? Also, recent figures show that a record number of companies were formed in Leamington Spa in the first quarter of this year. Will the Chancellor pay tribute to the local council, local chambers of trade and commerce and the local businesses that have made this possible, and will he outline what more can be done to further increase support for businesses in increasing employment?

I certainly pay tribute to the local council and local businesses who have worked with the excellent Member of Parliament, my colleague—[Interruption.] Yes, my hon. Friend has done remarkable work in bringing down the number of people claiming JSA by 60% since this Government came to office, and of course we will go on supporting businesses locally with important infrastructure, with the employment allowance and with awards. As I am sure my hon. Friend will be aware, Dennis Eagle, one of the companies in his constituency, has just been awarded a grant under our advanced manufacturing supply chain initiative, so we are backing manufacturing in the midlands, and backing his constituents all the way.

Sixty percent is a very interesting statistic. Does the Chancellor accept that the number of young people unemployed for more than 12 months has risen by 60% since he became Chancellor?

Youth unemployment is down 100,000 over the last year, and in the hon. Gentleman’s constituency the claimant count is down by 30%. I would have thought he would be welcoming that.

When a proud Kingstanding dad of a newborn baby son tells me he has been on zero-hours contracts for two years and cannot plan from one week to the next, and says “Do them up there”—the Government—“get what life is like down here?”, and when a proud Stockland Green mother caring for her disabled son says, “My husband’s been made redundant twice in the last three years, with each new job less secure and on a lower rate of pay,” and adds, “What planet does the Chancellor live on?”, what does the Chancellor have to say to them?

I would say that through our long-term economic plan we are creating jobs in the hon. Gentleman’s constituency, with the economic security that that brings. We are legislating to deal with the abuse of zero-hours contracts, which for 13 years the Labour party did nothing about, and we have discovered in the last couple of weeks that the shadow Chancellor, who from the Opposition Dispatch Box has criticised zero-hours contracts again and again, uses them in his own office.

If economic growth turns out to be higher than currently estimated, as has been the case in several quarters over the past 18 months, does the Chancellor agree that that might provide part of the answer to the so-called productivity puzzle? Has the Treasury done any work on that question, and does he agree with the Governor of the Bank of England that we need to do a lot more to improve Office for National Statistics data?

I agree with my hon. Friend that one of the big challenges now is to improve productivity, which was clearly impaired by the financial crisis. Obviously, in doing that we need to make sure that the data we receive from our ONS is of the highest quality. People at the ONS work incredibly hard on that, but of course there is always room for improvement, as the Governor of the Bank of England pointed out today, and we will work with the Bank and the ONS to ensure that any improvements that can be made will be made.

Is it not the truth that people in employment have seen their living standards fall year on year under this Chancellor? So can he tell us, will working people be better off next year than they were in 2010—yes or no?

The many thousands of people who are getting jobs in the hon. Lady’s area are better off, and of course—[Interruption.] Let me explain to the shadow Chancellor: if you bring the British economy to its knees, if you have the deepest recession for 100 years, if you preside over the biggest banking crisis in our history, you make this country poorer. But it is by fixing those problems, by working through our long-term economic plan, that we are going to make the country richer again.

Bank Lending

The Government have introduced several measures aimed at improving all types of lending to businesses, such as the funding for lending scheme, the British Business Bank and the SME appeals process. Against this backdrop, gross lending to businesses in Q1 2014 was almost 10% higher than in the same quarter a year earlier, and 32% of SMEs that have been through the appeals process have had their initial loan rejection overturned.

On the Government’s watch, net lending to business is down by some £57 billion since May 2010. Does that not underline the case for further banking reform, for an expansion of the use of community development financial institutions, and for consistent disclosure of bank lending data?

The hon. Gentleman will know that the great recession in 2008-09 that the previous Government presided over left banks in an absolute mess, and it takes a very long time to recover from such a devastating position. The banks are still trying to sort out their balance sheets, and net lending has been down. It will take time to recover, but this Government are putting measures in place to create new access to finance from all sorts of different lenders. I was delighted yesterday to support the credit union movement on its 50th anniversary with a call for evidence on how we can expand that area of activity for.

I draw attention to my entry in the Register of Members’ Financial Interests. Does the Minister agree with me that, as well as stabilising and reforming the banking system, one of the key aspects of the long-term economic plan is the creation since 2010 of many new local banks that provide alternative and expanded lending to retail and business customers?

Yes, I absolutely agree with my hon. Friend. The Government want more competition and diversity in the banking sector, which is why we asked the old Financial Services Authority to review the barriers to entry for banks, why we legislated to give the Financial Conduct Authority strong competition powers, and why we created the payment systems regulator to look at fair access to payment systems.

In recent discussions with women entrepreneurs I have been struck by the number who have said they were surprised by the banks’ attitude towards them and their businesses. I spoke to one entrepreneur who said that only when she was featured in a TV programme did a bank phone her up and offer her a loan. What discussions has the Chancellor had with banks about women-led businesses, the demand for lending and how many they are lending to?

This Government have taken great steps to improve competition and I am delighted that, currently, the regulator is talking to 25 new applicants for new banks. We are also taking steps to ensure that those who get turned down for credit have the opportunity to go to other challenger banks to access other sources of finance. I am sure that the hon. Lady will welcome the steps that the Financial Secretary to the Treasury, my right hon. Friend the Member for Loughborough (Nicky Morgan), is taking to improve particularly the support the Government are giving to female entrepreneurs.

Increasing competition in the sector is key to improving lending. The Minister mentioned that the Prudential Regulation Authority is looking at 25 new applications for licensing to be banks. How does this compare with the decade before 2010?

My hon. Friend may know that in May 2010, when Metro bank was granted a full banking licence, that was the first new full banking licence for over 100 years, so the fact that the regulator is talking to potentially more than 25 new banks is very good news for competition and choice in the UK.

Business Taxes

3. What recent assessment he has made of the potential effect of increasing tax on businesses on public finances. (904395)

Government analysis has shown that high corporate taxes have a negative impact on investment, jobs and growth, so we have cut the corporation tax rate from 28% to 21%. Next year, it will fall to 20%, the joint lowest rate in the G20. Increasing corporation tax, as some propose, would damage the economy, cost jobs and drive away investment. It is anti-business and we will not do it.

I welcome that answer. There is growing evidence that, in a number of sectors where we have cut taxation, revenues are starting to rise. Does my right hon. Friend agree that those proposing increases in taxes are doing so for purely ideological reasons and because they are engaging in the politics of envy?

Whatever their motivations—I think my right hon. Friend is right—we are absolutely clear about the results. It will put people out of work and ensure that investment does not come to Britain. We are against plans to increase corporation tax. Indeed, I think that most people from around the world would look on in bemusement if Britain were to increase its business taxes, as the Opposition propose. To come to the point, the Treasury and Her Majesty’s Revenue and Customs are now providing more dynamic modelling of the effect of tax cuts on investment and growth, and cuts in corporation tax and fuel duty are shown to have positive impacts on the economy.

High profile companies operate schemes that lead to the UK economy losing out, and not benefiting to the fullest extent. Is the Chancellor aware that Google AdWords is de-ranking small firms if they do not stump up substantial funds? It means not only that Google’s profits go up, helped by its tax arrangements, but that the profits of small firms, such as those in my constituency, go down, and the Exchequer is the net loser. Will he please discuss that with his colleague, the Secretary of State for Business, Innovation and Skills?

I will make a general point, which is that the internet has provided an enormous opportunity for many small businesses, because it has dramatically cut distribution and start-up costs and created all sorts of opportunities that did not previously exist for small businesses in Britain. If we believe in free markets and technological change, we should believe in the innovation that that brings. Specifically on the tax issue, we are working internationally—this cannot be done in one country—to ensure that the international corporate tax system reflects the digital economy and international business of today. We are helping to fund that OECD work, and we are expecting the first conclusions this autumn.

Employment is up substantially in my constituency of Nuneaton, and unemployment has dropped 20% in the past year. Does my right hon. Friend agree that it would be absolute suicide to increase employers’ national insurance contributions, and can he rule that out as part of our long-term economic plan?

My hon. Friend has done some fantastic work with local businesses to increase jobs in Nuneaton and to ensure that small businesses expand. He is absolutely right that the Opposition’s plans for an increase in corporation tax, which they talk about openly, and for a jobs tax, which they talk about secretly, would be a double whammy that would put people out of work in his constituency.

Is the Chancellor aware that most people do not mind paying tax if it is fair and transparent and if everyone pays their fair whack? When will he ensure that those people who avoid taxation actually pay it?

We have put a huge effort—I pay tribute to the Exchequer Secretary who has led this work—into ensuring that we collect the taxes that are due. As a result, many billions of pounds more in taxes are collected. We are eliminating abuse that existed before we arrived, such as that involving stamp duty, and we set our tax rates fairly. We do not have a situation, as we did under the previous Government, where people in the City were paying lower tax rates than the people who cleaned for them.

Housing Market

Our economic plan is about stability and security, so we are taking two steps on housing. First, we are building more homes, so that supply better matches demand. The Government’s reforms mean that housing starts are now at a six-year high. Secondly, we have given the Bank of England the responsibility and the tools to deal with any financial risk associated with the housing market, and I am clear that the banks should not hesitate to use those new powers if they think it is necessary to protect financial stability.

On 19 May, The Telegraph reported that house prices jumped £10,000 in five weeks when the Bank of England threatened to cap mortgages. Will my right hon. Friend take steps to ensure that the Bank does not inadvertently promote financial instability when it exercises those powers?

I do not think that the Bank is doing that. We have taken a big step forward in this Parliament to give the Bank of England macro-prudential tools to intervene in areas such as housing if it thinks that there is a financial risk. Clearly, these things did not exist before, which is one of the reasons why the economy was in the mess that it was in when we came to office. At the Mansion House, I offered the Bank of England new direct powers to impose limits on loan-to-value and loan-to-income ratios. It is, of course, entirely up to the Financial Policy Committee, acting independently of the Government, to deploy any of its tools if it sees risks developing.

The greatest threat to stability in the housing market is the mismatch between supply and demand. The House knows what the Chancellor has done to stoke up demand, but supply is at its lowest level since records began—fewer than 150,000 units. I heard what the Chancellor said in his initial reply. What more is he going to do to boost supply in the housing market?

Housing starts are now at their highest since 2007, and we have seen an increase in housing starts and planning permissions this year. I was with the hon. Gentleman in his constituency just the other day, talking about what we could do to get more housing going in his part of London on a brownfield site that he knows has been left derelict for many years. He was working very co-operatively with me then, but perhaps the Chamber of the House of Commons brings out a more adversarial encounter.

My right hon. Friend the Chancellor is right to say that meeting demand with supply is absolutely critical. Given that meeting that demand means 3 million new homes over the next 10 years and that the private sector built only 180,000 houses a year, at best, during the height of the housing boom in the 1990s, does he agree that public investment is needed in social rented housing, in the private sector and in the public sector, if we are to meet the 3 million target?

I do agree with my hon. Friend. We need to ensure that planning is reformed, and we have done that. It was a controversial decision, but as a Government we have pushed that through, and planning permissions are up. We need to create incentives for the private sector to build homes, and Help to Buy has done that. But we also need to go on building social housing, and as he well knows, the coalition Government are delivering the largest programme of social housing for a generation.

Does the Chancellor seriously believe that taxpayers subsidising mortgages on properties worth £600,000 is really leading to stability in the housing market?

I find it extraordinary that the Labour party is against Help to Buy, which is assisting those who are on low and middle incomes to get into the housing market. The great majority of those homes are outside London and the south-east. Almost none of them has been bought at £500,000 or £600,000, as the hon. Gentleman says, and what we are actually seeing is that the homes that are being built and bought are below the national average. So instead of carping about Help to Buy, Labour should get behind it.

A key component of the financial crisis was a debt-fuelled housing bubble. The Governor of the Bank of England confirmed to the Treasury Committee this morning that a failure of regulation and macro-prudential policy was instrumental in that crisis. Is my right hon. Friend confident that the measures that he has introduced, including the new regulatory framework as well as the Financial Policy Committee, will succeed in heading off any future housing bubble-inspired crisis?

The Bank of England now has very powerful tools to deal with the kind of risks that we saw develop in 2006 and 2007, with such catastrophic consequences for our banking system and for our economy. The new powers that it will receive—subject, of course, to parliamentary approval—on being able to limit loan-to-income ratios and loan-to-value ratios for every mortgage or, indeed, as a percentage of mortgage portfolios, are very powerful tools. It is up to the Bank of England to make independent judgments about when to deploy them, because, as we have learnt with such monetary and macro-prudential policies, it is better that the politicians stay out of it.

Under this Chancellor, we have had the lowest level of house building in peacetime since the 1920s. The Financial Times reported a few weeks ago that the Chancellor is “relaxed” about an early rise in interest rates to rein in our unbalanced housing market. Can he tell the House how much a 1% rise in interest rates would add to the average mortgage bill?

I am not going to comment on interest rates because, as the right hon. Gentleman should remember, the Bank of England is independent, and it is for the Bank to make its judgment. Let me pick him up on what he says about housing. I absolutely believe that we need to build more homes, and housing starts are now more than double what they were in the last year of the Labour Government, in whose Cabinet the right hon. Gentleman sat. If he supported our planning reforms rather than opposed them, if he supported our approach to spending, which has enabled us to pay for the new social housing, and if he backed Help to Buy, he would have a bit more credibility when he stood at the Dispatch Box. As it is, I prefer to listen to the Labour leader’s speechwriter, who said this week:

“I fell out with Ed Balls because Labour’s economic policy is nonsense.”

The Chancellor used to boast that record low mortgage rates were a sign that his policy was working. Now, with the Governor warning of an early rise in interest rates as demand outstrips supply, the Chancellor is desperately trying to claim that higher interest rates would be a sign of success as well. Is not the truth that his failure to get house building moving in the last four years is the reason our housing market is so unbalanced and early interest rate rises are on the cards? As for the question about mortgages, let me answer by quoting the Chancellor, who said in the House of Commons that

“a 1% rise on the average mortgage bill would add £1,000.”—[Official Report, 6 December 2011; Vol. 537, c. 147.]

I can tell him that homeowners up and down the country will not be relaxed about that.

The shadow Chancellor has got into pretty desperate territory when he says that an exit from exceptionally loose monetary policy, implemented in the middle of a crisis, whenever that comes, is a catastrophe for the British economy. The truth is that under any Bank of England setting, if the right hon. Gentleman was in office, the fiscal policy would be out of control and interest rates would be higher than under this Government.

The Prime Minister and I paid an interesting visit yesterday to the right hon. Gentleman’s constituency, along with the next Conservative MP for Morley and Outwood, Andrea Jenkyns. I will tell him what we found: people who had been unemployed now in work; the number of apprenticeships in the constituency doubled; and the Coca-Cola plant, which we visited, putting more money into Britain. The recovery in Morley and Outwood and the rest of the country is the real thing.

Payment of Tax

Since 2010, the Government have been determined to support HMRC in improving overall compliance levels, tackling tax avoidance, evasion and fraud, and punishing those who break the rules. Overall we are investing about £1 billion in HMRC’s compliance activities, and HMRC achieved record levels of compliance revenues last year, securing £23.9 billion.

It is a huge frustration to people to see wealthy individuals and large companies avoid paying the taxes that they ought to be paying. I thank the Minister for his comments, but will he go further to make sure that our rules are fit for purpose? Will he tackle, for example, transfer pricing, and ensure that there is an international agreement that benefits Britain and means that people pay the correct amount of tax in this country?

As the Chancellor made clear a moment ago, it is right that we address these issues, and that we do so at an international level. The Organisation for Economic Co-operation and Development’s important work on base erosion and profit shifting is a consequence of the leadership shown by the Prime Minister and the Chancellor, and we hope that we will see the fruits of that progress beginning this autumn.

With the amount of uncollected tax rising, the Swiss deal raising less than a third of what the Chancellor predicted and Ministers refusing to close the eurobonds loophole, is not the truth that the Government are totally failing to tackle tax avoidance and to close the tax gap?

No, it is not the truth. The truth is that there are record levels of compliance yield, as I mentioned: £23.9 billion as a consequence of HMRC’s activity. The UK is leading the way in international reform. There has never been a Government so committed to, nor a revenue authority so successful in, closing loopholes, getting the tax in and making sure that people pay what is required under the law.

While the Minister fails to tackle tax avoidance, overseas buyers are snapping up property in London but not making a proper tax contribution in this country. Is it not time that the Government introduced a fair tax on properties worth more than £2 million, and used the money to cut taxes for 24 million working people, with a lower 10p starting rate of income tax?

If the hon. Lady wants to cut taxes for 24 million people, she might want to consider increasing a personal allowance to £10,500, which is exactly what the Government have done, rather than doubling the 10p rate of income tax as the previous Government did. As for taxes on property, it was this Government who introduced the annual tax on envelope dwellings, ensuring that there is a contribution to the Revenue from owners and occupiers of properties held in a corporate envelope. Again, I really do not think that on this issue the Labour party has a leg to stand on.

Long-term Economic Plan

The Government’s long-term economic plan is working, and the UK is expected to grow faster than any other G7 country this year. Inflation is below target, the deficit has been reduced by more than a third since 2009-10, and employment is at record levels, but the job is not yet done, and the biggest risk now to the recovery would be abandoning the plan that is delivering a brighter economic future.

Evidence of the Government’s long-term economic plan was on display when the Chancellor visited Enfield to see the Meridian Water site, which is delivering jobs, houses and transport infrastructure. However, under this Government, will the Minister look at the opportunity for revisiting the northern gateway access road, which links the M25 with this vital economic area?

My right hon. Friend the Chancellor has said that, yes, he is very happy to look at it. As he said when he visited, infrastructure investment is an important part of our long-term economic plan. I know that my hon. Friend has been working for many years on this scheme. He has built a coalition of partners locally and this is important for the Lee valley. The Government will always look at important infrastructure investment to bring jobs and growth to all parts of our economy.

In my constituency, 20% of people in work earn less than the living wage and others are trapped in part-time jobs and on zero-hours contracts. Why do the Government keep trumpeting a supposed recovery that, for the first time ever, has left more people in poverty in work than out of work?

I am sure that the hon. Lady will welcome the fact that there has been a 24% fall in her constituency in the number of young people on jobseeker’s allowance, and the long-term economic plan is for all people. My hon. Friend the Exchequer Secretary has always talked about the rise in the personal allowance, and it is this Government, as we have already heard, who are taking action on zero-hours contracts. The last Government had 13 years to tackle them and failed to do so.

The Minister will know that Kettering is very much middle England at its best. With a 2,500 increase in local jobs since the last election, does that not demonstrate that plan A is most definitely working, and there is absolutely no need for a plan B?

I know Kettering very well as I pass it on the Midland main line up to my constituency twice a week. My hon. Friend is absolutely right to say that the increase in jobs shows that the Government’s long-term economic plan is working. As I said, the job is not yet done, there are always risks to our economy, and we need to build a sustainable, strong economic recovery that benefits everyone, including everyone living in Kettering.

Does the right hon. Lady agree that the Chancellor promised to balance the books, but is going to fail; he promised to deal with debt, but is failing; he promised to maintain triple A ratings, but he failed; and when it comes to the jobs market, as my hon. Friend the Member for Warrington North (Helen Jones) said, it is increasingly characterised by low pay, squeezed wages and zero-hours contracts?

My right hon. Friend the Chancellor promised to fix the British economy, which is what we are doing. The hon. Gentleman might remember that the last Chancellor promised to abandon boom and bust, and we know where that got us.

Child Poverty

8. What recent assessment he has made of the effect of the Government's policies on its commitments under the Child Poverty Act 2010. (904400)

The Government are committed to our goal of ending child poverty in the UK by 2020. We are determined to tackle the root causes of poverty, not just the symptoms. Our draft child poverty strategy 2014-17 sets out our approaches, based on robust published evidence review. Work remains the best route out of poverty. We are making work pay and tackling low pay through our reforms to the welfare and tax systems. Universal credit, for example, will lift as many as 300,000 children out of poverty.

But this week the largest ever study of poverty in the UK, the Poverty and Social Exclusion project led by the university of Bristol, was published. It found that full-time work is not sufficient to keep families out of poverty and that the majority of children who suffer multiple deprivations live with both parents, at least one of whom is working, in small families, with only one or two siblings. When will the Government accept responsibility for the rising tide of in-work poverty and do something to help people who are trying their hardest but still struggling to get by, including the children who are living in those families?

We have set out, as I have already said, a clear commitment by this Government to end child poverty by 2020. The hon. Lady’s question shows that there are a number of root causes of child poverty. Incomes, of course, are a very important part of that. We are working to raise the income of poor children’s families by helping them get into work and making work pay, and she will appreciate the rise in the national minimum wage. We are also raising educational outcomes for poor children, which is equally important.

But nearly 30% of children in my constituency, Liverpool Wavertree, are living in poverty, and many of those children have parents who are in work. This is the highest level in five years. Is the Minister embarrassed by her Government’s record on child poverty? What exactly is she going to do about it?

Five years ago there was a Labour Government in power, and I am sure the hon. Lady will welcome the fact that there has been a 21% fall in jobseeker’s allowance claimants in her constituency. I am sure she will also welcome the rise in the national minimum wage that this Government have overseen.

16. One of the key challenges to tackling child poverty in my constituency is the resilience of low income families to sudden financial shocks. The answer, surely, is to improve saving levels. What can the Minister do to improve the opportunities for families to save more? (904408)

We have seen that the savings ratio has gone up under this Government, but my hon. Friend is right. The causes of poverty are many and various, but the important point is getting people into work. The troubled families programme, which this Government have introduced and overseen, has shown that getting an adult in a workless household into work has a transformative effect, alongside steps such as increasing savings. Getting people into work is the most important thing we can do.

Is the Minister aware that child poverty, wider poverty and inequality rose in the previous Parliament and have been declining so far in this Parliament, as has the number of people who struggle to pay their food bill, according to OECD figures?

My hon. Friend is right about the figures. We remain committed to continuing the fall and to eradicating child poverty by 2020. Our draft strategy sets out how we intend to achieve that. Children are three times more likely to be in poverty if they live in a workless household, which is why work remains the best route out of poverty.

Construction Industry

9. What steps he is taking to promote private sector investment in the construction industry. (904401)

The Government published the Construction 2025 industrial strategy in July last year, setting out a clear vision of how the Government will work with the industry to maximise the opportunities for growth. The Construction Leadership Council, chaired by my right hon. Friend the Business Secretary and Sir David Higgins, is overseeing delivery of that strategy. In addition, efforts to drive improved delivery are being co-ordinated through Infrastructure UK’s cost review programme.

But Wrexham construction companies continue to tell me that banks fail to offer loans to support house building projects. Non-financial private sector investment has fallen from £43 billion in 2008 to £14 billion in 2013. Is this not just another aspect of the failure of the Chancellor’s short-term economic scam?

As a Government we are trying to do everything we can to help the construction industry, whether that is through the beneficial effect of Help to Buy, the local infrastructure fund, or the changes to planning. It is worth pointing out that construction output, according to the Office for National Statistics, is 4.6% up from where it was 12 months ago. The purchasing managers index also shows significant increases in construction. We are moving in the right direction.

The construction industry has benefited from the business-friendly policies of this Government. Does my hon. Friend agree with my constituent, the former Trade Minister, Lord Digby Jones, when he says that the Leader of the Opposition is the “least business-friendly” leader of any political party in years?

On the subject of private sector investment in the construction industry, rather than the characteristics of an individual, a brief reply, Minister Gauke. We are grateful.

If we want to see private sector investment in the infrastructure industry, or anywhere else, we must maintain business confidence. Anti-business policies do not help that.

But 2025 is a long way away for a plan. Is the Minister not aware that on this Government’s watch infrastructure output in the whole economy, public and private, is 13% down? Is it not about time they got their finger out and did something about it?

I am not sure whether the hon. Gentleman is criticising the long-term approach of our economic plan, but it is important that we think about the long term. Infrastructure spending, both private and public, will on average be higher in this Parliament than it was in the previous Parliament.

Is the Exchequer Secretary aware that a partnership between the Government, Central Bedfordshire council and developers is leading to the construction of 5,200 houses north of Houghton Regis and the provision of a bypass, for which we have waited 60 years, as a result of a £45 million contribution from the developers? Is not that the way to get construction going?

My hon. Friend is absolutely right. It is as a result of this Government’s long-term approach to the economy that we will see significant increases in infrastructure over the years ahead.

Inflation and Growth

11. What recent assessment he has made of the difference between the rate of inflation and the rate of growth in average earnings since May 2010. (904403)

Times have been tough for hard-working people. As Paul Johnson of the Institute for Fiscal Studies said on 6 December:

“There have been very significant falls in real earnings as a direct but delayed result of the 2008 recession, essentially.”

As the Bank of England and the IFS have said, the best way to support living standards is to improve productivity and by sticking to the Government’s long-term plan to build a stronger economy.

Real wages have fallen in Blaenau Gwent, partly due to poor access to labour markets. What progress is being made to speed up rail electrification for the valleys, which would boost earnings? The Chief Secretary said that he would look into the matter six months ago. What has happened?

There is an agreement with the Welsh Government on that, but as I said a moment ago, this Government have an infrastructure plan. Up and down the country progress is being made to improve our transport infrastructure. That is part of our long-term economic plan. The hon. Gentleman will also be aware that in his constituency the number of jobseeker’s allowance claimants is down 20% over the past year.

Does the Minister agree that all the evidence suggests that the biggest impact on the rate of earnings is the competitiveness and productivity of industry? Does he also agree that the single biggest threat to increases in average earnings is Labour’s plan for a stealth corporation tax and a jobs tax?

Absolutely. If we want to see jobs and investment in this country, we should be taxing jobs and investment less, not more.

Help to Buy Scheme

Help to Buy is working. Since the Chancellor announced the scheme in the 2013 Budget, it has supported over 27,000 households on to the housing ladder, and the numbers show that it is helping the right people—but we will be vigilant. The Chancellor has asked the Financial Policy Committee to assess the ongoing impact of the Help to Buy mortgage guarantee scheme annually, and it will make its assessment in September.

I thank the Minister for that reply, but when in five London boroughs, for example, the value of properties sold under the scheme has been over £400,000, have we not reached the point at which we should be reviewing this urgently, because at the same time we are hearing increasing calls for the Financial Policy Committee to look at cooling the housing market? We could be cooling the mortgage market on the one hand and encouraging higher prices through Help to Buy on the other. It does not make sense.

The hon. Lady should be aware that the numbers just do not support what she is saying. In fact, 94% of all completions under Help to Buy are outside London, the average price of a home under the mortgage scheme is around £151,000, which is well below the UK average of £260,000, and only 1.3% of total mortgage lending is under the Help to Buy mortgage scheme.

The Minister will know that Hull North’s Kingswood area leads the table for the number of houses sold under Help to Buy, but is she aware that Ministers in the Department for Environment, Food and Rural Affairs have repeatedly told me in this House that those houses should not have been built because they are on a floodplain and will not get insurance under the Government’s new insurance scheme? Does one hand of Government know what the other hand is doing, because it does not look like it to me?

The Government know exactly what their policy is on Help to Buy—it is to support first-time buyers and, at the same time, to make a significant contribution to new housing starts. The supply of housing is absolutely essential for people to achieve their dream of getting on the housing ladder.

A total of 119 households in my constituency have benefited from Help to Buy, of which 96% are first-time buyers. Will the Minister visit Swindon to meet these people and those in the construction industry who have benefited from this opportunity?

I am grateful to my hon. Friend for that invitation, and yes, I would love to take him up on it. As a new Minister, it would be a very exciting visit for me, so I thank him. The chief executive of Barratt Homes has said that its new housing starts are 20% up on two years ago owing to the Help to Buy scheme.

Does my hon. Friend agree that Help to Buy is a key component in helping families and first-time buyers take the important step on the property ladder, as evidenced by my right hon. Friend the Prime Minister’s recent visit to Ilkeston in Erewash to see the very successful scheme at Briars Chase?

My hon. Friend, who represents Erewash so well, is absolutely right. Aspiring to one’s first new home is something that we all wish for, for ourselves, our children and our grandchildren. This Government are determined to do something about that while ensuring that we do not do anything that would enable an unsustainable housing boom.

15. One of the features of the UK housing market is that millions of houses are inefficient in their use of energy, and even much new housing is not as energy-efficient as it ought to be. The Help to Buy scheme could have been used as a way of providing a massive boost to more energy-efficient UK housing stock, but that opportunity has so far been lost. What will the Government do to remedy this deficiency? (904407)

The hon. Gentleman is right that house builders should be seizing the opportunity to make homes as energy-efficient as possible. That does not, however, detract from the very important point that the Help to Buy scheme was started to try to regenerate growth in the housing market, and that is an achievement that all Members should be proud of.

Stamp duty on homes is a major money-spinner for the Treasury, yet it is paid disproportionately by hard-working families in the south-east of England who have to pay at least twice as much for a family home and therefore twice as much stamp duty as they might for a home in the shadow Chancellor’s constituency, for example. Is it not time to consider regional stamp duty rates so as to be fairer to hard-working families?

I accept my hon. Friend’s suggestion as a lobby to my hon. Friend the Exchequer Secretary, to whom I shall chat in due course, no doubt, in the Members’ Tea Room.

Topical Questions

As we strive to close the north-south divide and continue to deliver faster growth for the north, what further steps is my right hon. Friend proposing to promote the area as an economic powerhouse to rival London and our global competitors?

Yesterday I had a very good meeting in Manchester with civic leaders from all parties and with universities from the north of England to discuss how we could improve the transport links across the Pennines and through Yorkshire and Lancashire and ensure that we have strong civic governance as well. Today’s investment by Abu Dhabi in Manchester is a good example of the confidence in the northern economy.

The House and the Chancellor should know that the jury has just delivered its verdict and the Government’s former director of communications, Mr Coulson, has been found guilty of conspiracy to hack phones. Does the Chancellor now accept that it was a terrible error of judgment for—

Order. This may be a matter of great interest, but it does not relate to Treasury questions. [Interruption.] Well, it is not clear to me that it does, and if the question were to be judged to be in order, it would need to be clear by now. [Interruption.] I really think not. I cannot see what the relevance is to the responsibilities of the Chancellor of the Exchequer. The shadow Chancellor can try another sentence and we will see.

Does the Chancellor accept that he has brought the office of the Chancellor and the Treasury into disrepute by urging the Prime Minister, for his own reasons, to bring Mr Coulson into government? Has the Chancellor not damaged his own reputation and that of the Government?

Obviously the verdict has been announced while we have been doing Treasury questions. I will go away and study it, and of course if a statement is appropriate from me and the Prime Minister, there will be one—not in Treasury questions, when we are talking about the economy. May I say to the right hon. Gentleman that the person who worked alongside Damian McBride is no person to give lectures on anything?

T2. According to the Department for Transport, for Kettering’s sustainable urban extension to be sustainable a new road junction on the A14, junction 10A, costing £39 million, needs to be provided. Despite the best efforts of local people with numerous Departments, this funding has not been forthcoming. Would the Chancellor be kind enough to set up a meeting for local people with the Commercial Secretary to the Treasury so that funding for this vital infrastructure can be secured? (904419)

I am certainly aware of the importance to local people of this project, and I know that my hon. Friend has been speaking to the Department for Transport. I am of course happy to arrange for him to meet the Commercial Secretary, and I know there is also a bid in to the single local growth fund, on which we will be making an announcement in the coming weeks. May I also say that my hon. Friend has been a doughty champion of his constituents and of businesses in his constituency?

T3. The rate of employment of disabled people is approximately 30% lower than that of non-disabled people, and 650,000 more disabled people are required to look for work as a result of welfare reforms since 2008. The Chancellor of the Exchequer has spoken of his ambition of achieving full employment. Is he confident that the Government have a strategy sufficient to close this gap, as that will be essential to achieving that goal? (904420)

The Department for Work and Pensions, and the Ministers responsible for disabilities and for employment, launched a strategy last December to help those with disabilities to find work. What this Government have not done is what the previous Government did, which was to say to people, “We don’t think that you can work.” We want to empower people to work, and schemes such as Access to Work are all about doing that.

T6. May I congratulate the Chancellor on his excellent HS3 proposal? It follows on from an equally visionary plan from the Deputy Prime Minister—in the previous Government. How does the Chancellor’s plan exceed Lord Prescott’s ambition? (904423)

I am sorry, but when the hon. Gentleman was talking about an excellent Deputy Prime Minister I assumed he was talking about the leader of the Liberal Democrats rather than John Prescott—perhaps the hon. Gentleman was just being ironic about Lord Prescott. Lord Prescott was on the television yesterday boasting that he had set out a plan in 2004, and then someone pointed out that nothing had happened to his plan since. We are talking about improving the links from the Greater Merseyside region across Manchester and Leeds to Hull, and indeed across all parts of the north. High-speed rail is part of this, but it is only part of it: this is also about solving local bottlenecks, such as with the money we are putting into the M62, and about speeding up the commuter trains, which is what the northern hub is all about. This is a coherent plan to back a northern powerhouse.

T4. Despite the Chancellor’s boasts, the former Tory Chancellor admitted recently that people have “not yet felt any sense of recovery”.Does this Chancellor agree with him, yes or no? (904421)

I agree with the previous Deputy Prime Minister, John Prescott, who said that Labour gets “smashed on the economy”.

T8. Many trains now take longer to go from Liverpool to Manchester to Leeds than they did in the 19th century, so I welcome the Chancellor’s comment on HS3, but may I ask him to look particularly at how we can improve wider transport connectivity, not just an HS3 line? (904425)

High-speed connectivity across the Pennines is of course an important component of having the northern powerhouse, but it is also important to improve transport links within Lancashire, to Blackpool and other such places. We are going to be introducing electric trains on some of these lines in Lancashire from December, which will improve the quality of travel as well as the speed. As I said yesterday, when we also put in the franchise for the Northern rail line, we will be seeking to try to get better and more modern carriages, because one of the experiences of people living in the north is a feeling that the carriages are not as good as those in the south of England, and we want to address that in the franchise.

T5. Next year will mark 100 years since the execution of Edith Cavell, the brave nurse who saved countless lives during world war one. In this important year of remembrance, will the Chancellor join me and the 110,000 people who have signed an online petition and urge the Royal Mint to mark the anniversary by including Edith Cavell on its list of designs for the new £2 coin, so that we can honour all those who served and made sacrifices for our country in different ways a century ago? (904422)

As well as being Chancellor of the Exchequer, I am Master of the Royal Mint. I can therefore address the hon. Gentleman’s question directly. I am certainly aware of the campaign, and I of course honour the bravery and sacrifice of Edith Cavell. There will be a whole series of coins to commemorate the first world war, some of which will be in general circulation and some of which will be for collectors. Like previous Governments, we act on the advice of a Royal Mint advisory committee on these topics, but I will directly take up with it the suggestion of marking Edith Cavell’s sacrifice and make sure that it is honoured in an appropriate way.

T9. Pembroke refinery, which employs 1,100 people in my constituency, is 50 years old this year. Will the Chancellor assure the operator, Valero, that it has the full support of the UK Government and that the UK is a good place for refining to remain? (904426)

I can absolutely give my hon. Friend and his refinery that assurance. Refineries such as the one at Pembroke play a key role in the UK’s energy security and provide many thousands of skilled jobs across the country. Our energy policy enables companies to know that investment is coming in, and therefore to make investment decisions for the future. I hope that Valero will look at the British economy and see that it is recovering and on the rise, and that that, with activity increasing, will mean more requirements for refining capacity.

T7. May I remind the Chancellor that it was actually Daniel Adamson, who envisaged the Manchester ship canal in 1882, who talked about an economic powerhouse of the north from the banks of the Mersey estuary through to the North sea at Hull? That vision’s time has come, but it will take leadership, guts and gravitas locally and nationally, and on both sides of the House, to create a powerhouse that will rival any on the global stage. (904424)

I agree with the hon. Gentleman. One of the refreshing things about the discussions we had yesterday was that they took place on a genuinely cross-party basis. The Labour mayor of Liverpool, Joe Anderson, came to the speech I gave and met me and the Prime Minister to talk about what we could do, as did the civic leaders in Manchester. We are working across the political parties, as northern MPs, to bring this about, and of course the ship canal could be part of the exciting Atlantic gateway project, which would create regeneration and jobs along the course of that incredible waterway.

T10. With manufacturing growing at an impressive rate, as I saw on my recent visit to ABB in my constituency, what steps is the Chancellor taking to ensure that manufacturing growth remains sustainable? (904427)

We are taking steps to reduce business taxes, when others would put them up. We are also taking steps to ensure that energy costs for manufacturers are lower; we set out a package in the Budget. Above all, we are creating a country in which people want to invest and create jobs because they have confidence in our long-term economic plan.

The number of tax compliance inspections of companies by Her Majesty’s Revenue and Customs is falling, rather than rising. Why is that the case?

HMRC is increasingly successful in bringing in its yield. It has to develop the most effective ways of working, and if it can find more efficient ways of doing so, that is fine. The important point is that HMRC is bringing in more money than it has ever done before.

The Chancellor of the Exchequer will recall that we met a group of McDonald’s apprentices and an Ealing McDonald’s franchise owner, Atul Pathak, last week to celebrate the announcement by McDonald’s of 8,000 new apprenticeships across the UK. Does my right hon. Friend agree that the Government’s initiative on supporting apprenticeships has been one of our great success stories—good for the economy and good for youth unemployment?

We had a fantastic meeting with McDonald’s employees, at which my hon. Friend was present, and it was heartening to hear about their confidence in their economic future. It is remarkable that we have had an hour of Treasury questions, during which we have discussed youth unemployment, and there were Department for Work and Pensions questions yesterday, but not a single Labour MP has mentioned the welfare plan that their leader published last week. That shows why the Labour economic policy lacks credibility even with Labour MPs and why the Labour leadership is in crisis.

Unemployment is bringing despair to a generation of young people in Northern Ireland, where nearly one in four young people are unemployed and have to seek their prospects elsewhere. Has the Chancellor had any discussions with the Secretary of State for Northern Ireland? If so, what plans are in place to address this particular issue, as youth unemployment poses a risk to peace and the political process?

I certainly have regular discussions with the Secretary of State for Northern Ireland, who is very focused on Northern Ireland’s economic development. Of course, I also meet the Northern Ireland Executive. We have plans to increase investment through the enterprise zone, and I commend the work of people across Northern Ireland to bring new businesses to Northern Ireland. We have more work to do on fixing the banking system in Northern Ireland, which remains impaired by what happened a couple of years ago, but I assure the hon. Lady that we will work together to deliver an economic recovery of real strength in Northern Ireland.

Does my right hon. Friend accept that, as a result of the long-term economic plan, unemployment in Chelmsford over the past 12 months has fallen by just over 30% and, equally important, youth unemployment has fallen by just over 36%? Does he accept that any Opposition Member who thinks we should abandon that plan is a believer in voodoo economics?

I would suggest that it is not clear what Labour’s economic policy is. The shadow Chancellor wants to tax, borrow and spend more, but he is keeping his head down because he can see the car crash—he has experience of those—looming with the Labour leader, while the Labour leader is talking about prices and incomes policies and an anti-business agenda. It is totally muddled and means that if Labour ever got the chance again, it would put Britain back into crisis.

The Chancellor talks about credibility in economic policy, yet he consistently sets his face against having his economic policies, along with those of the other major parties—certainly those that would take part in television debates before the next general election—put before the Office for Budget Responsibility so that the electorate can understand what parties are saying about economic policy and be better informed when they vote.

As Robert Chote has set out, there would be very serious implications if the OBR, a new institution which, of course, the Labour party did not support when in government—[Interruption.] I remember proposing it time and again as shadow Chancellor and hearing Ministers say at this Dispatch Box that it was not a good idea. The proposal would make big changes to the role of the civil service as well as that of the OBR. Robert Chote is right to say that, while we can consider it in the next Parliament:

“To embark on this exercise in a rush, or with insufficient resources, could be…very damaging to the OBR.”

It is very welcome that the Government are introducing a statutory code of conduct for pub companies, but it lacks the all-important market rent only option. There is concern about the direct lobbying of the Treasury by the British Beer and Pub Association and the pub companies. When will the Treasury accept the freedom of information request from the all-party save the pub group?

I am happy to look into the freedom of information request, but we have been working very closely with the Business Secretary on these proposals, and I would hope that the hon. Gentleman would welcome the legislation we are introducing to make sure that local pubs and publicans get a good deal.

May I take this opportunity to welcome today’s announcement of the partnership between Manchester city council and the Abu Dhabi United Group to build 6,000 new homes in my constituency? Does the Chancellor agree that that shows that when we give freedoms, powers and budgets to good local authorities, they can increase housing supply in their areas and build the economy locally?

I certainly join the hon. Lady in commending the work that Manchester city council has done. One of the things I talked about yesterday was what we can do to make sure that cities such as Greater Manchester have more powers, perhaps through elected mayors. We should also pay tribute to Lord Deighton, who is in Abu Dhabi at the moment, for negotiating that deal. There was a good partnership between the city council and the Treasury, and it is fantastic news that Abu Dhabi United Group is making that big investment in the UK.

I apologise to the right hon. Gentleman, but points of order come after urgent questions and statements. [Interruption.] Well, that is the procedure, but I am always agog to hear the right hon. Gentleman. He can toddle back after the UQ and the statement, and I will be in the Chair to hear him. [Interruption.] I cannot have a conversation as we go along; we must have the urgent question.

Patient Safety

(Urgent Question): To ask the Secretary of State for Health if he will make a statement on his announcement on patient safety.

Mr Speaker, I would like to make a statement to the House about a package of measures that I have announced today to boost safety, transparency and openness in our NHS. It follows my earlier written ministerial statement.

Just last week, the independent Commonwealth Fund said that under this Government the NHS has risen to be the top-rated health care system in the world. Despite many challenges in our NHS, it is therefore clear that we have much to be proud of. However, it is also clear that there is more to do. It is estimated that for 12,000 deaths a year in hospitals there was a 50% or greater chance of their being prevented. Figures released by NHS England today tell us that there were 32 never events in the past two months, including cases of a throat pack and a hypodermic needle being left inside patients post-surgery. These are shocking statistics.

In the Government’s response to Sir Robert Francis’s landmark public inquiry on the poor standards of care at Mid Staffordshire NHS Foundation Trust, I made clear our determination to make the NHS the safest and most open health care system in the world. Today, all hospital trusts around the country will therefore receive an invitation to the Sign up to Safety campaign, which is led by Sir David Dalton, the inspirational chief executive of Salford Royal. The campaign will help us to achieve our ambition of halving avoidable harm, thereby potentially saving 6,000 lives. Trusts will be asked to devise and deliver a safety plan, and may receive a financial incentive from the NHS Litigation Authority to support implementation.

We are fulfilling the pledge that we made in our response to Francis to create a hospital safety website for patients. As of today, the NHS Choices website will tell us how all hospital trusts are performing across a range of seven key safety indicators, including one for open and honest reporting. For the first time, the website will let patients and the public see whether a hospital has achieved its planned levels for nursing hours. Indeed, I am pleased to inform the House that the latest work force statistics, published today, show us that we have 5,900 more nurses in our hospital wards since our response to Francis just over a year ago.

Finally, I am pleased to announce today that Sir Robert Francis QC will chair an independent review on creating an open and honest reporting culture in the NHS. The review will provide advice and recommendations to ensure that NHS workers can speak up without fear of retribution. It will also look at how we can ensure that where NHS whistleblowers have been mistreated, there are appropriate remedies for staff and there is accountability for those who have mistreated them.

I am confident that the package of measures announced today will shine a light on poor care so that lessons can be learned, action can be taken and harm to patients can be prevented. In the process, we will support front-line staff to help the best health care system in the world blaze a trail on issues of safety, transparency and compassionate care.

The Health Secretary rightly calls for openness, transparency and accountability. It is a pity that that does not extend to his dealings with this House. He spent the morning touring TV studios, but could not find the time to come to the Chamber. Is that because he has signed away day-to-day control of the NHS, as his public health Minister—the Under-Secretary of State for Health, the hon. Member for Battersea (Jane Ellison)—let slip, or is it because he did not want to face questions on the damning criticism of him from the outgoing president of the Royal College of Psychiatrists, who says that he is ignoring the “car crash” in mental health? Either way, it should not be left to us to drag the Secretary of State to the House.

An open, learning culture in all parts of the NHS is an ambition shared across this House and it builds on the work of the last Government following care scandals in the 1990s. More information is welcome, but how will the Secretary of State guard against the risk, as expressed this morning by Martin Bromiley, of creating a “naming, shaming and blaming” culture? He has just told the House that a fifth of hospitals are failing to report properly. Why is that and how will he correct it?

The Secretary of State mentions the Commonwealth Fund and I join him in celebrating the standing of the NHS. He implies that it has all been achieved in the past four years. That is pure spin. I remind him that the NHS first came top in 2007 and that this year’s report specifically traces the NHS’s recent success to reforms implemented by the last Labour Government and to the Darzi report, which it says led to

“an increased emphasis on improving the quality of care provided by the NHS.”

Perhaps the Secretary of State will reflect that analysis in any future statement on the previous Government’s record.

The Secretary of State promises new data on infection—one area where the Commonwealth Fund found cause for concern compared with 2010, with the NHS now ranked worst in the world for patients reporting infection in hospital or shortly after. What is he doing to turn that worrying trend around? On staffing, will he commit to publishing figures on how many of the nurses he mentioned are agency nurses? Is the NHS not now spending a fortune on agency staff—£1.4 billion, 162% higher than planned—because, in the first four years of this Parliament, the Government and the then Secretary of State, who is now the Leader of the House and sitting on the Front Bench, cut nurse training places by 10,000?

The Secretary of State talks about his new target to save 6,000 lives over three years. Can he explain how that will be achieved when people are now waiting longer to start treatment for cancer, when NHS waiting lists have hit a six-year high and when ambulance response times are getting longer? Is not that the real reason he was afraid to come here today? The NHS is getting worse on his watch and the Government have surrendered their power to do anything about it.

We talk about many things and there will always be political differences between Opposition and Government Members, but I would have thought that on patient safety, on saving patients’ lives, on dealing with the issue that once a week in the NHS we operate on the wrong part of someone’s body and on other terrible issues, there might be a degree of consensus. It is incredibly disappointing that, again, the right hon. Gentleman has chosen to make a political football out of something that should be above party politics.

Let me go through the right hon. Gentleman’s points. This morning in the radio studios, I talked about fulfilling a pledge that I made to the House in my response to Francis—that we would publish staffing data, something that he never did when he was in power. We have done that for 6,700 wards throughout the country, because we want to end the scandal of short staffing that happened on his watch and directly led to Mid Staffs.

I am delighted to come to the House. I have made a written ministerial statement. I often come to the House and I am delighted that the right hon. Gentleman has raised this issue. As he has raised some specific points, I need to address them. He quoted what the outgoing president of the Royal College of Psychiatrists said, but he failed to mention what the incoming president said this morning, which was to praise the remarkable work done by this Secretary of State and his Ministers to raise the issue of mental health.

The right hon. Gentleman talked about the Commonwealth Fund. Let us look at that. When he was Secretary of State, we fell from being top-rated in the world to being second. We are now back on top. He has spent the past four years saying that under the coalition Government the NHS is going to rack and ruin. Someone who is independent has now looked at it and said that we are the best in the world. The right hon. Gentleman should reflect on that before he starts to criticise and run down the NHS.

Let us talk about agency nurses. I am very proud of the fact that, in just over a year, we have 5,900 more nurses on our wards. That is an increase of 4,000 nurses across the system compared with when Labour was in power. Why is that? It is because we are doing something about the issue of safety and compassionate care—issues that the right hon. Gentleman repeatedly swept under the carpet when he was Health Secretary.

Finally, let me make this point. We are doing something that is a world first today: we are publishing staffing data on a hospital-by-hospital, ward-by-ward basis. Yes, we are also publishing which hospitals do not have an open and transparent reporting culture. Creating transparency about failures has, I am afraid, become one of the biggest dividing lines in this House. I think it is a very great shame that every time I raise the issue of poor care in the NHS, the right hon. Gentleman accuses me of running down the NHS and softening it up for privatisation, when what I am actually doing is standing up for patients, which is what he should have done when he was Health Secretary.

I welcome today’s announcements. Unsafe care in the NHS carries not only a terrible personal cost, but a terrible financial cost—£1.3 billion a year in litigation alone—and I welcome the announcement of Sir Robert Francis’s review. Will the Secretary of State use this opportunity to reassure NHS staff that they do not need to wait for the outcome of that review, and that if they raise concerns about unsafe practice, not only will they be protected, but they would be failing their patients if they failed to do so?

I start by welcoming my hon. Friend to her new position as Chair of the Health Select Committee, which I think she will do brilliantly well. I also thank her for the fact that she had been talking about this issue long before she took up that post, and as someone who has worked in the NHS, she has always recognised its importance.

My hon. Friend is absolutely right to say that NHS staff should not wait until the outcome of the new Francis review before speaking out. My view is that the atmosphere is beginning to change inside the NHS. We are getting trust boards that are now spending much more time talking with safety, but the reason I wanted to have this review is that there are problems and issues across the world with people in health care speaking out, and nowhere has really embraced the culture of safety that we have in the airline, nuclear and oil industries, where concerns about safety are on a completely different level. I know that I have the wholehearted support of NHS staff in this mission; I think it is a shame that we do not have the support of the Labour party.

In response to the Francis report in relation to the duty of candour, the Government said that it should be on institutions and not on individuals. Given that the Government appear not to want to bring in new regulatory bodies in relation to individual action inside the national health service, does the Secretary of State have any faith in the regulatory bodies currently looking after health professionals, given the state that Mid Staffs hospital ended up in?

We looked carefully at whether the duty of candour should apply to individuals, and we decided against that because we were worried about creating a legalistic culture in trusts. However, we are working with the regulatory bodies. The right hon. Gentleman is absolutely right to raise concerns, as they were indeed raised in the Francis report. Following on from my earlier response, one of the lessons that we learned from the airline industry is that pilots are professionally protected if they speak out, so on balance it is to their advantage to speak out rather than to shut up. As a result of that reporting of safety incidents, near misses and so on, the industry has achieved a remarkable reduction in accidents. I would like to see whether we can do the same thing in the NHS.

One of my constituents spoke out against malpractice at the hospital where she worked and was subsequently vindicated at a tribunal, but she lost her job and has been unable to find work in the national health service ever since. Is it not time that we put an end to some kind of blacklist that stops people being re-employed when they have done the right thing?

I would like to thank my hon. Friend for the support that she has given to her constituent, whom I think I have also met. My hon. Friend is absolutely right: we have to stop this system of consequences for people who do the right thing and speak out. It is not right for me to comment on an individual case, because legal proceedings are often involved, but one hears of situations where people have spoken out and then been victimised by a trust, and that is wrong. We need to be better at looking after whistleblowers, but we need to go further and eliminate the need for whistleblowing by creating a culture where trusts are hungry to hear from their own staff about safety concerns because they want to put them right.

An Exeter psychiatric nurse of more than 20 years’ standing wrote to me in despair this week saying that

“mental health services are in collapse”,

and that patients are regularly placed in “life threatening” situations or sent as far away as Bradford because there are no beds locally. Vulnerable people are waiting a shocking three months for the co-ordination of their care. How dare the Secretary of State come to the House today and claim that our mental health services are not in crisis?

There are real pressures in our mental health services, but the right hon. Gentleman should recognise the progress that the Government have made. That includes doubling the money going into talking therapies, having global summits on dementia and putting a massive amount of money towards raising the profile of dementia in this country and across the globe, and legislating for parity of esteem as between mental and physical health—something that never happened under the previous Government. There is a lot of work to do, but I think he should give credit where it is due.

On transparency of staffing levels, does my right hon. Friend know that the University Hospitals of Morecambe Bay NHS Health Trust vacancy level for nurses is now 4%, against a regional average of 10%? That is obviously an increase in nurses in my area, and I thank him for that.

I welcome the increase in nursing across the country, and I am surprised that Labour Members do not welcome it. When I started in this job they spoke constantly about nursing numbers, but I notice they have now stopped doing that. Although those numbers are an important first step, it is not possible to compare trust with trust at this stage because they are all self-reported numbers. Over the next months—certainly by next spring—we will go through all the figures ensuring that NICE-approved tools are used to fulfil them. We will then see how trusts are doing compared with each other, which will be useful to them.

As a member of the Health Committee, I am disappointed that the Secretary of State does not understand that being dragged to the House to answer an urgent question is not the same as coming here to make a statement. I would prefer to hear first in this House what the Government are doing.

The Secretary of State mentions the leadership of David Dalton and Salford Royal NHS Foundation Trust, but that leadership led to safe staffing levels, which he has not supported. A recent Nursing Times survey found that the majority of nurses said that their wards were dangerously understaffed. I hear from nurses who are working with ratios of 2:22, 2:24 or 2:28—that is the reality. Does he think it is time he apologised for cutting the number of nurses?

Again, I am surprised that we do not have more agreement. If the hon. Lady looks at the figures, she will see that in the past year there have been 5,900 more nurses on our wards. Why does she not welcome that? We are using Salford Royal—a brilliant hospital that she knows well—to lead a safety campaign across the whole country to learn from the brilliant things that it is doing. I put a written statement before Parliament, and nothing I said this morning is not in the public domain. I would be delighted to come to the House any time to make an oral statement, and I notice that far more coalition MPs want to ask questions about safety and compassionate care than do Labour MPs.

My right hon. Friend will remember some of the issues that I raised in the House about patient safety, and the Francis report, the Keogh review, and the new Care Quality Commission regime have made a material improvement. On Friday last week, Buckingham Healthcare NHS Trust was the second trust to emerge—at last—from special measures. Will the Secretary of State join me in congratulating that trust, and express the hope that that marks a new beginning about which we can be optimistic?

I would be delighted to do that. Incredible hard work by doctors, nurses and health care assistants on the front line of my hon. Friend’s local hospital has meant that the trust has come out of special measures, which the whole House should celebrate. Indeed, it was helped in that by Salford Royal, and one of the most encouraging things about the new special measures regime is that we are pairing up hospitals in difficulty with other hospitals that have a better record, and we are getting tremendous results.

Clinical commissioning groups commission services in hospitals. What discussions has the Secretary of State had with CCGs to ensure that when they commission services they particularly look to ensure transparency and that patient safety is the highest priority in their discussions?

We have a lot of discussions, and the hon. Gentleman is right: the commissioning of care is vital and we need CCGs to play their part. We have many discussions with NHS England about how to do that, and we will be considering how we can make CCGs more publicly accountable for their record in those areas.

Oxford University Hospitals NHS Trust has managed to make multi-million pound recurring savings over the past couple of years and is now in the black. At the same time it has managed to create 400 new jobs in the trust, almost all of which are new doctors and nurses. Does that not demonstrate that it is possible for the NHS both to meet the Nicholson challenge, and to recruit more doctors and nurses to improve and enhance patient safety?

It certainly does, and that is another area where it would be refreshing to have a bit more openness from the Labour party. We can afford 8,000 more doctors and 4,000 more nurses in our NHS than when Labour was in power because we got rid of primary care trusts and strategic health authorities, and 20,000 administrative jobs that were not on the front line—a change that Labour opposed bitterly every step of the way. Labour Members must say what would happen to those doctors and nurses if we repealed the Health and Social Care Act 2012, as they have publicly committed to do.

If the Secretary of States wants some kind of TripAdvisor-style scheme for the NHS that is fine; it may improve safety and it may help patient choice. However, a woman who has fallen to the bottom of her stairs and is waiting hours for an ambulance does not have a choice. That is happening now and it was not happening five or six years ago. What is he going to do about that?

First, I will ensure that throughout the system when we have failures in care we are completely transparent about them and do not seek to brush them under the carpet. That is a very important change. Secondly, yes there is pressure on ambulance services, just as there is pressure in most parts of the NHS now, but under this Government our ambulance service is taking 1,000 more people every day on emergency journeys. We should credit it with doing a very good job in difficult circumstances.

I commend my right hon. Friend for being determined to create a different and more effective safety culture in the NHS, just as in the airline or oil and gas industries. Does he accept that publishing more data is only part of the equation and will not necessarily change attitudes and behaviours, particularly if those data are then gamed at another target? We must tackle attitudes and behaviours at source—in the operating theatre, the GP’s surgery and throughout the whole service—to get that better safety culture.

As ever, my hon. Friend speaks wisely. The first step is to be open and transparent about where the problems are, and I hope today will be a step in that direction. In the end, however, if we are to change things we must create a learning culture in all our hospitals so that the word goes out from the top down that the management is interested in hearing from staff if they have concerns about safety, because it wants to learn from those concerns and put them right. One of the messages I have been trying to get across is that that does not cost money; it saves money. We spend £1.3 billion a year on litigation and £800 million on adverse events. If we are feeling, as everyone is, a tough climate financially, this is a positive thing to do for that reason as well.

The House will be aware that the Health Secretary has refused to comply with the Information Commissioner’s ruling to publish the risk register for NHS reorganisation. Will he at least say whether that risk register warned the Government specifically that such reorganisation would hit A and E services?

That risk register is in the public domain, but I defend the right of my officials to give confidential advice to Ministers as that is an important part of government. I want my officials to be open and transparent with me if they think I am about to do the wrong thing, and all Ministers need a protected area where they can get frank advice. The hon. Gentleman is one of my constituents, so he will be pleased to know that the Royal Surrey county hospital in Guilford is embracing the safety campaign with vigour and completely renewing the way its wards are organised to improve patient care and safety.

I commend the Secretary of State for these practical and sensible reforms on patient safety, and I look forward to discussing them with staff at West Suffolk hospital—the biggest district general hospital in my area. Does he agree that the sensible and deliverable transparency reforms will ensure that the conspiracy of silence that we saw tragically in Mid Staffs is not repeated on his watch?

I am absolutely determined to make that the case. The biggest example—a number of them have been raised today—is the issue of hospitals put in special measures. Over the last year, we have put more than 10% of NHS acute trusts into special measures. That was a very difficult decision and was not welcomed at the time. The result, I am pleased to say, is that we are seeing real and significant change in all those hospitals. I hope as many of them as possible will get out of special measures quickly, but we can achieve that change only if we are honest about the problem in the first place.

Bolton hospital is having to go abroad to recruit qualified nurses this summer because there are no British-trained nurses available. Will the Secretary of State now take responsibility for cutting nurse training places by 10,000 since the last election and accept that the lack of qualified nurses is just making the problem of safety worse?

What I will take responsibility for is agreeing to a public inquiry into what happened at Mid Staffs—something rejected by the Labour party—that has woken up the whole NHS to the need for safe staffing in all our wards. We are implementing the report and that will indeed be reflected in the nurse training numbers going forward.

Basildon and Thurrock hospital was the first to exit the special measures regime after a number of years of failure. It did so because the leadership embraced what happened, was willing to learn the lessons from what went wrong and went out of its way to fix them. Far from being a naming, shaming and blaming culture, is it not the truth that my right hon. Friend is strengthening the culture of accountability in the NHS, which is as it should be?

Yes, and I would like to thank my hon. Friend for her superb work in supporting Basildon and Thurrock hospital through a very difficult period. I think that the chief executive there, Clare Panniker, is an exemplary one. She wrote an article in The Guardian pointing out that it is incredibly painful for trusts when they go into special measures, that it causes a lot of pressure in the local media, but that it also means that change can be made much more quickly when an urgency to solve these problems, many of which have been around for years and years, is created. I commend the staff of that hospital not just for coming out of special measures but for being rated “good” by the chief inspector of hospitals—a fantastic achievement.

Never mind the fact that this Government will not publish the risk register for a £3 billion top-down reorganisation; the Secretary of State and his Ministers will not meet me. If he wants to talk about accountability, why will he and his Ministers not meet me to talk about a minor injury unit in Guisborough being closed, a minor injuries unit in Brotton hospital being closed, a GP centre in Park End being closed and a walk-in and GP centre in Skelton being closed? All those units are in my constituency and they are all being closed, yet the Secretary of State and his Ministers will not meet me, which would represent genuine accountability.

Let me say to the hon. Gentleman that the accountability he talks about is precisely demonstrated by his ability to ask me questions right now as he has just done. He needs to be accountable and come clean with the House by saying that he has actually met my Ministers on a number of occasions on precisely the issues that he raised.

Order. For the benefit of the public—it is important that they find our proceedings intelligible—I should say that these exchanges are taking place because an urgent question was submitted and because I granted it. That is the beginning and the end of the matter.

After the shocking events at Mid Staffs under the last Government, I would like to congratulate the Secretary of State on his crusade for accountability and transparency as the best disinfectant, as shown by his support for whistleblowers and for 4,000 additional nurses. Does he agree that the collection, monitoring and day-to-day use of data on health outcomes is absolutely key? I welcome his Minister’s support for measures in my ten-minute rule Bill, now adopted and sponsored by me and my hon. Friend the Member for Stafford (Jeremy Lefroy).

I am happy to do that, and I would particularly like to congratulate my hon. Friend on the insight he has brought with regard to the power of data. In one example of why this is so important, the latest figures showed 43 or 44 people dying in the NHS because of medication errors, but if the person giving the medication had been able to see the patient’s entire prescription history, those horrific tragedies might have been avoided. That is why proper sharing of data is so important.

I want to ask about the safety of the 22,000 patients who use Hammersmith hospital A and E every year. There is no increased capacity in the acute primary or community care services locally, which the Secretary of State set as a prerequisite for any A and E closures in west London. Will he ask Imperial Healthcare Trust to review plans to close the A and E at Hammersmith on 10 September? Will he answer that question, as my constituents in Shepherd’s Bush and White City deserve an answer to it, not the spin and the game playing that I always get from the Secretary of State?

I am afraid I will take no lessons in spin and game playing after what the hon. Gentleman wrote in local election leaflets in Hammersmith and Fulham, failing to tell his own constituents about the brand new hospitals, the opening of a seven-day GP surgery and the 800 out-of-hospital professionals. I think he behaved absolutely disgracefully.

I very much welcome the Francis review into whistleblowing, which does indeed focus on transparency, and I am bemused and depressed that we cannot get universal welcome for it across the House. In addressing the name, shame and blame argument, does my right hon. Friend recognise that many front-line staff will be relieved at what he has announced because it will force management priorities to be the same as their priorities, which are overwhelmingly about patient safety?

My hon. Friend speaks wisely, and I commend her for her work in championing whistleblowers. In her relatively brief time here, she has made a big difference on that issue. Personally, I do not like to use the term “naming and shaming” because I think identifying problems should always be the first step to sorting them out. What we are doing today by identifying trusts that do not have a proper open and honest reporting culture is also helping them to change that reporting culture while at the same time identifying trusts that have a good culture. It is all about changing the culture, so this is a positive move, and I think that NHS staff will really welcome it.

Does the Secretary of State agree that the best way to deal with concerns about patient safety, such as those raised last week about Scunthorpe general hospital, is to have a proper independent investigation that respects patient confidentiality and reports objectively, clearly and transparently so that appropriate action can be taken when all the facts are known?

There are definitely times when an independent investigation is needed, and a number of them are going on in the NHS at the moment. The first thing, however, is to talk to the trust and get it to deal with the particular issues being raised and to create a culture in which trusts are willing, enthusiastic and keen to do that. Today is an attempt to deal not only with what happens when things go wrong with whistleblowers, but with how to create the right culture in the first place.

I commend the Secretary of State for his desire to put patients at the centre of the NHS. Does he agree that patient safety in places such as North Cumbria can be ensured not just by quality medical care, but by good-quality leadership and management? Would he therefore agree that we need quality management throughout the NHS that is confident about being open and transparent?

I would agree with that, and I am grateful to my hon. Friend for talking to me on many occasions about the issues at North Cumbria hospital and for sharing his determination to turn things around— [Interruption.] I find it extraordinary that Labour Members are making all this noise. My hon. Friend will know that that hospital had to give £3.6 million in compensation to just one person because of an appalling mistake when Labour was in power. They should be welcoming these changes, not criticising them.

On 1 May I asked the care Minister why there had been a 60% drop in the number of people barred from working with vulnerable adults in the health and social care sector, and an even bigger drop of 75% in those barred from working with children. The Minister said that he was going to investigate, but I have heard nothing since. Does the Secretary of State share my concern that fewer unsuitable people are being barred from working in the social and health care sectors on his watch?

I do not know the answer to that question, so I will look further into the matter and get back to the hon. Lady.

As the hon. Member for Scunthorpe (Nic Dakin) mentioned, local GPs raised concerns last week about a cluster of cases at Scunthorpe and Grimsby hospitals—not at Goole hospital, which was also revealed last week never to have breached its four-hour waiting target. There is still a lot more to be done, so does the Secretary of State share my concern at the evidence received by the Health Select Committee last week from the Care Quality Commission, which stated that all too often, members of staff who raise concerns are dealt with by the human resources department rather than in a proper way that allows their complaints to be properly aired?

That is a very good point, and I thank my hon. Friend for welcoming me to Goole hospital; I had a very good visit. That hospital is in special measures but it is making real progress. It was interesting to talk to staff at the front line. I do not know when the hospital will be ready to leave special measures, but the staff on the front line felt that things were changing, and they welcomed that. My hon. Friend is absolutely right that if someone raises a safety concern, it should not be viewed as an HR issue; it is a patient safety issue, and trusts need to treat it as such.

In his reply to the right hon. Member for Leigh (Andy Burnham), the Secretary of State referred to avoiding avoidable harm. Given that Combat Stress has reported the referral of some 358 additional troops for urgent treatment—a rise of some 57%—will he give us some idea of the discussions in which he has engaged with service charities to ensure that that harm can be avoided?

We have ongoing discussions with the Ministry of Defence about the care and support that we offer to our combat troops, but I can assure the hon. Gentleman that we give them the highest priority.

I welcome the action taken by my right hon. Friend to extend transparency for the purpose of safety in the NHS, but could it be extended to the social care sector, especially in the light of the January 2010 Care Quality Commission report on Orchid View care home in Copthorne, near my constituency? The report rated the home as good, but 19 patients subsequently died.

I thank my hon. Friend for raising that very harrowing issue. I hope I can reassure him by saying that we are progressively extending the changes we introduced to hospital inspections to inspections of general practice and adult social care settings. The new inspection regime is designed to be much tougher when it comes to identifying problems. It is never possible to identify all abuse in an inspection, which is why what I have announced today is so important: it is about the creation of a culture that tries to prevent such problems from arising in the first place.

I welcome the statement and the work that the Secretary of State is doing. Mr Mufti, who was the medical director of Medway hospital under the last Government, raised serious concerns about the bullying of staff, which he feared was affecting the quality of care and patient safety. Will the new provisions address that problem?

That is exactly the intention. Following my conversation last week with Nigel Beverley, the chief executive of Medway, I think that the hospital is making good progress after going into special measures. However, it is important to recognise that while it is possible to change things externally, real culture change must come from inside. This is not a day on which we are announcing new targets or top-down initiatives. The Sign up to Safety campaign to be led by Sir David Dalton will be voluntary: hospitals must choose whether to sign up to it. I think that that will enable us to make more progress than we would make if we tried to do things in the old way.

Ah! I keep my eye on the hon. Member for Reading East (Mr Wilson), because he does bob up and down, but he tends to do so only intermittently. It is a good thing that I have noticed him. Let us hear from the fellow.

I was saving my energy, Mr Speaker.

I welcome my right hon. Friend the Secretary of State’s changes, which have made improving patient care and raising standards such a central part of the NHS mission. It is important to shine a light on poor performance, which is why I also welcome today’s CQC report on Royal Berkshire hospital, which highlights a number of important challenges that confront my local hospital. Does he agree that only by being open and transparent about problems can we tackle them and fix them for the long term?

I absolutely agree with my hon. Friend. I have had many discussions with him as he has campaigned in the House for his local hospital. The creation of a culture of openness and transparency should have support in all parts of the House, but that will not happen if every time we are honest about a problem, we are told that we are somehow running down the NHS. I urge Labour Members to think carefully about the way in which they approach this issue.

I applaud the cultural change that my right hon. Friend is leading in the NHS and the social care sector. As he may know, three former members of staff at Granary care home, owned by Shaw Healthcare, were last week found guilty of appalling violence and abuse of frail elderly patients. The sentences handed down to those three individuals were utterly derisory, the longest being four months in prison. Will my right hon. Friend meet the Secretary of State for Justice to review sentencing in this crucial area?

I shall be happy to raise that issue with the Justice Secretary, and I thank my hon. Friend for raising it. I think it reminds us that whatever changes we may make in the House, it will take time for them to filter through. I am afraid that, even now, some terrible things are happening. One of the things that worries me most is that abuse of this kind often involves people who have dementia and cannot speak up for themselves. That is why it is so important for us to raise the profile of dementia, and to improve the training of those who care for people with the condition.

May I take up what was said by my hon. Friend the Member for Brigg and Goole (Andrew Percy)? My right hon. Friend the Secretary of State will appreciate the concern felt by my constituents at a time when the local media are full of a dispute between the clinical commissioning group and the hospital trust about an ongoing investigation of patient safety. Can he assure patients that every support will be given to the CCG and the trust when the recommendations following the inquiry become known?